April 28, 2020 / 10:57 AM / a month ago

Boliden Q1 core profit slumps as Mines business weighs

STOCKHOLM (Reuters) - Swedish mining and smelting group Boliden (BOL.ST) on Tuesday reported a steep drop in quarterly core operating earnings as significantly lower metal prices and lower metal grades hit profits in its Mines business.

FILE PHOTO: The Boliden company flag flutters next to the mine in Garpenberg, Sweden, September 18, 2017. REUTERS/Ints Kalnins

Boliden’s first-quarter operating profit, excluding revaluation of process inventory, fell to 1.50 billion Swedish crowns ($151.6 million) from 2.05 billion a year earlier.

“While we had record results within Smelters, the quarter was challenging within Mines,” Boliden CEO Mikael Staffas said in a statement.

“The focus is to continue to operate normally, even though the current COVID-19 situation demands greater flexibility.”

The company said milled volumes at its mines in Aitik, Sweden, and Kevitsa, Finland had increased in the quarter.

“But a breakdown and a COVID-19 related shutdown in Tara had a negative effect,” it said.

Boliden had said on March 28 that production had been halted at the Irish Tara Mine, Europe’s biggest zinc mine, due to COVID-19 related government restrictions.

Production at the mine resumed on April 2.

Boliden said it was planning for normal business operations during the coming quarters

“However, elevated risks linked to the effects of the COVID-19 pandemic remain, such as increased short-term absence, disrupted logistics, raw materials supply and the availability of spare parts,” it said.

Reporting by Johannes Hellstrom; editing by Niklas Pollard

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