Centerra Gold Reports
Fourth Quarter Earnings (before Unusual Items) of $0.05 per Share
(This news release contains forward-looking information that is subject to the risk factors and assumptions set out on page 18 and in our Cautionary Note Regarding Forward-looking Statements on page 19. All figures are in United States dollars.)
Toronto, Canada, February 5, 2008: Centerra Gold Inc. (TSX: CG) today reported 2007 fourth quarter net earnings before unusual items of $9.7 million or $0.05 per common share on revenues of $89.4 million, compared to net earnings of $1.9 million or $0.01 per common share on revenues of $88.4 million in the same quarter of last year, reflecting higher realized gold prices partially offset by reduced production and sales volumes.
During the fourth quarter of 2007, the Company recorded an unusual item totaling $36.5 million resulting in a net loss of $26.7 million or $0.12 per share. The unusual item is a $36.5 million noncash expense representing the additional cost, based on the closing price of the Company's shares on December 31, 2007, associated with the expected issuance of 10 million treasury shares pursuant to a preliminary agreement with the Kyrgyz Government previously announced on August 30, 2007. The final cost of the treasury shares will be based on the closing price of the Company's shares on the date of issuance, which will occur following negotiation and signing of definitive agreements.
Consolidated gold production for the fourth quarter of 2007 totaled 132,530 ounces, in line with the Company's third quarter outlook, at a total cash cost of $585 per ounce compared to 142,291 ounces at a total cash cost of $473 per ounce in the corresponding quarter of 2006.
For the full year of 2007, net earnings before unusual items were $39.1 million or $0.18 per common share on revenues of $373.5 million and cash provided by operations amounted to $41.3 million. During the year, the Company recorded unusual items of $131.6 million resulting in a net loss of $92.5 million or $0.43 per share. Consolidated gold production totalled 555,410 ounces in line with the Company's third quarter outlook, at a total cash cost of $442 per ounce. In the comparable period of 2006, Centerra reported net earnings of $60.6 million or $0.28 per common share on revenues of $364.5 million and cash provided by operations of $80.3 million. In 2006, consolidated gold production was 586,384 ounces at a total cash cost of $386 per ounce. The differences reflect Boroo's taxable status in 2007, lower ounces sold and increased costs, partially offset by higher gold prices. After reflecting the unusual items recorded in the third and fourth quarters of 2007
, primarily related to the preliminary agreement with the Kyrgyz Government previously announced on August 30, 2007, the Company reported a net loss of $92.5 million or $0.43 per share for the twelve month period.
Proven and probable ore reserves total 7.0 million ounces of contained gold at the end of 2007.
The 718,000 ounces of contained gold mined in 2007 were replaced.
Measured and indicated resources at the end of 2007 total 5.8 million ounces of contained gold on a 100% project basis (Centerra's share is 5.3 million ounces), an increase of 139,000 ounces over 2006.
Received official approvals of the Gatsuurt in-situ reserves and resources paving the way to commencement of negotiations of a definitive investment agreement.
Completed an amended Boroo Stability Agreement which reaffirms the Company's rights to mine the Boroo gold deposit.
Reached a preliminary agreement with the Government of the Kyrgyz Republic for its full commitment to and support for the long-term operation of the Kumtor gold deposit.
Received the mining permit for the Sarytor deposit at the Kumtor Project.
On track to access the higher grade SB Zone in the Kumtor Central Pit mid-2008.
Commenced construction of the decline at Kumtor to gain underground access to the highgrade SB Zone with underground production targeted to commence in 2010.
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For more information:
John W. Pearson
Director Investor Relations
Renmark Financial Communications Inc.
Henri Perron : firstname.lastname@example.org
Bryan Neebar : email@example.com
Tel. : (514) 939-3989
Fax : (514) 939-3717
ADDITIONAL INFORMATION ON CENTERRA IS AVAILABLE ON THE COMPANY'S WEB SITE AT WWW.CENTERRAGOLD.COM AND AT SEDAR AT WWW.SEDAR.COM.