Metal prices give boost to Metallgesellschaft results

Metallgesellschaft Canada Investments, a wholly-owned subsidiary of Toronto-based Metall Mining has reported substantially increased earnings for the year ended Oct 31.

A dilution gain of $5.2 million from a public offering by Teck Corp. increased Metallgesellschaft’s 1987 net income from $780,000 in Oct 31, 1986, to $6,819,000.

With 5.6 million Teck B shares in hand, Metallgesellschaft holds an 8% interest in the Vancouver metals giant.

Teck’s steadily improving profit performance was reflected in Metallgesellschaft’s equity earnings which increased from $769,000 in 1986 to $1.56 million in 1987.

Despite the Oct 19 market correction, the market value of Metallgesellschaft’s holding in Teck increased from approximately $67 million last year to approximately $91 million for the year ended Oct 31, 1987.

“The increased market value also reflects the general improvement in base and precious metal prices as well as the unamimous decision of the Ontario Court of Appeal on Oct 5, concerning the Page-Williams gold mine at Hemlo, Ont.,” says Robert Morgan, vice-president finance.

The decision affirmed an earlier decision of the Supreme Court of Ontario which had awarded the Page-Williams gold mine to Teck and International Corona Resources a reimbursement of $154 million in capital costs to Lac Minerals.

The Supreme Court of Canada has agreed to hear another appeal by Lac Minerals on Oct 11, this year.

Following the June reorganization in the base and precious metal mining division of West German metal trader Metallgesellschaft AG, the common share ownership of the company was transferred to a new Canadian company called Metall Mining.

Charged with expanding Metallgesellschaft’s worldwide mining business, Metall has raised $160 million cash from a public offering and is currently scouring the continent for acquisitions.

Metallgesellschaft retains a 62% interest in Metall Mining.