Breakwater ends Q4 in black

Zinc miner Breakwater Resources (BWR-T) enjoyed a fourth-quarter profit of $327,000, largely as a result of foreign-exchange gains.

The earnings translate into nil per share and compare with a loss of $2 million (or 1 per share) in the fourth quarter of 2002.

However, revenue between the two periods was more than halved to $51.4 million, owing mainly to the closure of the Nanisivik mine on Baffin Island at the end of the third quarter of 2002, and to the stronger Canadian dollar.

Operating cash flow (before changes in non-cash working capital) more than tripled to $10.4 million.

For all of 2003, Breakwater earned $7.1 million (3 per share) on revenue of $207.6 million, compared with a loss of $19.9 million (12 a share) on $305.4 million in 2002. Cash flow from operations was $14.7 million, up from $8.6 million in 2002.

For all of 2003, zinc-in-concentrate production slipped by nearly 24% to 165,422 tonnes, owing to the closure of the Nanisivik mine. Breakwater’s copper production fell almost 40% to 3,710 tonnes, while silver output dropped by 25% to 2.2 million oz. Conversely, gold production grew by 1,416 oz. to 26,220 oz. and lead production increased by 823 tonnes to 13,516 tonnes.

Total cash costs were unchanged at US32 per lb. zinc, whereas mine site operating costs climbed US$1.13 to US$28.31 per tonne milled.

Breakwater says that while the average realized U.S.-dollar price of zinc climbed by US$84 to US$859 per tonne between the two fourth quarters, the Canadian-dollar price fell by $15 to $1,202 per tonne.

At the end of 2003, Breakwater had $6.4 million in cash and equivalents, unchanged from the end of 2002. Total debt was down to $25.8 million, versus $78.7 million at the end of 2002.