Reduced costs and an expansion in zinc production have seen mining company Ivernia West cut first-half losses by 77 per cent on the same period last year.
Ivernia, an Irish company which is listed on the Toronto Stock Exchange, made a net loss of $2.6 million (€2.65 million), or one US cent per share, in the six months to the end of June, down from an $11.6 million loss last year.
Chief executive Mr David Hough said the company had benefited from a reduction in the interest charges attached to financing its long-term debt, which currently stands at $75.8 million. Mr Hough also cited the advantages of foreign exchange gains.
Ivernia has reported record production at its Lisheen zinc mine in Co Tipperary over the second quarter.
The mine is now operating about 10 per cent above capacity, at a level that would translate into annual production of 1.63 million tonnes of zinc.
Mr Hough said Ivernia was now hopeful that zinc prices would rise from current historical lows so that the company could take full advantage of its production position.
Zinc prices are currently hovering at 35 US cents per pound, down from 42 cents at the same point last year.
Mr Hough said that if prices rose to 75 cents, an additional $20 million would be injected into Ivernia's balance sheet on an annual basis.
"Mines can't survive at these low levels," said Mr Hough, acknowledging, however, that Ivernia has been somewhat insulated from the worst of the downturn because of its limited size.
The mine is currently generating a small operational profit.
"Lisheen has been helped greatly by the fact that it is compact," said Mr Hough, also noting the high grade of zinc found in the mine.
Looking forward, Mr Hough is hopeful that Ivernia will soon identify an international partner to help fund development at the company's Magellan Project in Western Australia.
Ivernia spent $200,000 investigating Magellan over the second quarter.
The company is also seeking joint-venture partners for licences held in the Irish midlands.
Earlier this month, Ivernia announced that it was to raise up to $1.95 million through issuing convertible notes.
These funds will be used to fund general operations, according to Mr Hough, who says the company remains some years away from profitability.
"We'd be relying on the zinc price moving upward before we could talk about profit," he said yesterday.
