Lepanto trims loss to P21.3M in 2010

MANILA, Philippines - Lepanto Consolidated Mining Co. trimmed its loss to P21.3 million last year from P371.8 million in 2009.

In a financial report submitted to the Philippine Stock Exchange, Lepanto said consolidated revenues slightly fell to P1.41 billion due to lower gold sales as a result of lower grade and low tonnage.

Revenues from sale of metals amounted to P1.33 billion as against P1.42 billion a year earlier.

Total tons milled reached 331,220 compared with 357,680 tons in 2009.

Lepanto said the revaluation of its dollar-denominated loans as a result of the appreciation of the peso from 46.20 at the start of the year to 43.84 at yearend resulted in a foreign exchange gain of P3 million.

Other income increased to P459 million principally on account of the option fee of $10 million received from Gold Fields Switzerland Holding AG in relation to the Far Southeast project.

The company spent P464.4 million last year, mainly for mine development and special projects (P242.5 million), exploration cost (P48 million), tailing dam maintenance (P23.8 million), and mine machinery and equipment (P150.1 million).

Lepanto earlier secured the Securities and Exchange Commission’s nod to raise its authorized capital from P3.35 billion to P6.64 billion. The increase in capitalization was supported by a recent stock rights offering, which raised around P3 billion for the company.

Lepanto offered a total of 10.05 billion common shares to its stockholders at a ratio of one new common share for every 3.3 common shares at 30 centavos apiece.

Proceeds from the issue will be used to fund the development of the company’s Victoria mine in Benguet province as well as pay down loan obligations.

Lepanto is also setting aside a portion of the proceeds for payment of accounts with suppliers and advances from shareholders.