Xstrata says financial position "strong"

 
City A.M. Reporter
Miner Xstrata posted mixed third quarter production data and said financial performance was strong as metals prices remained healthy.

"Xstrata's operating and financial performance continues to be strong and the company's financial position remains robust," a statement said.

The Anglo-Swiss group also released the first resource estimate for the West Wall copper project, a 50:50 joint venture with Anglo American, showing it contained four million tonnes of copper.

"These latest successful exploration results confirm that the West Wall project represents an important discovery with the potential to contribute to Xstrata Copper's project development pipeline in Chile," a statement said.

Copper is the group's most important product, accounting for 43 per cent of first-half operating profit, while coal is second, making up 32 per cent.

Xstrata said production of mined copper increased 10 percent to 233,647 tonnes during the three months to the end of September due to improved mining rates and grades.

Consolidated coal output fell five per cent to 21.9m tonnes following planned mine closures in Australia and South Africa and bad weather in Colombia.

Xstrata more than doubled first-half earnings per share on higher metals prices when it reported in August, saying at the time it would pump over $5bn (£3bn) into new mines.

The trend of strong prices has largely continued through the third quarter, with copper prices up 24 per cent compared with a year ago, Australian coking coal 53 per cent higher and ferrochrome 46 per cent stronger.

Zinc in concentrate output fell by 10 per cent due to lower production at the Brunswick and Mt. Isa mines.

Mined nickel production jumped 21 per cent to a record 16,174 tonnes due to output from its new Rim South mine.