Goldcorp’s 2Q15 earnings
Goldcorp (GG) announced its 2Q15 results on July 30 and held a conference call on the same day for the benefit of analysts. The company produced 908,000 ounces of gold and 10.42 million ounces of silver. Gold production showed very strong growth at 25.3% quarter-over-quarter (or QoQ).
Goldcorp reported adjusted EPS (earnings per share) of $0.08, slightly above the consensus estimate of $0.07. Higher EPS was due to lower costs and stronger production. Goldcorp also reduced its dividend by 60% to $0.02 per share per month. Overall, Goldcorp’s results are a beat over market expectations.
In this series, we’ll analyze the 2Q15 earnings of Goldcorp Mining. We’ll look at its production and cost performance and the reasons it was able to beat the estimates.
Goldcorp (GG) is a senior gold producer based in Canada. It has four mines in Canada and the US. It also has three mines in Mexico and another three mines in Central and South America. Canada and the US account for 45% of Goldcorp’s production. Mexico accounts for 31%, and Central and South America account for 24%.
Goldcorp has the third-largest gold reserves in the world, totaling 49.6 million ounces. In comparison, Barrick Gold (ABX) has 93 million ounces, and Newmont Mining (NEM) has 82.2 million ounces in gold reserves.
Investors can access the gold industry through gold-backed ETFs such as the SPDR Gold Trust ETF (GLD) and the VanEck Vectors Gold Miners Index ETF (GDX). ABX, NEM, and GG make up 20.2% of GDX’s holdings.