Cambior still losing money (July 29, 2002)

Weighed down by falling gold production, gold miner Cambior (CBJ-T) turned in another quarterly loss.

The company posted a net loss of US$3.1 million (or US2 per share) on revenue of US$48.7 million during the second quarter, compared with a loss of US$10.9 million (US12 per share) on US$49.9 million in revenue during the corresponding period last year.

Gold production fell to 137,000 oz. from 153,000 oz. between the two periods, while direct mining costs rose by US$14 to US$233 per oz.

The output decline was caused by lower head grades at the Omai mine in Guyana (1.29 grams gold per tonne versus 1.48 grams a year earlier), as well as at the flagship Doyon division in Quebec (5.4 grams versus 5.9 grams).

The Sleeping Giant mine in Quebec, co-owned with Aurizon Mines (ARZ-T), saw a modest rise in head grades and production.

Under its hedging program, Cambior received US$311 per oz. for its second-quarter production, compared with a market price of US$312 per oz.

The company’s total gold-hedging commitments have been reduced by 206,000 oz. since the beginning of the year to 1,681,000 oz. at $304 per oz. on June 30, 2002.

Cambior’s attributable niobium production from the Niobec mine in Quebec, co-owned with Mazarin (MAZ-T), amounted to 392 tonnes during the second quarter, up from 355 tonnes a year earlier.

At its advanced, wholly owned Gross Rosebel gold project in Suriname, Cambior expects to submit a final feasibility study to the government during the third quarter, paving the way for mine construction to begin before year-end. Much of the equipment will be sourced from the Omai operation, which will close.

At June 30, Cambior held US$32 million in cash and equivalents and a total debt of US$26 million. The company had 154.6 million outstanding shares and 24.3 million listed warrants.