Higher prices for metals brighten Cominco quarter

Selling shares in a subsidiary boosted Cominco Ltd.’s consolidated earnings for the six months ended June 30 to $19.5 million. An extraordinary gain of $17 million was realized from the sale of shares in Cominco Resources International which was formed to handle all foreign exploration.

The earnings compare to a consolidated loss of $35.7 million last year which exclude an extraordinary gain of $41.4 million. After dividends on preferred shares but before extraordinary items, 6- month earnings were 15 cents per common share on sales of $518 million, compared to a loss of 65 cents on sales of $496.3 million a year ago. Including extraordinary items, 6-month earnings amounted to 40 cents per common share versus a 1 cents loss last year.

Second-quarter earnings were $14 million (excluding the extraordinary gain), which represents a sharp improvement from the $9.1- million loss in 1986. The company’s mining and integrated metals division also moved solidly into the black, reporting a second- quarter operating profit of $30.1 million against a loss of $8 million last year. For the 6-month period, the operating profit was $56.9 million compared to a $14.5 million loss last year.

According to Robert Hallbauer, president and chief executive officer, higher metals prices and increased sales volumes of molybdenum and copper from Highland Valley operations were largely responsible for the improved quarterly results. Gold sales, however, were lower because the company sold its Con mine at Yellowknife and the strike at Trail and Kimberley, B.C., also reduced sales volumes of zinc, lead and silver. The impact of the strike will carry through into the third quarter, he said.

The fertilizer business segment earned an operating profit of $7.6 million during the quarter and $7.2 million for the six months. Sales were adversely affected by the depressed agricultural economy in both the United States and Canada. Several fertilizer plants are on the selling block and they collectively earned a cash operating profit of $10.3 million, which is being deferred against any operating losses that may occur in the second half.