Earnings totalled US$2.4 million (or 3 per share) on revenue of US$15.5 million, compared with US$521,300 (1 per share) on revenue of US$7.5 million in the third quarter of 2001. Cash flow from operations increased to US$5.2 million from US$900,000 between the two periods.
For the first nine months of 2002, earnings amounted to US$7 million (10 per share), compared with a loss of US$1.5 million (2 per share) a year earlier. Revenue between the two 9-month periods climbed US$16.2 million to US$40.3 million, while cash flow more than doubled, to US$11.4 million.
Quarterly gold production shot up nearly 70% from year-earlier levels, to 48,029 oz., and operating cash costs slipped to US$130 from US$221 per oz. The improved production is attributed to higher grades (8.1 grams gold on average, compared with 6 grams a year earlier) and recovery rates (94%, compared with 91%).
For the nine months, the company churned out 134,820 oz. at US$134 each, up from 89,820 oz. at US$193 apiece a year earlier.
The average realized gold price in the quarter was US$317 per oz., up from US$243 per oz. a year earlier. For the nine months, the figure was US$33 per oz. higher than in 2001, at US$295 per oz.
With third-quarter production beating expectations, Rio Narcea has boosted its 2002 output target by 20,000 oz., to 170,000 oz. at less than US$150 apiece.
The company’s hedge book includes 142,555 oz. gold under forward sales contracts priced at US$300.98 per oz. The book also contains put options on 410,280 oz. at prices of US$280 and 300 euros apiece. Another 231,938 oz. are covered by call options at US$365 and 405 euros per oz.
On Sept. 30, the company had US$6.7 million in cash, plus working capital of US$2.3 million. Long-term debt was down more than US$3 million to US$16 million; the current portion was US$576,800.
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