UPDATE 1-Canada's First Quantum's earnings hurt by lower copper output

Thu Oct 30, 2014 5:29pm EDT
 
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(Adds analyst forecasts, production details)

Oct 30 (Reuters) - Canadian base metal miner First Quantum Minerals Ltd reported a bigger-than-expected drop in third-quarter earnings on Thursday due in part to lower copper and nickel production.

The company, which primarily mines copper but also produces nickel and gold, said earnings fell to $121.2 million, or 21 cents a share, in the three months through September, from $143 million, or 24 cents, a year earlier.

Analysts, on average, expected First Quantum to report earnings of 26 cents a share, according to Thomson Reuters I/B/E/S.

The company, which took over rival Inmet Mining last year, gaining control of the huge Cobre Panama project in Panama, is poised to become one of the world's largest copper producers over the next five years, with a number of projects, including Cobre Panama in Central America, set to begin production.

The Vancouver-based miner produced 101,553 tonnes of copper in the quarter, down 11 percent from the same period a year ago. Nickel output fell 5 percent and gold production fell by 21 percent.

An ongoing lack of smelting availability in Zambia continued to hamper First Quantum's Kansanshi copper production in the southern African country, First Quantum's Chief Executive and Chairman Philip Pascall said on Thursday.

"These constraints will ease substantially when our new smelter is in operation beginning in 2015," he said.

Cash costs per pound of copper rose to $1.44 from $1.16 a year ago, while the average copper price the company received rose 1 cent to $3.11 a pound. (Reporting by Nicole Mordant in Vancouver; Editing by Chris Reese and Diane Craft)