NEW YORK - Coeur d'Alene Mines Corp said on Monday first-quarter profit rose as silver production increased by 65%, especially from new mines in Mexico and Bolivia.
"The impact of Coeur's new mines is now beginning to be reflected in...quarterly results, which we expect will lead to a 66% increase in total silver production and an 85 percent jump in gold production this year," said Chairman, President and Chief Executive Officer Dennis Wheeler.
Net income was $6,1 million, or 1 cent per share, compared with $4,7 million, or 1 cent per share, in the same quarter of 2008, said the company based in Coeur d'Alene, Idaho. There were more shares outstanding in the quarter than in the previous year's quarter.
Analysts on average were expecting break-even first-quarter earnings, according to Reuters Estimates.
Although revenue fell to $49,8 million from $57,3 million, as a result of lower realized gold and silver prices, Coeur had a $15 million gain on debt extinguishment, the company said.
The mining company posted a production record of 3,9 million ounces of silver during the first quarter -- a 65 percent increase over the 2008 quarter and largely driven by new ounces from the new San Bartolome silver mine in Bolivia.
But the realized price per silver ounce dropped to $12,48 from $18,45, while the cost of production almost doubled to $8,63 per ounce from $4,80.
Realized gold prices dropped to $876 per ounce from $965 a year earlier.
During the quarter Coeur began production at its Palmarejo silver and gold mine in Mexico, marking an end of Coeur's heaviest period of capital investment in a two-year growth plan, Wheeler said. "We look forward to the transition into positive and significant cash flow generation."
Coeur expects Palmarejo to reach full capacity in July, with production for the rest of the year expected to reach 5,3 million ounces of silver and 72 000 ounces of gold.
San Bartolome, the world's largest pure silver mine, produced 2,1 million ounces of silver in the first quarter. In 2009, the first full year of production, it is expected to produce around 9,0 million ounces, the company said.
The company said it expects full-year operating cash flow of about $100 million based on current prices. Between existing cash and equivalents and expected operating cash flow during the remainder of the year, Coeur believes its liquidity position is sufficient.
In morning trading on the New York Stock Exchange, Coeur's stock was flat at $1,50.