| Goldcorp’s FCF Growth Could Strengthen Its Balance Sheet | |
| | |
|
2Q15 Highlights: Goldcorp Braces for Volatile Gold Market Outlook (Continued from Prior Part) Balance sheet healthy
Goldcorp (GG) has the strongest balance sheet in its peer group, which includes companies like Barrick Gold (ABX), Newmont Mining (NEM), and Kinross Gold (KGC). Goldcorp’s liquidity is also comfortable at $3.2 billion, including $940 million in cash and cash equivalents, as well as $2.16 billion of an undrawn revolving facility. As we discussed previously, Goldcorp extended its credit facility from $2 billion to $3 billion during 2Q15.
Net debt reduced
Goldcorp’s net debt reduced quarter-over-quarter (or QoQ) to $2.55 billion as on June 30, 2015, from $3.47 billion at the end of 1Q15. The company raised net cash of $768 million from the sale of its equity stake in Tahoe Resources (TAHO). It repaid the debt of $305 million during the second quarter. It also paid dividends amounting to $124 million.
The company’s management noted during the call that through the application of proceeds from stake sale in TAHO in the third quarter, the drawn amount on its revolver should be down to zero. This should leave the company with only long-term debt of $2.5 billion. The first scheduled repayment for the debt is in 2018.
FCF positive
After reporting a negative free cash flow (or FCF) of $374 million in the first quarter of 2015, Goldcorp has delivered a positive FCF of $174 million in 2Q15. The reduction of dividends by 60% should save the company another $300 million annually. The positive trend on FCF could continue going forward, given scheduled ramp-ups of its mines in the second half.
Goldcorp’s capital expenditure budget remains unchanged at $1.2 billion–$1.4 billion.
Investors can gain access to the gold sector through the Market Vectors Gold Miners ETF (GDX), which invests in intermediate and senior gold producers. Goldcorp makes up 7.6% of its holdings. The SPDR Gold Trust ETF (GLD) tracks spot gold prices.
Continue to Next Part Browse this series on Market Realist:
|
|
|
Kinross Gold Corporation
|
|
PRODUCTEUR |
CODE : K.TO |
ISIN : CA4969024047 |
CUSIP : 496902404 |
| |
ProfilIndicateurs de MarchéVALEUR : Projets & res.Communiqués de PresseRapport annuelRISQUE : Profile actifsContactez la cie |
Kinross Gold est une société de production minière d'or basée au Canada. Kinross Gold est productrice d'or, d'argent en USA, au Bresil, au Canada, au Chili, au Ghana, en Mauritanie et in Russia, en développement de projets d'argent, de cuivre et d'or au Chili, et détient divers projets d'exploration au Canada, au Chili et in Russia. Ses principaux projets en production sont ROUND MOUNTAIN en USA, CRIXÁS, MORRO DO OURO et PARACATU au Bresil, REFUGIO MINE (VERDE AND PANCHO), FORT KNOX, MARICUNGA et LA COIPA au Chili, PORCUPINE et MUSSELWHITE au Canada, CHIRANO au Ghana, TASIAST en Mauritanie et KUPOL in Russia, ses principaux projets en développement sont KETTLE RIVER, GOLD HILL et CERRO CASALE au Chili et ses principaux projets en exploration sont AHAFO NORTH, BIBIANI NORTH, BOLE, BOLE - BOLGATANGA, AKYEM, RUSSIAN MOUNTAIN, HORN MOUNTAIN, GIL, ENCHI et GOLDBANKS - KINROSS au Ghana, FRUTA DEL NORTE en Equateur, HAMMOND REEF au Canada, KUBAKA MINE - BIRKACHAN in Russia et LOBO-MARTE au Chili. Kinross Gold est cotée au Canada, aux Etats-Unis D'Amerique et en Allemagne. Sa capitalisation boursière aujourd'hui est 11,2 milliards CA$ (8,2 milliards US$, 7,7 milliards €). La valeur de son action a atteint son plus bas niveau récent le 27 octobre 2000 à 1,43 CA$, et son plus haut niveau récent le 13 décembre 2002 à 9,99 CA$. Kinross Gold possède 1 246 749 952 actions en circulation. |