(Adds production details, analyst forecast, background)
July 29 Centerra Gold Inc swung to a
wider-than-expected loss in the second quarter, results showed
on Tuesday, on the back of a lower gold price, higher
share-based compensation for executives and a charge for
inventory at its Kumtor mine in Kyrgyzstan.
The Toronto-based gold company reported a net loss of $31.7
million, or 13 cents a share, in the three months to the end of
June. That compared with earnings of $1.6 million, or 1 cent, a
Analysts, on average, had been expecting a loss of 9.7
cents a share, according to Thomson Reuters I/B/E/S.
Centerra, whose main asset is the Kumtor gold mine in
Kyrgyzstan, produced 92,124 ounces of gold in the second
quarter, down from 99,426 ounces in the same quarter a year
It said the mine recorded an inventory impairment of $14
million, which represents the excess of the inventory value on
its books over what the company believes it can get for the gold
Company-wide all-in sustaining costs per ounce of gold sold
were steady at $1,540 per ounce from $1,537 per ounce before.
The average price realized for Centerra's gold dropped to
$1,285 per ounce from $1,376 an ounce compared with a year ago.
The company, which also has mines and projects in Mongolia,
said it was on track to achieve its 2014 production forecast.
Centerra's Kumtor open-pit mine has faced several setbacks
since the project started in 1994, including threats of
nationalization, riots and more recently a $300 million
ecological damages lawsuit. The mine contributes some 10 percent
of the impoverished country's GDP.
But Kyrgyzstan's new prime minister last month said his
mission is to achieve what his predecessors failed to do - end a
dispute with Centerra, and thus send a signal to investors so
far mostly bypassing the country.
(Reporting by Nicole Mordant in Vancouver; Editing by David
Gregorio and Lisa Shumaker)