(Reuters) - Canada’s Eldorado Gold Corp (ELD.TO)(EGO.N) reported a decline in second-quarter profit on Friday despite a big increase in production, as the price of gold dropped, and the company revised its dividend policy.
Eldorado, which links its semi-annual dividend payments to the price of gold, cut some targeted payouts.
For example, at an average realized gold price of $1,500 an ounce, the new policy calls for C$50 ($48) worth of dividend payments for each ounce sold. Under the old policy, Eldorado would have aimed to pay C$100 per ounce at that price.
A steep drop in the price of gold has miners scrambling to preserve their cash flows, shelving new projects and slashing dividends. Eldorado, a mid-tier producer with mines in Turkey, Greece and China, pushed back several projects in July.
Eldorado’s gold production rose to 183,971 ounces in the second quarter to June 30, from 140,694 ounces a year earlier. Cash operating costs edged down to $478 per ounce from $480. But the miner’s average realized price dropped to $1,382 per ounce from $1,612.
Earnings attributable to shareholders fell to $43.3 million, or 6 cents a share, from $46.6 million, or 7 cents a share, a year earlier. Revenue rose to $266.9 million from $244.2 million.
Analysts, on average, expected earnings of 8 cents a share, according to Thomson Reuters I/B/E/S.
Reporting by Allison Martell; Editing by Gerald E. McCormick and Jeffrey Benkoe