Long-suffering Kinross investors welcome cost-cutting chief
Kinross Gold (TSX:K)(NYSE:KGC) on Thursday announced that Brant Hinze (pictured), the Canadian company's VP and COO will take over as President and COO following the abrupt departure of former CEO Tye Burt last week.
"This promotion is consistent with a renewed focus on operational fundamentals, delivering on key metrics at our sites, and reducing costs across our operations and projects," CEO since 1 August, J Paul Rollinson said in a statement.
"Since coming to Kinross, Brant Hinze has instilled a new level of accountability at our operations. We are now looking to him to lead the drive for performance improvements across the organization as the next step in our capital and project optimization process."
Hinze joined Kinross, Canada's number three gold producer by output, in October 2010 from Newmont Mining and holds a mining engineering degree from the University of Idaho.
Earlier on Thursday the company announced a 56% slump in profits and lowered its guidance for gold output to 2.5–2.6 million gold equivalent ounces from 2.6–2.8 million before.
Cost of sales shot up dramatically from $569 an ounce to $725 – the company said it was processing lower grade ore and labour and energy costs have been going up across its operations.
Kinross stock was trading up 2.7% on Thursday giving it a market capitalization of $9 billion. That is still only half of what it was worth this time last year.
Under Burt Kinross has suffered a series of setbacks, including a work stoppage and ballooning costs at its Tasiast mine in Mauritania, West Africa this spring.
At the start of the year it announced a $2.5 billion writedown in connection with the Tasiast deal with Red Back, which Burt had championed in 2010.
Kinross operates mines and projects in Brazil, Canada, Chile, Ecuador, Ghana, Mauritania, Russia and the United States, employing approximately 8,000 people worldwide.