Placer Dome 3rd-Qtr Net Doubles as Mine Output Rises
Vancouver, Oct. 24 (Bloomberg) -- Placer Dome Inc., the world's fifth-largest gold producer, said profit doubled in the third quarter as output rose from two Papua New Guinea mines and after it boosted its stake in a Chilean copper mine.
Net earnings rose to $34 million, or 10 cents a share, in the three months ended Sept. 30, from $17 million, or 6 cents a share a year earlier, the company said in a release distributed by the PR Newswire.
Placer benefited from rising output from its Porgera and Misima mines in Papua New Guinea and from a owning a bigger share of the Zaldivar copper mine in Chile. Copper prices have gained almost 11 percent since Placer bought the 50 percent of Zaldivar it didn't already own from Finland's Outokumpu Oyj.
``We are generating tremendous cash flow thanks in part to assets like Zaldivar and the enhanced performance at many of our operations,'' Placer Dome President and Chief Executive Jay Taylor said in a statement.
Vancouver-based Placer said Nov. 12 it agreed to pay $251 million for the stake in Zaldivar it didn't already own. The mine generated cash flow of $107 million in the first nine months of this year, Placer Dome said.
Cash flow from operations rose to $146 million in the third quarter from $99 million a year earlier, Placer Dome said.
Sales in the nine months to Sept. 30 rose to $1.05 billion, 23 percent more than in the previous corresponding period, the company said.
Placer Dome is among a group of North American miners seen as likely to make acquisitions in Australia after the Australian dollar fell 20 percent this year, making local companies cheaper for foreign rivals interested in acquisitions.
The company said it expects to reach its production target of 3 million ounces of gold for the year and that cash costs of producing the precious metal will decline to $160 an ounce.
Placer Dome's U.S. traded shares yesterday fell 0.8 percent to $7.81, while its Canadian shares dropped 1.3 percent to C$11.80.
Oct/24/2000 2:20 ET
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