North American Palladium cuts output forecast, shares plunge

Mon May 6, 2013 10:21am EDT
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May 6 (Reuters) - Precious metals company North American Palladium Ltd cut its 2013 production forecast by up to 15 percent, citing ramp-up delays at its Ontario mine, sending its shares down as much as 24 percent to their lowest in over a decade.

The company's shares were down 20 percent at C$1.11, making the stock the top percentage loser on the Toronto Stock Exchange on Monday.

"Management believes that the low end of the 150,000 to 160,000 ounce production guidance will be difficult to achieve, and could potentially decrease by about 10 to 15 percent," the company said in a statement.

North American Palladium said the ramp-up at Lac des Iles, its flasgship mine in Ontario, is taking longer than expected.

Palladium production at the mine fell to 38,654 ounces in the first quarter from 41,760 a year earlier.

The company also raised its 2013 capital expenditure of C$105 million ($104 million) by 35 percent.

The company's net loss widened to C$2.8 million, or 2 Canadian cents per share, in the first quarter from C$0.9 million, or 1 Canadian cent, a year earlier.

The company also operates the Vezza gold mine in the Abitibi region of Quebec. ($1 = 1.0084 Canadian dollars) (Reporting by Krithika Krishnamurthy in Bangalore)