Symbol Last Price Change TCK 7.97 0 (0%) QUOTES AS OF 04:05:59 PM ET 07/22/2015
Miner Teck Resources Ltd.(TCK) on Thursday reported a 21% drop in second-quarter earnings, hurt by a continued slump in prices for steelmaking coal and copper.
Still, the Vancouver-based diversified miner's results came in ahead of analyst expectations as a weaker Canadian dollar, sliding oil prices and cost-cutting measures helped offset lower prices for its key commodities.
Teck, which produces steelmaking coal, copper and zinc, earned 63 million Canadian dollars ($48 million), or 11 Canadian cents a share, in the second quarter, down from C$80 million, or 14 Canadian cents a share a year earlier.
The miner's adjusted profit, which excludes certain items, was 14 Canadian cents a share, better than the 11 Canadian cents analysts polled by Thomson Reuters expected.
Revenue was flat at about C$2.0 billion.
Teck has been hurt by weak prices for steelmaking coal, which have slumped on indications of weakening demand from China, the world's largest steelmaker.
Teck said its average realized coal price fell 14% in the latest quarter from a year earlier, to $95 per metric ton. That follows a 19% drop in the miner's first quarter.
Due to weak pricing and demand, Teck said in May it would temporarily idle operations at its six Canadian coal operations in the third quarter. The company said the shutdowns, which will cut third-quarter output by 22%, are under way.
Coal production in the latest quarter rose to 6.6 million tons from 6.4 million tons a year earlier, Teck said. The planned shutdowns led the company in May to slightly scale back its coal output view for the year, which it now puts in the range of 25 million to 26 million tons.
Teck's second-quarter copper production was up 7% from a year earlier, though its realized copper price fell 10%. It also shaved its full-year production guidance for copper to a range of 340,000 to 350,000 tons, which is at the low end of previous guidance, after a ground movement in late June at its Quebrada Blanca mine in Chile caused it to temporarily suspend some mining operations there.
The company said its cash position fell to C$1.3 billion from C$1.6 billion in the quarter, largely due to spending on the Fort Hills oil-sands project in northern Alberta. Teck has a 20% stake in the oil-sands project, which is under construction. Its partners in the project include the Canadian unit of Total SA and Suncor Energy Inc.
Write to Judy McKinnon at judy.mckinnon@wsj.com
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