* Q1 EPS C$1.54, helped by asset sales
* Revenue rises to C$1.9 bln from C$1.7 bln
* Will pay off short-term debt by Thursday
(In U.S. dollars unless noted)
TORONTO, April 20 (Reuters) - Teck Resources TCKb.TO said on Tuesday its first-quarter profit more than tripled on the back of asset sales and said it would pay back the remaining short-term debt from its 2008 Fording acquisition this week.
Teck borrowed $9.8 billion in term and bridge debt to buy Fording Canadian Coal Trust just ahead of the 2008 resource price crash.
The company has spent the past year paying back the debt — primarily through asset sales, suspending its dividend, and a $4.2 billion bond issue — and had the total down to $800 million in early March.
It now plans to have that paid down by Thursday, the company said in a statement. Teck has said it will consider reinstating the dividend once the debt is paid off.
The company’s first-quarter profit more than tripled to C$908 million ($908 million), or C$1.54 a share, as it realized a C$639 million gain on the sales of gold assets and a one-third stake in the Waneta hydroelectric dam in British Columbia.
This compared with a year-before profit of C$241 million, or 50 Canadian cents per share.
Quarterly revenue rose to C$1.9 billion from C$1.7 billion, due primarily to copper and zinc prices, which approximately doubled from the year-before period.
Prices for metallurgical coal — which is used in the steelmaking process — retreated. Coal contracts are renewed annually in April, so the first quarter sales were done at prices agreed to just after the bottom of the market in early 2009.
Since then, prices have increased as steel demand has rebounded.
“Our operating results reflect strong copper prices, but do not yet reflect the substantial increases in steelmaking coal prices that have been negotiated,” Teck Chief Executive Don Lindsay said in the statement.
Teck said it has agreed on 2010 prices with a majority of its coal customers, with settlements for most of the tonnage reached at $200 per tonne for the highest quality coal.
Realized prices during the quarter were $140 a tonne.
Following the Fording acquisition, metallurgical coal accounts of the majority of Teck’s revenue.
Shares of Vancouver-based Teck plunged in late 2008 as the company took on debt while metals prices were falling.
But the stock has risen 13-fold since bottoming in March 2009. It fell 71 Canadian cents to C$41.71 on the Toronto Stock Exchange. The results were released after markets closed.
Teck has been facing a challenge to permitting at its Red Dog zinc mine in Alaska that could force it to shut down the operation for more than a year if it is not resolved by May. Red Dog is the world’s biggest zinc mine. ($1=$1.00 Canadian) (Reporting by Cameron French; editing by Andre Grenon)