Vancouver-based New Gold Inc. (TSX:NGD) reported a 23% increase in first-quarter net profits for the period ending March 31, 2009. The company attributed the increase primarily to a $14.2 million gain from a redemption of $50 million worth of long-term debt.
New Gold's net income rose to $12.1 million from $9.8 million. But earnings from operations fell 55% to $6 million from $13.5 million as operating expenses, depreciation and depletion and exploration costs rose.
Consolidated first-quarter revenue increased to $58.8 million from $56.2 million due to higher sales, which offset lower copper and gold prices relative to 2008's first-quarter. The company sold 55,397 ounces of gold with an average per-ounce price of $898 compared with 51,700 ounces at $933 in the first quarter last year.
Total cash cost per-ounce also rose to an average $513 from $427 due to lower copper concentrate revenue.
The company's first-quarter copper sales volume was slightly higher: 2.75 million pounds sold compared with 2.55 million pounds in the same period last year. Copper revenue, however, fell with prices, which averaged $1.70 per pound versus $3.75 per pound a year ago.
The company plans to merge with Western Goldfields and is scheduled to hold shareholder meetings this week. The deal, which is subject to regulatory and other customary conditions, is expected to close June 1.
New Gold's share price range during the past week: between $2.21 and $2.55; 52-week high: $9.75; 52-week low: $0.94.