NEW YORK HudBay Minerals
Inc. closed out 2012 with a sharp drop in fourth-quarter
revenue compared with the same period a year earlier, but the
company anticipates a nearly 400-percent increase in copper
production as its Lalor and Reed projects in Manitoba and
Constancia project in southern Peru come online over the next
Toronto-based company posted fourth-quarter net income of
nearly Canadian $7.44 million ($7.3 million) vs. C$34.29
million a year earlier on revenue that tumbled 28.8 percent to
C$180.99 million ($177.7 million).
HudBay said that the declines
were due to lower metal prices and lower sales volumes compared
with the fourth quarter of 2011, when the company drew down on
an unusually large inventory of copper concentrate.
The company posted a full-year
net loss of C$21.17 million ($20.78 million) vs. a
C$163.59-million loss in 2011 on revenue that slid 21.1 percent
to C$702.55 million ($689.76 million).
The last three months of 2012
was the companys first full quarter since the closure of
its Trout Lake and Chisel North mines in Manitoba, HudBay
president and chief executive officer David Garofalo noted
during a Feb. 21 conference call with analysts and investors.
The company expects to experience a "trough" in copper
production in the first half of 2013 similar to that in the
fourth quarter of 2012.
However, Garofalo said that
copper and zinc production will increase significantly over the
coming years, with copper output alone expected to rise 390
percent by 2015.
"Our focus in 2013 is to
continue to advance our robust portfolio of development assets,
which we expect to provide significant copper, gold and zinc
production growth over the next two years as they are brought
into production," he said.
HudBay has boosted its Lalor
zinc and copper mine capital expenditure forecast by C$90
million to a total of C$794 million as the company is
increasing grinding capacity with a new concentrator design.
The company still projects ore production from the main
production shaft to start in late 2014.
HudBay also expects its
Constancia project to reach initial production in late 2014 and
full production in the second quarter of 2015, despite
greater-than-expected rainfall in the area which has delayed
the projects progress.
"HudBay believes that the impact
on project schedule is recoverable and the targets for initial
production and full production remain unchanged," the company
HudBay said that initial
production at its Reed copper project would begin in the fourth
quarter of 2013 and that it is expected to reach full
production by the first quarter of 2014.