IAMGOLD (IAG) Loses Luster on Sluggish Production

NEW YORK (TheStreet) -- IAMGOLD (IAG) lost its luster in Wednesday trading following preliminary 2013 production numbers and fiscal 2014 guidance issued a day earlier. By mid-morning, shares had tumbled 9.3% to $3.72.

Management announced its preliminary total cash costs for 2014 of approximately $800 an ounce, at the lower end of guidance of $790 to $840 an ounce. For IAMGOLD owner-operator mines, cash costs are expected to be 7% lower at around $740 an ounce compared to guidance of between $750 and $800 an ounce.

"We finished 2013 with cash costs near the bottom of the guidance range, which, midway through the year had been revised downward following excellent traction with our $100 million cost reduction program," said CEO Steve Letwin in a statement.

Over 2013, the gold miner reports gold production of 835,000 ounces, including 195,000 ounces over the fourth quarter ended December. Full-year production was around 5% below the bottom of the guidance range of 875,000 to 950,000 ounces due to grade variation and pit sequencing at the Rosebel mine in the Republic of Suriname.

Production in 2014 is expected within the range of 835,000 to 900,000 ounces. In fiscal 2014, total cash costs are expected between $825 and $875 an ounce, while owner-operator mines will see cash costs in the range of $790 to $830 an ounce.

"We ended the year with approximately $380 million in cash and bullion and $750 million in undrawn credit facilities. Our persistent efforts to preserve cash, cut costs and tighten capital spending are paying off despite our lower production this year as we focus on profitable ounces," said Letwin.

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