March 28, 2012 / 3:23 PM / in 6 years

Scorpio Mining shares fall on weak results

March 28 (Reuters) - Shares in Scorpio Mining Corp fell as much as 23 percent to an eight-month low, after the Canadian silver producer posted a fourth-quarter loss on lower revenue and higher costs.

The company, whose operations are mainly in Mexico’s Cosala district, said on Tuesday a customer did not buy all of the December production of lead concentrate that contained a significant portion of silver.

For the October-December quarter, Scorpio reported an 83 percent drop in cash flow and a 12 percent decline in revenue from metal payable.

Price of silver had been weak in the October-December quarter. The grey metal shed 7 percent to average $31.83 an ounce in the period.

Shares of Vancouver-based Scorpio Mining, which operates the Nuestra Señora mine and mill, fell to C$1.37 on Wednesday morning on the Toronto Stock Exchange.

The stock, which has gained more than 40 percent of its value in the last one year, was one of the top percentage losers on the exchange.

Silver miners such as Scorpio and Fortuna Silver Mines Inc have been grappling with cost pressures. On Wednesday, Haywood Securities cut its price target on the Fortuna stock to C$6.60 from C$7.25, saying cost pressures stand to eat into Fortuna’s fortunes. (Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Sriraj Kalluvila)

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