Swedish miner Boliden recorded a 358 million Swedish krona (€31 million) restructuring cost in its second quarter related to the reopening of its Tara mine in Ireland, the biggest zinc mine Europe, also weighed on the earnings. That was roughly in line with its earlier communication.
In May, members of the three unions representing workers at Tara Mines voted to accept an agreement intended to provide a basis for a phased reopening of the facility from next month.
Production at the Boliden-owned facility in Co Meath was shut down last July with the then workforce of 650 workers temporarily laid off after what the company said were “significant and unsustainable financial losses” amid soaring energy prices and falling zinc prices globally.
Boliden’s core earnings rose by nearly fivefold in the second quarter, bolstered by a one-off insurance claim of 2.4 billion Swedish crowns related to a fire at its copper smelter, it said on Friday.
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Boliden’s operating profit, excluding the revaluation of its process inventory, rose to 4 billion Swedish crowns in the April-June period.
The Swedish metals producer's profits have been hit in recent quarters by falling metal prices, lower mining grades and the suspension of production at its Tara zinc mine, as well as the fire at its smelter last year.
Boliden said higher prices for copper, zinc, gold and silver boosted its earnings in the quarter, while lower treatment charges and metal premiums weighed on the result.
Metal prices rallied in the second quarter but have pulled back somewhat since then, affected by high inventories and soft demand in China. Meanwhile, smelter treatment charges - the fee a smelter earns for converting mined concentrates into metal - have collapsed for copper and zinc.
“While I believe that the long-term demand looks very good, in a short-term perspective the market is now characterized by a global concentrate production, that does not quite meet the available smelter capacity,” chief executive Mikael Staffas said in a statement.
Quarterly revenue rose 23 per cent to 22.75 billion crowns. - Reuters
