TSX moves higher, Dec. 23-27: Kirkland Lake, Endeavour Mining, Kinross, Yamana

The S&P/TSX Composite Index rose 0.29% to finish at 17,168.20. The S&P/TSX Global Mining Index jumped 3.18% to 82.52, and the S&P/TSX Global Base Metals Index gained 1.03% to 110.16. Spot gold climbed US$32.40 per oz., or 2.19%, to US$1,510.80 per ounce.

Shares of Kirkland Lake Gold advanced $3.13 to $56.72 per share. The company filed its management circular in connection with its bid to acquire Detour Gold Mines. Shareholders will convene at a special meeting on Jan. 28 to vote on the proposed acquisition. In other news, the company released its full-year guidance for 2020. Consolidated production is expected to reach 950,000 to 1 million oz. gold at average cash-operating costs per ounce sold of US$300 to US$330, and all-in sustaining costs of US$570 to US$630 per oz. sold. The company plans to spend US$120 million to US$140 million on exploration. Sustaining capital expenses are targeted to reach US$165 million to US$175 million, while growth capital expenses are forecast to reach US$70 million to US$80 million. The company will start work on development ramps aimed at establishing two mining operations, Robbin’s Hill at its Fosterville mine in the state of Victoria, Australia, and high-grade zones near surface along the Amalgamated Break at its Macassa mine in northern Ontario. Kirkland Lake says it will continue advanced exploration work at its assets in the Northern Territory, Australia. Endeavour Mining’s shares were up $1.53 to $24.22 apiece. West Africa-focused Endeavour announced that it has been given more time to make a takeover offer for Centamin. The “put up or shut up” deadline for Endeavour to make a formal offer has been set for Jan. 14. In early December, Centamin rejected a US$1.9 billion  all-stock takeover proposal from Endeavour, saying it didn’t offer enough value. Centamin’s assets include the Sukari mine in Egypt.

Kinross Gold was the second most heavily traded stock, and its shares closed at $6.04, up 40¢. The company recently announced a US$300-million debt financing for its Tasiast operation in Mauritania with the International Finance Corp. (IFC), Export Development Canada, and with the participation of ING Bank and Société Générale. It is IFC’s largest-ever investment in Mauritania. The eight-year loan matures in December 2027 and has a floating London interbank offered rate, plus 4.38%. The initial drawdown is expected in early 2020. Tasiast is an open-pit mine 300 km north of the capital Nouakchott. The mine produced 250,945 equivalent oz. gold in 2018, and is undergoing an expansion to increase throughput capacity to 24,000 tonnes per day by mid-2023. Tasiast has an expected mine life to 2033.

Yamana Gold announced a 25% dividend increase to 5¢ per share a year, effective for the first quarter of 2020. This followed the 100% increase in dividends declared earlier in the third quarter of 2019, marking a 125% increase in dividends in the three months ended Dec. 31. The company’s shares increased 45¢ to $5.05.


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