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Gold/Mining/Energy : ZINC The base metal. News and Views. Symbol Zn -- Ignore unavailable to you. Want to Upgrade?

To: John McCarthy who wrote (1793)	11/1/2006 9:24:38 AM
From: Herb Duncan	Respond to of 3270

Read this it will help put things in perspective. Teck Cominco Reports 25% Increase in Profit Year-on-Year By Craig Wong 31 Oct 2006 at 07:45 AM EST VANCOUVER (CP) -- Teck Cominco Ltd. [NYSE:TCK; TSX:TCK.B] reported a nearly 25% increase in third-quarter profit compared to a year ago due to higher copper and zinc prices, partially offset by lower zinc sales and a lower realized coal price. The company said it earned C$504 million or C$2.32 per diluted share for the three months ended Sept. 30. That compared to a profit of C$405 million or C$1.88 per diluted share in the same period last year. Quarterly revenue increased to C$1.63 billion, up from C$1.15 billion a year ago. The average analyst estimate had been for earnings of C$2.65 per share, based on 12 analysts surveyed by Thomson Financial. The average revenue estimate was for C$1.75 billion, based on four analysts. Teck Cominco chief executive Don Lindsay said the company managed to ship all of its concentrates from its Red Dog mine in Alaska, but still faced some delays. ''Poor weather conditions delayed the loading of vessels and the timing of shipments resulting in the shifting of some of Red Dog's sales from the third quarter into the fourth quarter of this year and the first quarter of 2007,'' Lindsay said in a statement. The company said the average cash prices for copper and zinc were US$3.48 and US$1.53 per pound respectively in the quarter, compared to US$1.70 and US$0.59 per pound a year ago. Realized coal prices averaged US$109 per tonne compared with US$118 per tonne last year. Weighing on the results, the company said zinc sales from the Red Dog mine were sharply lower due to poor weather conditions that delayed concentrate shipments. Red Dog's zinc sales in the third quarter were 80,000 tonnes lower than a year ago, deferring about C$82 million in net earnings to the following two quarters. The company also took two accounting provisions related to the Antamina operations. They involved the refinancing of the original project debt and an accrual of social contributions pending the finalization of an agreement with the Peruvian government. In its outlook, the company said it expects strong zinc sales in the fourth quarter, as most shipments from Red Dog delayed in the third quarter will be brought into sales in the fourth quarter. The company said capital expenditures are estimated to be C$120 million in the fourth quarter. Teck Cominco also said that it expects to record a pre-tax gain of C$135 million on the sale of the Inco shares it held after it failed to win its bid for the nickel producer. In announcing it decision to allow its bid to expire in August, Teck Cominco said it would now move on to the next set of projects, working its way down a 13-item list of potential targets or partners. At Sept. 30, Teck Cominco had C$3.8 billion in cash and temporary investments. Meanwhile, the company said Monday it will implement the recommendations of the province's chief mines inspector and a report into four deaths at the company's former Sullivan mine earlier this year. The accident killed environmental consultant Doug Erickson and Teck Cominco employee Bob Newcombe. Paramedics Kim Weitzel and Shawn Currier also died in the rescue attempt. Last week, Teck Cominco restored temporary power at its Pogo mine site in Alaska that would allow scheduled maintenance and construction work to proceed in its mill. An additional portable generator was expected to allow the partial restart of underground mining by the end of the month. Underground ore production will be stockpiled on surface until mill operations resume. Shares in the company, which reported its results after the close of markets, were down C$2.43 at C$83.50 on Monday in trading on the Toronto Stock Exchange on. The company announced early Tuesday that the company is focused on internal growth projects, not big acquisitions right now and plans to complete repairs at its Pogo mine project in December. Lindsay said Tuesday that since the company let its failed bid for Inco Ltd. expire, Teck Cominco has been looking at a growing list of internal projects for its growing pile of cash, which totalled C$3.8 billion at the end of September. ''We are carefully assessing just how far along those projects are, how fast we can bring them into production and how much capital they would require,'' Lindsay told a conference call with analysts. Lindsay said if the company does look to make an acquisition it would likely be a fraction of the size of its proposed deal for Inco, which he called a unique situation. ''I'm not even sure that we will be making any acquisitions because, frankly, there's nothing at the moment that is that far along,'' he said. The company has said it would like to see about 35% of the company's revenue come from commodities that are not trading on the volatile London Metals Exchange, identifying iron as one area in which the company is interested