Goldcorp Inc.
TSX : G
NYSE : GG

Goldcorp Inc.

August 15, 2005 16:00 ET

Goldcorp Reports Ten-Fold Earnings Increase to $98 Million on Gold Sales of 543,000 Ounces for Second Quarter

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 15, 2005) - Goldcorp Inc. (TSX:G)(NYSE:GG) is pleased to announce its second quarter results, highlights of which are:

- Net earnings increased to $98 million ($0.30 per share), compared with $9 million ($0.05 per share) in 2004. Included in the 2005 net earnings of $98 million is $52 million from the sale of gold bullion inventory;

- Operating cash flows increased to $164 million ($0.50 per share), compared with $12 million ($0.06 per share) in 2004.

- Gold production doubled to 281,000 ounces for the quarter, compared with 138,600 ounces in 2004;

- Gold sales were 543,100 ounces, including the sale of 275,700 ounces of gold bullion inventory held at the start of the quarter (2004 - 93,600 ounces);

- Total cash costs more than halved to $52 per ounce compared to $116 per ounce in 2004.

- Commissioning of Amapari mine commenced during the quarter, with production expected by the fourth quarter.

- With a cash balance of $421 million at June 30, 2005, in combination with the recently announced $500 million bank credit facility, the Company is well positioned to continue to grow by way of acquisition.

For the six months to June 30, 2005, net earnings increased to $128 million ($0.44 per share) compared with $27 million ($0.14 per share) in 2004, and operating cash flows increased to $244 million ($0.84 per share), compared with $8 million ($0.04 per share) in 2004. Gold production totalled 556,400 ounces in 2005 compared with 297,900 ounces in 2004. Gold sales increased to 760,600 ounces at a total cash cost of $64 per ounce, compared with 201,000 ounces at a total cash cost of $107 per ounce in 2004.

President and CEO Ian Telfer said, "The Company's spectacular quarterly results are indicative of the strengths of the Company, which include increasing gold production, very strong earnings and cash flows, and the lowest cash costs in the industry."

Goldcorp is the world's lowest-cost million-ounce gold producer with safe, profitable and sustainable mining operations throughout the Americas and in Australia. Production in 2005 is expected to exceed 1.1 million ounces at a cash cost of less than $60 per ounce. The company has a strong balance sheet, no outstanding debt and no hedging. Goldcorp expects a 40% increase in annual production to 1.6 million ounces of gold by 2007 due to organic growth, and the company also intends to grow through acquisition.

Second Quarter Earnings Conference Call:

A conference call will be held Tuesday, August 16th at 11:00 a.m. (ET) to discuss these results. You may join the call by dialing toll free 1-888-789-0150 or (416) 695-6622 for calls from outside Canada and the US.

The conference call will be recorded and you can listen to a playback by dialing 1-888-509-0081 or (416) 695-5275. A live and archived audio webcast will also be available on the website at www.goldcorp.com.

Management's Discussion and Analysis

of Financial Condition and Results of Operations

For the Six Months Ended June 30, 2005

This Management's Discussion and Analysis should be read in conjunction with Goldcorp's unaudited consolidated financial statements for the six months ended June 30, 2005 and related notes thereto which have been prepared in accordance with Canadian generally accepted accounting principles. In addition, the following should be read in conjunction with the 2004 audited consolidated financial statements, the related annual Management's Discussion and Analysis, and the Annual Information Form/40-F on file with the Canadian provincial securities regulatory authorities and the US Securities and Exchange Commission. All figures are in United States dollars unless otherwise noted. This Management's Discussion and Analysis has been prepared as of August 12, 2005.

SECOND QUARTER HIGHLIGHTS

- Completion of the acquisition of Wheaton, creating the world's lowest-cost million ounce gold producer.

- Second quarter results reflect an 82% ownership of Wheaton for the two weeks to April 15, 2005, and a 100% ownership for the remainder of the quarter:

- Net earnings increased ten-fold to $98.0 million ($0.30 per share), compared with $9.2 million ($0.05 per share) in 2004.

- Operating cash flows increased to $163.9 million (2004 - $11.9 million).

- Gold production doubled to 281,000 ounces, compared with 138,600 ounces in 2004.

- Gold sales were 543,100 ounces, including the sale of 275,700 ounces of gold bullion inventory held at the start of the quarter (2004 - 93,600 ounces).

- Total cash costs more than halved to $52 per ounce (2004 - $116).

- Dividends paid during the quarter of $15.2 million.

- Cash and cash equivalents at June 30, 2005 totalled $421 million.

- Commissioning of Amapari mine commenced during the quarter, with production expected by the fourth quarter.

OVERVIEW

Goldcorp Inc ("Goldcorp" or "the Company") is a leading intermediate gold producer engaged in gold mining and related activities including exploration, extraction, processing and reclamation. As a result of the successful acquisition of Wheaton River Minerals Ltd ("Wheaton") on February 14, 2005, the Company's assets are comprised of the Red Lake gold mine in Canada, a 37.5% interest in the Alumbrera gold/copper mine in Argentina, the Luismin gold/silver mines in Mexico, the Peak gold mine in Australia, and the Wharf gold mine in the United States. Significant development projects include the expansion of the existing Red Lake mine, the Los Filos/Bermejal gold project in Mexico and the Amapari gold project in northern Brazil. Goldcorp also owns a 65% interest in Silver Wheaton Corp ("Silver Wheaton"), a publicly traded silver mining company.

Goldcorp's strategy is to provide its shareholders with superior returns from high quality assets. The Company has a strong and liquid balance sheet, no debt outstanding and has not hedged or sold forward any of its future gold production.

With a cash balance of $421 million at June 30, 2005, in combination with the recently announced $500 million bank credit facility, the Company is well positioned to continue to grow by way of acquisition.

Goldcorp is listed on the New York Stock Exchange (symbol: GG) and the Toronto Stock Exchange (symbol: G). In addition, the Company has five series of share purchase warrants which trade on the Toronto Stock Exchange; two of which also trade on the New York Stock Exchange. The Series A, B and C share purchase warrants replaced the former Wheaton share purchase warrants as of April 15, 2005, adding to the two previously existing series of Goldcorp share purchase warrants.

ACQUISITION OF WHEATON RIVER MINERALS LTD.

On December 6, 2004, Goldcorp and Wheaton announced a proposed transaction which provided for Goldcorp to make a take-over bid for Wheaton on the basis of one Goldcorp share for every four Wheaton shares. On December 29, 2004, Goldcorp mailed the Goldcorp Take-over Bid Circular to the Wheaton shareholders.

On February 8, 2005, Goldcorp announced a special $0.50 per share cash dividend would be payable to existing Goldcorp shareholders should shareholders approve by majority Goldcorp's take-over bid for Wheaton and Wheaton shareholders tender the minimum two-thirds bid requirement. The payment of the special dividend also resulted in an adjustment to the exchange ratio of Goldcorp's outstanding warrants - an increase in entitlement from 2.0 to 2.08 Goldcorp shares per warrant.

On February 10, 2005, at a special meeting, Goldcorp shareholders approved the issuance of additional Goldcorp common shares to effect the acquisition of Wheaton. As of February 14, 2005, the effective date of the acquisition, approximately 70% of the outstanding Wheaton common shares were tendered to Goldcorp's offer, satisfying the minimum two-thirds bid requirement under the terms of the Goldcorp offer. With conditions met, the special $0.50 per share cash dividend, totalling approximately $95 million, was paid on February 28, 2005.

As of March 31, 2005, Goldcorp held approximately 82% of the outstanding Wheaton common shares and by April 15, 2005, 100% had been acquired. Consideration amounted to $1,887 million satisfied by the issue of 143.8 million Goldcorp shares at a price of $13.13 per share. In addition, each Wheaton warrant or stock option, which gave the holder the right to acquire common shares of Wheaton, was exchanged for a warrant or stock option of Goldcorp, giving the holder the right to acquire common shares of Goldcorp on the same basis as the exchange of Wheaton common shares for Goldcorp common shares.

This business combination has been accounted for as a purchase transaction, with Goldcorp being identified as the acquirer and Wheaton as the acquiree in accordance with CICA 1581 "Business Combinations". These consolidated financial statements include 82% of Wheaton's operating results for the period February 15, 2005 to April 15, 2005, and 100% of the results thereafter.

For the purposes of these consolidated financial statements, the purchase consideration has been allocated on a preliminary basis to the fair value of assets acquired and liabilities assumed, with goodwill assigned to specific reporting units, based on management's best estimates and taking into account all available information at the time these consolidated financial statements were prepared. Goldcorp will continue to review information and perform further analysis with respect to each of the Wheaton assets, including an independent valuation, prior to finalizing the allocation of the purchase price. This process will be performed in accordance with the recent accounting pronouncement relating to "Mining Assets - Impairment and Business Combination" (Emerging Issue Committee Abstract 152). Although the results of this review are presently unknown, it is anticipated that it may result in a change to the amount assigned to goodwill and a change to the value attributable to tangible assets.



SUMMARIZED FINANCIAL RESULTS

--------------------------------------------------------------------
June 30 March 31
2005 2004 2005 2004
--------------------------------------------------------------------
(note 1) (note 1)
Revenues ($000's) $ 301,605 $ 40,461 $ 122,849 $ 48,314

Gold produced (ounces) 281,000 138,600 275,400 159,300

Gold sold (ounces) 543,100 93,600 217,500 107,400

Average realized gold price
(per ounce) $ 432 $ 393 $ 430 $ 411

Average London spot gold
price (per ounce) $ 427 $ 393 $ 427 $ 408

Earnings from operations
($000's) $ 162,410 $ 16,363 $ 53,694 $ 26,703

Net earnings ($000's) $ 98,030 $ 9,198 $ 29,489 $ 17,328

Earnings per share
Basic $ 0.30 $ 0.05 $ 0.12 $ 0.09
Diluted $ 0.28 $ 0.05 $ 0.11 $ 0.09

Cash flow from operating
activities ($000's) $ 163,870 $ 11,947 $ 80,244 $ (3,538)

Total cash costs (per gold
ounce) (note 2) $ 52 $ 116 $ 94 $ 100

Dividends paid ($000's) $ 15,213 $ 8,532 $ 105,305 $ 27,454

Cash and cash equivalents
($000's) $ 420,843 $302,850 $ 338,966 $328,701

Total assets ($000's) $3,755,982 $608,541 $3,309,220 $607,488

--------------------------------------------------------------------
December 31 September 30
2004 2003 2004 2003
--------------------------------------------------------------------
Revenues ($000's) $ 51,872 $110,625 $ 50,369 $ 55,792

Gold produced (ounces) 166,300 158,300 163,800 161,500

Gold sold (ounces) 113,800 280,400 112,800 140,000

Average realized gold price
(per ounce) $ 432 $ 388 $ 399 $ 364

Average London spot gold
price (per ounce) $ 434 $ 391 $ 401 $ 363

Earnings from operations
($000's) $ 19,347 $ 63,267 $ 23,246 $ 26,534

Net earnings ($000's) $ 14,967 $ 43,330 $ 9,854 $ 23,671

Earnings per share
Basic $ 0.08 $ 0.23 $ 0.05 $ 0.13
Diluted $ 0.08 $ 0.22 $ 0.05 $ 0.12

Cash flow from operating
activities ($000's) $ 22,388 $ 69,849 $ 22,306 $ 23,025

Total cash costs (per gold
ounce) (note 2) $ 127 $ 95 $ 121 $ 116

Dividends paid ($000's) $ 8,548 $ 10,091 $ 8,537 $ 4,579

Cash and cash equivalents
($000's) $ 333,375 $378,954 $ 315,642 $260,731

Total assets ($000's) $ 701,518 $638,523 $ 648,914 $544,943

(1) Includes, with the exception of net earnings, 100% of Wheaton's
operating results from February 15, 2005, the date of acquisition.
Net earnings include 82% of Wheaton's operating results from
February 15, 2005 to April 15, 2005 and 100% from April 16, 2005
onwards.

(2) The calculation of total cash costs per ounce of gold for Peak
and Alumbrera is net of by-product copper sales revenue and for
Luismin is net of by-product silver sales revenue of $3.90 per
silver ounce sold to Silver Wheaton.

RESULTS OF OPERATIONS
--------------------------------------------------------------------

Three Months Ended June 30, 2005

Red Lake Alumbrera Luismin Amapari Peak
--------------------------------------------------------------------
(notes 1,2) (notes 1,3) (note 1) (notes 1,4)
Revenues
($000's) $176,939 $65,612 $25,559 - $12,326
Ounces of
gold
produced 142,800 48,900 41,800 - 31,100
Ounces of
gold sold 408,500 47,700 44,000 - 27,200
Average
realized
gold price
(per ounce) $ 433 $ 422 $ 427 $ - $ 442
Earnings
(loss)
from
operations
($000's) $129,144 $26,323 $ 3,328 $ - $ 2,138
Total cash
costs
(per gold
ounce) $ 81 $ (442) $ 115 $ - $ 246


Silver
Wharf Wheaton Corporate Total
--------------------------------------------------------------------
(note 1) (note 1)
Revenues ($000's) $ 7,014 $19,263 $ (5,108) $301,605
Ounces of gold produced 16,400 - - 281,000
Ounces of gold sold 15,700 - - 543,100
Average realized gold price
(per ounce) $ 429 $ - $ - $ 432
Earnings (loss) from
operations ($000's) $ 627 $ 6,560 ($ 5,710) $162,410
Total cash costs
(per gold ounce) $ 291 $ - $ - $ 52


Three Months Ended June 30, 2004

Red Lake Wharf Corporate Total
--------------------------------------------------------------------
Revenues ($000's) $30,045 $ 7,250 $3,166 $ 40,461
Ounces of gold produced 116,800 21,800 - 138,600
Ounces of gold sold 75,600 18,000 - 93,600
Average realized gold price
(per ounce) $ 393 $ 395 $ - $ 393
Earnings (loss) from
operations ($000's) $20,480 $ 706 ($4,823) $ 16,363
Total cash costs
(per gold ounce) $ 85 $ 245 $ - $ 116

(1) Includes 100% of Wheaton's operating results.

(2) Includes Goldcorp's 37.5% share of the results of Alumbrera. The
calculation of total cash costs per ounce of gold for Alumbrera is
net of by-product copper sales revenue.

(3) All Luismin silver is sold to Silver Wheaton at a price of $3.90
per ounce. The calculation of total cash costs per ounce of gold is
net of by-product silver sales revenue.

(4) The calculation of total cash costs per ounce of gold at Peak is
net of by-product copper sales revenue.


Six Months Ended June 30, 2005

Red Lake Alumbrera Luismin Amapari Peak
--------------------------------------------------------------------
(notes 1,2) (notes 1,3) (note 1) (notes 1,4)
Revenues
($000's) $232,926 $86,796 $39,387 - $20,354
Ounces of
gold
produced 341,300 72,600 62,200 - 46,200
Ounces of
gold sold 535,900 62,900 67,300 - 44,500
Average
realized
gold
price
(per ounce) $ 432 $ 429 $ 428 $ - $ 435
Earnings
(loss)
from
operations
($000's) $168,320 $35,337 $ 6,728 $ - $ 3,846
Total cash
costs (per
gold ounce) $ 81 $ (431) $ 103 $ - $ 256

Silver
Wharf Wheaton Corporate Total
--------------------------------------------------------------------
(note 1) (note 1)
Revenues ($000's) $21,952 $30,120 $ (7,080) $424,455
Ounces of gold produced 34,100 - - 556,400
Ounces of gold sold 50,000 - - 760,600
Average realized gold
price (per ounce) $ 430 $ - $ - $ 431
Earnings (loss) from
operations ($000's) $ 2,653 $10,454 ($ 11,232) $216,106
Total cash costs (per
gold ounce) $ 284 $ - $ - $ 64


Six Months Ended June 30, 2004

Red Lake Wharf Corporate Total
--------------------------------------------------------------------
Revenues ($000's) $68,952 $13,531 $ 6,292 $ 88,775
Ounces of gold produced 257,000 40,900 - 297,900
Ounces of gold sold 167,900 33,100 - 201,000
Average realized gold price
(per ounce) $ 404 $ 399 - $ 403
Earnings (loss) from
operations ($000's) $48,409 $ 1,547 ($ 7,192) $ 42,764
Total cash costs (per
gold ounce) $ 80 $ 242 - $ 107

(1) Includes 100% of Wheaton's operating results for the period
subsequent to February 14, 2005, the date of acquisition.

(2) Includes Goldcorp's 37.5% share of the results of Alumbrera. The
calculation of total cash costs per ounce of gold for Alumbrera is
net of by-product copper sales revenue.

(3) All Luismin silver is sold to Silver Wheaton at a price of
$3.90 per ounce. The calculation of total cash costs per ounce of
gold is net of by-product silver sales revenue.

(4) The calculation of total cash costs per ounce of gold at Peak is
net of by-product copper sales revenue.


OPERATIONAL REVIEW
--------------------------------------------------------------------
Red Lake Mine
Three Months Ended
Jun 30 Mar 31 Dec 31 Sep 30 Jun 30
Operating Data 2005 2005 2004 2004 2004
--------------------------------------------------------------------
Tonnes of ore milled 60,600 59,400 56,500 58,500 54,500
Average mill head grade
(grams/tonne) 79 104 86 68 68
Average recovery rate 97% 97% 97% 97% 98%
Ounces of gold produced 142,800 198,500 151,100 143,800 116,800
Ounces of gold sold 408,500 127,400 98,300 99,100 75,600
Average realized gold
price (per ounce) $ 433 $ 429 $ 427 $ 398 $ 393
Total cash costs
(per ounce) $ 81 $ 81 $ 105 $ 100 $ 85

Financial Data
--------------------------------------------------------------------
(in thousands)
Revenues $176,939 $55,987 $41,883 $41,369 $30,045
Earnings from
operations $129,144 $39,176 $27,317 $26,598 $20,480


The Red Lake mine had a strong second quarter, producing 142,800 ounces of gold at a total cash cost of $81 per ounce sold, compared with 116,800 ounces at a total cash cost of $85 per ounce sold for the corresponding period last year. The Canadian dollar was approximately 10% stronger relative to the United States dollar, compared to the second quarter of 2004. This negative impact on total cash costs per ounce was offset by a 16% higher grade.

During the quarter, Red Lake sold 408,500 ounces of gold compared with 75,600 ounces in 2004. The Company's previous policy of holding back from sale approximately one-third of mine production was discontinued effective April 1, 2005, and the gold bullion on hand at March 31, 2005 (275,700 ounces), together with current production, was sold during the second quarter at an average realized price of $433/oz.

The sale of gold bullion inventory during the second quarter, in conjunction with normal operating activities, generated record mine revenues and earnings from operations of $176,939,000 and $129,144,000, respectively, for the three months. Of these, revenues of $119,676,000 and earnings from operations of $86,117,000 resulted from the sale of gold bullion inventory.

During the second quarter, the new shaft was advanced a further 160 metres, bringing the depth to 1,104 metres at June 30, 2005. Planned work such as excavating the 23 level station, hoist rope and cable pull changes, together with unplanned interruptions such as hoist brake problems and other mechanical issues, delayed shaft progress during the quarter; however, it is still anticipated that the shaft will be completed by the end of 2007. Engineering and equipment design for the associated mill expansion was commenced during the quarter. As part of that development, the new Tower mill was ordered early in July 2005.



Alumbrera Mine (Goldcorp interest - 37.5%)

Operating Data June 30 2005 Mar 31 2005
--------------------------------------------------------------------
(six weeks)
(note 1)
Tonnes of ore mined 3,442,900 1,725,600
Tonnes of waste removed 7,535,900 3,540,800
Ratio of waste to ore 2.2 2.1
Tonnes of ore milled 3,450,000 1,735,761
Average mill head grade
- Gold (grams/tonne) 0.58 0.55
- Copper (%) 0.56% 0.46%
Average recovery rate
- Gold (%) 77% 78%
- Copper (%) 91% 89%
Ounces of gold produced 48,900 23,700
Pounds of copper produced (thousands) 38,994 17,162
Ounces of gold sold 47,700 15,200
Pounds of copper sold (thousands) 33,937 9,998
Average realized price
- Gold (per ounce) $ 422 $ 452
- Copper (per pound) $ 1.59 $ 1.62
Total cash costs (per ounce) (note 2) $ (442) $ (397)

FINANCIAL DATA
--------------------------------------------------------------------
(IN THOUSANDS) (note 1)
Revenues $65,612 $21,184
Earnings from operations $26,323 $ 9,014


Three Months Ended

Mar 31 Dec 31 Sep 30 Jun 30
Operating Data 2005 2004 2004 2004
--------------------------------------------------------------------

Tonnes of ore mined 3,235,300 3,182,800 2,935,000 3,113,700
Tonnes of waste removed 7,190,200 7,174,200 7,303,000 7,803,000
Ratio of waste to ore 2.2 2.3 2.5 2.5
Tonnes of ore milled 3,430,200 3,463,400 3,400,600 3,222,200
Average mill head grade
- Gold (grams/tonne) 0.56 0.79 0.65 0.64
- Copper (%) 0.49% 0.62% 0.54% 0.49%
Average recovery rate
- Gold (%) 77% 80% 77% 74%
- Copper (%) 90% 91% 89% 88%
Ounces of gold produced 47,600 70,500 55,200 49,200
Pounds of copper produced
(thousands) 32,781 43,007 36,151 30,194
Ounces of gold sold 50,200 51,900 54,200 56,500
Pounds of copper sold
(thousands) 30,000 32,909 34,914 31,114
Average realized price
- Gold (per ounce) $ 417 $ 451 $ 405 $ 388
- Copper (per pound) $ 1.62 $ 1.51 $ 1.38 $ 1.21
Total cash costs (per ounce)
(note 2) $ (389) $ (457) $ (374) $ (218)


FINANCIAL DATA
--------------------------------------------------------------------
(IN THOUSANDS)
Revenues $61,231 $68,540 $65,049 $53,353
Earnings from operations $32,586 $40,168 $33,753 $26,392

(1) Alumbrera's operations are included in Goldcorp's operating
results for the period subsequent to February 15, 2005, the date of
acquisition of Wheaton.

(2) The calculation of total cash costs per ounce of gold for
Alumbrera is net of by-product copper sales revenue. If copper
production were treated as a co-product, average total cash costs at
Alumbrera for the three months ended June 30, 2005 would be $169 per
ounce of gold and $0.73 per pound of copper (June 30, 2004 - $128 per
ounce of gold and $0.60 per pound of copper).


Gold production during the quarter ended June 30, 2005 of 48,900 ounces was slightly higher than the first three months of this year, due primarily to higher grades mined as a result of mine schedule improvements. Gold grades are expected to remain at these levels for the third quarter with further increases expected in the fourth quarter of 2005. Copper production for the quarter was also well above the first quarter of this year, for similar reasons.

Product shipments late in the second quarter (Goldcorp's share - 15,100 ounces of gold and 12,870,000 pounds of copper) will not be recognized as sales until the third quarter due to the shipping schedules which delayed the transfer of title, which is a requirement under the Company's accounting policy for revenue recognition. Had these shipments been recognized during the second quarter, Goldcorp's revenues and net earnings would have increased by approximately $24.2 million and $10.0 million, respectively.

The concentrate market remains very tight, with many smelters continuing to take "holidays" as allowed under the frame contracts. However, as expected, conditions have improved since the first quarter, and further improvements are expected during the second half of 2005.

The Alumbrera shareholders have approved an 8% expansion of the concentrator to a 40 million tonne per annum milling capacity (Goldcorp's share - 15 million tonnes per annum) by the installation of an additional 6.7 MW ball mill and ancillary equipment. An 18 month construction period is anticipated, and orders for major long lead time equipment have already been placed. The capital cost of the concentrator expansion is estimated at $16 million (Goldcorp's share - $6 million).

Productivity improvements in the mine continue with the completion of construction of the tailings dam embankment which will reduce waste haulage distances. This will enable the mine to optimize trucking and material movements, and will lead to improved mining costs and productivities generally.

The open pit trial of multiple benching and pre-splitting continues with very encouraging results in the upper levels of the mine, further reinforcing the possible opportunities to optimise the pit ore and waste volumes.

In August 2005, Alumbrera announced an increase of more than 10% in the ore reserves. An on-going ore delineation drilling program, undertaken both within the existing ore envelope and from extensions at depth, plus improvements in the ultimate pit slopes design, has confirmed 40 million tonnes of additional ore reserves (Goldcorp's share - 15 million tonnes). This equates to an additional 500,000 ounces of gold (Goldcorp's share - 187,500 ounces) and 375 million pounds of contained copper (Goldcorp's share - 141 million pounds) over the life of the mine. The mine plan has been re-optimized based on a new geological model with additional mineralization.

Alumbrera will continue the in-pit resource definition program in the second half of 2005 with the objective of adding further ore reserves to the mine.

During the quarter the Alumbrera mine made cash tax payments of $57 million, of which $46 million related to 2004.



Luismin Mines

Operating Data Jun 30 2005 Mar 31 2005
--------------------------------------------------------------------
(six weeks)
(note 1)
Tonnes of ore milled 218,700 100,800
Average mill head grade
- Gold (grams/tonne) 6.23 6.58
- Silver (grams/tonne) 310 328
Average recovery rate
- Gold (%) 95% 96%
- Silver (%) 91% 90%
Ounces of gold produced 41,800 20,400
Ounces of silver produced 1,974,400 961,500
Ounces of gold sold 44,000 23,300
Ounces of silver sold 1,976,400 1,314,800
Average realized price
- Gold (per ounce) $ 427 $ 430
- Silver (per ounce) (note 2) $ 3.90 $ 3.90
Total cash costs per ounce (note 2) $ 115 $ 80

FINANCIAL DATA
--------------------------------------------------------------------
(in thousands) (note 1)
Revenues $25,559 $13,828
Earnings from operations $ 3,328 $ 3,400

Three Months Ended

Mar 31 Dec 31 Sep 30 Jun 30
Operating Data 2005 2004 2004 2004
--------------------------------------------------------------------

Tonnes of ore milled 199,000 199,900 187,800 192,600
Average mill head grade
- Gold (grams/tonne) 6.59 5.35 5.95 5.61
- Silver (grams/tonne) 335 280 326 302
Average recovery rate
- Gold (%) 95% 94% 95% 95%
- Silver (%) 88% 88% 91% 89%
Ounces of gold produced 40,000 32,300 34,200 33,300
Ounces of silver produced 1,894,000 1,586,900 1,798,700 1,664,400
Ounces of gold sold 38,300 32,800 33,400 33,500
Ounces of silver sold 1,974,000 1,615,100 1,792,000 1,654,500
Average realized price
- Gold (per ounce) $ 428 $ 436 $ 402 $ 392
- Silver (per ounce)
(note 2) $ 3.90 $ 4.33 $ 6.47 $ 6.09
Total cash costs (per ounce)
(note 2) $ 86 $ 115 $ 71 $ 88


FINANCIAL DATA
--------------------------------------------------------------------
(in thousands)
Revenues $22,942 $20,676 $24,406 $22,709
Earnings from operations $ 5,529 $ 6,238 $10,811 $ 9,789

(1) Luismin's results are included in Goldcorp's operating results
for the period subsequent to February 14, 2005, the date of
acquisition of Wheaton.

(2) Subsequent to October 15, 2004, all Luismin silver is sold to
Silver Wheaton at a price of $3.90 per ounce. The calculation of
total cash costs per ounce of gold is net of by-product silver sales
revenue of $3.90 per silver ounce (pro forma basis prior to October
15, 2004).


Luismin continued its strong production performance with its second consecutive highest quarterly production on record. Gold production for the three months ended June 30, 2005 was 41,800 ounces, a 26% increase compared to the same period in 2004, as a result of an 11% increase in the average mill head grade and an increase of 14% in tonnes of ore milled, mainly due to the installation of two additional treatment tanks at San Dimas. The San Dimas mill capacity has been increased by 25% compared with the second quarter of 2004. However, full mill capacity is not currently being utilized, in order to maintain 95% recoveries of the high grade ore being processed. Cash costs were higher during the quarter as compared to 2004 due to fuel and labour cost pressures, as well as the under-utilization of capacity. Further modifications are presently being made to the mill, to allow increased throughput without a reduction in recoveries.

During the quarter, intensive exploration and development activities continued throughout the Luismin operations, with exploration meters drilled increasing by 24% compared to the second quarter of 2004.

At the San Dimas mine, exploration drifting in the Central Block along the high grade zone has detected a new northwest vein system above the San Luis Tunnel. The high grades along these veins continue to show excellent consistency at the deepest levels to the east. In the Tayoltita area, exploration drifting has found new veins on the lowest levels to the east of the Arena vein. In the Santa Rita area, the exploration drifting and drilling have proven ore in the new northeast vein system.

At the San Martin mine, an eastbound exploration crosscut has exposed a new vein system to the west of the dome. The objective of this crosscut is to open for exploration the vein system of the eastern portion of the dome. Exploration drifting at the 7th level of the San Martin ore body has proven the extension of the ore zone.

At the Nukay mine, exploration drilling has confirmed extension of the ore body, both lateral and below the current bottom of the Nukay pit and Subida mine. In addition, exploration in the Conchita and Peninsular areas has detected mineralization.



Peak Mine

Operating Data Jun 30 2005 Mar 31 2005
--------------------------------------------------------------------
(six weeks)
(note 1)
Tonnes of ore milled 165,200 82,600
Average mill head grade
- Gold (grams/tonne) 6.67 6.22
- Copper (%) 0.28% 0.58%
Average recovery rate
- Gold (%) 88% 91%
- Copper (%) 60% 82%
Ounces of gold produced 31,100 15,100
Pounds of copper produced (thousands) 579 864
Ounces of gold sold 27,200 17,300
Pounds of copper sold (thousands) 505 1,612
Average realized price
- Gold (per ounce) $ 442 $ 423
- Copper (per pound) $ 1.53 $ 1.36
Total cash costs (per ounce) (note 2) $ 246 $ 272

FINANCIAL DATA
--------------------------------------------------------------------
(in thousands) (note 1)
Revenues $12,326 $ 8,028
Earnings from operations $ 2,138 $ 1,708

Three Months Ended

Mar 31 Dec 31 Sep 30 Jun 30
Operating Data 2005 2004 2004 2004
--------------------------------------------------------------------

Tonnes of ore milled 167,300 165,800 162,200 164,600
Average mill head grade
- Gold (grams/tonne) 5.95 8.23 7.94 7.04
- Copper (%) 0.61% 0.39% 0.55% 0.55%
Average recovery rate
- Gold (%) 90% 92% 89% 89%
- Copper (%) 80% 84% 81% 68%
Ounces of gold produced 29,000 40,600 37,100 32,900
Pounds of copper produced
(thousands) 1,819 1,195 1,590 1,331
Ounces of gold sold 27,800 40,200 33,100 33,000
Pounds of copper sold
(thousands) 1,612 892 1,492 1,385
Average realized price
- Gold (per ounce) $ 422 $ 460 $ 400 $ 379
- Copper (per pound) $ 1.36 $ 1.54 $ 1.29 $ 1.28
Total cash costs (per ounce)
(note 2) $ 278 $ 197 $ 161 $ 172

FINANCIAL DATA
--------------------------------------------------------------------
(in thousands)
Revenues $12,091 $18,969 $14,610 $14,137
Earnings from operations $ 1,741 $ 7,786 $ 5,230 $ 4,551

(1) Peak's operations are included in Goldcorp's operating results
for the period subsequent to February 15, 2005, the date of
acquisition of Wheaton.

(2) The calculation of total cash costs per ounce of gold is net of
by-product copper sales revenue.


Peak sold 27,200 ounces of gold and 0.5 million pounds of copper during the quarter. Ore milled was in line with plan, however, production of 31,100 ounces was below expectations due to changes in mine sequencing. The scheduled high grade production from the Perseverance ore body was slowed for geotechnical considerations and will be mined over a longer time frame to ensure stope stability. Higher grades are scheduled for the second half of the year, which should result in increased gold production compared to the first half of the year.

Total cash costs for the quarter were $246 per ounce of gold. These costs are higher than the same quarter in 2004, as a result of a 7% stronger Australian dollar relative to the United States dollar, lower average mill head grades processed (particularly by-product copper), higher maintenance costs and increased treatment and refining charges ("TCRC's"). The increased TCRC's, which relate to gold/copper concentrate, result from current market constraints on smelter capacity.

Development of the ramp accessing the New Cobar ore body continues on schedule with stope ore production expected in the fourth quarter of 2005. Some ore is already being mined from lateral development headings during the decline development. Access to this ore body will provide Peak with far more operational flexibility by providing a further ore source to assist ore scheduling.

Exploration work and delineation drilling continued to focus on New Cobar and Perseverance Zone D where additional reserves and resources are expected to be added in 2005, with drilling on several new prospects scheduled for the remainder of the year.



Wharf Mine

Three Months Ended
Jun 30 Mar 31 Dec 31 Sep 30 June 30
Operating Data 2005 2005 2004 2004 2004
--------------------------------------------------------------------
Tonnes of ore mined 584,300 646,000 735,000 722,000 505,000
Tonnes of ore processed 561,100 656,000 670,000 760,000 584,000
Average grade of gold
processed (grams/tonne) 0.99 1.10 0.93 1.06 0.79
Average recovery rate (%) 75% 75% 75% 75% 75%
Ounces of gold produced 16,400 17,700 15,200 20,000 21,800
Ounces of gold sold 15,700 34,300 15,500 13,800 18,000
Average realized gold
price (per ounce) $ 429 $ 431 $ 432 $ 405 $ 395
Total cash costs
(per ounce) $ 291 $ 282 $ 268 $ 271 $ 245

Financial Data
--------------------------------------------------------------------
(in thousands)
Revenues $ 7,014 $14,938 $ 6,826 $ 5,763 $ 7,250
Earnings from operations $ 627 $ 2,026 $ 1,270 $ 452 $ 706


The Wharf Mine produced 16,400 ounces of gold in the second quarter of 2005; ounces sold were 15,700 compared to 18,000 ounces in 2004. Total cash costs for the quarter were $291 per ounce, compared to $245 per ounce during the second quarter of 2004, a 19% increase primarily as a result of the lower ounces sold. Tonnes of ore processed each quarter do not necessarily correlate to ounces produced during the quarter as there is a time delay between placing tonnes on the leach pad and pouring ounces of gold.

The operation continues to perform according to plan.

During the March 31, 2005 quarter, the Company discontinued its previous policy of holding back from sale a portion of the production and sold its gold bullion inventory on hand.



Silver Wheaton Corp. (Goldcorp interest - 65%)

(100% figures shown)

Operating Data Jun 30 2005 Mar 31 2005
--------------------------------------------------------------------
(six weeks)
(note 1)
Ounces of silver purchased
- Luismin 2,088,000 1,314,800
- Zinkgruvan 476,200 223,300
- Total 2,564,200 1,538,100
Ounces of silver sold
- Luismin 2,088,000 1,314,800
- Zinkgruvan 580,400 226,400
- Total 2,668,400 1,541,200
Average realized silver price
(per ounce) $ 7.22 $ 7.04
Total cash costs (per silver ounce) $ 3.90 $ 3.90

Financial Data
--------------------------------------------------------------------
(in thousands) (note 1)
Revenues $19,263 $10,857
Earnings from operations $ 6,560 $ 3,894


Three Months Ended

Mar 31 Dec 31 Sep 30 Jun 30
Operating Data 2005 2004 2004 2004
--------------------------------------------------------------------

Ounces of silver purchased
- Luismin 1,974,000 1,387,300 - -
- Zinkgruvan 330,800 240,500 - -
- Total 2,304,800 1,627,800 - -
Ounces of silver sold
- Luismin 1,974,000 1,387,300 - -
- Zinkgruvan 349,000 117,800 - -
- Total 2,323,000 1,505,100 - -
Average realized silver
price (per ounce) $ 6.92 $ 7.30 $ - $ -
Total cash costs
(per silver ounce) $ 3.90 $ 3.90 $ - $ -

Financial Data
--------------------------------------------------------------------
(in thousands)
Revenues $16,077 $10,986 $ - $ -
Earnings from operations $ 5,257 $ 3,938 $ - $ -

(1) Silver Wheaton's operations are included in Goldcorp's operating
results for the period subsequent to February 14, 2005, the date of
acquisition of Wheaton.

Silver Wheaton, a publicly traded company, is owned 65% by Goldcorp
as a result of the acquisition of Wheaton. Silver Wheaton has
agreements to purchase all of the silver produced by Goldcorp's
Luismin mines in Mexico and Lundin Mining Corporation's Zinkgruvan
mine in Sweden for a per ounce cash payment of the lesser of $3.90
and the prevailing market price, subject to adjustment.


PROJECT DEVELOPMENT REVIEW

Amapari Project

Construction progressed substantially through the second quarter, with project commissioning commencing in late June 2005. Most of the recent development activities have involved the ongoing construction of the auxiliary plant site buildings, assay laboratory, main workshop and warehouse, reagent storage and hydro-metallurgical plant. The hydro-metallurgical plant will be commissioned in the third quarter. The erection of the heap leach pad reclaimer was further advanced and will be completed in the third quarter as planned.

The main power line from the regional hydro-electric plant was energized to the property. Pit pre-stripping continued ahead of plan with five pits now opened up for maximum ore mining flexibility. Haul road construction to the highest point in the mining area has been completed. More than 1.5 million tonnes of waste were pre-stripped allowing the stockpiling of more than 200,000 tonnes of ore.

As part of the commissioning process, crushing, agglomeration and stacking of ore is underway. Some modifications have been made to crushing and agglomeration equipment to ensure maximum throughput will be realized.

Capital expenditures have been further impacted by the appreciation of the Brazilian real, and oil and steel price increases. The accumulated impact is approximately US$10 million; however, construction is now almost complete.

Exploration activities commenced at Urucum East where rock samples assayed up to 4.7 g/t, and at Timbo where three continuous gold anomalies over 50 ppb Au were delineated over several hundreds of metres.

Los Filos / Bermejal Project

On March 31, 2005, Goldcorp completed the acquisition of the 2.4 million ounce Bermejal gold deposit in Mexico for cash consideration of $70 million, from a joint venture of Industrias Peñoles S.A. de C.V. and Newmont Mining Corporation. The Bermejal Gold Deposit is located just two kilometres south of Goldcorp's Los Filos gold deposit.

The Company plans to develop the two deposits as a single operation with two open pits and one single heap leach pad facility. The feasibility study of a standalone Los Filos project is complete; however, in order to maximize the synergies with Bermejal, a combined feasibility study will be completed by the end of 2005.

Exploration continues in the area; 26,322 metres have been drilled year to date with positive results, and additional resources are expected. The estimation of these new resources will be developed before year-end.

The 115 Kv power supply system has been adapted to cater for the unified project and construction works are well advanced, with the main transformer already on the site. The water supply system has been upgraded to provide adequate water volumes and the two associated pumping stations are under construction. Clearing has started with top soil removal for the new 220 hectare pad facility. Basic engineering design is in progress for the crushing, agglomeration and hydro-metallurgical plants.

Representative samples from new and old underground workings, such as declines, drifts, crosscuts, etc., have been collected in order to carry out further metallurgical research of the Bermejal ore.

The Los Filos stand alone environmental impact assessment (EIA), which includes the new pad area, has been approved by the Mexican Government Agency. Additionally, an EIA study to cover the additional Bermejal pit with the implicit waste dumps is underway. With the approved Los Filos EIA, pre-stripping work has commenced, and some open pit mining equipment is already assembled and crew training has started.

The sustainability development plan, including socioeconomic and public consultation studies, has been submitted for approval.



EXPENSES
--------------------------------------------------------------------
Three Months Six Months
Ended June 30 Ended June 30
(in thousands) 2005 2004 2005 2004
--------------------------------------------------------------------
Depreciation and depletion $ 40,313 $ 4,273 $ 57,892 $ 8,819
Corporate administration 6,784 2,358 10,792 4,407
Exploration 2,493 2,460 4,010 2,568


Depreciation and depletion, which relates to mining activities, increased to $40.3 million for the quarter, compared to $4.3 million in 2004. Of this increase, $24 million relates to the acquisition of Wheaton mining assets effective February 15, 2005, with the remainder relating primarily to the sale of the gold bullion inventory.

Corporate administration costs increased during the second quarter of 2005, compared to the same period in 2004, due primarily to increased corporate activity relating to the Wheaton acquisition and the consolidation of Wheaton's operating results in 2005.



OTHER INCOME (EXPENSE)
--------------------------------------------------------------------
Three Months Six Months
Ended June 30 Ended June 30
(in thousands) 2005 2004 2005 2004
--------------------------------------------------------------------
Interest and other income $ 2,491 $ 2,692 $ 5,357 $ 5,651
Stock option expense (2,156) (634) (7,476) (2,211)
(Loss) gain on foreign
currency (2,150) 365 (3,353) 502
(Loss) gain on marketable
securities, net (1,147) (2,265) 1,444 (1,543)
Corporate transaction costs (540) - (3,439) -
--------------------------------------------------------------------
$ (3,502) $ 158 $ (7,467) $ 2,399
--------------------------------------------------------------------
--------------------------------------------------------------------


As a result of the acquisition of Wheaton, Goldcorp stock options which existed at December 31, 2004 became fully vested during the first quarter of 2005 and were expensed in the amount of $5.3 million. During the second quarter, the Company granted 5,000,000 stock options vesting over a period of three years, with a fair value of $19.9 million. Stock option expense of $2.2 million has been recognized in the second quarter, and $3.3 million will be recognized during the remainder of 2005, $6.6 million in 2006, $5.6 million in 2007 and $2.2 million in 2008.

During the second quarter, the Company suffered a loss on foreign currency of $2.1 million (6 months to June 30, 2005 - $3.4 million) as a result of holding a portion of its cash balances in Canadian dollars during a period of a strengthening US dollar.

Corporate transaction costs pertaining to the acquisition of Wheaton in the amount of $0.5 million ($3.4 million for the six months ended June 30, 2005) relate to severance and restructuring of insurance policies, which may not be capitalized as acquisition costs under current accounting standards and thus have been expensed.

INCOME AND MINING TAXES

Income and mining taxes for the three months ended June 30, 2005 totalled $57.7 million, approximately 36% of earnings before taxes. In 2004, income and mining taxes were $7.3 million, or 44% of earnings before taxes. Income and mining taxes for the six months ended June 30, 2005 totalled $73.7 million (approximately 35% of earnings before taxes) compared with $18.6 million (41% of earnings before taxes) in the prior year.

The lower effective tax rate during 2005 is due to the lower statutory tax rates applicable to the Wheaton operations. The statutory tax rate at Goldcorp's Canadian operations is approximately 40% while the combined statutory tax rate at the Wheaton operations is approximately 30%.

NON-CONTROLLING INTERESTS

During the quarter ended March 31, 2005, Goldcorp acquired an 82% interest in Wheaton, which resulted in an 18% non-controlling interest in the amount of $141.9 million. During the period February 15 to April 15, 2005, the non-controlling interest's share of Wheaton's net earnings was $3.5 million. Goldcorp acquired the 18% non-controlling interest's share of Wheaton on April 15, 2005.

A further non-controlling interest arose as a result of the Wheaton acquisition with respect to Wheaton's 65% ownership of its subsidiary, Silver Wheaton. The share of earnings of the 35% non-controlling interest for the six months to June 30, 2005 amounted to $3.9 million.

NON-GAAP MEASURES - PRO FORMA ADJUSTED NET EARNINGS

"Pro Forma Adjusted Net Earnings" when used with respect to Goldcorp net earnings for the three and six months ended June 30, 2005, refers to net earnings that include 100% of the earnings of Goldcorp and Wheaton for the full three and six month period, adjusted for certain items that management of Goldcorp believes facilitates the evaluation of future operations. Pro Forma Adjusted Net Earnings excludes non-recurring stock option expenses and corporate transaction costs (including investment banking, legal, and other fees relating to the acquisition of Wheaton) and includes adjustments for gold bullion withheld or sold, during the period and estimated additional depreciation and depletion. Management believes that such adjustments are appropriate. Pro Forma Adjusted Net Earnings should not be construed as an alternative to net earnings determined in accordance with Canadian generally accepted accounting principles ("GAAP"). For a reconciliation of Pro Forma Adjusted Net Earnings to net earnings, based on the financial statements prepared in accordance with GAAP, see "Reconciliation of Pro Forma Adjusted Net Earnings to Net Earnings". Pro Forma Adjusted Net Earnings is not a recognized measure under GAAP and does not have a standardized meaning prescribed by GAAP, and may differ from methods by which other companies calculate such measures and, accordingly, such measures as used herein may not be comparable to similarly titled measures used by other companies. Further, the pro forma financial information is not necessarily indicative of the results of operations that may be obtained in the future.



Reconciliation of Pro Forma Adjusted Net Earnings to Net Earnings
(for the three and six months ended June 30, 2005):

--------------------------------------------------------------------
Three Months Six Months
Ended Ended
(in thousands) June 30 June 30
--------------------------------------------------------------------
Net earnings $ 98,030 $ 127,519
Non-controlling interest in Wheaton
(note 1) 832 3,548
Wheaton:
Results for January 1 -
February 14, 2005 (note 2) - 17,145
Estimated additional depreciation
and depletion (note 3) - (4,383)
--------------------------------------------------------------------
98,862 143,829
Corporate transaction costs (note 4) 324 5,946
Bullion adjustments (note 5) (51,670) (39,392)
--------------------------------------------------------------------
Pro forma adjusted net earnings $ 47,516 $ 110,383
--------------------------------------------------------------------
--------------------------------------------------------------------

(1) Add back non-controlling interest arising from Goldcorp only
owning 82% of Wheaton between February 15 and April 15, 2005.

(2) Includes 100% of Wheaton earnings from January 1 to February 14,
2005, adjusted for the non-recurring corporate transaction costs
incurred by Wheaton to effect the merger.

(3) Represents estimated additional depreciation and depletion if
Wheaton had been acquired on January 1, 2005.

(4) Represents adjustment for the non-recurring corporate transaction
costs incurred by Goldcorp to effect the merger. This includes stock
option expenses incurred from the immediate vesting of all unvested
options as a result of the transaction.

(5) Represents adjustment to recognize earnings on all gold bullion
withheld from sale, or sold, during the period.


Revenue from gold bullion production is recognized in the consolidated financial statements when title passes to the purchaser and, as a result, revenue is recorded when the gold is sold, not when it is produced. During the first quarter of 2005, the Red Lake mine withheld from sale 71,100 ounces of gold bullion while the Wharf mine sold an additional 16,600 ounces of gold, held back from prior year production. During the second quarter, Red Lake mine sold 275,700 ounces of gold bullion inventory held at March 31, 2005, increasing net earnings by $51.7 million and cash flow from operations by $85.2 million for the three months to June 30, 2005. Cumulatively, for the six months to June 30, 2005, net earnings were increased by $39.4 million and cash flow from operations by $70.8 million.



Reconciliation of Pro Forma Adjusted Basic Earnings per Share

The number of shares used in the computation of pro forma adjusted
basic earnings per share is as follows:

Three Months Six Months
Ended Ended
(in thousands) June 30 June 30
--------------------------------------------------------------------
Weighted-average number of
Goldcorp shares outstanding
for the period 330,114 290,335
Adjustment to reflect
acquisition of 100% of
Wheaton, effective January 1, 2005 4,367 43,939
--------------------------------------------------------------------
Pro forma weighted average
number of shares outstanding
for period 334,481 334,274
--------------------------------------------------------------------
--------------------------------------------------------------------
Pro Forma Adjusted Net Earnings $ 47,516 $ 110,383
--------------------------------------------------------------------
--------------------------------------------------------------------
Pro forma adjusted basic
earnings per share $ 0.14 $ 0.33
--------------------------------------------------------------------
--------------------------------------------------------------------


NON-GAAP MEASURE - TOTAL CASH COST PER GOLD OUNCE CALCULATION

The Company reports total cash costs on a sales basis. In the gold mining industry, this is a common performance measure but does not have any standardized meaning, and is a non-GAAP measure. The Company follows the recommendations of the Gold Institute standard. The Company believes that, in addition to conventional measures, prepared in accordance with GAAP, certain investors use this information to evaluate the Company's performance and ability to generate cash flow. Accordingly, it is not intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The following table provides a reconciliation of total cash costs per ounce to the financial statements:



(in thousands, Three Months Six Months
except gold ounces sold and Ended June 30 Ended June 30
per ounce amounts) 2005 2004 2005 2004
--------------------------------------------------------------------
Operating expenses per financial
statements $ 89,605 $ 15,007 $ 135,655 $ 30,217
Industrial minerals
operating expense (2,644) (2,886) (5,802) (5,711)
Treatment and refining
charges on concentrate sales 10,371 - 15,070 -
By-product silver and copper
sales, and other (66,338) (288) (92,218) (538)
Non-cash adjustments (2,540) (1,005) (3,727) (2,474)
--------------------------------------------------------------------
$ 28,454 $ 10,828 $ 48,978 $ 21,494
--------------------------------------------------------------------
Divided by gold ounces sold 543,100 93,600 760,600 201,000
--------------------------------------------------------------------
Total cash costs per ounce $ 52 $ 116 $ 64 $ 107
--------------------------------------------------------------------
--------------------------------------------------------------------


LIQUIDITY AND CAPITAL RESOURCES

At June 30, 2005 the Company held cash and cash equivalents of $421 million (December 31, 2004 - $333 million) and working capital of $431 million (December 31, 2004 - $400 million).

In the opinion of management, the working capital at June 30, 2005, together with cash flows from operations, are sufficient to support the Company's normal operating requirements on an ongoing basis.

Total assets increased to $3,756 million at June 30, 2005 from $702 million at December 31, 2004, primarily as a result of the acquisition of Wheaton. The Wheaton acquisition, financed by the issuance of Goldcorp common shares, resulted in an increase in total assets of $2,955 million, an increase in total liabilities of $720 million, and an increase in shareholders' equity of $2,235 million.

Mining interests increased by $2,397 million, representing the fair value of Wheaton's mining properties acquired, and goodwill increased by $249 million. Future income tax liabilities of $541 million and deferred employee profit sharing liabilities of $86 million were accrued on the acquisition and will be amortized to income as the related mining interests are depreciated. Accounting for income taxes uses the liability method which takes into consideration the differences between accounting and tax values of all assets and liabilities. In particular, on business acquisitions, the Company grosses up the value of mining interests acquired to reflect the recognition of future income tax liabilities for the tax effect of such differences.

During the quarter, the Company generated operating cash flows of $164 million (six months ended June 30, 2005 - $244 million), compared with $12 million (six months ended June 30, 2004 - $8 million) during the same period of 2004. The favourable non-cash operating working capital movement during 2005 primarily resulted from the sale of the gold bullion inventory during the second quarter, offset by cash tax payments at Alumbrera of $57 million. Conversely, a negative non-cash operating working capital movement of $13 million during the second quarter of 2004 was largely due to cash tax payments.

Finished goods inventory at June 30,2005 amounted to $26.3 million, compared with $0.6 million at December 31, 2004. Of this increase, approximately $14 million related to product shipments late in the second quarter at Alumbrera, which will not be recognized for accounting purposes as sales until the third quarter, and the remainder related primarily to dore and other finished goods held at the mines which were not shipped until the third quarter.

The acquisition of Wheaton during 2005 resulted in net cash acquired of $132 million after cash payments of acquisition costs. During the first quarter, the Company invested cash of $70 million to acquire the Bermejal property in Mexico. During the six months ended June 30, 2005, the Company invested a total of $117 million in mining interests, including $29 million at Red Lake, $36 million at the Luismin operations and $39 million at Amapari.

Cash dividend payments for the six months totalled $121 million, primarily due to the payment of a special $0.50 per share cash dividend, totalling approximately $95 million, during the first quarter. The Company paid a monthly dividend of $0.015 per share, resulting in cash dividend payments for the second quarter of $15 million.

As of August 12, 2005, there were 336.3 million common shares of the Company issued and outstanding and 15.3 million stock options outstanding under its share option plan. In addition, the Company had 7.0 million share purchase warrants outstanding (exchangeable for 14.5 million common shares) and 167.9 million Series A, B and C share purchase warrants outstanding (exchangeable for 42.0 million common shares), issued in exchange for existing Wheaton share purchase warrants.

Derivative instruments

The Company employs, from time to time, interest rate and Canadian dollar forward and option contracts to manage exposure to fluctuations in metal prices and foreign currency exchange rates.

Commitments

Commitments exist for expenditures for mining interests of approximately $146 million, primarily relating to the Red Lake expansion, completion of construction of Amapari and commencement of construction at Los Filos/Bermejal.

Related party transactions

During the six months ended June 30, 2005, Goldcorp sold its holdings in three marketable securities to a company owned by Robert R. McEwen, the non-Executive Chairman and former CEO of Goldcorp. These were non-brokered transactions which were executed at market value based on the average of the TSX closing price for the ten trading days prior to the sale agreements, resulting in gains totaling approximately $4.0 million.

CRITICAL ACCOUNTING POLICIES

Acquisition accounting

For the purposes of these consolidated financial statements, the purchase consideration has been allocated on a preliminary basis to the fair value of assets acquired and liabilities assumed based on management's best estimates and taking into account all available information at the time these consolidated financial statements were prepared. Goldcorp will continue to review information and perform further analysis with respect to these assets, including an independent valuation, prior to finalizing the allocation of the purchase price. This process will be performed in accordance with the recent accounting pronouncement relating to "Mining Assets - Impairment and Business Combination" (Emerging Issue Committee Abstract 152). Although the results of this review are presently unknown, it is anticipated that it may result in a change to the amount assigned to goodwill and a change to the value attributable to tangible assets.

Goodwill and impairment testing

The acquisition of Wheaton was accounted for using the purchase method whereby assets acquired and liabilities assumed were recorded at their fair market values as of the date of acquisition and any excess of the purchase price over such fair value was recorded as goodwill. Goodwill was identified and allocated to reporting units by preparing estimates of the fair value of each reporting unit and comparing this amount to the fair value of assets and liabilities in the reporting unit.

The Company evaluates, on at least an annual basis, the carrying amount of goodwill to determine whether current events and circumstances indicate that a reporting unit's carrying amount is greater than its fair value. This impairment assessment involves estimating the fair value of each reporting unit that includes goodwill. We compare this fair value to the total carrying amount of the reporting unit (including goodwill). If the fair value exceeds this carrying amount, we consider that the goodwill is not impaired. If the fair value is less than this carrying amount, then we estimate the fair values of all identifiable assets and liabilities in the reporting unit, and compare this net fair value of assets less liabilities to the estimated fair value of the entire reporting unit. The difference represents the fair value of goodwill, and if necessary, we reduce the carrying amount of goodwill to this fair value with a charge to operations. Assumptions underlying fair value estimates are subject to significant risks and uncertainties.

Investment in Alumbrera

The Company has joint control over Alumbrera through certain matters requiring unanimous consent in the shareholders' agreement and, therefore, has proportionately consolidated its 37.5% share of the financial statements of Alumbrera from February 15, 2005. On this basis, the Company records its 37.5% share of the assets, liabilities, revenues and expenses of Alumbrera in these consolidated financial statements.

Non-controlling interest

Non-controlling interest exists on less than wholly-owned subsidiaries of the Company and represents the outside interest's share of the carrying value of the subsidiaries. As at June 30, 2005, non-controlling interests had a 35% interest in Silver Wheaton.

OUTLOOK

Goldcorp anticipates continued strong operating results for the second half of 2005, with total gold production for the year forecast to exceed 1.1 million ounces at a total cash cost of less than $60 per ounce (net of by-product sales revenue).

Expenditures for mining interests for the remainder of the year are forecast to approximate $158 million, which primarily relate to the Red Lake expansion, completion of the construction of Amapari and commencement of construction at Los Filos/Bermejal.

With a cash balance of $421 million at June 30, 2005, in combination with the recently announced $500 million bank credit facility, the Company is well positioned to continue to grow by way of acquisition.

Additional information relating to the Company, including its Annual Information Form, is available on SEDAR at www.sedar.com.

This Management's Discussion & Analysis contains certain forward-looking statements. All statements, other than statements of historical fact, included herein, including without limitation, statements regarding future plans and objectives of the Company are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove accurate, and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in Company documents filed from time to time with the Toronto Stock Exchange and other regulatory authorities.



Consolidated Statements of Earnings

(in thousands of United States dollars and shares, except per share
amounts - Unaudited)

Three Months Six Months
Ended June 30 Ended June 30
Note 2005 2004 2005 2004
--------------------------------------------------------------------
Revenues $ 301,605 $ 40,461 $ 424,455 $ 88,775
Operating expenses 89,605 15,007 135,655 30,217
Depreciation and
depletion 40,313 4,273 57,892 8,819
--------------------------------------------------------------------
Earnings from mine
operations 171,687 21,181 230,908 49,739
Corporate
administration 6,784 2,358 10,792 4,407
Exploration 2,493 2,460 4,010 2,568
--------------------------------------------------------------------
Earnings from
operations 162,410 16,363 216,106 42,764
--------------------------------------------------------------------

Other income
(expense)
Interest and other
income 2,491 2,692 5,357 5,651
Stock option
expense 12 (2,156) (634) (7,476) (2,211)
(Loss) gain on
foreign
currency (2,150) 365 (3,353) 502
(Loss) gain on
marketable
securities, net (1,147) (2,265) 1,444 (1,543)
Corporate
transaction
costs 6 (540) - (3,439) -
--------------------------------------------------------------------
(3,502) 158 (7,467) 2,399
--------------------------------------------------------------------
Earnings before
taxes and
non-controlling
interests 158,908 16,521 208,639 45,163

Income and mining
taxes (57,677) (7,323) (73,714) (18,637)
Non-controlling
interests (3,201) - (7,406) -
--------------------------------------------------------------------
Net earnings $ 98,030 $ 9,198 $ 127,519 $ 26,526
--------------------------------------------------------------------
--------------------------------------------------------------------

Earnings per share 12
Basic $ 0.30 $ 0.05 $ 0.44 $ 0.14
Diluted 0.28 0.05 0.40 0.14
Weighted average
number of
shares outstanding
Basic 330,114 189,656 290,335 189,560
Diluted 355,721 193,196 315,881 193,713

The accompanying notes form an integral part of these consolidated
financial statements.


Consolidated Balance Sheets
(in thousands of United States dollars - Unaudited)

June 30 December 31
Note 2005 2004
--------------------------------------------------------------------
Assets
Current
Cash and cash equivalents $ 420,843 $ 333,375
Gold bullion (market value:
$nil; 2004 - $96,363) - 33,895
Marketable securities
(market value: $27,517;
2004 - $31,006) 21,957 22,873
Accounts receivable 48,212 7,197
Income and mining taxes
receivable 2,774 12,269
Inventories and stockpiled ore 7 64,200 15,329
Other 9,478 1,735
--------------------------------------------------------------------
567,464 426,673
Mining interests 3,8 2,797,048 264,949
Goodwill 3 249,315 -
Silver contract 5 76,137 -
Stockpiled ore 7 50,510 -
Deposits for reclamation costs 5,111 4,924
Future income and mining taxes 3,965 -
Other 6,432 4,972
--------------------------------------------------------------------
$ 3,755,982 $ 701,518
--------------------------------------------------------------------
--------------------------------------------------------------------
Liabilities
Current
Accounts payable and
accrued liabilities $ 77,344 $ 25,507
Income and mining taxes payable 59,160 -
Future income and mining taxes - 1,149
--------------------------------------------------------------------
136,504 26,656
Future income and mining taxes 614,175 70,610
Reclamation and closure
cost obligations 48,402 26,403
Future employee benefits and other 10 89,159 -
--------------------------------------------------------------------
888,240 123,669
--------------------------------------------------------------------
Non-controlling interests 11 58,863 -
--------------------------------------------------------------------
Shareholders' equity
Capital stock 12 2,616,543 386,703
Cumulative translation adjustment 101,930 107,741
Retained earnings 90,406 83,405
--------------------------------------------------------------------
2,808,879 577,849
--------------------------------------------------------------------
$ 3,755,982 $ 701,518
--------------------------------------------------------------------
--------------------------------------------------------------------
Commitments and contingencies (note 15)
Subsequent event (note 9 (c))

The accompanying notes form an integral part of these consolidated
financial statements.


Consolidated Statements of Cash Flows
(in thousands of United States dollars - Unaudited)

Three Months Six Months
Ended June 30 Ended June 30
Note 2005 2004 2005 2004
--------------------------------------------------------------------
Operating
activities
Net earnings $ 98,030 $ 9,198 $ 127,519 $ 26,526
Reclamation
expenditures (1,415) (458) (1,526) (577)
Items not
affecting cash
Depreciation and
depletion 40,313 4,273 57,892 8,819
Loss (gain) on
marketable
securities, net 1,147 2,265 (1,444) 1,543
Stock option expense 2,156 634 7,476 2,211
Future income
and mining
taxes (6,225) 8,696 (2,119) 12,283
Future employee
benefits 1,704 - 2,735 -
Non-controlling
interests 3,201 - 7,406 -
Other 2,924 - 2,642 -
Change in non-cash
operating working
capital 13 22,035 (12,661) 43,533 (42,396)
--------------------------------------------------------------------
Net cash provided
by operating
activities 163,870 11,947 244,114 8,409
--------------------------------------------------------------------
Investing activities
Mining interests (68,352) (13,796) (116,621) (29,424)
Acquisition of
Wheaton River
Minerals Ltd,
net of
cash acquired 3 (8,172) - 132,446 -
Acquisition of
Bermejal
property 4 - - (70,010) -
Purchase of
marketable
securities (5,268) (12,925) (8,205) (16,623)
Proceeds from
sale of
marketable
securities 4,801 1,335 15,479 3,797
Other (176) 664 (187) 745
--------------------------------------------------------------------
Net cash used
in investing
activities (77,167) (24,722) (47,098) (41,505)
--------------------------------------------------------------------
Financing activities
Common shares issued 12,231 1,361 13,340 2,515
Shares issued by
subsidiary to
non-controlling interests 120 - 3,312 -
Dividends paid to common
shareholders (15,213) (8,532) (120,518) (35,986)
--------------------------------------------------------------------
Net cash used in
financing
activities (2,862) (7,171) (103,866) (33,471)
--------------------------------------------------------------------
Effect of exchange
rate changes
on cash (1,964) (5,905) (5,682) (9,537)
--------------------------------------------------------------------
Increase (decrease)
in cash and cash
equivalents 81,877 (25,851) 87,468 (76,104)
Cash and cash
equivalents,
beginning of period 338,966 328,701 333,375 378,954
--------------------------------------------------------------------
Cash and cash
equivalents,
end of period $ 420,843 $302,850 $ 420,843 $ 302,850
--------------------------------------------------------------------
--------------------------------------------------------------------
Supplemental cash flow information (note 13)

The accompanying notes form an integral part of these consolidated
financial statements.


Consolidated Statements of Shareholders' Equity
(in thousands - Unaudited)

Common Shares Share
------------- Purchase Stock
Shares Amount Warrants Options
--------------------------------------------------------------------
At January 1, 2004 189,274 $ 359,717 $ 16,110 $ 2,275
Stock options exercised 706 3,529 - (9)
Fair value of stock
options issued - - - 5,081
Dividends declared - - - -
Unrealized gain on
translation
of non-US dollar
denominated accounts - - - -
Net earnings - - - -
--------------------------------------------------------------------
At December 31, 2004 189,980 363,246 16,110 7,347
Issued pursuant to Wheaton
acquisition (note 3) 143,771 1,887,421 290,839 30,794
Stock options exercised 694 7,761 - (2,495)
Share purchase warrants
exercised 1,536 17,506 (9,228) -
Fair value of stock
options issued - - - 7,438
Share issue costs - (196) - -
Dividends declared - - - -
Unrealized loss on
translation
of non-US dollar
denominated accounts - - - -
Net earnings - - - -
--------------------------------------------------------------------
At June 30, 2005 335,981 $2,275,738 $297,721 $43,084
--------------------------------------------------------------------
--------------------------------------------------------------------
The accompanying notes form an integral part of these consolidated
financial statements.

Cumulative
Translation Retained
Adjustment Earnings Total
--------------------------------------------------------------------
At January 1, 2004 $ 66,282 $63,358 $ 507,742
Stock options exercised - - 3,520
Fair value of stock options issued - - 5,081
Dividends declared - (31,300) (31,300)
Unrealized gain on translation of
non-US dollar denominated accounts 41,459 - 41,459
Net earnings - 51,347 51,347
--------------------------------------------------------------------
At December 31, 2004 107,741 83,405 577,849
Issued pursuant to Wheaton
acquisition (note 3) - - 2,209,054
Stock options exercised - - 5,266
Share purchase warrants exercised - - 8,278
Fair value of stock options issued - - 7,438
Share issue costs - - (196)
Dividends declared - (120,518) (120,518)
Unrealized loss on translation of
non-US dollar denominated accounts (5,811) - (5,811)
Net earnings - 127,519 127,519
--------------------------------------------------------------------
At June 30, 2005 $101,930 $90,406 $2,808,879
--------------------------------------------------------------------
--------------------------------------------------------------------
The accompanying notes form an integral part of these consolidated
financial statements.


Notes to the Consolidated Financial Statements
Six Months Ended June 30, 2005
(in United States dollars, tabular amounts in thousands - Unaudited)


1. DESCRIPTION OF BUSINESS AND NATURE OF OPERATIONS

Goldcorp Inc ("Goldcorp" or "the Company") is a leading intermediate gold producer engaged in gold mining and related activities including exploration, extraction, processing and reclamation. As a result of the successful acquisition of Wheaton River Minerals Ltd ("Wheaton") during the period (note 3), the Company's assets are comprised of the Red Lake gold mine in Canada, a 37.5% interest in the Alumbrera gold/copper mine in Argentina, the Luismin gold/silver mines in Mexico, the Peak gold mine in Australia, and the Wharf gold mine in the United States. Significant development projects include the expansion of the existing Red Lake mine, the Los Filos/Bermejal gold project in Mexico and the Amapari gold project in northern Brazil. Goldcorp also owns a 65% interest in Silver Wheaton Corp ("Silver Wheaton"), a publicly traded silver mining company.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

These unaudited interim consolidated financial statements have been prepared by the Company in accordance with Canadian generally accepted accounting principles ("Canadian GAAP"). The preparation of financial data is based on accounting policies and practices consistent with those used in the preparation of the audited annual consolidated financial statements, other than as set out below. The accompanying unaudited consolidated financial statements should be read in conjunction with the notes to the Company's audited consolidated financial statements for the year ended December 31, 2004, since they do not contain all disclosures required by Canadian GAAP for annual financial statements.

(a) Basis of presentation

These consolidated financial statements reflect the results of Goldcorp's Red Lake and Wharf mines, together with an 82% interest in those of Wheaton from February 15 to April 15, 2005 and 100% thereafter (note 3).



The principal mining assets of Wheaton are listed below:

Oper-
ations
and
Develop-
ment
Mining Ownership Projects
Asset Location Interest Status Owned
---------------------------------------------------------------------
Minera Alumbrera
Ltd. ("Alumbrera") Argentina 37.5% Proportionately Alumbrera
consolidated mine

Luismin SA de
CV ("Luismin") Mexico 100% Consolidated San Dimas,
San Martin
and Nukay
mines and
Los Filos/
Bermejal
development
project

Mineracao Pedra
Branco do Amapari
Ltda ("Amapari") Brazil 100% Consolidated Amapari
development
project

Peak Gold Mines
Pty Ltd ("Peak") Australia 100% Consolidated Peak mine

Silver Wheaton
Corp ("Silver
Wheaton") Canada 65% Consolidated Silver
contracts
in Mexico
and Sweden


(b) Revenue recognition

Revenue from the sale of metals is recognized in the accounts when title and risk passes to the buyer, collection is reasonably assured and the price is reasonably determinable. Revenue from the sale of metals in concentrate may be subject to adjustment upon final settlement of estimated metal prices, weights and assays. Adjustments to revenue for metal prices are recorded monthly and other adjustments are recorded on final settlement. Refining and treatment charges are netted against revenue for sales of metal concentrate.

(c) Investment in Alumbrera

The Company has joint control over Alumbrera through certain matters requiring unanimous consent in the shareholders' agreement and, therefore, has proportionately consolidated its 37.5% share of the financial statements of Alumbrera from February 15, 2005. On this basis, the Company records its 37.5% share of the assets, liabilities, revenues and expenses of Alumbrera in these consolidated financial statements.

(d) Goodwill

The acquisition of Wheaton was accounted for using the purchase method whereby assets acquired and liabilities assumed were recorded at their fair market values as of the date of acquisition and any excess of the purchase price over such fair value was recorded as goodwill. Goodwill was identified and allocated to reporting units by preparing estimates of the fair value of each reporting unit and comparing this amount to the fair value of assets and liabilities in the reporting unit.

The Company evaluates, on at least an annual basis, the carrying amount of goodwill to determine whether current events and circumstances indicate that a reporting unit's carrying amount is greater than its fair value. This impairment assessment involves estimating the fair value of each reporting unit that includes goodwill. We compare this fair value to the total carrying amount of the reporting unit (including goodwill). If the fair value exceeds this carrying amount, we consider that the goodwill is not impaired. If the fair value is less than this carrying amount, then we estimate the fair values of all identifiable assets and liabilities in the reporting unit, and compare this net fair value of assets less liabilities to the estimated fair value of the entire reporting unit. The difference represents the fair value of goodwill, and if necessary, we reduce the carrying amount of goodwill to this fair value with a charge to operations. Assumptions underlying fair value estimates are subject to significant risks and uncertainties.

(e) Silver contract

Contracts for which settlement is called for in silver are recorded at cost. These assets are depreciated on a unit-of-sale basis over the estimated recoverable reserves and resources at the mine corresponding to the specific contract.

Evaluations of the carrying values of each contract are undertaken at least annually to determine if estimated undiscounted future net cash flows are less than the carrying value. Estimated undiscounted future net cash flows are calculated using estimated production, sales prices and purchase costs. If it is determined that the undiscounted future net cash flows from an operation are less than the carrying value then a write-down is recorded with a charge to operations.

(f) Foreign currency translation

Prior to April 1, 2005, the Canadian dollar was determined to be the measurement currency of the Company's Canadian operations and these operations have been translated into United States dollars up until this date using the current rate method as follows: all assets and liabilities are translated into United States dollars at the exchange rate prevailing at the balance sheet date; all revenue and expense items are translated at the average rate of exchange for the period; and the resulting translation adjustment is recorded as a separate component of shareholders' equity. In addition, unrealized gains and losses due to movements in exchange rates on cash balances held in foreign currencies are shown separately on the Consolidated Statements of Cash Flows.

Due to the Wheaton acquisition and related changes, including holding a greater proportion of the Company's cash in United States dollars, it has been determined that as of April 1, 2005, the United States dollar is the reporting and measurement currency of the Company's Canadian operations and therefore these operations have been translated using the temporal method from that date onward. All operations outside of Canada, including those of Wheaton, previously applied the United States dollar as their reporting and measurement currency and therefore translated their operating results using the temporal method. Under this method, foreign currency monetary assets and liabilities are translated into United States dollars at the exchange rates prevailing at the balance sheet date; non-monetary assets denominated in foreign currencies are translated using the rate of exchange at the transaction date; foreign currency transactions are translated at the United States dollar rate prevailing on the transaction dates; and foreign exchange gains and losses are included in the determination of earnings.

(g) Non-controlling interest

Non-controlling interest exists on less than wholly-owned subsidiaries of the Company and represents the outside interest's share of the carrying values of the subsidiaries. When the subsidiary company issues its own shares to outside interests, a dilution gain or loss arises as a result of the difference between the Company's share of the proceeds and the underlying equity of the shares involved. Dilution gains that do not represent the culmination of earnings are deferred and recognized as revenue on a systematic basis.

(h) Financial instruments

The Company employs, from time to time, interest rate and Canadian dollar forward and option contracts to manage exposure to fluctuations in interest rates and foreign currency exchange rates.

(i) Income and mining taxes

The Company uses the liability method of accounting for income taxes. Under the liability method, future tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Upon business acquisitions, the liability method results in a gross up of mining interests to reflect the recognition of the future tax liabilities for the tax effect of such differences.

Future tax assets and liabilities are measured using enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability settled. A reduction in respect of the benefit of a future tax asset (a valuation allowance) is recorded against any future tax asset if it is not likely to be realized. The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period in which the tax rate changes.

(j) Comparative amounts

Certain comparative information has been reclassified to conform to the current period's presentation.

3. BUSINESS COMBINATION

On December 6, 2004, Goldcorp and Wheaton announced a proposed transaction which provided for Goldcorp to make a take-over bid for Wheaton on the basis of one Goldcorp share for every four Wheaton shares. On December 29, 2004, Goldcorp mailed the Goldcorp Take-over Bid Circular to the Wheaton shareholders.

On February 8, 2005, Goldcorp announced a special $0.50 per share cash dividend would be payable to existing Goldcorp shareholders should shareholders approve by majority Goldcorp's take-over bid for Wheaton and Wheaton shareholders tender the minimum two-thirds bid requirement. The payment of the special dividend also resulted in an adjustment to the exchange ratio of Goldcorp's outstanding warrants - an increase in entitlement from 2.0 to 2.08 Goldcorp shares per warrant.

On February 10, 2005, at a special meeting, Goldcorp shareholders approved the issuance of additional Goldcorp common shares to effect the acquisition of Wheaton. As of February 14, 2005, the effective date of acquisition, approximately 70% of the outstanding Wheaton common shares were tendered to Goldcorp's offer, satisfying the minimum two-thirds bid requirement under the terms of the Goldcorp offer. With conditions met, the special $0.50 per share cash dividend, totalling approximately $95 million, was paid on February 28, 2005.

As of March 31, 2005, Goldcorp held approximately 82% of the outstanding Wheaton common shares and by April 15, 2005, 100% had been acquired. In addition, each Wheaton warrant or stock option, which gave the holder the right to acquire common shares of Wheaton, was exchanged for a warrant or stock option of Goldcorp, giving the holder the right to acquire common shares of Goldcorp on the same basis as the exchange of Wheaton common shares for Goldcorp common shares.

This business combination has been accounted for as a purchase transaction, with Goldcorp being identified as the acquirer and Wheaton as the acquiree in accordance with CICA Handbook Section 1581 "Business Combinations". These consolidated financial statements include 82% of Wheaton's operating results for the period February 15 to April 15, 2005, and 100% of the results thereafter.

The preliminary allocation of the purchase price of the shares of Wheaton is summarized in the following table and is subject to adjustment:



Purchase price

Common shares of Goldcorp issued to acquire
100% of Wheaton (143.8 million shares) $ 1,887,421

Share purchase warrants of Goldcorp in exchange
for those of Wheaton (174.8 million warrants) 290,839

Stock options of Goldcorp in exchange for those
of Wheaton (4.9 million options) 30,794

Acquisition costs 25,969
--------------------------------------------------------------------
$ 2,235,023
--------------------------------------------------------------------
--------------------------------------------------------------------

Net assets acquired:
Cash and cash equivalents $ 168,663
Marketable securities 4,348
Other non-cash operating working capital (7,753)
Mining interests 2,396,671
Silver contract 77,489
Stockpiled ore, non-current 55,286
Other long-term assets 3,767
Other liabilities (10,248)
Future income taxes, net (540,570)
Reclamation and closure costs obligations (20,613)
Future employee benefits and other (86,424)
Non-controlling interest in Silver Wheaton
(35%) (note 11) (54,908)
--------------------------------------------------------------------
Net identifiable assets 1,985,708
Residual purchase price allocated to goodwill 249,315
--------------------------------------------------------------------
$ 2,235,023
--------------------------------------------------------------------
--------------------------------------------------------------------


A total of 143.8 million Goldcorp shares were issued to acquire a 100% interest in the shares of Wheaton at a price of $13.13 per share. This issue price is the five-day average share price of Goldcorp common shares at February 8, 2005, reduced by the amount of the special dividend.

For the purposes of these consolidated financial statements, the purchase consideration has been allocated on a preliminary basis to the fair value of assets acquired and liabilities assumed, with goodwill assigned to specific reporting units, based on management's best estimates and taking into account all available information at the time of acquisition as well as applicable information at the time these consolidated financial statements were prepared. Goldcorp will continue to review information and perform further analysis with respect to these assets, including an independent valuation, prior to finalizing the allocation of the purchase price. This process will be performed in accordance with the recent accounting pronouncement relating to "Mining Assets - Impairment and Business Combination" (Emerging Issue Committee Abstract 152). Although the results of this review are presently unknown, it is anticipated that it may result in a change to the amount assigned to goodwill and a change to the value attributable to tangible assets.

4. ACQUISITION

On March 31, 2005, Goldcorp completed the acquisition of the Bermejal gold deposit in Mexico for cash consideration of US$70 million from a joint venture of Industrias Penoles SA de CV and Newmont Mining Corporation. The Bermejal gold deposit is located two kilometres south of Goldcorp's Los Filos gold deposit, where a feasibility study has recently been completed. The Company plans to develop the two deposits as a single project, the Los Filos/Bermejal project, and expects to complete a feasibility study of the combined project by December 2005.

5. SILVER CONTRACT

Silver Wheaton has an agreement to purchase all of the silver produced by Lundin Mining Corporation's Zinkgruvan mine in Sweden for a per ounce cash payment of the lesser of $3.90 and the prevailing market price, subject to adjustment. The carrying value of the silver contract at June 30, 2005 is $76,137,000 which is being amortized on a unit-of-sale basis.

6. CORPORATE TRANSACTION COSTS

Certain costs associated with the restructuring of Goldcorp's Toronto office, following the acquisition of Wheaton, including severance and restructuring of insurance policies, may not be capitalized as acquisition costs under current accounting standards. These costs have been expensed in the amount of $540,000 for the three months ended June 30, 2005 (six months ended June 30, 2005 - $3,439,000).



7. INVENTORIES AND STOCKPILED ORE

June 30 December 31
2005 2004
-------------------------------------------------------------
Supplies $ 16,547 $ 4,146
Finished goods 26,328 644
Work in process 14,736 10,539
Stockpiled ore 57,099 -
-------------------------------------------------------------
114,710 15,329
Less: non-current stockpiled ore 50,510 -
-------------------------------------------------------------
$ 64,200 $ 15,329
-------------------------------------------------------------
-------------------------------------------------------------


Non-current stockpiled ore is comprised of lower grade ore at
Alumbrera, which will be processed later in the mine life.

8. MINING INTERESTS

June 30, 2005
----------------------------------------
Accumulated
Depreciation
Cost and Depletion Net
--------------------------------------------------------------------
Mineral properties
Red Lake mine, Canada $ 258,733 $ (97,452) $ 161,281
Alumbrera mine, Argentina 399,257 (9,764) 389,493
Luismin mines, Mexico 571,644 (6,295) 565,349
Peak mine, Australia 162,935 (943) 161,992
Wharf mine, United States 50,985 (42,998) 7,987
--------------------------------------------------------------------
1,443,554 (157,452) 1,286,102
--------------------------------------------------------------------
Plant and equipment
Red Lake mine, Canada 164,039 (56,218) 107,821
Alumbrera mine, Argentina 207,800 (9,091) 198,709
Luismin mines, Mexico 51,638 (1,230) 50,408
Peak mine, Australia 18,015 (1,016) 16,999
Wharf mine, United States 50,915 (50,532) 383
Corporate and other, Canada 16,635 (12,944) 3,691
--------------------------------------------------------------------
509,042 (131,031) 378,011
--------------------------------------------------------------------
Properties under development
Los Filos/Bermejal
project, Mexico 266,073 - 266,073
Amapari project, Brazil 700,689 - 700,689
--------------------------------------------------------------------
966,762 - 966,762
--------------------------------------------------------------------
Exploration projects
El Limon and other
projects, Mexico 166,173 - 166,173
--------------------------------------------------------------------
$3,085,531 $(288,483) $2,797,048
--------------------------------------------------------------------
--------------------------------------------------------------------


December 31, 2004
----------------------------------------
Accumulated
Depreciation
Cost and Depletion Net
--------------------------------------------------------------------
Mineral properties
Red Lake mine, Canada $ 234,565 $ (90,080) $ 144,485
Alumbrera mine, Argentina - - -
Luismin mines, Mexico - - -
Peak mine, Australia - - -
Wharf mine, United States 48,985 (40,764) 8,221
--------------------------------------------------------------------
283,550 (130,844) 152,706
--------------------------------------------------------------------
Plant and equipment
Red Lake mine, Canada 160,567 (52,339) 108,228
Alumbrera mine, Argentina - - -
Luismin mines, Mexico - - -
Peak mine, Australia - - -
Wharf mine, United States 50,915 (50,280) 635
Corporate and other, Canada 16,345 (12,965) 3,380
--------------------------------------------------------------------
227,827 (115,584) 112,243
--------------------------------------------------------------------
Properties under development
Los Filos/Bermejal
project, Mexico - - -
Amapari project, Brazil - - -
--------------------------------------------------------------------
- - -
--------------------------------------------------------------------
Exploration projects
El Limon and other
projects, Mexico - - -
--------------------------------------------------------------------
$ 511,377 $(246,428) $ 264,949
--------------------------------------------------------------------
--------------------------------------------------------------------


9. BANK CREDIT FACILITIES

(a) The Company has an Aus$5,000,000 ($3,819,000), unsecured, revolving working capital facility for its Peak mine operations of which $nil was drawn down at June 30, 2005. The loan bears interest related to the Australian Treasury Bill rate plus 1.5% per annum.

(b) During the six months ended June 30, 2005, the Company cancelled a $300 million acquisition facility and a $75 million revolving working capital facility, both of which were undrawn.

(c) On July 29, 2005, Goldcorp entered into a $500 million revolving credit facility with a syndicate of five lenders. The facility is unsecured and available to finance acquisitions and for general corporate purposes. Amounts drawn incur interest at LIBOR plus 0.625% to 1.125% per annum dependent upon the Company's leverage ratio, increasing by an additional 0.125% per annum if the total amount drawn under this facility exceeds $250 million. Undrawn amounts are subject to a 0.15% to 0.25% per annum commitment fee dependent on the Company's leverage ratio. All amounts drawn are required to be refinanced or repaid by July 29, 2010. The facility is currently undrawn.



10. FUTURE EMPLOYEE BENEFITS AND OTHER

June 30 December 31
2005 2004
-------------------------------------------------------------
Deferred employee profit sharing $ 84,269 $ -
Other 4,890 -
-------------------------------------------------------------
$ 89,159 $ -
-------------------------------------------------------------
-------------------------------------------------------------


Deferred employee profit sharing

Under Mexican tax laws, the Company is required to remit 10% of taxable income to employees as statutory profit sharing. The provision for deferred profit sharing is based on the liability method. Deferred profit sharing liabilities arise from the recognition of the differences between the financial statement carrying amounts and the tax bases of certain assets and liabilities.

11. NON-CONTROLLING INTERESTS

During the quarter ended March 31, 2005, Goldcorp acquired an 82% interest in Wheaton (note 3) which resulted in an 18% non-controlling interest of $141,850,000. During the period February 15 to April 15, 2005, the non-controlling interest's share of Wheaton's net earnings was $3,548,000. Goldcorp acquired the 18% non-controlling interest's share of Wheaton on April 15, 2005.

A further non-controlling interest arose as a result of the Wheaton acquisition with respect to Wheaton's 65% ownership of its subsidiary, Silver Wheaton. The details of this non-controlling interest are as follows:



At January 1, 2005 $ -
Arising upon acquisition of Wheaton 54,908
Issuance of shares of Silver Wheaton to
non-controlling interests 97
Share of net earnings of Silver Wheaton 3,858
--------------------------------------------------------
At June 30, 2005 $ 58,863
--------------------------------------------------------
--------------------------------------------------------


12. SHAREHOLDERS' EQUITY

June 30 December 31
2005 2004
-------------------------------------------------------------
Common shares $2,275,738 $363,246
Share purchase warrants (a) 297,721 16,110
Stock options (b) 43,084 7,347
-------------------------------------------------------------
$2,616,543 $386,703
-------------------------------------------------------------
-------------------------------------------------------------


At June 30, 2005, the Company had 335,981,000 common shares outstanding (December 31, 2004 - 189,980,000). Refer to the Consolidated Statements of Shareholders' Equity for movement in capital stock.

(a) Share Purchase Warrants

The payment of a special dividend (note 3) during February 2005 resulted in an adjustment to the exchange ratio of Goldcorp's warrants outstanding prior to the acquisition of Wheaton - an increase in entitlement from 2.0 to 2.08 Goldcorp shares per warrant. Upon completion of the Wheaton transaction on April 15, 2005, Goldcorp issued 174.8 million Series A, B and C share purchase warrants to the former Wheaton share purchase warrant holders. Each share purchase warrant is exercisable for 0.25 Goldcorp common shares at prices ranging from C$1.65 to C$3.10 (or C$6.60 to C$12.40 for four share purchase warrants which are exchangeable for one Goldcorp common share), with expiry dates ranging from 2007 to 2008.



The following table summarizes information about the share purchase
warrants outstanding at June 30, 2005:

(in thousands Common
of warrants Shares
and shares) to be
Received Effec-
upon tive
Warrants Exercise Price
Outstand- Exercise Exchange of Per Expiry
ing Price Ratio Warrants Share Date
--------------------------------------------------------------------
US dollar
Warrants 3,993 $25.00 2.08 8,304 $12.02 April 30,
2007
--------------------------------------------------------------------
--------------------------------------------------------------------
Canadian
dollar
Warrants
Series A
and C 104,550 C$1.65 0.25 26,137 C$6.60 May 30,
2007
Series B 64,137 3.10 0.25 16,034 12.40 August 25,
2008
Share
purchase
warrants 3,000 20.00 2.08 6,240 9.62 May 13,
2009
--------------------------------------------------------------------
48,411 C$8.91
--------------------------------------------------------------------
--------------------------------------------------------------------


(b) Stock Options

On May 15, 2005, shareholders approved the Company's 2005 Stock Option Plan which allows for up to 12.5 million stock options, with a maximum exercise period of ten years, to be granted to employees, officers and consultants.

The Company recognizes a compensation expense for all stock options awarded since January 1, 2003, based on the fair value of the options on the date of grant which is determined by using an option pricing model with the following assumptions: risk-free interest rate of 3% (2004 - 4%); dividend yield of 1% (2004 - 1%); volatility factor of the expected market price of the Company's common stock of 30% (2004 - 42%); and a weighted average expected life of the options of fours years (2004 - five years). The fair value of the options is expensed over the vesting period of the options. No compensation expense had been recorded for stock options issued before January 1, 2003. As a result of the acquisition of Wheaton, all Goldcorp stock options which existed at December 31, 2004 became fully vested during the first quarter of 2005 and were expensed in the amount of $5,320,000. On April 15, 2005, as a result of the Wheaton acquisition, Wheaton stock options with a fair value of $30,794,000 were converted to 4.9 million Goldcorp stock options, all of which are fully vested and are exercisable at prices ranging from C$2.28 to C$15.68, with expiry dates ranging from 2006 to 2010.

In addition, on June 29, 2005, the Company granted 5,000,000 stock options which vest over a period of three years, are exercisable at C$19.23 per option and have a total fair value of $19,855,000. Compensation expense of $2,118,000 has been recognized in the second quarter and the remainder will be recognized as the stock options vest.



Weighted
(in thousands, except per Average
option amounts) Outstanding Exercise Price
---------------------------------------------------------------
At January 1, 2004 6,012 C$12.68
Granted 1,335 16.89
Exercised (706) (6.64)
Cancelled (497) (16.47)
---------------------------------------------------------------
At December 31, 2004 6,144 13.98
Issued in connection with
acquisition of Wheaton 4,917 9.52
Granted 5,000 19.23
Exercised (694) 9.40
Cancelled (23) 17.01
---------------------------------------------------------------
At June 30, 2005 15,344 C$14.46
---------------------------------------------------------------
---------------------------------------------------------------


The following table summarizes information about the options
outstanding at June 30, 2005:

Options Outstanding Options Exercisable
------------------------- --------------------------
Weighted Weighted
Average Options Average
Remain- Out- Remain-
Weighted ing standing Weighted ing
Options Average Contr- and Average Contr-
Out- Exer- actual Exer- Exer- actual
Exercise standing cise Life cisable cise Life
Prices (C$) (000's) Price (years) (000's) Price (years)
-------------------------------------------------------------------

$2.05-$3.90 578 C$2.94 3.2 578 C$2.94 3.2
$4.40-$8.48 2,137 6.03 2.3 2,137 6.03 2.3
$11.40-$13.30 4,265 12.58 5.2 4,265 12.58 5.2
$14.80-$16.87 1,597 16.47 8.0 1,597 16.47 8.0
$17.15-$19.46 6,754 18.81 9.5 2,288 17.99 6.3
$23.80 13 23.80 8.4 13 23.80 8.4
-------------------------------------------------------------------

15,344 C$14.46 6.9 10,878 C$12.16 5.4
-------------------------------------------------------------------
-------------------------------------------------------------------


(c) Restricted Share Units

On May 15, 2005, shareholders approved the Company's Restricted Share Unit Plan which allows for up to 500,000 restricted share units to be granted to employees, directors and consultants.

On June 29, 2005, the Company issued 31,500 restricted share units to the non-executive Directors of the Company, which vest over a period of two years from the grant date. The Company will record compensation expense totalling $473,000 over the two year vesting period.

(d) Diluted Earnings per Share

The following table sets forth the computation of diluted earnings per share:



Three Months Ended Six Months Ended
June 30 June 30
2005 2004 2005 2004
---------------------------------------------------------------------

Earnings available to
common shareholders $ 98,030 $ 9,198 $ 127,519 $ 26,526
---------------------------------------------------------------------
---------------------------------------------------------------------

Weighted average
shares outstanding 330,114 189,656 290,335 189,560
Effect of dilutive
securities:
Stock options 3,117 1,248 3,106 1,378
Warrants 22,458 2,292 22,408 2,775
Restricted share
units 32 - 32 -
---------------------------------------------------------------------

Adjusted weighted
average shares and
assumed conversions 355,721 193,196 315,881 193,713
---------------------------------------------------------------------
---------------------------------------------------------------------

Earnings per share
Basic $ 0.30 $ 0.05 $ 0.44 $ 0.14
Diluted $ 0.28 $ 0.05 $ 0.40 $ 0.14


The following lists the stock options and warrants excluded from the
computation of diluted earnings per share because the exercise prices
exceeded the average fair market value of the common shares for the
period:

Three Months Ended Six Months Ended
June 30 June 30
2005 2004 2005 2004
---------------------------------------------------------------------

Stock options 6,762 1,825 6,762 1,816
Warrants - 8,000 - -

(e) Pro forma Earnings

The following is the Company's pro forma earnings with the fair value
method applied to all options issued since January 1, 2002 (the
Black-Scholes option pricing model assumptions used are consistent
with those described in Note 8 (d) to the 2004 audited consolidated
financial statements):

Three Months Ended Six Months Ended
June 30 June 30
2005 2004 2005 2004
--------------------------------------------------------------------

Net earnings $ 98,030 $ 9,198 $ 127,519 $ 26,526
Net additional
compensation expense
related to fair
value of stock
options - (164) (320) (784)
--------------------------------------------------------------------

Pro forma earnings $ 98,030 $ 9,034 $ 127,199 $ 25,742
--------------------------------------------------------------------
--------------------------------------------------------------------

Pro forma earnings
per share
Basic $ 0.30 $ 0.05 $ 0.44 $ 0.14
Diluted $ 0.28 $ 0.05 $ 0.40 $ 0.13

13. SUPPLEMENTAL CASH FLOW INFORMATION

Three Months Ended Six Months Ended
June 30 June 30
2005 2004 2005 2004
--------------------------------------------------------------------

Change in non-cash
operating working
capital
Gold bullion $ 33,645 $ (7,258) $ 33,895 $ (13,430)
Accounts receivable 5,093 5,836 2,553 5,226
Income and mining
taxes receivable 2,013 - 12,269 -
Inventories and
stockpiled ore (9,384) 1,666 (5,568) 2,721
Accounts payable and
accrued liabilities (15,710) (1,651) (8,404) (6,551)
Income and mining
taxes payable 3,855 (11,596) 6,501 (30,283)
Other 2,523 342 2,287 (79)
--------------------------------------------------------------------

$ 22,035 $ (12,661) $ 43,533 $ (42,396)
--------------------------------------------------------------------
--------------------------------------------------------------------

Non-cash financing
and investing
activities
Shares issued on
acquisition of
Wheaton $ 333,421 $ - $1,887,421 $ -
Warrants issued in
exchange for those
of Wheaton 50,839 - 290,839 -
Options issued in
exchange for those
of Wheaton 12,794 - 30,794 -

Operating activities
included the
following cash
payments
Interest paid $ - $ - $ - $ -
Income taxes paid 58,317 10,457 58,406 36,827

14. SEGMENTED INFORMATION

The Company's reportable operating segments are summarized in the
table below.

Three Months Ended June 30, 2005

Red Lake Alumbrera Luismin Amapari Peak
--------------------------------------------------------------------

Revenues $ 176,939 $ 65,612 $ 25,559 $ - $ 12,326
Depreciation and
depletion 14,923 14,921 5,307 - 2,482
Earnings
(loss) from
operations 129,144 26,323 3,328 - 2,138
Expenditures
for mining
interests 8,182 1,729 25,319 28,683 4,171

Silver
Wharf Wheaton Corporate Total
---------------------------------------------------------

Revenues $ 7,014 $ 19,263 $ (5,108) $ 301,605
Depreciation and
depletion 1,595 1,736 (651) 40,313
Earnings
(loss) from
operations 627 6,560 (5,710) 162,410
Expenditures
for mining
interests 242 - 26 68,352


Six Months Ended June 30, 2005

Red Lake Alumbrera Luismin Amapari Peak
--------------------------------------------------------------------

(note 1) (note 1) (note 1) (note 1)

Revenues $ 232,926 $ 86,796 $ 39,387 $ - $ 20,354
Depreciation and
depletion 19,741 18,855 7,613 - 3,337
Earnings
(loss) from
operations 168,320 35,337 6,728 - 3,846
Expenditures
for mining
interests 29,184 2,065 36,453 38,930 7,894
Total assets 268,869 720,974 1,151,480 706,253 198,080

Silver
Wharf Wheaton Corporate Total
---------------------------------------------------------

(note 1) (note 1)

Revenues $ 21,952 $ 30,120 $ (7,080) $ 424,455
Depreciation
and depletion 4,671 2,635 1,040 57,892
Earnings
(loss) from
operations 2,653 10,454 (11,232) 216,106
Expenditures
for mining
interests 2,001 - 94 116,621
Total assets 45,810 286,621 377,895 3,755,982

(1) Includes results from February 15, 2005, the date of acquisition
of Wheaton.

Three Months Ended June 30, 2004

Red Lake Wharf Corporate Total
---------------------------------------------------------

Revenues $ 30,045 $ 7,250 $ 3,166 $ 40,461
Depreciation
and depletion 2,404 1,708 161 4,273
Earnings
(loss) from
operations 20,480 706 (4,823) 16,363
Expenditures
for mining
interests 12,319 1,441 36 13,796

Six Months Ended June 30, 2004

Red Lake Wharf Corporate Total
---------------------------------------------------------

Revenues $ 68,952 $ 13,531 $ 6,292 $ 88,775
Depreciation
and depletion 5,394 3,158 267 8,819
Earnings
(loss) from
operations 48,409 1,547 (7,192) 42,764
Expenditures
for mining
interests 25,854 3,495 75 29,424
Total assets
(December 31,
2004) 280,289 32,037 389,192 701,518


The geographical distribution of the above segments is as follows:

- Red Lake and Corporate - Canada

- Alumbrera - Argentina

- Luismin (includes Luismin mines, Los Filos/Bermejal project, El Limon and other projects) - Mexico, Cayman Islands

- Amapari - Brazil

- Peak - Australia

- Wharf - United States

- Silver Wheaton - Canada, Cayman Islands

15. COMMITMENTS AND CONTINGENCIES

(a) Commitments exist for capital expenditures of approximately $146 million.

(b) In early May 2005, the Corporation was served with Statements of Claim with respect to a class action against, among others, the Corporation and certain of its directors. The plaintiffs are seeking an unspecified amount of damages as a result of stock options granted in September 2004. The claims allege that the defendants acted on material non-public information at the time of the option grants. The Corporation believes that the allegations are unfounded and intends to vigorously defend these claims.

16. RELATED PARTY TRANSACTION

During the six months ended June 30, 2005, Goldcorp sold its holdings in three marketable securities to a company owned by Robert R. McEwen, the non-Executive Chairman and former CEO of Goldcorp. These were non-brokered transactions which were executed at market value based on the average of the TSX closing price for the ten trading days prior to the sale agreements, resulting in gains totalling $4,047,000.


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