New Gold reports record 212% increase in 2011 net earnings

The combination of increased gold production, low total cash cost, and strong commodity prices, led New Gold to the "strongest financial performance in the company's history."

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RENO (MINEWEB) -

New Gold reported a 212% increase in net earnings last year, as well as record annual gold production of 387,155 ounces.

The company met its production guidance of 380,000 to 400,000 ounces of gold, despite a decrease in fourth-quarter 2011 gold production from 124,400 ounces in fourth-quarter 2010 to 100,671 ounces. Fourth-quarter 2010 gold production had benefitted from higher grades being mined at all of the operations without grades at Mesquite and Cerro San Pedro above reserve grade.

New Gold Thursday reiterated its 2012 guidance of 405,000 to 445,000 ounces of gold. Silver production guidance is 1.9 million to 2.1 million ounces this year, while copper production guidance is 42 million to 49 million pounds.

Total cash cost guidance is a range of $410 to $430 per ounce this year.

The company also reported a drop in silver production from 2,188,200 ounces in 2010 to 1,989,300 ounces in 2010. Copper production also declined from 15.3 million pounds in 2010 to 12.7 million pounds in 2011.

Robert Gallagher, New Gold CEO said, "While we are pleased with our 2011 results, 2012 should be even more transformational for New Gold with production from New Afton set to drive record production, construction at El Morro advancing and continued exploration and development at Blackwater."

FINANCIALS

Net earnings in 2011 increased by 212% from $57 million or 15-cents per share in 2010 to $179 million or 42-cents per share.

Adjusted net earnings increased by 62% to $188 million or 44-cents per share in 2011, compared to $115.7 million or 30-cents per share.

For the fourth-quarter 2011 net earnings were reported at $35 million or 8-cents per share, up from $25.6 million or 7-cents per share for the same quarter of 2010.

Adjusted net earnings for the fourth-quarter 2011 were reported at $42.2 million or 9-cents per share, down from $57 million or 15-cents per share in adjusted net earnings for the fourth-quarter 2010. The company's fourth quarter revenue and earnings were down primarily due to "production of gold, silver and copper in the fourth quarter of 2010 all being benefitted by above average grade due to mine sequencing," New Gold said.