Perth-based gold miner Perilya Ltd has reported a full-year net loss of $140.2 million after writedowns totaling $188.2 million associated with its Broken Hill zinc and lead operation
The company said excluding the writedowns, the underlying net loss after tax was $22.1 million.
"The results reflect the challengind period of the past 12 months that saw metal prices fall significantly giving rise to Perilya's recent decision to resize the Broken Hill Operation to focus on a lower production and cost profile," the company said.
Earlier this month the company announced it would cut 440 jobs from the South Australian mine and halve the ore production.
Revenue over the period was down 35 per cent from $365.8 million to $237.1 million while earnings before, interest, tax, depreciation and amortisation was halved to $75 million.
The writedown on Broken Hill amounted to $135.7 million while the value of exploration assets was down to $29.9 million.
Zinc and lead production at the mine were slightly lower than fiscal 2007 figure, with 91,295 tonnes of zinc and 52,412t of lead produced over the year.
Cash operating margins fell 78 per cent to $US0.16 cents per pound zinc while net cash costs increased 37 per cent to $US1.03/lb zinc on the back of higher operating costs, treatment charges and lower lead prices.
Over the reporting period the price of lead fell 35 per cent from $US1.20/lb to $US0.78/lb while the zinc price dropped 43 per cent from $US1.51/lb to $US0.86/lb.
Executive chairman Patrick O'Connor said it had been a challenging year for zinc producers.
"During the past year Perilya experienced an improved second half of sustainable production, however this was
offset during the year by significant cost pressures, a sharp decline and volatility in the price of zinc and lead
and a strong Australian dollar, Mr O'Connor said.
"During the year zinc and lead prices have fallen by 50% and 42% respectively in Australian Dollars terms."
The company is currently finalising a review on its Mount Oxide copper project which includes expression of interest received.
Perilya said following the outcome of the review, an investigation will be undertaken on non-core assets and any surplus capital.
