Motley Fool  Apr 21  Comment 
Even when optimistic about a stock's future, it's important to recognize where the potential trouble lies.
Motley Fool  Apr 17  Comment 
Investors won't strike out with either of these companies, but they may strike gold with one of them.
Motley Fool  Mar 30  Comment 
What's next for gold miners Goldcorp and Yamana Gold is the big question, and one has more in the works than the other.
Motley Fool  Mar 27  Comment 
Which one would you buy?
Motley Fool  Mar 14  Comment 
If you're looking for stock market bargains, we have three that might entice you.
Motley Fool  Mar 6  Comment 
Learn these interesting facts about the company and earn a gold star.
Motley Fool  Feb 24  Comment 
Can investors enjoy golden slumbers after reviewing this earnings report?


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Yamana Gold Inc. (NYSE:AUY, TSE:YRI, LON:YAU) is a Canadian based gold producer with significant gold and copper-gold producing assets in the America's. There are seven operating mines in Brazil, Chile and the U.S., as well as gold development stage properties, exploration properties, and land positions throughout North and South America. There's also other exploratory activity in Mexico and Peru. In early 2011 there were 751.7 million common shares outstanding (fully diluted).

Yamana has targeted sustainable gold production of 1.7 million ounces of gold equivalent by 2014 (about 10-15% of that from silver, the gold to silver ratio is used to convert it); that's 55-60% higher than the estimates it has for 2011 and 2012 (new projects come on tap in 2013).[1] Yamana gold has been noted for its low PEG ratio (price/earnings)/(EPS annual projected growth), the PEG ratio is only useful when applied to companies with high annual earnings per share growth (usually mid cap companies that are not well established).[2]


2013 forecast - 1.5-1.7 million ounces due to mines at Mercedes, Pilar, Jeronimo reaching commercial production. 2012 forecast - 1.3 million ounces

2011 production - reported by Yamana Gold on January 11, 2012. The company produced 1.1 million ounces of gold (22% higher than previously forecasted) on the back of higher output from El Penon (476,000 ounces) and Gualcamayo (up 18% on the year to 159,000 ounces). Chapada produced 11% more copper (166 million pounds) and that helped lower cash costs net of by products ($50/gold equivalent ounces much lower than the $250/oz previous estimate). Chapada (135,000 ounces) and Jacobina (122,000 ounces) also produced gold in line with expectations. The 9.3M oz of silver produced in 2011 is included in the 1.1M ounces as gold equivalent (916,284 oz is pure gold up from 864,768 in 2010).

2011 production forecast - 900,000 ounces for gold, 9 million ounces for silver, 150 million pounds for copper. In 2010 production for the fiscal year was: 1.05 million gold equivalent ounces (85-90% pure gold), 10 million ounces for silver, 149.4 million pounds for copper. At $442 per ounce cash costs are relatively low (industrywide was $585 in the 3rd quarter of 2010). For the next few years (until around 2013) no new mines are expected to begin operating however just after that the company has a few slated projects scheduled to begin producing (combined they could increase gold production by 60 - 80%). Annual GEO production increased 680% between 2006 and 2010 (147,000 to over 1 million).[1]

El Pinon, Chile - is the company's biggest mine in term of production; 2010 geo (gold equivalent ounces) was 428,000. 2011 production was 476,000 ounces up 11.2%.

Gualcamayo, Argentina - Opened in 2009, produced 135,000 ounces in 2010 compared to 98,600 ounces in 2009. Capacity upgrades affected production and cash costs in the 4th quarter of 2010 (increased cash costs year on year because ore was transported by truck rather than conveyor). 2011 production was 159,000 ounces up 17.8%.

Minera Florida, Chile - Earthquake affected production in 2010 (February) however 2010 production was 15% higher than in 2009. New high grade deposit was discovered in 2010.

Jacobina, Brazil - Mine optimization enabled production to rise 10% to 122,000 in 2010 (111,000 in 2009). 2011 production was steady at 122,000 ounces.

Chapada, Brazil - Yamana's source of all of its copper (149.4 million pounds) and less than 15% of gold production (135,600 ounces). 2011 copper production was 166 million ounces (up 11%) and gold production was 135,000 ounces.

Business and Financials

Although Yaman's financial metrics/balance sheet have shown solid, consistent annual growth for the last few years (2008-2011) stock performance has been lackluster, the result of slight exposure to risks in many different areas (currency risk associated with Brazilian operations, inflation, sovereign risk in Argentina, earthquakes in Chile (February 27, 2010) as well as inconsistent quarterly results.[3] By-product cash costs per gold equivalent ounce: 2010: US$50/oz. In December 2010 it had US$330 million in cash equivalents with another US$858 million in credit available; debt totalled $486 million, fourth quarter 2010 dividend was 3 cents per share. Operating cash flow recorded a record increase of 51% in 2010 (up to $747 million from 496 and 411 the 2 previous years). Capital expenditure was $531 million (2010), another $45 million went to debt and $48 million to dividend payments.

Revenue 2010: $1.687 billion (43% growth, 1.183 billion 2009), $535 million in the fourth quarter (34% yoy growth). Net income: $451 million (30.3% growth, $346 million in 2009).

Net income per share 2010 2010 : 61 cents (30% more than 2009), 22 cents in the fourth quarter.

2011 Data

End of 2011 cash and cash equivalents up 67% to $550M. [4] Cash margin $1517 per ounce gold gold.

2011 cash costs

$50 per gold equivalent ounce in 2011.[4] Chapada produced 11% more copper (166 million pounds) anthat helped lower cash costs net of by products ($50 per ounce of gold equivalent which is a lot lower than the $250/oz previous estimate).


  1. 1.0 1.1 Yamana Gold 2010 Annual Report (2011-02-23).
  2. Top 4 Mid-Cap Stocks In The Gold Industry With The Lowest PEG Ratio (IAG, HMY, AUY, EGO) (2011-04-11).
  3. The good and bad for Yamana Gold (2010-03-05).
  4. 4.0 4.1 Yamana Gold Announces Record Fourth Quarter & Year End 2011 Results (February 22, 2012).
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