UPDATE 2-Goldcorp reports loss on impairment, tax-related charges

Thu Feb 13, 2014 5:45pm EST
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By Euan Rocha

TORONTO Feb 13 (Reuters) - Goldcorp Inc reported a quarterly loss of $1.1 billion on a slew of one-time charges, but better-than-expected production costs and a rising gold price pushed the miner's stock higher on Thursday.

Vancouver, British Columbia-based Goldcorp said a number of tax and impairment charges hurt results, along with reclamation and closure costs at its inactive mine sites.

The company is the latest of a string of gold miners to be stung by asset impairment charges due to the sharp year-on-year slide in price of gold. Goldcorp's rival's Barrick Gold and Agnico-Eagle Mines both saw their quarterly results hurt by similar charges this week.

Goldcorp also followed in the steps of its peers and trimmed the size of its gold reserve base by 15 percent to account for the 28 percent slide in the price of gold in 2013. It said it had 54.4 million ounces of proven and probable gold reserves at the end of 2013, based on a $1,300 per ounce gold price.

Gold miners typically recalculate reserves, the amount of gold that it is economically feasible to mine, at the beginning of each year. Many have lowered their estimates with fourth-quarter results, following years of increases. When prices fall, reserves typically fall as well, because it is no longer profitable to mine lower-quality ore.

Barrick, which opted to use a more conservative long-term gold price assumption, lowered its estimated gold reserves to 104.1 million ounces from 140.2 million ounces a year ago.

Goldcorp's Chief Executive Chuck Jeannes, in an interview, said the company was comfortable with using a higher gold price assumption, as it remains bullish on gold over the long run.   Continued...