April 28, 2010 / 9:59 PM / in 8 years

UPDATE 2-Goldcorp adjusted profit slips on costs

* Adjusted EPS $0.22 versus estimated $0.25

* Net EPS loss $0.07 shr on non-cash charge

* Revenue rises on higher prices (Adds CEO comments and details. In U.S. dollars unless noted)

By Cameron French

TORONTO, April 28 (Reuters) - Goldcorp (G.TO) said on Wednesday its adjusted profit slipped by 3.9 percent, missing analysts’ estimates, as the timing of sales and the stronger Canadian dollar raised costs and offset the impact of higher gold prices.

On a net basis, the Canadian gold miner recorded a loss of $52.3 million, or 7 cents a share, as it took a non-cash foreign exchange charge of $211.8 million on a translation of future income tax liabilities.

Stripping out the charge, adjusted profit was $162.7 million, or 22 cents a share, down from $169.3 million, or 23 cents per share in the year-before period.

Analysts polled by Thomson Reuters I/B/E/S had expected, on average, a profit of 25 cents a share.

The strong year-over-year gains by the Canadian dollar and Mexican peso stripped a total of $25.9 million from the bottom line, while results were also hurt by delayed sales at the Red Lake mine in Canada and a port strike that delayed gold and copper sales at the Alumbrera mine in Argentina.

The delays meant that gold sales dropped 6.4 percent to 569,100 ounces during the quarter, despite production that climbed 1.4 percent to 625,000.

The strike has ended, and those sales have since gone through, Goldcorp Chief Executive Chuck Jeannes said in an interview.

“One would expect those sales to increase relative to production in the second quarter,” he said.

Revenue rose 20 percent to $750.3 million as realized gold prices rose 21.7 percent to $1,110 an ounce. Cash costs per ounce climbed to $325 per ounce from $288, when using by-product metals production as a cost offset.

Goldcorp is the world’s No. 2 gold producer by market value, and runs mines spread throughout the Americas. It expects to produce 2.6 million ounces of gold this year.

The company has been ramping up production at its new Penasquito mine in Mexico, where it began producing concentrates last October.

The company is projecting a further increase in output when a second milling circuit starts up around mid-year.

“It remains on schedule, or slightly ahead of schedule, but we’re sticking with the guidance for a mid-year startup,” said Jeannes.

$1.01 Canadian Reporting by Cameron French; editing by Rob Wilson

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