The Vancouver-based mining giant on Thursday announced that it cut the monthly dividend to US2 cents a share, down from US5 cents.
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Free cash flow in the second quarter came in at $174 million, or $50 million after the payment of dividends. The company reported $0.01 EPS for the quarter, missing the Thomson Reuters consensus estimate of $0.10 by $0.09.
Like most of its peers, Goldcorp continues to work on lowering costs and shoring up its balance sheet. The move will save Goldcorp nearly $300 million US a year.
Goldcorp Inc. has slashed its dividend 60 per cent in order to maintain financial flexibility in a miserable gold market.
Initiatives attempted within the section relate to the company’s method “to stay perfectly ready for great success in different gold-price environment”, Mr. Jeannes said throughout the company’s revenue ring. It dropped to $1,073.70 on July 24, the lowest for a most-active contract since 2010. The company had revenue of $1.30 billion for the quarter, compared to analysts’ expectations of $1.07 billion.
Goldcorp fell 1.4 percent to C$16.46 at 4 p.m.in Toronto. Barclays restated an “overweight” rating and issued a $23.00 target price (down previously from $25.00) on shares of Goldcorp in a research report on Thursday, July 16th.
The increase in production at Eleonore, in Northern Quebec, has been slower than planned, the company said. All-in sustaining costs were US$846 an ounce, a slight reduction from US$852 in the second quarter of 2014.
Gold production jumped 40 per cent year-over-year to 908,000 ounces, as the new Cerro Negro mine in Argentina ramped up production and the Penasquito mine in Mexico performed well. Fourteen analysts estimated an average of 824,900 ounces of output.
In its outlook, Goldcorp said it expects to come in at the high end of its production guidance for between 3.3 million and 3.6 million gold ounces this year.
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If the price remains below $1,100 for a prolonged period, Goldcorp would have to dip into its credit facility to keep paying the higher dividend, which does not make sense to Jeannes.
