Centerra Gold posts fourth-quarter loss on impairment charge
(Reuters) - Centerra Gold Inc (CG.TO: Quote) reported a loss for the fourth quarter as the miner produced and sold fewer ounces of gold and took a goodwill impairment charge due to a fall in reserves and resources at its Kumtor mine.
The Toronto-based company reported a net loss of $11.3 million, or 5 cents per share, compared with a profit of $106.6 million, or 44 cents, a year earlier.
The loss includes a non-cash impairment charge of $111 million, or 47 cents per share, for goodwill related to its Kyrgyz cash generating unit (CGU), Centerra said.
Centerra, whose main asset is the Kumtor mine in Kyrgyzstan, produced 301,236 ounces of gold in the quarter, down nearly 17 percent from 362,234 ounces a year earlier. For 2014, it produced 620,821 ounces compared with 690,720 ounces in 2013.
The average price realized for Centerra's gold fell 6 percent to $1,199 per ounce.
Centerra's Kumtor open-pit mine has faced several setbacks since the project was started in 1994, including threats of nationalization, riots and more recently a $300 million ecological damages lawsuit. The mine contributes some 10 percent of the impoverished country's GDP.
Centerra and the government of Kyrgyzstan have been in discussions for more than a year on a deal that would involve the state swapping its 32.7 percent stake in Centerra for half of a joint venture that would control the Kumtor mine.
"In the Kyrgyz Republic, the company is continuing its discussions with the government regarding the potential restructuring of the Kumtor Project to resolve all outstanding concerns relating to the project," said Ian Atkinson, CEO of Centerra Gold, in a statement on Thursday.
Earlier this month, Centerra and Premier Gold Mines Ltd (PG.TO: Quote) formed a joint venture to develop a gold property owned by Premier in Ontario - a move that helps to dilute Centerra's Asian exposure.
(Reporting by Nicole Mordant in Vancouver and Supriya Kurane in Bengaluru; Editing by Gopakumar Warrier)
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