Company has properties in Newfoundland
Anaconda Mining Inc. credits a toll processing agreement with Crew Gold (Canada) Ltd. for improved financial results in its most recent quarter.
The Toronto-based mining company, which has properties in Newfoundland and Chile, said net income for the quarter ended Aug. 31 was $406,000 or zero cents per share, compared with a loss of almost $1.2 million or two cents a share for the year-ago period.
Revenue was $3.2 million, up from $340,000 in the 2008 quarter.
In June, a toll processing agreement was reached with Crew Gold allowing for the custom milling of ore from Anaconda's Pine Cove gold mine in Newfoundland at Crew's Nugget Pond facility.
"Thus far, the toll milling arrangement has provided cash flow to sustain the mining operations at Pine Cove," Anaconda said in documents filed with financial regulators.
". . . It is anticipated that the ongoing cash flow from this arrangement will be utilized by the company to fund its working capital as well as the required upgrades to the Pine Cove mill in order to facilitate commercial production in the intermediate term."
Anaconda president and CEO Lew Lawrick described the quarterly operating profit at Pine Cove as "a significant milestone for Anaconda and its partner on the project, New Island Resources Inc."
"This is especially significant considering we only had the contribution of two months of custom milling of Pine Cove ore at Nugget Pond," Lawrick said in a news release Friday.
"Further, this signifies that the Pine Cove deposit is a robust asset in this period of high gold prices and gives us further encouragement to pursue aggressively the upgrade and expansion of our mill that is currently underway."
Besides the Pine Cove gold mine, Anaconda is evaluating the commercial potential of its San Gabriel iron mine in Chile.
Anaconda shares were up two cents or 8.9 per cent at 24.5 cents Friday on the Toronto Stock Exchange.