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SEGMENTED INFORMATION | 12 Months Ended
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Dec. 31, 2018
SEGMENTED INFORMATION |
SEGMENTED INFORMATION | 18. SEGMENTED INFORMATION The Company operates primarily in the gold mining industry and its major product is gold. Its activities include gold production, acquisition, exploration and development of gold properties. The Company’s primary mining operations are in the United States, the Russian Federation, Brazil, Chile, Ghana and Mauritania. The reportable segments are those operations whose operating results are reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance provided those operations pass certain quantitative thresholds. Operations whose revenues, earnings or losses or assets exceed 10% of the total consolidated revenue, earnings or losses or assets are reportable segments. In order to determine reportable operating segments, management reviews various factors, including geographical location and managerial structure. It was determined by management that a reportable operating segment generally consists of an individual mining property managed by a single general manager and management team. The Kupol segment includes the Kupol and Dvoinoye mines. These two mines have been aggregated into one reportable segment as they have integrated cost structures, due to the processing of Dvoinoye ore at the Kupol mill, and other shared infrastructure such as the purchasing function. The Corporate and other segment includes corporate, shutdown and other non-operating assets (including Kettle River-Buckhorn, La Coipa, Lobo-Marte and White Gold until its disposal on June 14, 2017) and non-mining and other operations. These have been aggregated into one reportable segment as they do not generate revenues. Finance income, finance expense, other income (expense), and equity in earnings (losses) of associate and joint ventures are managed on a consolidated basis and are not allocated to operating segments. i. Operating segments The following tables set forth operating results by reportable segment for the following years:
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Non-operating |  |  |
|  | Operating segments |  | segments (a) |  |  |
|  |  |  |  | Round |  | Bald |  |  |  |  |  |  |  |  |  |  |  | Corporate and |  |  |
Year ended December 31, 2018: |  | Fort Knox |  | Mountain |  | Mountain |  | Paracatu |  | Maricunga |  | Kupol |  | Tasiast |  | Chirano |  | other (b), (c) |  | Total
Revenue |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Metal sales |  | $ | 325.5 |  | 483.9 |  | 403.9 |  | 663.1 |  | 113.6 |  | 627.7 |  | 307.8 |  | 286.0 |  | 1.1 |  | $ | 3,212.6
Cost of sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Production cost of sales |  |  | 214.4 |  | 277.6 |  | 174.1 |  | 430.5 |  | 65.7 |  | 288.2 |  | 237.3 |  | 172.7 |  | — |  |  | 1,860.5
Depreciation, depletion and amortization |  |  | 109.7 |  | 51.0 |  | 99.7 |  | 148.9 |  | 4.0 |  | 133.5 |  | 95.5 |  | 123.8 |  | 6.3 |  |  | 772.4
Total cost of sales |  |  | 324.1 |  | 328.6 |  | 273.8 |  | 579.4 |  | 69.7 |  | 421.7 |  | 332.8 |  | 296.5 |  | 6.3 |  |  | 2,632.9
Gross profit (loss) |  | $ | 1.4 |  | 155.3 |  | 130.1 |  | 83.7 |  | 43.9 |  | 206.0 |  | (25.0) |  | (10.5) |  | (5.2) |  | $ | 579.7
Other operating expense |  |  | 38.2 |  | — |  | 7.9 |  | 13.8 |  | (1.3) |  | (0.4) |  | 52.4 |  | (10.3) |  | 36.7 |  |  | 137.0
Exploration and business development |  |  | 4.7 |  | 1.2 |  | 11.5 |  | — |  | 0.1 |  | 19.2 |  | 8.5 |  | 6.0 |  | 58.0 |  |  | 109.2
General and administrative |  |  | — |  | — |  | — |  | — |  | — |  | — |  | — |  | — |  | 133.0 |  |  | 133.0
Operating earnings (loss) |  | $ | (41.5) |  | 154.1 |  | 110.7 |  | 69.9 |  | 45.1 |  | 187.2 |  | (85.9) |  | (6.2) |  | (232.9) |  | $ | 200.5
Other income (expense) - net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 3.2
Equity in losses of joint ventures |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (0.3)
Finance income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 11.0
Finance expense |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (101.2)
Earnings before tax |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 113.2
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Non-operating |  |  |
|  | Operating segments |  | segments (a) |  |  |
|  |  |  |  | Round |  | Bald |  |  |  |  |  |  |  |  |  |  |  | Corporate and |  |  |
Year ended December 31, 2017: |  | Fort Knox |  | Mountain |  | Mountain |  | Paracatu |  | Maricunga |  | Kupol |  | Tasiast |  | Chirano |  | other (b), (c) |  | Total
Revenue |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Metal sales |  | $ | 481.1 |  | 552.2 |  | 331.5 |  | 447.0 |  | 52.0 |  | 726.9 |  | 298.4 |  | 317.6 |  | 96.3 |  | $ | 3,303.0
Cost of sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Production cost of sales |  |  | 239.9 |  | 302.5 |  | 168.9 |  | 310.2 |  | 19.9 |  | 300.9 |  | 178.2 |  | 200.1 |  | 36.8 |  |  | 1,757.4
Depreciation, depletion and amortization |  |  | 86.6 |  | 107.4 |  | 83.5 |  | 127.0 |  | 4.6 |  | 184.2 |  | 78.6 |  | 138.6 |  | 8.9 |  |  | 819.4
Impairment, net of reversals |  |  | (88.6) |  | — |  | — |  | 253.0 |  | — |  | — |  | (142.9) |  | — |  | — |  |  | 21.5
Total cost of sales |  |  | 237.9 |  | 409.9 |  | 252.4 |  | 690.2 |  | 24.5 |  | 485.1 |  | 113.9 |  | 338.7 |  | 45.7 |  |  | 2,598.3
Gross profit (loss) |  | $ | 243.2 |  | 142.3 |  | 79.1 |  | (243.2) |  | 27.5 |  | 241.8 |  | 184.5 |  | (21.1) |  | 50.6 |  | $ | 704.7
Other operating expense |  |  | 9.5 |  | — |  | 1.1 |  | 20.1 |  | 6.1 |  | (0.3) |  | 60.0 |  | (1.8) |  | 34.9 |  |  | 129.6
Exploration and business development |  |  | 9.0 |  | 2.6 |  | 9.5 |  | — |  | 0.1 |  | 17.1 |  | 5.7 |  | 8.2 |  | 53.8 |  |  | 106.0
General and administrative |  |  | — |  | — |  | — |  | — |  | — |  | — |  | — |  | — |  | 132.6 |  |  | 132.6
Operating earnings (loss) |  | $ | 224.7 |  | 139.7 |  | 68.5 |  | (263.3) |  | 21.3 |  | 225.0 |  | 118.8 |  | (27.5) |  | (170.7) |  | $ | 336.5
Other income (expense) - net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 188.1
Equity in losses of joint ventures and associate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (1.3)
Finance income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 13.5
Finance expense |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (117.8)
Earnings before tax |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 419.0
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Non-operating |  |  |
|  | Operating segments |  | segments(a) |  |  |
|  |  |  |  | Round |  | Bald |  |  |  |  |  |  |  |  |  |  |  | Corporate and |  |  |
|  | Fort Knox |  | Mountain |  | Mountain |  | Paracatu |  | Maricunga |  | Kupol |  | Tasiast |  | Chirano |  | other (b), (c) |  | Total
Property, plant and equipment at: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
December 31, 2018 |  | $ | 363.3 |  | 433.9 |  | 513.5 |  | 1,585.8 |  | 39.5 |  | 418.4 |  | 1,591.6 |  | 232.2 |  | 340.9 |  | $ | 5,519.1
Total assets at: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
December 31, 2018 |  | $ | 590.1 |  | 583.9 |  | 686.1 |  | 1,832.8 |  | 126.6 |  | 1,054.9 |  | 1,940.6 |  | 334.0 |  | 914.8 |  | $ | 8,063.8
Capital expenditures for year ended December 31, 2018 (d) |  | $ | 95.1 |  | 196.5 |  | 161.1 |  | 96.0 |  | — |  | 63.6 |  | 454.7 |  | 25.5 |  | 5.8 |  | $ | 1,098.3
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Non-operating |  |  |
|  | Operating segments |  | segments (a) |  |  |
|  |  |  |  | Round |  | Bald |  |  |  |  |  |  |  |  |  |  |  | Corporate and |  |  |
|  | Fort Knox |  | Mountain |  | Mountain |  | Paracatu |  | Maricunga |  | Kupol |  | Tasiast |  | Chirano |  | other (b), (c) |  | Total
Property, plant and equipment at: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
December 31, 2017 |  | $ | 354.1 |  | 286.2 |  | 422.2 |  | 1,383.1 |  | 39.5 |  | 474.7 |  | 1,296.0 |  | 332.6 |  | 298.8 |  | $ | 4,887.2
Total assets at: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
December 31, 2017 |  | $ | 559.1 |  | 460.2 |  | 612.2 |  | 1,646.5 |  | 171.3 |  | 1,164.5 |  | 1,580.3 |  | 516.4 |  | 1,446.7 |  | $ | 8,157.2
Capital expenditures for year ended December 31, 2017 (d) |  | $ | 110.2 |  | 97.1 |  | 90.4 |  | 121.6 |  | 1.4 |  | 54.1 |  | 434.5 |  | 46.0 | # | 5.0 |  | $ | 960.3
| (a) |  | Non-operating segments include development properties.
| (b) |  | Corporate and other includes corporate, Cerro Casale until its disposal on June 9, 2017, shutdown and other non-operating assets (including Kettle River - Buckhorn, La Coipa, Lobo-Marte and White Gold until its disposal on June 14, 2017).
| (c) |  | In 2017, the Kettle River - Buckhorn mine came to the end of its life and mining activities were completed. The Kettle River - Buckhorn segment has been reclassified to Corporate and other for 2018, as well as the 2017 comparative figures, for segment reporting purposes. Accordingly, Corporate and other includes metal sales and operating earnings (loss) of Kettle River - Buckhorn of $1.1 million and $(8.4) million, respectively (2017 - $96.3 million and $43.4 million, respectively).
| (d) |  | Segment capital expenditures are presented on an accrual basis. Additions to property, plant and equipment in the consolidated statements of cash flows are presented on a cash basis.
ii. Geographic segments The following table shows metal sales and property, plant and equipment by geographic region:
|  | Metal sales |  | Property, plant and equipment
|  | Years ended December 31, |  | As at December 31,
|  | 2018 |  | 2017 |  | 2018 |  | 2017
Geographic information (a) |  |  |  |  |  |  |  |  |  |  |  |
United States |  | $ | 1,214.4 |  | $ | 1,461.1 |  | $ | 1,315.6 |  | $ | 1,067.4
Russian Federation |  |  | 627.7 |  |  | 726.9 |  |  | 423.9 |  |  | 482.3
Brazil |  |  | 663.1 |  |  | 447.0 |  |  | 1,585.5 |  |  | 1,383.1
Chile |  |  | 113.6 |  |  | 52.0 |  |  | 358.2 |  |  | 308.8
Mauritania |  |  | 307.8 |  |  | 298.4 |  |  | 1,594.8 |  |  | 1,302.1
Ghana |  |  | 286.0 |  |  | 317.6 |  |  | 241.1 |  |  | 343.5
Canada |  |  | — |  |  | — |  |  | — |  |  | —
Total |  | $ | 3,212.6 |  | $ | 3,303.0 |  | $ | 5,519.1 |  | $ | 4,887.2
| (a) |  | Geographic location is determined based on location of the mining assets.
iii. Significant customers The following table represents sales to individual customers exceeding 10% of annual metal sales for the following periods:
|  |  |  | Round |  | Bald |  |  |  |  |  |  |  |  |  |  |  | Corporate |  |  |  |
Year ended December 31, 2018: |  | Fort Knox |  | Mountain |  | Mountain |  | Paracatu |  | Maricunga |  | Kupol |  | Tasiast |  | Chirano |  | and other |  | Total |
Customer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
1 |  | $ | 38.4 |  | 96.2 |  | 70.4 |  | 46.2 |  | 18.1 |  | — |  | 119.4 |  | 116.4 |  | — |  |  | 505.1 |
2 |  |  | — |  | — |  | — |  | — |  | — |  | 376.3 |  | — |  | — |  | — |  |  | 376.3 |
3 |  |  | 56.1 |  | 38.8 |  | 19.8 |  | 75.3 |  | 38.7 |  | — |  | 75.5 |  | 56.6 |  | — |  |  | 360.8 |
4 |  |  | 17.5 |  | 5.6 |  | 3.6 |  | 186.4 |  | 5.5 |  | — |  | 62.0 |  | 71.3 |  | — |  |  | 351.9 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 1,594.1 |
% of total metal sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 49.6 | %
|  |  |  | Round |  | Bald |  |  |  |  |  |  |  |  |  |  |  | Corporate |  |  |  |
Year ended December 31, 2017: |  | Fort Knox |  | Mountain |  | Mountain |  | Paracatu |  | Maricunga |  | Kupol |  | Tasiast |  | Chirano |  | and other |  | Total |
Customer |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
1 |  | $ | — |  | — |  | — |  | — |  | — |  | 694.5 |  | — |  | — |  | — |  |  | 694.5 |
2 |  |  | 54.4 |  | 60.2 |  | 64.8 |  | 48.8 |  | 6.8 |  | 16.4 |  | 146.9 |  | 116.3 |  | 16.9 |  |  | 531.5 |
3 |  |  | 6.4 |  | 19.0 |  | 16.4 |  | 157.9 |  | 11.6 |  | — |  | 31.7 |  | 99.1 |  | — |  |  | 342.1 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 1,568.1 |
% of total metal sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 47.5 | %
The Company is not economically dependent on a limited number of customers for the sale of its product because gold can be sold through numerous commodity market traders worldwide.

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