Teck Resources Ltd. (TCK/B), Canada’s second-largest mining company, delayed a copper project in Chile and the start of production at a coal mine in British Columbia after a decline in commodity prices.
Output at the Quintette coal mine won’t begin until a recovery in the martket for metallurgical coal, Vancouver-based Teck said today in a statement. Development at the Quebrada Blanca Phase 2 copper project has also been slowed by issues with environmental permitting and construction will now start in 2016 at the earliest.
“Prices for our products have continued to weaken,” Chief Executive Officer Don Lindsay said in the statement. “We continue to adapt to changing market conditions.”
Teck said second-quarter net income declined to C$143 million ($138.9 million), or 25 cents a share, from C$354 million, or 60 cents, a year earlier. Excluding one-time items, profit was 34 cents a share, topping the 32-cent average of 25 estimates compiled by Bloomberg.
Sales fell to C$2.15 billion from C$2.56 billion, beating the C$2.08 billion average of 15 estimates.
Teck’s operating cost per metric ton of coal sold fell to C$50 from C$59 a year earlier, according to the statement. Coal is Teck’s biggest source of revenue..
“They’ve done a pretty good job of managing costs in a difficult market environment,” John Stephenson, who helps oversee about C$2.7 billion at First Asset Investment Management Inc. in Toronto, said by phone before the results were released.
Barrick Gold Corp. is Canada’s largest miner by sales.
(Teck scheduled a conference call for 11 a.m. New York time at +1-866-226-1792.)
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