IAMGOLD (IAG) Q4 2008 earnings summary

Executive summary

• Record 2008 gold production of 997,000 oz, 8% above the original forecast and 3% higher YoY; record revenue, adjusted earnings and operating cash flow.

• Adjusted net earnings reached $107.5M ($0.36/share), while reported net loss was $9.9M ($0.03/share), primarily reflecting non-cash impairment charges.

• Q4 net loss was $96.4M ($0.33/share), including $112.8M of after-tax impairment charges; adjusted Q4 earnings were $16.4M ($0.06/share).

Financial highlights

• FY revenue rose 28% to $869.6M; mining costs increased 6% to $451.8M, while earnings from mining operations advanced 85% to $248.2M.

• Operating cash flow more than doubled to $255.4M ($0.86/share) from $117.1M; cash and bullion at market totaled $269.1M at year-end.

• Average realized gold price increased 23% to $855/oz; gold sales volume rose 4% to 997,000 oz.

• Q4 revenue was $209.6M; reported net loss of $96.4M compared with $8.5M net earnings in Q4 2007.

• Adjusted FY earnings exclude impairment charges; 2008 impairment charges were $129.9M pre-tax and $117.4M net of tax, mainly related to Buckreef.

Outlook and guidance

• 2009 gold production guidance is 880,000 oz at cash costs of $470-$480/oz, based on an $800/oz gold price and $65/barrel oil; forecast includes lower output from mine closures and lower grades.

• 2009 capital expenditures are projected at $439.5M, including $219.4M for Essakane; planned greenfields exploration expense is $33.9M.

• Long-term target: 1.8M oz annual gold production with cash costs below the industry average by 2012.

• 2009 Niobec production is forecast at 4.4M kg; 75% of projected output has sales commitments and another 15% is allocated under customer options.