(All figures are in US dollars unless stated otherwise)
Vancouver, British Columbia – March 8, 2007 – Goldcorp Inc. (GG:NYSE; G:TSX) is pleased to announce its 2006 annual results, highlights of which are:
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Net earnings increased to $408.3 million, or $0.94 per share, compared to $285.7 million, or $0.91 per share, in 2005. Adjusted net earnings (1) amounted to $434.2 million, or $1.00 per share, for 2006.
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Operating cash flows increased substantially to $791.3 million, or $1.82 per share, compared to $465.8 million in 2005.
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Gold production increased nearly 50% to 1,693,300 ounces compared to 1,136,300 ounces in 2005.
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Total cash costs of $33 per ounce (net of by-product copper and silver credits), compared to $22 per ounce in 2005. (2)
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Dividends paid of $79.1 million in 2006.
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Cash and cash equivalents at December 31, 2006 totalled $555.2 million versus $562.2 million one year ago.
For the three months ended December 31, 2006, net earnings were $65.9 million, or $0.11 per share, compared with $101.7 million, or $0.30 per share, in 2005. Adjusted net earnings(3) amounted to $113.5 million, or $0.19 per share. Operating cash flows increased 90% to $255.5 million, or $0.43 per share, compared with $136.9 million, or $0.40 per share in 2005. Gold production doubled to 587,900 ounces in the fourth quarter of 2006 compared with 296,200 ounces in 2005. Gold sales also doubled to 599,500 ounces at a total cash cost of $160 per ounce, compared with 307,300 ounces at a total cash cost of minus $73 per ounce in 2005.
Kevin McArthur, President and Chief Executive Officer of Goldcorp, said, "The significant increase in earnings, cash flows and production are the natural result of growth and successful acquisitions, which include the Placer assets and Glamis. The Company’s profit margins are among the highest in the precious metals industry, and are attributable to our low total cash costs. As Goldcorp continues to sharpen its geographic focus, build new mines and execute organic growth programs, we expect to deliver superior shareholder value."
A conference call will be held Thursday, March 8th at 2:00 p.m. (ET) to discuss these results. Participants may join the call by dialing toll free 1-888-789-0156 or (416) 695-9753 for calls from outside Canada and the US.
The conference call will be recorded and available for replay until April 8th, 2007 by dialing 1-888-509-0081 or 416-695-5275. A live and archived audio webcast will be available on the website at www.goldcorp.com.
Goldcorp is one of the world’s lowest-cost and fastest growing multi-million ounce gold producers with operations throughout the Americas. The Company does not hedge its gold production.
(1) Adjusted net earnings are reported net earnings less the gain on sales of subsidiary shares after tax of $88 million, less foreign exchange on revaluation of future income tax liabilities of $5 million, less dilution gain of $64 million and adding back the write down of mineral interests of $175 million and non-hedge derivative after tax loss of $3 million and loss on marketable securities of $5 million. Adjusted net earnings is a non-GAAP measure, the Company believes that, in addition to conventional measures, prepared in accordance with GAAP, certain investors use this information to evaluate the Company’s performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.
(2) The Company has included a non-GAAP performance measure, total cash cost per gold ounce, throughout this document. The Company reports total cash costs on a sales basis. In the gold mining industry, this is a common performance measure but does not have any standardized meaning, and is a non-GAAP measure. The Company follows the recommendations of the Gold Institute standard. The Company believes that, in addition to conventional measures, prepared in accordance with GAAP, certain investors use this information to evaluate the Company’s performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.
(3) Adjusted net earnings are reported net earnings less the gain on sales of subsidiary shares after tax of $88 million, less foreign exchange on revaluation of future income tax liabilities of $21 million, less non-hedge derivative after tax gain of $18 million, and adding back the write down of mineral interests of $175 million. Adjusted net earnings is a non-GAAP measure, the Company believes that, in addition to conventional measures, prepared in accordance with GAAP, certain investors use this information to evaluate the Company’s performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.
Click here to review Management’s Discussion and Analysis of Financial Condition and Results of Operations For the Year Ended December 31, 2006.
Cautionary Note Regarding Forward-Looking Statements
This press release contains "forward-looking statements", within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation, concerning the business, operations and financial performance and condition of Goldcorp. Forward-looking statements include, but are not limited to, statements with respect to the future price of gold, silver, copper, lead and zinc, the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, costs and timing of the development of new deposits, success of exploration activities, permitting time lines, hedging practices, currency exchange rate fluctuations, requirements for additional capital, government regulation of mining operations, environmental risks, unanticipated reclamation expenses, timing and possible outcome of pending litigation, title disputes or claims and limitations on insurance coverage. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Goldcorp to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the integration of acquisitions; risks related to international operations; risks related to joint venture operations; actual results of current exploration activities; actual results of current reclamation activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of gold, silver, copper, lead and zinc; possible variations in ore reserves, grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities, as well as those factors discussed in the section entitled "Description of the Business – Risk Factors" in Goldcorp’s Annual Information Form for the year ended December 31, 2005, available on www.sedar.com, and Form 40-F for the year ended December 31, 2005 on file with the United States Securities and Exchange Commission in Washington, D.C. Although Goldcorp has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Goldcorp does not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws.
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