VANCOUVER (miningweekly.com) – Base metals producer Imperial Metals is reviewing its mine plans and its capital requirements because of lower-than-expected metal output in the first half of this year, the company said late on Monday.

To tide it over, the Vancouver-based company, which operates the Red Chris and Mount Polley copper mines, in British Columbia, has accepted a C$20-million bridge loan from affiliates of its two major shareholders that matures on the earlier of October 15, or as soon as the company secures additional financing.

The review might require it to secure further financing or request an extension of the maturity dates of some of its debt, which raises doubt regarding the company’s ability to continue as a going concern.

Based on the results of operations for the second quarter ended June 30, the company met three of four financial covenants contained in its senior credit facility and received a waiver for the covenant in breach, so that no event of default has occurred under the facility. The waiver covers the period to September 30, and requires management to deliver a financing plan to the senior credit facility lenders for their approval before that time.

At June 30, the company had cash of C$8.7-million, C$5.2-million undrawn on the senior credit facility and a working capital deficiency of C$910.8-million, which includes an C$842.5-million current portion of debt.

Revenues for the June quarter fell 8% year-on-year to C$106.7-million, impacted mainly by lower revenue from the Red Chris mine of C$62.3-million, compared with C$92-million a year earlier and reflects the lower-grade ore processed and lower recoveries in the quarter.

Revenue from the Mount Polley mine was C$44.1-million, compared with C$24-million in the 2016 comparative quarter, reflecting a higher quantity of copper sold, along with an increased quantity of gold by‐product sold as the mine had not returned to normal operations for the entire June 2016 quarter, the company advised.

The adjusted net loss in the latest quarter was C$22.3-million, or C$0.24 a share, compared with a headline net loss of C$1.2-million, or C$0.01 a share, a year earlier. Net income for the period was C$64.1-million, or C$0.68 a share, compared with a net loss of C$4.2-million, or C$0.05 a share, in the 2016 comparative quarter.

During the quarter under review, the company sold 23.1-million pounds of copper and 22 700 oz of gold, compared with 30.6-million pounds copper and 25 052 oz gold in the 2016 comparative quarter.

As a result of the weaker-than-expected results in the second quarter, Imperial reduced its production target for the year for the Red Chris and Mount Polley mines to between 102‐million and 107-million pounds of copper, compared with the initial target of 110‐million to 118-million pounds of copper.

Meanwhile, early this month marked the end of the three-year statute of limitations for charges relating to the Imperial’s Mount Polley tailings-dam disaster on August 4, 2014, on a provincial level, and these charges are not possible without a completed provincial-federal investigation. To date, no charges had been laid under British Columbia’s environmental laws; however, federal authorities are still pursuing an investigation and federal charges under the Fisheries Act remain a possibility.

The company’s TSX-listed stock fell as much as 7% on Tuesday to a low of C$3.04 a share.