Cambior losses continue to shrink

Having completed its financial restructuring in by simultaneously closing a US$65-million credit facility and a US$55-million prepaid gold forward sale, Cambior (CBJ-T) continues to see its losses shrink.

During the first three months of 2001, Cambior posted a net loss of US$900,000 (or 1 per share) on revenues of US$47.5 million, compared with year-ago earnings of US$16.4 million (23 per share) on revenues of US$50.2 million. Before an unrealized gain on derivative instruments of US$4.4 million, the adjusted net loss was US$5.4 million in the recent quarter, compared with a loss of $1.5 million in 2000.

Thanks to the restructuring, financial expenses fell 35% to US$2.1 million during the quarter, down from US$3.3 million in the same quarter of 2000.

During the final three months of 2000, Cambior posted a loss of US$71.3 million on revenue of US$52.9 million, compared with a loss of US$347.4 million during the corresponding period in 1999.

Gold production for the quarter amounted to 151,900 oz. at a total production cost of US$219 per oz., compared with 150,400 oz. at US$222 per oz. during the same period of 2000. Cambior realized a price of US$296 per oz. for its production during the recent quarter, down from US$304 per oz. a year earlier, but still a US$32-per-oz. premium over the quarter’s average market price.

The bulk of the production came from the Omai open-pit gold mine in Guyana, where higher grades and increased milled tonnage pushed production 22% higher to 88,600 oz. Direct mining costs fell to US$213 per oz. from US$230 a year earlier.

The Doyon division in Quebec poured 55,000 oz., just 1,000 oz. off last year’s total. Direct mining costs fell by US$9 to US$229 per oz.The company now expects to produce 600,000 oz. during 2001, up from the 585,000 oz. predicted at the beginning of the year.

In January, Cambior completed a US$6.3-million private placement of 15 million shares to Japan’s Jipangu, which is now Cambior’s largest shareholder with a 22% interest. The proceeds were used to repay part of Jipangu’s US$10-million mortgage on Cambior’s 50% interest in the Niobec mine. The mortgage loan was reduced to US$3.7 million and subordinated to the aforementioned credit facility.

At the end of March, the company had cash and equivalents of US$8 million . Its debt stood at US$68 million, compared with US$130 million the previous year.