Inmet posts Q3 profit

Inmet Mining (IMN-T) made $3.7 million (or 7 per share) during the three months ended Sept. 30, thanks to higher metal prices and a strong performance by the Pyhasalmi copper-zinc mine in Finland.

During the year-earlier period, Inmet’s net earnings came to $574,000 (minus a penny a share). Sales revenue climbed to $52.9 million from $29.4 million.

For the first nine months of 2002, Inmet took in earnings of $6.7 million (a dime a share) on revenue of $151.5 million, compared with a loss of $1.1 million (10 a share) on $78.8 million in the same period of 2001. The improvement is attributed to increased sales at the Cayeli and Troilus mines and the addition of Pyhasalmi.

Grades and recoveries at Pyhasalmi continue to exceed expectations. The mine’s quarterly copper production amounted to 4,000 tonnes; zinc output tallied to 7,600 tonnes (both in concentrate). For the year, the mine is expected to spit out 13,000 tonnes of copper and 32,000 tonnes of zinc. The mine also produced 120,100 tonnes of pyrite, which is expected to hit 600,000 tonnes by yearend. Cash costs were US25 per lb. of copper.

At the Cayeli copper-zinc mine in northeastern Turkey, copper production slipped 800 tonnes to 10,200 tonnes on lower recoveries. Zinc production was boosted by 1,000 tonnes to 9,500 tonnes. Cash costs were US41 per lb. copper, a penny better than 2001. For the nine-month period copper production was 28,300 tonnes (compared with 22,900 tonne a year earlier) and 30,500 tonnes of zinc (17,100 tonnes, thanks to a first-quarter labour strike) were produced at US44 per lb.

Inmet expects Cayeli to run through more than 1 million tonnes of ore to produce 38,000 tonnes of copper for the year. Cayeli’s zinc production is also pegged at 38,000 tonnes, down from the originally target of 43,000 tonnes. Inmet has a 55% stake in Cayeli.

Back in Canada, at the Troilus mine, production was 40,200 oz. of gold at a cash cost of US$270 apiece during the quarter, down from the year-ago 45,400 oz. at US$212 per oz. Production suffered as mining targeted lower grade ore as the north pit wall was pushed back.

However, production for the nine-month period climbed to 123,300 oz. at US$247 per oz., from 118,100 oz. at US$230 each. Full-year production is projected at 161,000 oz. (lower than the original target of 163,000 oz.) at a US$255 per oz. Mining will continue in the north part of the pit during the fourth quarter.

At the Ok Tedi copper-gold mine in Papua New Guinea, where Inmet has an 18% stake, concentrate shipments were cut into owing to drought conditions on the Fly River. Still, the mine continued to operate and stockpile concentrates.

Projected 2002 production has climbed to 215,000 tonnes from 208,000 tonnes on higher mill throughput and improved recoveries. However, gold production estimates are now pegged below the original plan of 525,000 oz.

The company plans to replace the shell in one of Ok Tedi’s 2 semi-autogenous-grinding (SAG) mills. Mill through put will be cut in half for seven weeks.

At quarter’s end, Inmet had cash and short-term investments of $71 million, up about $4.4 million from the previous year. The company’s long-term debt stood at $69.2 million.