Vancouver-based mining giant Teck Resources Ltd. had record-high revenue in the first quarter and a net profit of $218-million but fell short of analyst estimates as lower copper prices put a slight dent into its sales revenue.
The Vancouver-based company said a decline in revenue from copper partly offset the impact of strong coal sales. Teck’s profit was also slightly short of expectations as the company recorded higher costs at its copper operations.
The profit was equal to 37 cents per share, before adjustments. After excluding the impact of debt refinancing and other items, adjusted profit was $504-million or 86 cents per share – a penny short of analyst estimates.
Teck’s revenue for the quarter was $2.5-million, also short of the consensus estimate of $2.6-billion but above the 2011 first quarter revenue of $2.4-billion.
The company’s coal operations provided most of the increased revenue, with some help from zinc. That was partially offset by reduced copper revenue as lower prices offset higher output.
Teck’s profit attributable shareholders in the first three months of this year was down from $461-million or 78 cents per share in the first quarter of 2011 before adjustments and $450-million or 76 cents per share after adjustments.
The 2012 first quarter included a $329-million after-tax charge related to refinancing about $1-billion of its debt to lower future interest rate costs.
The average analyst estimate was for a profit of 87 cents per share on an adjusted basis and revenue of $2.6-billion, according to those polled by Thomson Reuters.
In January, Teck signed a deal to buy SilverBirch Energy Corp. for $435-million, snagging full ownership in two oil sands projects and spinning out the rest into a new junior company.
The deal gives Teck the Frontier and Equinox projects, as well as a nearby property called Twin Lakes, while the spin-out firm, to be called SilverWillow Energy Corp., will take a handful of early-stage properties.
The move also expands Teck’s oil sands business and allows it to use the truck-and-shovel open-pit mining expertise it’s honed from mining coal, copper and zinc.
Teck is a diversified miner producing steel making coal, zinc, copper and energy.
The company’s energy business includes a 20-per-cent stake in the Fort Hills project and a 50-per-cent interest in the Frontier project in the Athabasca region of northern Alberta.