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Brad's Desktop
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IAMGOLD Says “I Am Profitable” |
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Written by Brad Zigler
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Tuesday, 12 August 2008 13:02 |
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Canadian gold miner IAMGOLD Corp. (NYSE: IAG) became profitable in its second quarter as production and sales prices both ramped up. That was the good news. The not-so-good news is that the miner's extraction costs also went up and are bound to rise even further. IAMGOLD's net earnings shot up 169% to $33.3 million, or $0.11 per share, versus the second quarter of 2007 on a 35% increase in revenue. EPS beat Street estimates by a penny a share, or 10%. Year-over-year, the company's average sale price for gold climbed from $660 an ounce to $878 for the quarter ending June 30. Production was pegged at 255,000 ounces at an average cost of $472 an ounce. IAMGOLD projects the full year's output of 950,000 ounces will now cost between $485 and $495 an ounce. Investors reacted to the earnings surprise by taking IAMGOLD shares up 8 cents on the open to $5.49 a share, only to watch the stock sell off as much 2.2%, or 12 cents, as the reports of the company's narrowing margins were digested. By midday, prices had climbed back to the unchanged level at $5.41. This year, IAMGOLD shares have slipped 33.2% while the Market Vectors Gold Mining ETF (AMEX: GDX) shed 24.9%. IAMGOLD makes up 2.9% of the ETF's underlying index. IAMGOLD Corp. Vs. Market Vectors Gold Miners ETF 
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