Lower coal prices eat into Teck Resources profits in Q2

VANCOUVER – Teck Resources Ltd. (TSX:TCK.B) says it logged an adjusted profit of $328 million, or 56 cents per share, in the first quarter, down from $544 million, or 93 cents per share in the same period last year.

The Vancouver company says the lower profit is primarily due to sharply lower coal prices, despite stronger sales volumes compared with the same period a year ago.

Profit attributable to shareholders was $319 million, or 55 cents per share, in the first quarter compared with $258 million or 44 cents per share in the same period last year.

Teck says profit last year was affected by a $329 million after-tax charge related to debt refinancing.

The company says it achieved all-time record first quarter coal sales of 6.6 million tonnes despite relatively weak market conditions and repairs at Westshore terminals which continued into early February.

Teck says it has agreements to sell 5.4 million tonnes of coal in the second quarter at an average price of US$154 per tonne and expects total second quarter sales to be at or above six million tonnes.

“I’m pleased with our performance so far this year,” said president and CEO Don Lindsay.

“Sales of steelmaking coal were up 24 per cent over the first quarter of 2012, a new record for first quarter sales. However, with continuing uncertain global economic conditions, prices for all of our major products were down compared to the first quarter of last year resulting in lower profits and cash flows.”