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Yamana Gold maintains guidance, boosts dividend by 50%

Published: 13:02 05 May 2010 EDT

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By Dorothy Kosich, Mineweb.com

Yamana Gold reported a drop in both production and net earnings during the first quarter of this year.

The Toronto-based gold miner reported production of 239,838 gold equivalent ounces during the first quarter, down from 271,482 GEO reported during the first quarter of 2009.

Meanwhile net earnings dropped from $86 million or 12-cents per share for the first-quarter 2009 to $79.5 million or 11-cents per share for the first quarter of this year. Adjusted net earnings were $73.2 million or 10-cents/sh.

Total production from continuing operations during the first-quarter 2010 was 239,838 GEO, comprised of 190,666 ounces of gold and 2.7 million ounces of silver.  Production is on track to achieve an annual guidance of 1,030,000 to 1,145,000 GEO this year. 

Copper production for the first quarter was reported to be 41.5 million pounds, down from 45.2 million pounds in the first-quarter 2009. Copper production is expected to be in excess of 150 million pounds in 2010, consistent with previous guidance.

Capital expenditures are expected to be $515 million for 2010 and $455 million for 2011. The majority of the expansionary capital costs are allocated to the development of growth projects, C1 Santa Luz in Brazil, Mercedes in Chile, the Minera Florida tailings project in Chile and Ernesto/Pau-a-Pique in Brazil, all of which are expected to begin production in 2012.

In a statement, Yamana CEO Peter Marrone said, "We have three development stage projects now in progress, two optimization strategies being evaluated, an exploration program which is expected to deliver strong results this year and further cash flow growth anticipated in 2010. 2010 is expected to be a significant year of achievement for Yamana."

Exploration expenditures are expected to be $80 million this year. Yamana's exploration program will focus on increasing mineral reserves and mineral resources while continuing with the near-mine exploration program.

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