Why the Kirkland Lake Gold (ASX:KLA) share price is charging 5% higher

ASX gold shares’ results will be closely watched during the upcoming full year reporting season.

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The Kirkland Lake Gold CDI (ASX: KLA) share price is charging higher today, up more than 5%.

The company is listed on the Canadian, US and Australian exchanges, with producing gold mines in Canada and Australia.

Below we take a look at the ASX gold share’s latest quarterly and half year results, for the financial year ending 30 June.

What results did Kirkland report?

Kirkland Lake Gold’s share price is leaping after the company reported that production increased at all 3 of its cornerstone assets in the second quarter of 2021 (Q2 2021), compared to both Q2 2020 and Q1 2021.

Kirkland produced 379,195 ounces of gold in the reported quarter. That’s up 25% from the prior quarter and also an increase of 15% on gold production figures from Q2 2020.

Year-to-date gold production increased 3% from the 2020 half year figures, to reach 682,042 ounces of gold.

The Kirkland Lake Gold share price is also likely getting a lift after the company reported record net earnings and earnings per share (EPS) for the quarter.

Net earnings came in at US$224.2 million, or 91 cents per share. That’s up 67% year-on-year and up 51% from the prior quarter.

In the meantime, costs came in below the company’s guidance for the quarter.

Kirkland reported operating cash costs of US$431 per ounce of gold sold compared to guidance of US$450 per ounce to US$475 per ounce.

All in sustaining costs (AISC) were US$780 per ounce, also below guidance of US$790 per ounce to US$810 per ounce.

During the half year, the company paid US$100.3 million in dividends to shareholders, and it used $58.3 million to repurchase shares.

The company is continuing apace with its exploration programs.

Commenting on the half year results, Tony Makuch, Kirkland Lake Gold’s CEO said:

We had an excellent quarter in Q2 2021 highlighted by record earnings, record quarterly production, strong revenue growth and significant increases in both operating and free cash flow…

Our financial strength continued to improve during Q2 2021, with cash increasing to $858.4 million, and we remain committed to returning capital to shareholders, renewing our normal course issuer bid and introducing an automatic share purchase plan.

What’s ahead for Kirkland Lake Gold?

Looking ahead, Kirkland is targeting the higher end of its full financial year production guidance of 1.3 million to 1.4 million ounces of gold. It said it will maintain its unit cost and capital expenditure guidance.

Readers looking for a deeper dive into Kirkland’s complete Management’s Discussion and Analysis (MD&A) can find that here.

Kirkland Lake Gold share price snapshot

Over the past 12 months, Kirkland Lake Gold’s share price is down 20%. Over that same time, the S&P/ASX 200 Index (ASX: XJO) is up 22%.

Year-to-date, the Kirkland Lake Gold share price is in the green, up 3% at the time of writing.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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