Teck profit tumbles on weaker coal, metal prices
(Reuters) - Teck Resources Inc TCKb.TO, Canada's largest diversified miner, said on Wednesday lower coal and metal prices contributed to a steeper-than-expected drop in quarterly profit and that it sees no reprieve anytime soon, sending its shares more than 7 percent.
Vancouver-based Teck said economic uncertainties in Europe and the United States and ebbing growth in China, India and other emerging markets held back both demand and prices for many of its products in the second quarter.
"While we believe that the medium to long-term fundamentals for steelmaking coal, copper and zinc are quite favorable, the recent weakness in these markets may well persist over the near term," the company said in a statement.
Net profit dropped nearly 65 percent to C$268 million ($262.84 million), or 46 Canadian cents a share, from C$756 million, or C$1.28, a year earlier.
Adjusted profit, excluding one-time items such as asset sales, fell 53 percent to C$312 million, or 53 Canadian cents a share.
Analysts, on average, had expected a profit of 64 Canadian cents a share on revenue of C$2.47 billion, according to Thomson Reuters I/B/E/S.
Revenue fell to C$2.56 billion from C$2.80 billion, as coal, copper, zinc and other metal prices dropped below year-ago levels.
Teck, which has operations in Canada, the United States, Chile and Peru, produced a record 90,000 tonnes of copper in the quarter, but sales fell 2 percent to C$731 million due to a decline in copper prices.
Coal revenues dropped 7 percent to C$1.36 billion on lower prices, while zinc sales volumes slipped due to seasonal fluctuations at the Red Dog mine in Alaska. Continued...