Vancouver – Painful pricing adjustments and a hefty writedown have claimed another victim in Quadra Mining (QUA-T, QADMF-O). Quadra posted a $126 million loss for the fourth quarter ending Dec. 31, 2008.
Though it managed to eke out $38.6 million in earnings for the year, that compares to earnings of $135 million in 2007.
A $96 million writedown due to the suspension of its Malmberg molybdenum project in Greenland accounted for the bulk of the fourth quarter loss.
Otherwise there were some bright spots for Quadra. Its Robinson copper-gold mine in Ely, Nevada, turned in revenues of $458 million for the year on production of 147 million lbs. copper and 127,000 oz. gold.
Promising too were lower cash costs at Robinson. These were down 34¢-per-lb. copper over 2007 to $1.15-per-lb. copper.
Quadra was also able to scratch $150 million in senior debt from its books in 2008 with a well-timed equity financing in June that raised net proceeds of $183.3 million, including a $19 million over-allotment.
Although Quadra ended the fourth quarter with $107.8 million in cash and cash equivalents, those were down precipitously from the third quarter by $158.6 million.
Most of the disappearing cash resulted from $112 million in pricing adjustments to customers. Quadra president and CEO Paul Blythe noted in a statement that such pricing adjustments are normal “but the amount was exceptional due to the unprecedented fall in the copper price in the second half of 2008.”
With no debt and a strong cash balance he said Quadra’s “immediate focus is on riding out the downturn in the economy”.
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