NEW YORK Thompson Creek Metals Co. Inc. has posted a 2012 net loss of $546.3 million, in contrast to net income of $292.1 million the previous year, with the companys results "dominated" by a $530.5-million asset write-down associated with difficulties at its Endako molybdenum mine.
The Denver-based company recorded consolidated revenues of $99.4 million for the three months ended Dec. 31, down 14.8 percent from $116.7 million in the year-ago period. The quarter also saw a net loss of $484.4 million in contrast to net income of $800,000 a year earlier.
Full-year 2012 revenues stood at $401.4 million, down 40 percent from $669.1 million in 2011.
The companys earnings were "dominated by the impairment we took in the fourth quarter," chairman and chief executive officer Kevin Loughrey said in a Feb. 25 conference call.
The impairment came about as the Endako Mine began to experience issues caused by frozen water in the sites tailings pond in December 2012.
"Endako has been unable to feed sufficient water from the tailings pond to the new mill on a consistent basis, which has negatively impacted its rate and level of throughput of mined material to the mill and thus its production of molybdenum," the company said.
While Thompson Creek has made modifications to the Endako Mine which are expected to prevent a recurrence of these issues, the company warned that the issues "will have a negative effect on production and financial results from the Endako Mine in the first quarter of 2013."
The company produced 22.4 million pounds of molybdenum in 2012 at its Endako and Thompson Creek sites and forecast total production of 27.5 million to 30.5 million in 2013.
Loughrey added that a lull in global molybdenum demand and pricing had affected the companys bottom line.
"The moly market continues to be disappointing for us, as we dont have the robust demand from the steel sector that we had anticipated," Loughrey said. "Demand in China appears to be picking up now, but in 2012 it was not occurring at the rate that we had expected either. And Western Europe continues to be a significant problem as the economies there struggle."
However, the company said that its Mount Milligan copper-gold project remains on schedule, with commissioning and start-up expected in the third quarter of 2013 and commercial production of copper and gold expected in the fourth quarter of 2013.
Thompson Creek added that it will provide detailed production and cash cost guidance for Mount Milligan once it is operational, but noted that the sites average annual production is expected to be highest during the first full six years of production (approximately 89 million pounds of copper and 262,000 ounces of gold in concentrate) compared with its annual life-of-mine production.