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Unformatted text preview: t Africa operations.
The Way Forward principles strongly influenced our budgeting and planning process for
2013. We have stressed quality over quantity in our mine planning, and our operations have
maintained a concerted focus on addressing the costs that lie within our control.
That said, we forecast that our 2013 production will be slightly less than 2012, and our costs
per ounce slightly higher, due to anticipated lower grades at most of our mines, the planned
suspension of mining at La Coipa in the second half, and expected increases in consumable
and labour costs. Notwithstanding these cost pressures, we expect that our cost per tonne in
2013 will be similar to 2012. We forecast 2013 production of 2.4 to 2.6 million gold equivalent
ounces at a cost of sales of $740 to $790 per ounce.
In the area of capital discipline, when I became CEO in August 2012, we launched a targeted
initiative to find opportunities to reduce our capital expenditures. This resulted in a reduction of
$200 million in our 2012 capital forecast, bringing it down to $2 billion. Our actual expenditures
for the full year 2012 were $1.92 billion.
In 2013, we expect to spend about $325 million less on capital than we did in 2012. This includes
reductions in all three categories of capital expenditure: sustaining, opportunity, and growth. In
all of our capital decisions, we will remain focused on disciplined spending that drives margin
and cash flow, consistent with our Way Forward principles. REPORTING ALL-IN COSTS 2
Kinross is part of the World Gold Council process that is seeking industry consensus on adopting
formal guidelines for reporting all-in costs associated with gold production, to give investors
more information on the full costs of producing an ounce of gold. While this process is ongoing,
we are independently reporting an all-in sustaining cost in order to provide our investors with
more detailed information on our cost structure. We are forecasting an all-in sustaining cost of
approximately $1,100 to $1,200 per gold ounce sold on a by-product basis in 2013, compared
with approximately $1,100 per gold...
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This document was uploaded on 03/30/2014.
- Spring '14