Aur’s earnings deflate

Caught in the web of depressed metal prices, Aur Resources (AUR-T) saw its second-quarter earnings squeezed by an astonishing 93%.

The Toronto-based company earned $488,000 on revenue of $25 million for the three months ended June 30, compared with $7.3 million on $36 million in the corresponding quarter last year.

The loss is attributed to lower metal prices, especially copper. Aur sold its copper production at US79 cents per lb., which is nearly a third less than its realized price of a year ago.

Earnings in the first half of the year totalled $865,000, whereas revenue amounted to $46 million.

At June 30, cash flow was $4.6 million; working capital, $93 million. And on that date, shareholders received their first dividend (5 cents per share), which was followed in July by the company repurchasing 204,100 of its own shares for cancellation.

Despite the depressed metal prices, production at the jointly owned Louvicourt and Andacollo mines in Quebec and Chile, respectively, remained on budget. Aur’s share of second-quarter output was 17.7 million lbs.

copper, 3.5 million lbs. zinc, 69,000 oz. silver and 2,400 oz. gold. These figures bring the company to within nearly 50% of its year-end target.

Developments at both mines are continuing apace. At Andacollo, a prefeasibility study on a 600-million-tonne deposit that averages 0.4% copper and 0.13 gram gold per tonne is expected to be completed by year-end.

The deposit, which consists of primary sulphide mineralization, is situated below the currently outlined reserves.

Aur owns a 70% interest in the Andacollo mine, whereas the remainder is held by a Chilean company. The government owns a 10% net profits interest in the project.

At Louvicourt, underground drilling is continuing to test a new zone of mineralization east of the mine. The discovery hole returned 95 metres of semi-massive to massive sulphides with anomalous zinc and gold. Aur owns a 30% interest in the Louvicourt mine and is the operator. The remaining interest is divided among Teck, with 25%, and Novicourt, with 45%.