Lundin Mining Corp.'s (LUN.T, LUNMF) net income rose by more than a third during the first quarter but fell short of expectations due to higher costs, weather and shipping problems.

The international base metals miner reported net income of $71.2 million, or 12 cents a share, compared with $51.9 million, or 9 cents a share a year earlier.

Adjusted net earnings excluding the effects of foreign exchange and other one-time items more than doubled to $84.2 million, or 14 cents a share from a year earlier, but fell below the 19 cents a share average estimate of analysts polled by Thomson Reuters.

Sales increased 49% to $211.5 million, while copper production also increased 49% to 19,139 tonnes. Nickel production dropped to zero from 2,156 tonnes due to the closure of the Aguablanca mine in Spain during the fourth quarter.

"Given the strong copper price, the increase in net income is less than we would have liked and has been affected by suspension of operations at Aguablanca and by shipping disruptions," Lundin Chief Executive Phil Wright said.

Wright also said that Lundin was still engaged in searching for strategic alternatives, including a possible sale.

The Toronto-based miner with operations in Portugal, Sweden, Spain and Ireland, and a 25% stake in the large Tenke Fungurume cobalt-copper mine in the Democratic Republic of the Congo has been at the center of takeover rumors since its merger-of-equals with Inmet Mining Corp. (IMN.T) was scuttled in March due to a hostile takeover attempt by Equinox Minerals Ltd. (EQN.T). Equinox dropped its bid for Lundin last month after agreeing to be acquired itself by Barrick Gold Corp. (ABX).

Lundin's first-quarter earnings were helped by a 33% increase in copper prices during the quarter, but were hurt by higher costs at its Neves-Corvo mine in Portugal due to lower ore grades and wet January weather causing milling problems. Sales also fell behind production growth due to shipping delays in the Baltic Sea from heavy ice.

The December closure of Lundin's Aguablanca mine in Spain due to damage from heavy rains also cut $46.5 million from sales during the quarter. The mine is expected to restart mid-year 2012.

Lundin shares closed down 0.3% to C$8.89 Tuesday on the Toronto Stock Exchange.

-By Edward Welsch, Dow Jones Newswires; 403-229-9095; edward.welsch@dowjones.com

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