In a financial report to the Securities and Exchange Commission, Lepanto said it registered a loss of P19.2 million from operations as against the P111.5 million income for the same period last year as sales of metals dipped from P596.6 million to P407.93 million.
Gold sold totaled 16,951 ounces compared with 25,264 ounces the previous year.
Loss before deferred foreign exchange losses booked during the quarter under review amounted to P43 million against an income of P57.3 million while finance cost increased by four percent due to a slight increase in the rates of some lender banks.
Lepanto said while the reduced tonnage significantly reduced costs, it impacted negatively on gold production for the quarter as the company was able to produce only 16,998 ounces or 33 percent lower than last year’s 25,359 ounces.
The mining firm’s notes and loans payable rose by 77.5 percent, representing the difference between fresh loans obtained mainly from Ivanhoe Mines and the settlement of various outstanding loans from local banks. Its long-term debt, on the other hand, amounted to P1.23 billion.
Lepanto has yet to fully settle its hedged position with NM Rotschild & Sons (Australia) Ltd. and Dresdner Kleinwort Wasserstein.
Although it had retained earnings of P2.54 billion as of the end of the quarter, the company cannot as yet declare dividends.
Of its P629.9-million capital budget for the year, P145.2 million had already been spent for the first quarter.
Bulk of the programmed capital budget or P333.3 million will go to capital development of mining projects. Special projects in support of mining operations will account for P27.4 million while exploration for new mining areas will add another P82.7 million. Tailing dam costs will entail another P47.4 million while additional mine machinery and equipment will cost about P137.4 million.
Lepanto, however, expects to recover the rest of the year with gold production seen to increase to 95,000 ounces.