As a result of lower silver prices and an increase in operating costs, FMC Gold (NYSE) reported a drop in earnings to US$5.3 million for the fourth quarter ended Dec. 31 from the US$10 million reported in 1989.
Earnings per share for the period were 7 cents compared with 16 cents in the previous year.
The company said the drop in earnings per share was caused by an increase in shares outstanding (by eight million shares) as a result of the acquisition of Meridian Gold from Burlington Resources.
The average realized price for silver dropped to US$4.18 per oz. from an average of US$5.32 received in the year-earlier period. The average price for gold also dropped, falling to US$378 per oz. from US$389.
Gold production for the fourth quarter jumped to 88,000 oz., compared with the 74,000 oz. produced in the same period last year. Silver production for the fourth quarter was 901,000 oz., down from the 1.2 million oz. produced in the fourth quarter of 1989.
Operating costs per gold equivalent oz. jumped to US$199 from the US$142 per oz. reported last year.
Revenues for the year increased slightly to US$153 million while earnings dropped to US$39.4 million from US$48.9 million.
The average cost of production increased to US$161 per oz. for the full year, compared with an average cost of US$129 in 1989. The full cost of production for 1990 increased to US$240 per oz. from US$201. FMC Gold 3 months ended Dec. 31 1990 1989 Revenue $37,200 $36,100 Net earnings 5,300 10,000
per share 0.07 0.16 12 months ended Dec. 31 1990 1989 Revenue $153,000 $151,500 Net earnings 39,400 48,900
per share 0.56 0.75
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