Gold Earnings Season Set for Kick Off

Metal prices may have seen across-the-board declines in the fourth quarter, but gold held up the best. Bullion saw an 8% quarter-over-quarter decline, but silver, copper and zinc fell 32%, 48% and 32%, respectively.

The declining price for gold impacts a wide range of names but companies that will feel the earnings pinch include copper producers Yamana Gold Inc. (AUY), Northgate Minerals Corp. (NXG), Goldcorp Inc. (GG) and Barrick Gold Corp. (ABX), according to Credit Suisse analyst Anita Soni.

And for those that produce copper in a concentrate and price as of the end of the quarter, there is the extra kicker of an end-of-quarter price of $1.33 per pound versus the quarterly average of $1.79, she told clients.

The analyst expects Agnico (AEM) will be negatively affected by the 32% decline in zinc prices. Meanwhile, Kinross Gold Corp. (KGC), Gammon Gold Inc. (GRS) and Yamana will be impacted by the sharp decline in silver, as will other companies that report gold equivalent ounces.

Earnings season for North American gold producers kicks off with Kinross and Agnico-Eagle Mines Ltd. on Wednesday February 18. Ms. Soni said this will be a critical week as Eldorado Gold Corp. (EGO), Goldcorp and Barrick also report at the end of the week.

Comments

[D. McHattie:]

Do we know any more details? Isn't fuel one of the largest costs for miners? Couldn't miners stand to benefit from lower fuel prices.

Feb 02 09:06 PM

[arlin:]

Many of these producers have hedged their copper production,and will offset some of the decline,AUY stands to do very well in the exchange rates to the dollar,and the decrease in energy prices.....while increasing their production numbers to all time highs,...Im expecting very good earnings from AUY.

Feb 03 08:33 AM

[bonz:]

The government has been artificially manipulating the price of gold. It is running out of bullets and gold is soaring again.

Feb 03 08:42 AM

[PeteK:]

Gold is everything.
History proves that.

Feb 03 02:01 PM

[X-15:]

D. McHattie --Excellent point --I've read Gold/ Silver miners are huge consumer of Oil products for extraction. So it would be a BIG PLUS to have much lower fuel prices. Curious the Author did not include that savings.

Feb 03 08:52 PM

[PeteK:]

On your second paragraph, it started "The declining price of gold . . . ."
That depends on which month you are talking about.
Lately gold price is mostly up.
When you start a paragraph like that, it is confusing and misleading.
Please don't do that again.

Feb 05 04:13 AM