Profitability eludes Yukon-Nevada

Vancouver – The ongoing shutdown of its Jerritt Canyon mill in Nevada gouged into Yukon-Nevada‘s (YNG-T) bottom line during the second quarter.

Yukon-Nevada reported a net loss of US$7.7 million for the quarter ending June 30, up from a loss of US$5.2 million in the first quarter of 2009. The loss extended to six the number of consecutive quarters Yukon-Nevada has posted losses, the largest of which was US$77.2 million in the third quarter of 2008.

The latest loss bled Yukon-Nevada’s cash and cash equivalents to the precipitously low level of US$1.5 million.

Gold sales were down 40% during the second quarter of 2009 as compared to the first quarter due to the May 30 shutdown of its Jerritt Canyon mill, about 80 km north of Elko.

Yukon-Nevada had to flip the switch at the mill as the Nevada Department of Environmental Protection had required it to complete an upgrade of its mercury emissions control system at the Jerritt Canyon roaster by May 30. An unfortunate delay in the manufacture of equipment needed to complete the operation, however, meant Yukon-Nevada could not comply on time.

While Yukon-Nevada has since finished the upgrade, which will significantly reduce air emissions of mercury, the company is now working through the process of getting a restart order.

Stop-and-go’s have plagued the Jerritt Canyon operation over the past two years. In 2008 Yukon-Nevada shuttered Jerritt as mining and milling costs were escalating.

On news of its second quarter results Yukon-Nevada’s share price was holding steady at 12¢ as of presstime.