Partial Transcript.
"Gold production increased 11% to 2.7 million ounces and in an all-in sustaining cost of $1031 per ounce. The lower cost guidance of a $1050 to $1100 per ounce. Of particular note nearly every mine in the portfolio either met or exceeded production guidance a testament to our focus on execution.
Our financial results demonstrate the impact of lower metal prices that have on our overall performance but they also reflect the swift response by our operating teams to the changes we saw in the business during the year. We significantly reduced our spending forecast in mid-2013 and in the year-end we repeat the revised forecast. Our capital spending, exploration expense and G&A.
Importantly these changes have not adversely affected our leading growth profile which will include contributions from two important new gold mines in 2014. In response to changing market conditions in 2013 investors have rightly demanded that renewed focus on profitable gold production. While we’re disappointed to break our string of nine consecutive years of increasing gold reserves our 54.4 million ounces of proven and probable gold reserves demonstrate strong economics in the current metals market and in fact we saw our overall reserve rate increased by 18%. Peñasquito is a prime example of how a new mine plan that cuts reserves and mine life can actually yield enhanced value and cash flow. We remain bullish on the long term direction of gold prices but our focus on cost containment across our portfolio represents best opportunity for continued success in (indiscernible) gold price environment.
Our strategy is unchanged, we’re committed to being a gold focus company and intend on growing safe profitable gold exposure for investors. On that front our plans to deliver two new outstanding gold mines in 2014 remain on track. With Cerro Negro in Argentina scheduled to commence gold production mid-year and Éléonore in Quebec on track for first gold by year end. Our period of intense capital investment is nearing an end. In fact most of our capital spending this year will be front end loaded such that at a flat gold price of $1200 per ounce we expect to generate free cash flow during the fourth quarter of this year. The completion and integration of the Cochenour project will soon follow in 2015 bringing a new source of gold production to Red Lake and an initial capital cost that’s actually decreased from our expectations a year ago.
The prospect of growing cash flows coupled with our strong balance sheet provided the confidence to maintain our dividend at $0.60 per share in 2013 when many companies were compelled to cut or cancel dividends. As a our cash flows increase overtime we will continue to evaluate our capital allocation alternatives to maximize shareholder returns while pursuing future growth opportunities. On January 8 we provided new production and cost guidance for 2014 and our updated five year growth profile. Production is expected to increase significantly in 2014 to between 3 million and 3.15 million ounces with all in sustaining costs decreasing to between $950 and a $1000 per ounce.
Capital expenditures are expected to range between $2.3 billion and $2.5 billion. Our five year gold production profile remains intact with a forecast increase of approximately 50% over the next two years driven by our three new projects coming online this year. The ramp up of Pueblo Viejo and continued increases in production for Peñasquito. Our five year plan positions us for continued success. With strong production growth combined with continued decreases in all-in sustaining cost we expect to generate increasing cash flows even in a flat gold price environment.
We have worked very hard to get to this position and we look forward to delivering sustained value to our shareholders in 2014 and for many years to come".
