IMN Inmet announced Q2 earnings from continuing operations of USD 1.36 per share compared to USD 0.83 per share in the Q2 of 2011.
Q2 highlights;
1. Strong earnings from operations;
Earnings from operations were USD 109 million compared to USD 85 million in the Q2 of 2011. Significantly higher copper sales volumes increased operating earnings by USD 83 million a result of higher production at Las Cruces and Çayeli. Lower realized copper and zinc prices and lower zinc sales volumes compared to the Q2 of 2011 reduced earnings by USD 43 million.
2. Las Cruces achieved design capacity for each month of the quarter;
Las Cruces produced 18,300 tonnes of copper cathode in the quarter compared to 8,500 tonnes produced during the same period of 2011. Plant production exceeded 6,000 tonnes of copper cathode each month this quarter and unit costs decreased to USD 1.04 per pound of copper cathode produced.
3. Inmet begins reporting financial results in US dollars;
Effective June 1st 2012 the US dollar was adopted as Inmet’s functional and presentation currencies. We have restated all comparative financial statements from previously reported Canadian dollar amounts to US dollars using the May 31st 2012 transition rate of USD 0.97 per Canadian dollar.
4. Foreign exchange gains increased net income from continuing operations;
We recognized USD 40 million in foreign exchange gains this quarter, mainly on the revaluation of our US dollar denominated cash and long-term bonds held in Inmet Mining prior to the change in its functional currency from the Canadian dollar to the US dollar and US dollar cash held in our euro based entities.
5. We began full scale construction for Cobre Panama;
During May 2012, we announced the completion of basic engineering for Cobre Panama, the launch of a financing plan to fully fund our 80% share of the related development costs and issued Full Notice to Proceed to start construction of the project.
6. Issuance of USD 1.5 billion in senior unsecured notes;
On May 18th 2012, we issued USD 1.5 billion in senior unsecured notes the proceeds of which will be used to fund development of Cobre Panama. The notes bear a coupon rate of interest of 8.75% and mature on June 1th 2020.
Source - IMN Inmet
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