March 6, 2009 / 3:46 PM / 9 years ago

UPDATE 1-Western Goldfields posts Q4 profit, helped by gain

* Q4 net EPS $0.05 per share vs. loss of $0.06

* Results include mark-to-market gain on forward contracts

* Sees ‘09 gold output 140,000 to 150,000 ounces

March 6 (Reuters) - Canadian gold miner Western Goldfields Inc WGI.TO posted a quarterly profit helped by a gain from mark-to-market on its gold forward sales contracts.

The production and exploration company company posted net income of $7.8 million, or 5 cents a share, compared with a loss of $7.3 million, or 6 cents a share a year ago.

The company said fourth-quarter results included a non-cash after-tax gain of $9.2 million or 7 cents a share.

The mark-to-market gain reflects a decrease in spot gold price to $870 on Dec. 31, 2008, from $885 on Sept. 30, 2008.

Revenue rose to $24.5 million from $606,000.

Western Goldfields agreed on Wednesday to be acquired by rival New Gold Inc NGO.TO, in a deal that will give New Gold control of the Mesquite mine in California and create a mid-tier miner with expected output of 335,000 ounces this year. [ID:nN04541113]

The company expects to produce and sell between 140,000 and 150,000 ounces of gold, and assumes an average gold price this year of $850 an ounce. It also forecast cost of sales per ounce of $530 to $540.

Shares of the Toronto, Ontario-based company rose 1 cent to C$2.20 in morning trade on the Toronto Stock Exchange. (Reporting by Isheeta Sanghi in Bangalore; Editing by Mike Miller)

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