Teck, the largest producer of steel-making coal in North America, said the write-downs reflect lower expectations for commodity prices.
Canadian mining giant Teck Resources (TSX:TCK.A, TCK.B), (NYSE: TCK) swung to a loss in the third quarter of the year due to a $1.7 billion (Cdn$2.2 billion) asset impairment charge in its steel-making coal and other businesses.
The Vancouver-based company, the largest producer of steel-making coal in North America, said the write-downs reflect lower expectations for commodity prices.
“We are taking significant steps to meet the challenge of low commodity prices,” Tech chief executive Don Lindsay said in a statement.
And it seems to be working, as the company’s adjusted earnings and revenue, excluding the charges, did better than analyst estimates. Third-quarter earnings, totalled Cdn$29 million ($22 million), or 5 cents a share, from Cdn$159 million, or 28 cents, a year earlier.
Teck also noted it has reduced costs throughout the company and raised nearly $1 billion in two streaming transactions.
In April, the miner decided to cut its dividend to shareholders from $0.45 per share to $0.15 to weather weak prices that the company attributes to global oversupply.
A month later, it cut production and inventories of steel-making coal by suspending operations for three weeks in the third quarter. It said production in the fourth quarter, which began Oct. 1, would be aligned with sales volumes.
In August, Teck and Vancouver-based Goldcorp (TSX:G), (NYSE:GG) said they would combine their Relincho and El Morro copper-and-gold projects in Chile in a joint venture.
And early in October the company agreed to sell future silver production on its Antamina mine in Peru to Franco-Nevada (NYSE:FNV). The so-called streaming deal includes a $610 million upfront payment.
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