Boliden (BOL-T) lost US$21.5 million on revenues of US$311.7 million in the three months ended March 31, marking the twelfth successive quarter the base metal producer has posted a loss.
The loss, equal to US11 per share, compares with a loss of US18.3 million in the first quarter of 2000. Revenues in that period were US$292.7 million.
Boliden’s quarterly report said lower metal prices were a major factor in the loss and the company’s flagship Ronnskar smelter in northern Sweden had had to negotiate lower treatment and refining charges with its concentrate suppliers. This meant lower revenues for Boliden’s smelting operations.
Most of Boliden’s mining operations had steady production results. The exception was the Los Frailes mine in Spain, where quarterly production declined to 18,361 tonnes zinc from 21,404 tonnes in the first quarter of 2000. Boliden is still looking for a buyer for Los Frailes.
Several of Boliden’s creditors have waived requirements of existing loan agreements, forcing the company to reclassify much of its debt as a short-term liability. Boliden says it is considering options that include refinancing this debt.
Boliden and Rio Tinto (RTP-N) closed the sale of their Norzink zinc plant in southern Norway last week. The buyer, Finnish metal producer Outokumpu, paid US$180 million for the facility. Boliden will pocket a gain of US$30 million on the transaction in the second quarter.
A second deal that will send some cash Boliden’s way is now expected to close on April 30. Noranda (NOR-T) and Falconbridge (FL-T) are buying the Lomas Bayas copper mine and the Fortuna de Cobre copper project, now at the development stage, from Boliden for a net US$64.4 million. They will assume US$112.7 million in project debt. The purchasers’ due-diligence investigation is ongoing.
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