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Kinross(KGC) - 2024 Q4 - Annual Report
KGCKinross(KGC)2025-02-12 22:08
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Production and Sales - Kinross Gold Corporation produced 2,170,791 gold equivalent ounces in 2024, a 1% increase from 2023, with higher production from Fort Knox and Bald Mountain offset by lower production from Paracatu and Round Mountain[12][17]. - Total gold equivalent ounces produced in 2024 were 2,170,791, a 1% increase from 2023, while total gold equivalent ounces sold were 2,153,212, a 1% decrease[85]. - In 2024, Kinross Gold Corporation produced 622,394 gold equivalent ounces at the Tasiast mine, a slight increase of 0% compared to 2023[91]. - At the Paracatu mine, gold equivalent ounces produced decreased by 10% to 528,574, while metal sales increased by 10% to 1,258.9million[96][99].−LaCoipamineproduced246,131goldequivalentounces,adecreaseof51,258.9 million[96][99]. - La Coipa mine produced 246,131 gold equivalent ounces, a decrease of 5% compared to 2023, while metal sales increased by 10% to 573.3 million[100][103]. - At Round Mountain, gold equivalent ounces produced decreased by 9% to 215,387 ounces, and ounces sold decreased by 8% to 214,996 ounces due to fewer ounces recovered from heap leach pads[115]. - Bald Mountain saw a 15% increase in gold equivalent ounces produced to 181,047 ounces, driven by higher grades and planned mine sequencing[122]. Financial Performance - Metal sales increased by 21% to 5,148.8millionin2024,drivenbya235,148.8 million in 2024, driven by a 23% rise in the average realized gold price to 2,393 per ounce[12][18]. - Net earnings attributable to common shareholders surged by 128% to 948.8million,withbasicanddilutedearningspersharerisingto948.8 million, with basic and diluted earnings per share rising to 0.77, a 126% increase[12][12]. - Attributable adjusted net earnings increased by 55% to 838.3million,withadjustednetearningspershareat838.3 million, with adjusted net earnings per share at 0.68, also up 55%[12][12]. - Operating earnings for 2024 reached 1,540.3million,a921,540.3 million, a 92% increase from 2023[88]. - The company recorded an income tax expense of 487.4 million in 2024, up from 293.2millionin2023[135].−Netcashflowfromoperatingactivitiesroseby52293.2 million in 2023[135]. - Net cash flow from operating activities rose by 52% to 2,446.4 million, reflecting improved operational efficiency[12][12]. - Net cash flow from operating activities increased to 2,446.4millionin2024from2,446.4 million in 2024 from 1,605.3 million in 2023, reflecting improved margins and favorable working capital movements[25]. - Net cash flow used in financing activities in 2024 was 1,005.9million,anincreasefrom1,005.9 million, an increase from 549.0 million in 2023, primarily due to term loan repayments of 800.0million[151].CostsandExpenses−Productioncostofsalesroseto800.0 million[151]. Costs and Expenses - Production cost of sales rose to 2,197.1 million, an increase of 7%, with production cost per equivalent ounce sold at 1,020,up81,020, up 8% compared to 2023[12][19]. - Attributable all-in sustaining cost per equivalent ounce sold increased by 5% to 1,388, while the all-in cost per equivalent ounce sold rose by 6% to 1,739[12][20].−Depreciation,depletion,andamortizationexpensesincreasedby161,739[12][20]. - Depreciation, depletion, and amortization expenses increased by 16% to 1,147.5 million, primarily due to a higher depreciable asset base at Tasiast and Bald Mountain[12][21]. - Production cost of sales per equivalent ounce sold at Paracatu rose by 14% to 1,039duetohigherdrillingcontractorandblastingsupplycosts[96][99].−ProductioncostofsalesatLaCoipaincreasedby271,039 due to higher drilling contractor and blasting supply costs[96][99]. - Production cost of sales at La Coipa increased by 27% to 231.3 million, primarily due to higher mill maintenance costs[100][103]. - Production cost of sales increased by 32% to 452.5million,primarilyduetohighercontractor,royalty,andreagentcostsassociatedwiththestartofManhChohproduction[109].−ProductioncostofsalesperequivalentouncesoldatBaldMountaindecreasedby3452.5 million, primarily due to higher contractor, royalty, and reagent costs associated with the start of Manh Choh production[109]. - Production cost of sales per equivalent ounce sold at Bald Mountain decreased by 3% to 1,205, maintaining cost efficiency despite increased production[119]. Future Outlook - The company expects to produce 2.0 million attributable gold equivalent ounces in 2025, with stable production expected for 2026 and 2027[60]. - Attributable production cost of sales per equivalent ounce sold is expected to be 1,120in2025,upfrom1,120 in 2025, up from 1,021 in 2024[61]. - The expected attributable all-in sustaining cost for 2025 is 1,500perequivalentouncesold,comparedto1,500 per equivalent ounce sold, compared to 1,388 in 2024[62]. - Attributable capital expenditures for 2025 are forecasted to be approximately 1,150million,withsustainingcapitalexpendituresofapproximately1,150 million, with sustaining capital expenditures of approximately 535 million and non-sustaining capital expenditures of approximately 615million[65].−The2025forecastforexplorationandbusinessdevelopmentis615 million[65]. - The 2025 forecast for exploration and business development is 200 million, including approximately 175millionforexplorationexpendituresatvarioussites[68].−Theforecasteffectivetaxratefor2025isexpectedtobeintherangeof32175 million for exploration expenditures at various sites[68]. - The forecast effective tax rate for 2025 is expected to be in the range of 32% - 37%[70]. Legal and Regulatory Matters - The company is involved in ongoing legal proceedings, but management believes that the ultimate liability will not materially affect its financial position, results of operations, or cash flows[174]. - The Maricunga operation has faced regulatory challenges, including a series of sanctions from the Chilean environmental authority, leading to a suspension of mining activities since 2016[176]. - In a recent settlement regarding the Maricunga case, the company is required to submit a restoration plan to the environmental authority, which is currently under appeal[177]. - The Kettle River-Buckhorn Mine has faced multiple Notices of Violation (NOV) from the Washington Department of Ecology, asserting discharge limit exceedances[180]. - A citizen's suit was filed against the company under the Clean Water Act, seeking civil penalties of up to 55,800 per day for alleged permit violations, with ongoing litigation and settlement discussions[183]. - Kinross Brasil Mineração S.A. reached a settlement with the State Public Attorney in Brazil, agreeing to pay approximately 7millionovertenyearstosupportsocio−environmentalprojects[184].−TheManhChohmineprojectinAlaskaisfacingoppositionfromlocalgroups,butadministrativeappealsagainsttheprojecthavebeenunsuccessfultodate[185].−Thecourthasgrantedjudgmentonthreeofthefourclaimsinthelawsuitagainsttheorehaulplan,withthecasesetfortrialonAugust11,2025[187].CashandLiquidity−Cashandcashequivalentsattheendof2024increasedby747 million over ten years to support socio-environmental projects[184]. - The Manh Choh mine project in Alaska is facing opposition from local groups, but administrative appeals against the project have been unsuccessful to date[185]. - The court has granted judgment on three of the four claims in the lawsuit against the ore haul plan, with the case set for trial on August 11, 2025[187]. Cash and Liquidity - Cash and cash equivalents at the end of 2024 increased by 74% to 611.5 million compared to 352.4millionattheendof2023[145].−Thecompanyhad352.4 million at the end of 2023[145]. - The company had 1,645.9 million available credit as of December 31, 2024, indicating strong liquidity[167]. - The company repaid 800.0millionofthetermloanduring2024,witharemainingbalanceof800.0 million of the term loan during 2024, with a remaining balance of 200.0 million as of December 31, 2024[161]. - Total assets increased by 322.3millionto322.3 million to 10,865.6 million in 2024, driven by an increase in cash and cash equivalents and inventories[152]. - Current liabilities rose by 374.6millionto374.6 million to 1,060.1 million, mainly due to the reclassification of a 1.0billiontermloanfromlong−termtocurrent[152].−Totaldebtdecreasedto1.0 billion term loan from long-term to current[152]. - Total debt decreased to 1,435.4 million in 2024 from 2,232.6millionin2023,reflectingsignificanttermloanrepayments[152].ImpairmentsandAdjustments−InQ42024,theCompanyrecordedanafter−taximpairmentreversalof2,232.6 million in 2023, reflecting significant term loan repayments[152]. Impairments and Adjustments - In Q4 2024, the Company recorded an after-tax impairment reversal of 73.4 million related to property, plant, and equipment at Round Mountain[22]. - The company recorded an after-tax impairment reversal of 73.4millioninQ32024relatedtoproperty,plant,andequipment,contrastingwitha73.4 million in Q3 2024 related to property, plant, and equipment, contrasting with a 35.8 million impairment charge in Q4 2023[193]. Internal Controls and Reporting - The implementation of a new consolidation accounting system was completed in 2024 without material changes to internal controls[198]. - Management concluded that internal control over financial reporting was effective as of December 31, 2024, based on their evaluation[197]. - The company’s financial performance is subject to inherent limitations in disclosure controls and procedures, despite being deemed effective[199].