More matter with less art

And on the subject of Kinross (K.to) (KGC)…

…the 2q12 numbers (linked here) aren’t as bad as many feared, but there are devils in the details. We do have a slight miss on the bottom line mainly due to higher costs (though higher deprec/deplet/amort of $235/oz from a guided $200/oz  is in there too), but guidance is kept for FY12 (bar the lost Crixas production cos they sold their 50% of that asset) and things like Fort Knox did ok. However (trembling roll on drums):

1) Lobo Marte has been delayed again. Wow what a shockah*. That White Heffalump is still going nowhere fast, plug ugly thing,

2) Tasiast is getting a PFS run on a smaller 30k tpd operation, instead of the planned 60k tpd due to capex hikes. Which is a neat and politically acceptable way of deferring development in 2012, if nothing else.  

3) But the thing at Tasiast is that K is now flagging another write-down in the pipeline, mebbe for year’s end, which again points the finger directly at the most obvious reason as to why Mr. Burt became Mr. Boot; he paid way but waaay too much for Red Back. Har har hardy har, Tye.

But y’know, look at the balance sheet and it’s really not that bad at K. Working cap’s still at (just a smidge under) $1.5Bn so as long as that Tasiast writedown isn’t too heavy the current book value ($11.19/share) makes the stock look reasonably cheap (and although Lobo El Marte is a dog worth residual value in your author’s horribly biased opinion, it’s not a mega slice of that balance). Kinross is a company that i’d like to pick big bones against and this set of numbers is by no means sparkly, but in this nervously anticipated quarter there really isn’t that much to worry about. 


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