Cda Mines Posts Profit For Quarter Cost-Cutting Allows Company To Offset Weak Metals Prices

In a time of lackluster metals prices, Coeur d’Alene Mines Corp. turned a profit last quarter by lowering its costs.

Coeur earned $1.9 million in the third quarter compared with a profit of $2 million in third quarter 1995. After dividends to shareholders, Coeur’s common stockholders lost three cents per share for the quarter.

The company’s interest in Silver Valley Resources Corp, co-owed by Asarco Inc., was a contributor to the profit for the first time since starting up this spring.

The joint venture controls the Coeur and Galena Silver mines, which produced 331,000 ounces of silver for Coeur in the quarter, and at a cash cost of $2.21 per ounce, a historical record. The cash cost includes all the direct costs of producing the metal, excluding depreciation, royalties and other capital costs.

Silver, expected for much of the decade to eclipse $6 an ounce, has lagged under $5 an ounce for much of the year.

Coeur also mined gold for lower costs than other local mining companies. The average cash cost for its gold mines was $212 per ounce. Coeur saw the earnings of its Yilgarn Star mine in Australia reflected in its earnings for the first time, a product of its acquisition of Gasgoyne Gold Mines Ltd. in Australia.

Work continues on Coeur’s giant Kensington gold mine in Alaska, and the company expects to make a production decision on the mine in early 1997. Kensington could produce 200,000 ounces of gold yearly.

Despite the company’s low costs and modest earnings, Coeur’s $57 million write-down last quarter likely will make 1996 a negative earnings year. Environmental troubles at its Golden Cross mine in New Zealand caused the write-down of the mine.

Coeur’s stock has fallen to near lows of the decade following the Golden Cross write-down. The stock closed unchanged Tuesday at $14.50.

, DataTimes