Profit for Breakwater
NNSL (Apr 26/99) - Nanisivik mine owner Breakwater Resources reports first-quarter profit slightly ahead of the same quarter a year earlier.
For the three months ending March 31, Breakwater, a subsidiary of CanZinco Ltd., made $1.64 million, or two cents a share compared to $1.59 million in first-quarter '98.
Nanisivik, located on Baffin Island's Borden Peninsula near the community of Arctic Bay, contributed operating earnings of $1.9 million to Breakwater's financial statements.
That amount was ahead of Breakwater's other three operating mines.
But the $1.9-million figure was down from $3.5 million in first-quarter 1998, the company said.
"The earnings decline in 1999 versus 1998 was due primarily to lower zinc prices and lower zinc production," Breakwater said.
Lower zinc prices and production was partly offset by a significant decrease in operating costs which were about $1 million lower in first- quarter 1999 compared to first quarter 1998, Breakwater said. Prices paid for zinc, lead and silver in the first three months of 1999 were down compared to 1998 first-quarter figures.
The average realized price for zinc was 66 cents per kilogram compared to 76 cents while the average realized price for lead was 34 cents compared to 42 cents. Comparable silver prices were $7.72 and $9.27.
Gross revenues from Nanisivik were $17.9 million compared to $19.9 million.
Breakwater's 1999 objective is to increase zinc production at all operations combined by 30 per cent to 173.3 million kilograms at a cash cost less than 60 cents per kilogram.
First-quarter results indicate the company is on track to meet such targets.
Overall, the company's first-quarter zinc and lead productions were up 36 per cent and 23 per cent, respectively.
Meanwhile, Nanisivik miners are attempting to unionize under the United Steelworkers of America banner.
The United Steelworkers represents more unionized miners in Canada than any other union.
In the North, Miramar Con miners and Polaris miners are represented by the Steelworkers union.
Earlier this month, Ken Neumann, Steelworkers' district 3 director, said there has been no word on when the Canadian Labour Relations Board will decide on the application.
Nanisivik employs about 200 people. The community of Nanisivik has about 350 residents.
Last year, the mine's life was estimated at about six years but reserves have continually been expanded. Nanisivik began production in 1976. The project's feasibility study outlined a 12-year operation.