* Third quarter net loss of $199 mln, or 51 cents a share
* Takes $228.2 million writedown on mines, acquisitions
* Shares rise 5 Canadian cents to C$1.55 (Adds details. In U.S. dollars, unless noted)
TORONTO, Nov 13 (Reuters) - Lundin Mining LUN.TO fell to a steep loss in the third-quarter as plunging metals prices eroded core earnings and forced a writedown of some mines and two recent acquisitions, the company said on Thursday.
Lundin, which is based in Toronto but operates mainly in Europe, also said it would temporarily shut its Aljustrel mine and suspend zinc production from its Neves-Corvo mine due to the sharp drop in the metal’s price. Both operations are located in Portugal.
Revenue plunged 34 percent to $191.9 million as stronger production failed to compensate for tumbling metal prices.
The company lost $199 million, or 51 cents a share, in the three-month period ended Sept 30. That compared with a profit of $76.6 million, or 20 cents a share, in the year-before quarter.
Stripping out one-time items, including a noncash $228.2 million charge largely to write down the 2006 and 2007 acquisitions of Eurozinc and Rio Narcea Mining, Lundin earned $2.1 million, or 1 cent a share.
Analysts polled by Reuters had expected, on average, a profit of 7 cents a share, before exceptional items.
The company’s shares, which have plunged 80 percent since May, were up 5 Canadian cents at C$1.55 on the Toronto Stock Exchange on Thursday.
Copper output rose 8 percent to 24,433 tonnes, while zinc production climbed 23 percent to 44,605 tonnes. Lead production was relatively flat at 9,908 tonnes, while nickel production rose 36 percent to 2,155 tonnes. The company said metal production was mostly ahead of its expectations.
However, zinc prices fell 45 percent year over year, while lead and nickel dropped 38 percent and 37 percent, respectively. Copper prices were fairly steady.
In a statement, the company blamed the price declines on consumer destocking and unwinding of metal futures contracts, due to tight credit.
“Our view is that prices in some of our products are already so low that perhaps a majority of global production is now uneconomic; a situation that should correct over time unless unprecedented economic decline reverses decades of rising demand trend,” it said.
Lundin operates mines in Sweden, Ireland, Portugal and Spain.
Lundin has been quiet since an aggressive spurt of acquisitions in 2006 and 2007 when it snapped up Eurozinc, Rio Narcea and Tenke Mining, the latter of which gave it a 25 percent stake in the massive Tenke Fungurume copper-cobalt project in the Democratic Republic of Congo.
The Tenke project is a joint venture with U.S. miner Freeport-McMoRan (FCX.N). Lundin said it expects copper production from the deposit in the second half of 2009.
$1=$1.23 Canadian Reporting by Cameron French; Editing by Frank McGurty