Ivanhoe’s Kipushi zinc mine in the DRC officially reopens
The restart marked exactly a century since the mine first went into production.
Teck Resources Limited (TSX:TCK.B) saw its 2014 profit fall by more than half compared with 2013 as copper and steelmaking coal prices remained low throughout the year.
The mining giant saw profit attributable to shareholders slip to $452 million or $0.78 per share – down 55% compared with $1.0 billion in 2013.
In Q4 alone, profit fell to $116 million or $0.20 per share – which missed analysts’ expectations of $0.22 per share – compared with $227 million or $0.40 per share in the same period last year.
“Although 2014 was a challenging year with significantly lower prices for some of our key products, our operations performed well, setting various production records and generating positive cash flows at all sites,” said Teck president and CEO Don Lindsay in a release.
“We continued to focus on conserving cash and maintaining a strong financial position.”
Coal prices slid 23% in 2014 (in US dollars) and copper prices fell 6%. Gross profit was also hit by lower sales volumes for the two metals.
The company said it believes low steelmaking coal prices are unsustainable in the longer term. Demand for coal remains strong, it said, but the market is oversupplied due to an increase in production in Australia.
Teck said in a release that the sliding price of oil will have a significant effect on the company’s operating costs if the trend continues.
“Our mining operations use a significant amount of diesel fuel and certain transportation costs are contractually linked to diesel prices,” said the release. “At current exchange rates, each US$1 change in the price of a barrel of oil has an approximate $5 million effect on our operating costs.”
As of press time, shares of Teck were trading at $17.87 – an increase of 1.48%. This remains well below the 52-week high of $28.18.
