Teck Resources Ltd. (TSX:TCK.B) (NYSE:TCK), the world’s second-largest exporter of seaborne coal used in steelmaking, announced Thursday a fall in its last quarter of 2012 net profit, as lower commodity prices took a big bite out of its earnings.
Canada’s largest diversified miner posted adjusted earnings of $354 million, or $0.61 a share. That was down 54% from the $1.04 per share it earned in the fourth quarter of 2011, but exceeded the consensus analyst estimate of $0.48 a share.
Although the Vancouver-based company met 2012 production targets for all of its key commodities —coal, copper and zinc— it didn’t remain immune to significantly lower metallurgical coal prices in the fourth quarter. Teck’s realized price fell 37% to $159 a tonne, which more than offset a 16% increase in coal sales volumes.
Chief executive Don Lindsay said demand for Teck’s products is being affected by economic uncertainty in Europe and the U.S., as well as lower growth rates in emerging markets.
He maintained that the long-term outlook for steelmaking coal is positive, but expects the recent weakness to persist for “at least” the first half of 2013.
“In the meantime, the company’s financial position is strong and we continuously monitor all aspects of our key markets as conditions evolve in order to be in a position to take whatever actions may be appropriate,” he said.