trumpeted the extent to which it held down costs in the second quarter, even while a big increase in gold production helped double its revenue, but the Canadian miner still missed Wall Street's profit targets by a penny.
Shares of Kinross were trading slightly lower in after-hours action, changing hands recently at $19.35, down 12 cents from the regular-session close. The stock, up about 7% year-to-date, has been the best-performing gold name listed on the
New York Stock Exchange
After the bell Wednesday, Kinross posted adjusted earnings, which excludes items, of $84.3 million, or 12 cents a share. Analysts had been looking for a per-share profit of 13 cents.
Still, comparisons were favorable with the year-ago period, when Kinross reported adjusted earnings of nearly $50 million, or 8 cents a share. Revenue, meanwhile, rose to a record $598 million in the just-ended quarter from $298.7 million a year ago. The company's top-line beat analysts' forecasts of $545 million.
Kinross said the average price its gold bars fetched during the quarter came to $915 an ounce, up just slightly from $903 an ounce a year ago. The company sold a total of 651,390 ounces, up 97% from the 330,633 ounces it unloaded in the same period of 2008.
Kinross's chief, Tye Burt, attributed the performance to that big boost in production, as well as a 7% decrease in the cost of sales and rising gold prices. The company has a reputation for being an efficient operator.
Looking ahead, Kinross cut back slightly its production guidance for 2009, saying it now expects to turn out between 2.3 million and 2.4 million gold equivalent ounces for the year. That's down from original projections of 2.5 million ounces.
The company blamed the planned decrease on delays in the expansion of its Paracatu mine, in Brazil, a place from which investors have been anticipating much of Kinross's future growth.
Another Kinross project, known as Fruta del Norte, in Ecuador, is also seen as an important growth driver for the company. Kinross said in its earnings release that it's still waiting for final approval from Ecuador's mining ministry to restart drilling. The government last year had put a halt to all mining within the country's borders so it could rewrite its mining laws.
As Dalhman Rose analyst Anthony Rizutto wrote in a recent research note on Kinross, "Political risk in Ecuador is considerable as the country does not have an extensive mining history, nor is the current leftist federal government especially investor friendly or investor savvy."
-- Reported by Scott Eden in New York
Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.