(Corrects production figure in seventh paragraph of story originally published Nov. 2.)

Nov. 2 (Bloomberg) -- Kinross Gold Corp., Canada’s third- largest producer of the metal, posted an unexpected third- quarter loss after recovering less gold than planned from ore at its Paracatu mine in Brazil.

The net loss was $21.5 million, or 3 cents a share, compared with profit a year earlier of $64.7 million, or 10 cents, Toronto-based Kinross said today in a statement. Sales climbed 16 percent to $582.3 million, helped by higher prices.

Chief Executive Officer Tye Burt and counterparts at competitors Barrick Gold Corp. and Agnico-Eagle Mines Ltd. are trying to boost output and looking for acquisitions to take advantage of higher gold prices. Burt said in September his company was evaluating projects that may increase gold output by 57 percent in the next five years.

Problems at Kinross’ Paracatu mine in Brazil “had a significant impact on our overall production,” Burt said in today’s statement. “We are working diligently to bring performance and production at Paracatu closer to plant design levels.”

Excluding one-time items Kinross broke even in the quarter, trailing the 12-cent average estimate of 21 analysts surveyed by Bloomberg. The lowest estimate in the survey was profit of 8 cents a share.

Kinross fell 34 cents, or 1.7 percent, to C$19.76 today in Toronto Stock Exchange trading. The shares have dropped 12 percent this year.

Kinross Gold Output

Kinross produced 537,440 ounces of gold in the period, down from 551,510 ounces a year earlier. Production costs were $464 an ounce, up from $434 in the previous three months and $406 a year earlier. The company’s average realized price in the quarter rose 12 percent to $956 an ounce.

Gold futures in New York rose 18 percent to $1,040.40 an ounce this year through October, while the 16-company Philadelphia Stock Exchange Gold & Silver Index climbed 26 percent. The precious metal, which reached a record $1,072 on Oct. 14, has risen for eight straight calendar years.

Barrick is the largest Canada-based gold producer, followed by Goldcorp Inc.

To contact the reporter on this story: Rob Delaney in Toronto at robdelaney@bloomberg.net.

Last Updated: November 3, 2009 06:55 EST