Princeton earnings drop

Higher costs and lower revenues brought about a sizable drop in earnings for Princeton Mining (TSE) in 1990 over the previous year. Princeton reported earnings of $10.8 million for 1990, a significant drop from the $30.6 million in earnings reported in 1989. The company’s yearly cash flow was also hit, dropping to $32.5 million in 1990 from over $50 million in 1989.

The company reported a loss of $369,000 for the fourth quarter ended Dec. 31, compared with earnings of $1.9 million in the year-earlier period.

The 1990 results were affected by a drop in asbestos fibre production at the Cassiar mine in northern British Columbia as underground mining was phased in during the fourth quarter.

Asbestos production dropped to 95,000 tons of fibre in 1990 from 117,000 tons in 1989.

The Similco copper mine, near Princeton, B.C., produced 56.4 million lb. copper, 13,617 oz. gold and 311,660 oz. silver in 1990. This compares with 1989 production of 57.4 million lb. copper, 17,277 oz. gold, and 432,220 oz. silver.

Copper production for 1990 had been forecast at 60 million lb., but poor metallurgical recoveries for the fine-grained ore from Pit One reduced output.

Production was also affected by adverse weather conditions during the fourth quarter and reduced mill availability as a result of increased maintenance on the grinding mills.

Princeton expects to produce about 59 million lb. copper in 1991. Mining costs are expected to drop as operations move to lower strip areas.

The company reports its working capital position has been affected by recent production shortfalls at the Cassiar operation as the new underground mining operations comes on stream. This situation was compounded by a recent labor dispute at the Cassiar mine, which was recently resolved.

In order to alleviate a working capital shortfall, Princeton is negotiating a convertible debenture financing. Princeton Mining (TSE) 3 months ended Dec. 31 1990 1989 Revenue $32,000 $33,154 Net earnings (369) 1,898 per share (0.02) 0.08 12 months ended Dec. 31 Revenue $126,416 $141,850 Net earnings 10,808 30,602 per share 0.45 1.32