TORONTO - Labrador Iron Mines Holdings Ltd. (TSX:LIM) says its net loss surged to $28.5 million in the first quarter of its fiscal year as revenues fell by half to $17.9 million due to lower shipments of iron ore.
The Toronto-based company says it was hampered in part in the quarter by poor weather and limited produced ore that resulted in fewer shipments of metal sold than planned.
Labrador Iron Mines lost 23 cents per share for the period ended June 30. That compared to a loss of 16 cents per share a year earlier when the net loss was $10.58 million.
The increased loss in the quarter included a $5.6 million depletion and depreciation charge and $6.2 million in rail transportation penalties.
Revenues decreased from $38 million in the prior year as it sold just two shipments totalling 328,00 dry tonnes of ore, one less than planned and at lower metal prices. Subsequent to the quarter, two more shipments departed the Port of Sept-Iles with 361,500 wet tonnes of iron ore.
The ore producer says it has implemented immediate cost reduction and cash conservation measures that should improve results for the remainder of the fiscal year. These include the deferral of non-essential capital expenditures and workforce reductions.
In May, it announced a new two-year agreement to sell all of its production to Iron Ore Company of Canada, which is owned by Rio Tinto, Japan's Mitsubishi Corp., and Labrador Iron Ore Royalty Co. (TSE:LIF).
It is targeting to have 10 shipments containing 1.7 million tonnes of iron ore products shipped in the year.
Labrador Iron Mines is the only independently owned Canadian iron ore producer listed on the Toronto Stock Exchange, It has a portfolio of operations and projects in the prolific Labrador Trough region.
Its shares lost three cents, or 5.66 per cent, at 50 cents in early morning trading Thursday on the TSX.
Last week, Labrador Iron Ore Royalty announced it had $39.2 million of net income or 61 cents per share for the first quarter of its 2014 financial year, up from $36.8 million or 57 cents per share a year earlier.
LIF'r revenue for the quarter ended June 30 rose to $42.2 million from $36.4 million, an increase of 16 per cent from a year before. The revenue comes from a royalty paid to LIF by Iron Ore Company.
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