Summary of Quarterly Results
The table below summarizes selected quarterly operating and financial results for the previous eight quarters.
In 2008, gold production increased early in the year with the addition of the Fosterville and Stawell mines on February 18, 2008. In the first half of the year, net earnings were lower than expected, as a result of lower gold output from the Australian mines in addition to one-time costs as various production enhancing initiatives were implemented. Production in the third quarter was impacted by unusual disruption events at the Kemess mine and ongoing challenges at the Australian operations. Net earnings in the third and fourth quarters of 2008 also included charges of $16,912,000 and $3,398,000, respectively, to recognize an other than temporary impairment on Northgate's ARS investments. Results in the fourth quarter of 2008 improved markedly, driven by a significant increase in gold production at Fosterville and Stawell compared to previous quarters. Decreased revenues from Kemess resulting from lower copper prices and lower than budgeted production were partially offset by an increase in the value of Northgate's copper forward contracts. Net earnings in the fourth quarter were reduced by a future income tax expense comprised mainly of the reversal of a future tax asset relating to mineral taxes and the future tax impact of Northgate's copper forward contracts, which are in a significant asset position.
Quarterly revenues increased steadily in 2007, due primarily to increasing copper and gold prices although metal production was higher in the first half of the year than in the second half of the year. In the fourth quarter of 2007, a significant crack developed in the main Kemess haul road necessitating the realignment of the road during November and December. During this period, the Kemess mill processed a variety of metallurgically challenging ores from surface stockpiles. The combination of high native copper supergene ore and harder lower grade hypogene ore was processed at a lower rate than expected due to a variety of weather-related issues and recoveries below management's expectations. In the third quarter of 2007, Northgate recorded a write-down of its Kemess North property for $31,433,000.