View of Teck Trail from Jubilee Park. Photo: Trail Times

View of Teck Trail from Jubilee Park. Photo: Trail Times

Teck Trail reports $7M third quarter loss

Overall number an improvement from a reported $20-million loss for the third quarter of 2019

Teck has reported a $7-million loss in the third quarter at the Trail operation.

The smelter would have posted a gross profit of $14-million over the three months of July, August and September if not for depreciation and amortization.

The overall number, however, is still an improvement from a reported $20-million loss for the third quarter of 2019.

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The company’s financial report, released Oct. 26, shows production of refined zinc in Trail increased six per cent to 76,400 tonnes from one year ago, though 2019 production was impacted by equipment failure in the zinc refinery.

Refined lead production of 18,200 tonnes in the third quarter at Teck Trail was 1,100 tonnes higher than the same period last year.

Silver production decreased to 2.6 million ounces compared with 3.5 million ounces a year ago primarily as a result of lower silver contained in concentrate feeds.

At Red Dog Operations, zinc and lead production in the third quarter decreased by 14 per cent and nine per cent respectively, compared to a year ago.

The company says the lower production was primarily due to lower ore grades as expected in the mine plan as well as reduced mill throughput.

Property, plant and equipment expenditures include $61 million for sustaining capital, of which $5 million relates to Trail Operations and $56 million relates to Red Dog.

Operating costs before changes in inventory in the third quarter were three per cent lower than a year ago at $118 million, primarily due to lower supplies and maintenance costs.

The report shows gross profit from Teck’s overall zinc business unit was $184 million in the third quarter compared with $207 million a year ago.

The company says uncertainty remains over the extent and duration of impacts that COVID-19 may have on demand and prices for Teck commodities, as well as on its suppliers, customers and employees and on global financial markets.

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Reported impacts on Teck’s business include: global workforce and contractors continue to work safely and productively with challenges associated with the COVID-19 pandemic to minimize the spread of the virus; protocols remain in place with a continued focus on preventative measures, controls and compliance, and the integration into “new normal” of operations and planning; all mines have recovered from COVID-19 production disruptions in the second quarter, though labour intensive activities such as maintenance, mine operations, and projects continue to be impacted by COVID-19 safety protocols; $130 million in costs was expensed in the quarter relating to the temporary suspension and remobilization of the QB2 project after suspension due to COVID-19 in March 2020.

(QB2 refers to Quebrada Blanca Phase 2, a copper project in the northern region of Chile).

“We made significant progress during the quarter on our priority projects, including safely ramping back up construction at our QB2 project (Chile) and advancing the Neptune Bulk Terminals upgrade in line with schedule and budget. Our financial performance recovered strongly from a second quarter that was significantly negatively impacted by COVID-19, and despite the decline in realized steelmaking coal prices, we posted gains in profitability and operating cash flows,” Don Lindsay, President and CEO said in the report.

“Across our business, our people have adapted to the new normal of operating through the pandemic, staying focused on health and safety while continuing to responsibly produce materials essential to the global economic recovery,” said head of Teck, Don Lindsay.

In the third quarter, Teck’s profit attributable to shareholders was $61 million, or $0.11 per share, compared with $369 million, or $0.66 per share, in the same period a year ago.



newsroom@trailtimes.ca

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