Turquoise Hill beats profit estimates on higher copper, gold production
Canada's Turquoise Hill Resources posted a surprise rise in quarterly profit on Monday, helped by increased production of copper and gold at its Oyu Tolgoi mine in Mongolia.
The results come a week after CEO Ulf Quellmann resigned amid a protracted dispute between the company and its top shareholder, Rio Tinto, over funding for the underground expansion of the Oyu Tolgoi copper-gold mine.
Oyu Tolgoi is one of the world's largest copper-gold-silver mines. Rio owns 51% of Turquoise Hill, which in turn owns 66% of the mine. The rest of the mine is owned by government of Mongolia.
Turquoise on Monday also cut its 2021 capital expenditure outlook for the open-pit mine to between $110-million and $140-million from a prior range of about $120-million to $160-million, to reflect the deferral of certain non-critical projects.
Copper production rose 26.4% to 41 600 t in the fourth quarter, while gold production surged 266.7% to 88 000 oz, the company said.
Copper prices rose 21.7% and gold prices rose 26.5% as parts of the world, particularly China, began to recover from the Covid-19 pandemic. Copper demand is closely linked to economic health.
All-in sustaining costs halved to $1.45 per pound of copper produced in the quarter, the company said.
Rio Tinto-controlled Turquoise said income attributable to owners of the company was $159.9-million, or 79c a share, for the three months ended December 31, compared with $113.1-million, or 56c a share, a year earlier.
Analysts on average were expecting profit to fall to 41 cents per share, according to Refinitiv IBES.
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