PRESS RELEASE

Goldcorp issues 2019 guidance

By
Monday, January 28, 2019

PRESS RELEASE

VANCOUVER, Jan. 28, 2019 /CNW/ - GOLDCORP INC. (TSX: G, NYSE: GG) ("Goldcorp" or the "Company") is providing a summary of fourth quarter 2018 milestones and 2019 annual guidance.

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Fourth Quarter Milestones

  • As previously disclosed, fourth quarter 2018 gold production of 630,000 ounces exceeded guidance. All-in sustaining costs for the full year are expected to be in line with guidance of $850 per ounce.
  • Cerro Negro exited the year at 4,000 tonnes of ore per day, completing the ramp up of the mine to nameplate capacity.
  • Éléonore exited the year at 6,600 tonnes of ore per day and produced an average of 35,000 ounces per month in the fourth quarter, in line with targeted annual gold production of 400,000 ounces.
  • At Peñasquito the Pyrite Leach Project achieved commercial production. The project was completed under budget and ahead of schedule.
  • At Porcupine, Borden has obtained all permits and is advancing towards commercial production in the second half of 2019. Borden will be the world's first all electric mine and is expected to create 200 jobs in the Chapleau, Ontario area.

Detailed 2019 Guidance

Production

Units

2019 Guidance

2018 Actuals

Gold Production1,2

Moz

2.2 - 2.4

2.294

Silver Production1,2

Moz

40 - 50

25

Zinc Production1,2

Mlbs

390 - 450

318

Lead Production1,2

Mlbs

240 - 290

116

Gold Equivalent Production1,2

Moz

3.3 - 3.7

3.0

Costs

Units

2019 Guidance

AISC1,2,3,4,7

$/oz

$750 - $850

By-product Cash Costs1,2,5,7

$/oz

$400 - $500

Capital Expenditures

Units

2019 Guidance

Sustaining Capital1,2,6

$M

$575 - $625

Growth Capital1,2,6

$M

$290 - $350

While gold grades in the first quarter of 2019 are expected to be lower at Cerro Negro, Éléonore and Red Lake, due to mine sequencing, gold production in 2019 is expected to increase progressively each quarter as the Musselwhite Materials Handling and Borden projects are expected to achieve commercial production in the second half of the year. In addition, grades and recoveries are expected to steadily climb at Peñasquito as the mine benefits from the completion of the multi-year waste stripping campaign in the main Peñasco pit and a full year of operation at the now fully commissioned pyrite leach plant.

Further to the press release dated, January 14, 2019, entitled Newmont and Goldcorp Combine to Create World's Leading Gold Company, subsequent to the expected closing in the second quarter of 2019, Newmont Goldcorp will provide updated guidance for the combined company.

Footnotes

1.

Guidance projections used in this document ("Guidance") are considered "forward-looking statements" and represent management's good faith estimates or expectations of future production results as of the date hereof. Guidance, with the exception of the Gold Equivalent Production, is based upon certain assumptions, including, but not limited to, metal prices, oil prices, certain exchange rates and other assumptions. 2019 guidance assumes Au=$1,250/oz, Ag=$16.00/oz, Cu=$2.75/lb, Zn=$1.10/lb, Pb=$0.95/lb, $1.30 CAD/USD, 19.00 MXN/USD. Gold Equivalent Production assumes Au=$1,300/oz, Ag=$18.00/oz, Cu=$3.00/lb, Zn=$1.15/lb, Pb=$1.00/lb. Such assumptions may prove to be incorrect and actual results may differ materially from those anticipated. Consequently, Guidance cannot be guaranteed. As such, investors are cautioned not to place undue reliance upon Guidance and forward-looking statements as there can be no assurance that the plans, assumptions or expectations upon which they are placed will occur.

2.

The Company has included certain performance measures, including non-GAAP performance measures, in this release, which have been calculated on an attributable (or Goldcorp's share) basis. Attributable performance measures include the Company's mining operations and projects, and the Company's share of Pueblo Viejo, Alumbrera, and NuevaUnión. The Company believes that disclosing certain performance measures on an attributable basis is a more relevant measurement of the Company's operating and economic performance, and reflects the Company's view of its core mining operations. The Company believes that, in addition to conventional measures prepared in accordance with GAAP, the Company and certain investors use this information to evaluate the Company's performance and ability to generate cash flow; however, these performance measures do not have any standardized meaning. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.

3.

The Company's projected all-in sustaining costs are not based on GAAP total production cash costs, which forms the basis of the Company's by-product cash costs. The projected range of all-in sustaining costs is anticipated to be adjusted to include sustaining capital expenditures, corporate administrative expense, mine-site exploration and evaluation costs and reclamation cost accretion and amortization, and exclude the effects of expansionary capital, tax payments, dividends and financing costs. Projected GAAP total production cash costs for the full year would require inclusion of the projected impact of future included and excluded items, including items that are not currently determinable, but may be significant, such as sustaining capital expenditures, reclamation cost accretion and amortization and tax payments. Due to the uncertainty of the likelihood, amount and timing of any such items, we do not have information available to provide a quantitative reconciliation of projected all-in sustaining costs to a total production cash costs projection.

4.

All-in sustaining costs is a non-GAAP performance measure that the Company believes more fully defines the total costs associated with producing gold; however, this performance measure has no standardized meaning. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The Company reports this measure on a gold ounces sold basis. The Company's all-in sustaining cost definition follows the guidance note released by the World Gold Council, which became effective January 1, 2014. The World Gold Council is a non-regulatory market development organization for the gold industry whose members comprise global senior gold mining companies.

5.

The Company has included a non-GAAP performance measure - total cash costs: by-product in this document. Total cash costs: by-product incorporate Goldcorp's share of all production costs, including adjustments to inventory carrying values, adjusted for changes in estimates in reclamation and closure costs at the Company's closed mines which are non-cash in nature, and include Goldcorp's share of by-product silver, lead, zinc and copper credits, and treatment and refining charges included within revenue. Additionally, cash costs are adjusted for realized gains and losses arising on the Company's commodity and foreign currency contracts which the Company enters into to mitigate its exposure to fluctuations in by-product metal prices, heating oil prices and foreign exchange rates, which may impact the Company's operating costs. In addition to conventional measures, the Company assesses this per ounce measure in a manner that isolates the impacts of gold production volumes, the by-product credits, and operating costs fluctuations such that the non-controllable and controllable variability is independently addressed. The Company uses total cash costs: by product per gold ounce to monitor its operating performance internally, including operating cash costs, as well as in its assessment of potential development projects and acquisition targets. The Company believes this measure provides investors and analysts with useful information about the Company's underlying cash costs of operations and the impact of by-product credits on the Company's cost structure and is a relevant metric used to understand the Company's operating profitability and ability to generate cash flow. When deriving the production costs associated with an ounce of gold, the Company includes by-product credits as the Company considers that the cost to produce the gold is reduced as a result of the by-product sales incidental to the gold production process, thereby allowing the Company's management and other stakeholders to assess the net costs of gold production.

The Company reports total cash costs: by-product on a gold ounces sold basis. In the gold mining industry, this is a common performance measure but does not have any standardized meaning. The Company follows the recommendations of the Gold Institute Production Cost Standard. The Gold Institute, which ceased operations in 2002, was a non-regulatory body and represented a global group of producers of gold and gold products. The production cost standard developed by the Gold Institute remains the generally accepted standard of reporting cash costs of production by gold mining companies.

6.

Excludes capitalized exploration costs. Growth capital includes capital costs for those projects which are in execution and/or have an approved feasibility study.

7.

Guidance excludes the impact of the temporary Argentine Export Tax, which is expected to impact production costs by approximately $25 per ounce in 2019.