After shocking investors with a multibillion-dollar loss, Goldcorp Inc. is telling disgruntled shareholders to be patient as the gold producer prepares for a shift in leadership next week.
The Vancouver-based miner slashed its dividend while delivering ugly results and underwhelming guidance after markets closed Thursday. In response, its share price tumbled 13.1 per cent on Friday.
“I’m certainly aware that many shareholders are disappointed with some of the news this morning and I share their disappointment,” Chuck Jeannes, the outgoing chief executive officer, told analysts. However, he defended the dividend cut as being a realistic response to a gold price that has mostly trended lower in recent years.
Mr. Jeannes, a well-regarded executive, announced last December that he was stepping down after more than seven years as CEO. He said Friday that he was confident he was leaving the company in great hands.
His successor, David Garofalo, the former CEO of HudBay Minerals Inc., has been working closely with Mr. Jeannes for the past two months and his move into the top job, previously scheduled for April, has now been moved up to Monday.
Some analysts believe Goldcorp’s massive $4.9-billion (U.S.) writedown in the fourth quarter reflected a desire to clear the decks for Mr. Garofalo and manage down expectations. But whatever the motivation, the company’s suddenly darker outlook has taken investors by surprise.
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