April 30, 2013 / 10:03 PM / 5 years ago

UPDATE 1-Yamana Gold profit falls on lower gold price, costs

TORONTO, April 30 (Reuters) - Canadian miner Yamana Gold Inc reported a 40 percent drop in first-quarter profit on Tuesday as lower gold prices and higher costs outweighed a boost in gold production.

Net income was $102.1 million, or 14 cents a share, in the quarter ended March 31. That compared with $170 million, or 23 cents a share, in the year-earlier period.

Adjusted to remove one-time items, earnings fell to $117 million, or 16 cents a share, from $184.3 million, or 25 cents a share, in the first quarter of 2012.

Analysts, on average, had expected earnings of 18 cents a share, on revenue of $564.6 million, according to Thomson Reuters I/B/E/S.

Revenue fell 4 percent to $534.9 million, as the average realized gold price slipped 4 percent to $1,620 an ounce and by-product cash costs climbed 31 percent on a fall in copper prices and higher input costs.

Gold prices have since slipped to around $1,475 an ounce, prompting Yamana to pledge to bring down costs, preserve margins and maximize its profitability.

Production climbed to 291,312 gold equivalent ounces in the first quarter, up from 278,832 ounces in the year-ago quarter. Gold sales climbed 4 percent to 292,039 ounces.

Lower equity earnings from the company’s 12.5 percent stake in the Alumbrera project in Argentina also weighed on profit.

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