The Reminder is making its archives back to 2003 available on our website. Please note that, due to technical limitations, archive articles are presented without the usual formatting.
Jonathon Naylor Editor Hudbay may be looking to the future with new mines in Manitoba and overseas, but the present is not nearly as rosy as shareholders would like. The company announced last week that it lost $30.4 million in the second quarter, with declining metal prices among the factors at play. Hudbay also blamed impairments related to junior-mining investments, financing of the Constancia project in Peru, and 'adjustments' related to zinc inventory, among other factors. And a decline in copper, gold and silver prices during the quarter, the company said, affected provisional pricing adjustments in revenue totaling $14.5 million. Despite it all, Hudbay President and CEO David Garofalo said operating mines 'have continued to perform within expectations.' He said the company expects 'significant metal production growth over the next three years' with Lalor beginning early production and two other mines in the works _ Reed outside Snow Lake and Peru's Constancia. The second-quarter loss of $30.4 million followed a first quarter that saw Hudbay turn a tidy profit of $8 million. For the first half of 2012, Hudbay is now in the red to the tune of $22.4 million. Revenue up Revenue for the second quarter was up $2.9 million over the first quarter, to $189.9 million. Compared to the second quarter of 2011, revenue plummeted $57 million due to worse metal prices and lower concentrate sales. At 777 Mine, this year's second-quarter production was in line with 2011 results. Operating costs per tonne of ore in the second quarter of 2012 were 12 per cent higher compared to the same period in 2011, mainly due to additional ground support requirements and the timing of maintenance. The Flin Flon concentrator's operating cost per tonne of ore processed in this year's second quarter decreased by 11 per cent versus 2011, largely due to last year's timing of maintenance expenditures. Just outside Flin Flon, Trout Lake Mine closed as planned on June 29 with what Hudbay called 'strong production and grades' in its final quarter. Total ore production at Snow Lake's Chisel North Mine for the second quarter of 2012 was two per cent lower than last year's second quarter due to the mining method used to extract ore from pillars. Production at Chisel North is expected to conclude before October. At Lalor, Hudbay has approved $704 million in capital spending. As of June 30, the company had spent about $277 million and entered into another $91.4 million in commitments for the project. Located a short distance from Snow Lake, Lalor remains on budget, the company said. Hudbay's overall cash and cash equivalents dropped by $189 between Dec. 31, 2011 and June 30 of this year. The company said this was driven mainly by capital expenditures at Lalor and Constancia, taxes and dividend payments. _ With notes from a Hudbay news release
