TORONTO (miningweekly.com) – Denver, Colorado-based Thompson Creek Metals on Monday reported a net loss of $484.4-million or $2.87 per diluted share as it booked a $530.5-million noncash pretax write down of its share of the property, plant, equipment and development assets at the Endako molybdenum mine, in British Columbia (BC).

“We recorded a significant fixed asset write down at our Endako mine during the fourth quarter, and our Endako management team is working diligently to address its operational challenges, which are expected to continue through the winter months,” CEO Kevin Loughrey said in a statement.

On an adjusted basis, with one-time items removed, the company reported a fourth-quarter loss of $18-million or 11c per diluted share. Analysts on average expected a fourth-quarter loss of 3c a share on revenue of $105.71-million.

Thompson Creek reported fourth-quarter revenue of $99.4-million, which was nearly 15% lower than the 116.7-million the company reported in the same quarter a year earlier, as a significant decline in molybdenum prices in 2012 and operational challenges at the company’s two operating mines hit hard.

The price of molybdenum, which is mainly used to create high-strength alloys and superalloys, as well as for high-pressure and high-temperature applications, such as pigments and catalysts, in 2012 declined by 16.4% to $11.77/lb in the fourth quarter, compared with $14.08/lb in the same quarter a year earlier.

For the full year, revenue was at $401.4-million, down 40% when compared with 2011, as molybdenum sales declined by 40% when compared with that of the previous year. However, during the fourth quarter, molybdenum sales rose by about 42% quarter-on-quarter to 8.1-million pounds.

In the quarter, the company increased total molybdenum production by about 26% from the previous quarter to 7.7-million pounds, up from 6.1-million pounds. This helped the company to decrease average cash costs per pound of molybdenum produced by about 31% from the previous quarter to $6.58/lb from $9.46/lb.

The company said that while it was working to improve operations at its two operating mines, it was focused on progressing with the 81%-completed Mt Milligan copper/gold mine, in BC.

"While 2012 had some noteworthy highlights, including the significant advancement of the Mt Milligan project and our achievement of a significant safety milestone at Mt Milligan, the year proved to be challenging from both a funding and operational perspective.

“During the year, we raised additional funding to ensure the completion of the Mt Milligan project, and took several strategic steps to address operational challenges at both of our molybdenum mines.

As the Mt Milligan project continues to advance, we very much look forward to its completion and the commencement of copper and gold production and our expectation of near-term increases in revenue, cash flow and net income,” Loughrey said.

Thompson Creek at the end of November closed the $350-million senior secured first priority notes offering, which bears interest of 9.75% and is due in 2017.

The company said it intended to use the proceeds from the offering for general corporate purposes, including capital expenditure relating to the development of its $1.5-billion Mt Milligan mine.

The company’s shares were down by 6.46% at $3.33 apiece on the New York bourse on Monday morning.