Kinross Gold Corp., North America's fourth-biggest gold producer, reported record net income of $65.6 million in the second quarter, after a loss a year earlier, as gold prices climbed.

Per-share profit was 19 cents. A year ago the company reported a net loss of $16.4 million, or 5 cents a share. Sales rose 45 percent to $252.3 million, Kinross said in a statement.

Toronto-based Kinross, which mines in Canada, Brazil and Chile, sold gold at an average of $625 an ounce, up 48 percent from a year earlier. The company also said its board yesterday approved a $470 million expansion of the Paracatu mine in Brazil.

``This quarter was strong,'' John Bridges, an analyst at J.P. Morgan Securities Inc., said in a report. ``We'd be buyers of Kinross on this news,'' said Bridges, who forecast 10-cent profit and has an ``overweight'' rating on the stock.

The profit included a $2.9 million pretax gain on disposal of assets, which added less than 1 cent to per-share earnings, Kinross said. The company sold its Lupin mine in Canada to Wolfden Resources Inc. and Blanket mine in Zimbabwe to Caledonia Mining Corp.

Shares Rise

Shares of Kinross gained 30 cents, or 2.3 percent, to C$13.52 at 2:04 p.m. on the Toronto Stock Exchange. Before today, they had surged 78 percent in the past year.

Kinross was forecast to earn 12 cents, the average estimate of six analysts surveyed by Thomson Financial. Thomson didn't say what parameters were used in the estimates.

Gold futures for December delivery fell $1 to $656 an ounce on the Comex division of the New York Mercantile Exchange. Prices on May 12 reached $732, the highest in 26 years. The metal has climbed 26 percent this year, partly on demand for a hedge against inflation.

``If we get a good gold price, we will continue to perform well,'' Chief Executive Officer Tye Burt said in a telephone interview. ``We won't be spending $470 million on a new project if we weren't very bullish on the gold price.''

Paracuta Mine

The Paracatu mine expansion will boost production in 2009 through 2013 to 557,000 ounces from 180,522 ounces in 2005, Kinross said. The company, which also produces silver, raised its 2009 output estimate to between 1.8 million to 1.9 million gold equivalent ounces from 1.7 million and 1.75 million ounces.

Output this year will be the equivalent of 1.44 million ounces of gold, Kinross affirmed. Cost estimates were increased in May to $305 to $315 an ounce from a March forecast of $285 to $295.

Paracatu, which is now one of Brazil's largest gold mines, ``is expected to be one of the western hemisphere's largest gold mines,'' Chief Operating Officer Tim Baker said in the statement.

To finance the expansion, Kinross increased its existing $295 million revolving credit facility to $300 million and extended the maturity date to August 2009 from April 2008. It's also negotiating for a 5 ½-year loan of up to $250 million.

Production fell 6.8 percent to the equivalent of 385,514 ounces of gold after the Kettle River mine in Washington state was closed and output declined at the Kubaka mine in Russia, Kinross said.

The cost of producing the equivalent of an ounce of gold rose 16 percent to $311 as the Canadian dollar, the Brazilian real and the Chilean peso rose against the dollar. Kinross has costs in local currencies to mine ore and sells metals in dollars. Expenses for fuel, power and labor also increased, the company said.

Crown Resources

Kinross has agreed to buy Wheat Ridge, Colorado-based Crown Resources Corp. for $173.1 million in stock to gain a gold deposit in the state of Washington. Crown shareholders will get 0.32 of a Kinross share, or $3.76 a share based on yesterday's closing price, if the deal goes through.

Crown shares rose 5 cents, or 1.4 percent, to $3.65 in over-the-counter trading. They have risen 87 percent in the past year.

The planned purchase, first announced in October 2003, has been stalled by an independent review of the valuations of Kinross's 2003 acquisitions of TVX Gold Inc. and Echo Bay Mines Ltd., which was requested by U.S. regulators.

The acquisition of Crown's Buckhorn Mountain gold deposit in north central Washington state would allow Kinross to restart its Kettle River milling facility.

Kinross needs at least two-thirds of the outstanding Crown shares to be voted in favor at the Crown shareholders meeting on Aug. 31 for the deal to go through.

Kinross's sales in the second quarter of 2005 were $174.6 million.

Barrick Gold Corp. is North America's largest gold producer by first-quarter output, followed by Newmont Mining Corp. and Freeport-McMoRan Copper & Gold Inc.