Campbell turns a profit while expanding its Joe Mann mine

While in the midst of expanding its Joe Mann gold copper mine in Chibougamau, Que., Campbell Resources (TSE) earned a small profit for the year ended Dec. 31. In 1989, the Toronto-based affiliate of Northgate Exploration (TSE) reported net income of $3 million or 4 cents per share, compared with a loss of $67.7 million or $1.25 per share in 1988.

The 1988 results included a $58.4 million writedown in the carrying value of Campbell’s Henderson II mine and $6.8 million which the company set aside to cover the cost of discontinued coal operations.

Annual revenues in 1989 increased to $45.8 million from $41.7 million in the previous year. So too did the company’s gold output. Campbell produced 67,800 oz. gold as well as 3.3 million lb. copper in 1989, compared with 61,000 oz. gold and 4.9 million lb. copper a year earlier.

Joe Mann contributed 47,100 oz. to that amount while Cedar Bay and the former S-3 (which was shut down in January) each contributed 9,100 oz. and 11,600 oz. respectively.

Campbell attributed the improved earnings picture to reduced mining costs which have dropped to an average of US$323 per oz. of gold produced from US$362 per oz. in 1988. The sale of Campbell’s 50% stake in the Martinson/ Cargill phosphate properties in northern Ontario last July for $1 million was also a factor in the improved earnings picture.

Income during the fourth quarter was $808,000 or 1 cents per share, compared with a loss of $115,000 or 1 cents per share in the 1988 period. Revenue in 1989’s fourth quarter increased to $12.9 million from $9.4 million at the same time last year.

Campbell is operating with two Chibougamau gold-copper mines — the Joe Mann and the marginally economic Cedar Bay. Campbell Resources (TSE) — 000s Year ended Dec. 31 1989 1988 Revenue $45,783 $41,730 Net earnings (loss) 3,001 (67,666 )

per share $0.04 $(1.25 )