All dollar amounts stated in this press release are expressed in U.S.
dollars
TORONTO, Nov. 30 /CNW/ - Kinross Gold Corporation ("Kinross" or the
"Company") (TSX-K; NYSE-KGC) announces that it has filed today its audited
financial statements for the year ended December 31, 2004 which include the
audited comparative restated financial statements for the year ended
December 31, 2003 and the related management discussion and analysis ("MD&A"),
and that it has also filed its restated quarterly financial statements and
MD&A for 2004. Kinross expects to file its quarterly financial statements and
MD&A for the quarters of 2005 by mid December.
In finalizing the restated financial statements Kinross has made minor
adjustments to the preliminary results previously announced in the October 20,
2005 press release, to reflect updated information related to the size of
certain exploration properties acquired in the Echo Bay and TVX acquisition.
These changes resulted in an increase in the value of exploration properties
of $5.4 million, a related decrease in the future income tax liability of
$0.4 million and a corresponding decrease in goodwill of $5.8 million on the
acquisition of TVX and Echo Bay, as of January 31, 2003. These changes
resulted in a decrease in goodwill impairment of $5.7 million and a related
increase in the amount of the impairment of Kinross' exploration properties of
$0.5 million as of December 31, 2003. The reported net loss for 2004 was
slightly higher due to a $0.2 million tax adjustment; this did not change net
loss per share.
Kinross also announced that an application (the "Application") will be
made to the Ontario Superior Court of Justice for an order extending the time
for holding the Company's 2005 annual and special meeting of shareholders past
December 31, 2005. The application will seek an order from the Court to extend
the meeting deadline until February 28, 2006, although Kinross anticipates
holding its meeting, together with an investor information update, in late
January 2006. This meeting will replace the previously scheduled December 21,
2005 shareholders' meeting.
Kinross hereby notifies its shareholders that a court date to hear the
Application has been set for December 13, 2005 at 10:00 a.m. to be heard at
393 University Avenue, 8th Floor, Toronto, Ontario. Shareholders who wish to
appear on this application should serve a Notice of Appearance, in accordance
with the Ontario Rules of Civil Procedure on Robert Cohen of Cassels Brock &
Blackwell LLP at 40 King Street West, Suite 2100, Scotia Plaza, Toronto,
Ontario, M5H 3C2 or by fax to Robert Cohen at 416-350-6929. The Court
Application materials will be made available on our website at
www.kinross.com.
In addition, Kinross announced today that it has filed a Change of
Auditor Notice and related documents with the securities regulatory
authorities of all Canadian provinces in accordance with National Instrument
51-102 Continuous Disclosure Obligations ("NI 51-102"). Deloitte & Touche LLP
has confirmed to Kinross, following the request of the Company, that it will
not stand for reappointment as auditor of the Company for the financial year
ended December 31, 2005. In this connection, the board of directors of Kinross
has appointed KPMG LLP as its auditor for the financial year ended
December 31, 2005. The shareholders of the Company will be asked to ratify the
appointment of KPMG as auditor of the Company at the next annual meeting of
shareholders scheduled to be held before the end of January.
In accordance with NI 51-102, there is a reportable event noted in the
Change of Auditor Notice, which consisted of the following disagreement (as
defined in NI 51-102): On November 9, 2004, the Company entered into a letter
of intent in connection with the purchase from Rio Tinto PLC of a 51% interest
in the Paracatu gold mine in Brazil. Deloitte & Touche LLP disagreed with the
Company's view that this proposed transaction did not result in an event or a
change of circumstances during the third quarter of 2004, that more likely
than not reduced the fair value of Kinross' previously owned 49% interest in
the Paracatu gold mine below its carrying value, which would have resulted in
a requirement to test goodwill for impairment. Management ultimately agreed to
assess whether goodwill was impaired as a result of the negotiation of that
letter of intent, and the disagreement was resolved to the satisfaction of
Deloitte & Touche LLP by Kinross recognizing a goodwill impairment of
$143 million in the third quarter of 2004.
Audited 2004 financial statements including restated comparable results
for 2003 are available on SEDAR, EDGAR, and on the Company's website at
www.kinross.com
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About the Company
Kinross Gold Corporation, www.kinross.com, is a senior gold producer with
eleven gold producing properties in six countries, primarily in North and
South America. Kinross' head office is located in Toronto and its common
shares trade under the symbol K on the Toronto Stock Exchange, and under
the symbol KGC on the New York Stock Exchange.
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Consolidated balance sheets
(expressed in millions of U.S. dollars)
As at December 31
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2004 2003
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Assets Restated
Current assets
Cash and cash equivalents $ 47.9 $ 245.8
Restricted cash 1.4 5.1
Short-term investments 5.7 -
Accounts receivable and other assets 40.9 42.2
Inventories 111.0 109.2
-----------------------
206.9 402.3
Property, plant and equipment 1,244.1 1,010.4
Goodwill 329.9 342.3
Future income and mining taxes - 1.5
Long-term investments 25.7 2.1
Deferred charges and other long-term assets 27.6 35.9
-----------------------
$ 1,834.2 $ 1,794.5
-----------------------
-----------------------
Liabilities
Current liabilities
Accounts payable and accrued liabilities $ 143.2 $ 101.9
Current portion of long-term debt 6.0 29.4
Current portion of reclamation
and remediation obligations 23.6 19.2
-----------------------
172.8 150.5
Long-term debt 116.9 0.7
Reclamation and remediation obligations 108.1 111.1
Future income and mining taxes 90.6 126.6
Other long-term liabilities 9.5 6.9
Redeemable retractable preferred shares 2.6 3.0
-----------------------
500.5 398.8
-----------------------
Commitments and contingencies
Non-controlling interest 0.4 0.7
-----------------------
Convertible preferred shares of subsidiary company 13.3 12.6
-----------------------
Common shareholders' equity
Common share capital and
common share purchase warrants 1,775.8 1,783.5
Contributed surplus 33.9 30.0
Accumulated deficit (487.7) (429.1)
Cumulative translation adjustments (2.0) (2.0)
-----------------------
1,320.0 1,382.4
-----------------------
$ 1,834.2 $ 1,794.5
-----------------------
-----------------------
Total issued and outstanding
common shares (millions) 345.1 345.6
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Consolidated statements of operations
(expressed in millions of U.S. dollars, except per share amounts)
For the years ended December 31
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2004 2003 2002
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Restated Restated
Revenue and other operating income
Metal sales $ 666.8 $ 571.9 $ 261.0
Operating costs and expenses
Cost of sales (excludes accretion,
depreciation, depletion and
amortization) 402.4 362.0 169.8
Accretion 21.4 9.0 1.6
Depreciation, depletion
and amortization 170.1 172.7 85.6
-----------------------------------
72.9 28.2 4.0
Other operating costs 25.8 16.5 2.7
Exploration and business development 20.4 24.3 11.6
General and administrative 36.4 25.0 11.3
Impairment charges:
Goodwill 12.4 394.4 -
Property, plant and equipment 46.1 15.2 -
Investments 1.4 1.9 0.2
Gain on disposal of assets (1.7) (29.5) (2.7)
-----------------------------------
Operating loss (67.9) (419.6) (19.1)
Other income - net 3.7 11.1 4.9
-----------------------------------
Loss before taxes and other items (64.2) (408.5) (14.2)
Income and mining taxes
recovery (expense) 8.6 (1.5) (6.5)
Non-controlling interest 0.3 (0.2) -
Share in loss of investee companies - - (0.6)
Dividends on convertible preferred
shares of subsidiary (0.8) (0.8) (1.5)
-----------------------------------
Net loss $ (56.1) $ (411.0) $ (22.8)
-----------------------------------
-----------------------------------
Attributable to common shareholders:
Net loss $ (56.1) $ (411.0) $ (22.8)
Increase in equity component
of convertible debentures - (6.5) (7.3)
Gain on redemption of equity
component of convertible debentures - 16.5 -
-----------------------------------
Net loss attributable
to common shareholders $ (56.1) $ (401.0) $ (30.1)
-----------------------------------
-----------------------------------
Loss per share
Basic and diluted $ (0.16) $ (1.30) $ (0.25)
Weighted average number of common
shares outstanding (millions)
Basic and diluted 346.0 308.6 119.7
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Consolidated statements of cash flows
(expressed in millions of U.S. dollars)
For the years ended December 31
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2004 2003 2002
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Restated Restated
Net inflow (outflow) of cash related
to the following activities:
Operating:
Net loss $ (56.1) $ (411.0) $ (22.8)
Items not affecting cash:
Depreciation, depletion
and amortization 170.1 172.7 85.6
Impairment charges 59.9 411.5 0.2
Gain on disposal of assets (1.7) (29.5) (2.7)
Future income and mining taxes (26.0) (14.8) -
Deferred revenue recognized (6.3) (2.3) (5.1)
Other (7.2) 5.8 3.3
Changes in operating assets
and liabilities:
Accounts receivable and other assets 4.2 (1.7) (1.6)
Inventories (19.3) (11.3) 2.4
Accounts payable and
accrued liabilities 43.6 (29.9) (2.6)
-----------------------------------
Cash flow provided from
operating activities 161.2 89.5 56.7
-----------------------------------
Investing:
Additions to property,
plant and equipment (169.5) (73.4) (22.6)
Business acquisitions,
net of cash acquired (261.2) (81.9) (0.1)
Proceeds on sale of
marketable securities 0.7 4.6 2.8
Proceeds on sale of long-term
investments and other assets 14.6 63.3 5.5
Additions to long-term
investments and other assets (26.4) (6.1) (3.7)
Proceeds from the sale of
property, plant and equipment 1.5 5.9 1.3
Additions to short-term investments (5.7) - -
Decrease (increase) in restricted cash 3.7 37.5 (21.1)
-----------------------------------
Cash flow used in investing activities (442.3) (50.1) (37.9)
-----------------------------------
Financing:
Repurchase of common shares (11.8) - -
Issuance of common shares and
common share purchase warrants 3.1 187.9 112.8
Redemption of convertible debentures - (144.8) -
Acquisition of convertible preferred
shares of subsidiary company - (0.3) (11.4)
Reduction of debt component
of convertible debentures - (4.2) (5.1)
Debt issue costs (1.4) - -
Proceeds from issuance of debt 119.5 - -
Repayment of debt (26.8) (10.5) (28.5)
-----------------------------------
Cash flow provided from
financing activities 82.6 28.1 67.8
-----------------------------------
Effect of exchange rate changes on cash 0.6 7.7 3.0
-----------------------------------
(Decrease) increase in cash
and cash equivalents (197.9) 75.2 89.6
Cash and cash equivalents,
beginning of year 245.8 170.6 81.0
-----------------------------------
Cash and cash equivalents,
end of year $ 47.9 $ 245.8 $ 170.6
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%SEDAR: 00002968E
