Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Revett Minerals announced on Thursday record quarterly revenues of $18.8 million, a 102% increase compared to the same period last year. The Company also increased its cash and cash equivalents on hand at the end of the second quarter to $14.7 million from $8.8 million at the beginning of the year.
For the three months ended June 30, 2011 the Company had net income of $7.9 million or $0.23 per share.
These record results are due to higher metal prices, significantly improved metal grades, and higher metallurgical and operating efficiencies.
Revett President and Chief Executive Officer John Shanahan said, “We are delighted to announce record earnings of $0.23 cents per share for this quarter which is a wonderful reflection of the hard work, dedication, and resourcefulness of our operating team at the Troy mine.
We remain committed to meeting our near term production targets as well as longer term expansion plans at Troy. Troy continues to play a vital role and increase our cash position as we work towards advancing development of our nearby significant silver/copper deposit at Rock Creek.”
Highlights:
· Silver production totaled 342,822 ounces and copper production totaled 3,028,252 pounds, representing increases of 65% for silver and 60% for copper over the same period last year.
· Net cash(1) provided from operations before capital expenditures for the second quarter of 2011 was US$7.7 million, for a total of $11.1 million for the first half of 2011.
· Cash cost for the second quarter of 2011 improved significantly on a net of by-product basis at $3.38 per ounce of silver and $0.73 per pound of copper, compared with $13.08 per ounce of silver and $2.63 per pound of copper for the same period last year.
· The Company’s working capital increased to $19.8 million as of June 30, 2011, an 86% increase since December 31, 2010.
Image is of Revett’s producing project, the Troy Mine, acquired from Asarco in 1999 and put back into production in 2005. Since then, the Troy Mine has produced 6.4 million ounces of silver and 44 million pounds of copper.
