Teck (TSX: TECK, NYSE: TECK) reported on Monday an 84% plunge in quarterly profit, primarily due to the effects of the covid-19 pandemic and the weak performance of its energy unit.
In the first quarter, Teck had an attributable loss to shareholders of C$312 million, or a $0.57 loss per share, compared with a profit of C$630 million ($1.11 per share) a year ago.
The adjusted profit attributable to shareholders was C$94 million (C$0.17 per share) compared with C$587 million (C$1.03 per share) a year ago, Teck said.
Teck reported adjusted EBITDA of C$608 million for the first quarter of 2020 compared with C$1.4 billion a year ago.
Covid-19 impact
The company has suspended its 2020 financial forecasts due to the impacts of the coronavirus pandemic.
Teck also temporarily suspended construction at its Quebrada Blanca Phase 2 project in northern Chile.
In February, Teck officially withdrew its application to build the C$20.6-billion ($15.7bn) Frontier oilsands mine, just days before the Canadian government was slated to make a decision on the 260,000-barrel-per-day project in northern Alberta.
As a result, Canada’s largest diversified miner will take a C$1.13-billion ($852.12m) writedown on the project.
Teck was forced to reduce its oil sands Fort Hills mine in Alberta to a single-train facility resulting in lower production of bitumen
Teck was forced to reduce its oil sands Fort Hills mine in Alberta to a single-train facility resulting in lower production of bitumen and contributing to an impairment of C$474 million.
“The pandemic has had a significant negative impact on the global economy and commodity markets and the outlook is uncertain,” Don Lindsay, Teck’s president and CEO said the statement.
“However, almost all of our sites are currently operating, with some at reduced production, and our steelmaking coal operations had a strong finish to the quarter, exceeding our sales guidance with site costs well below expectations,” Lindsay said.
Production at its steelmaking coal operations, Teck Resources’ biggest business, fell 19.7% to 4.9 million tonnes in the first quarter, while copper declined 1.4%.
Midday Tuesday, Teck’s stock was down nearly 7% on the NYSE. The company has a $3.8 billion market capitalization.
(With files from Reuters)