Copper producer First Quantum Minerals Ltd. (TSX:FM) has fallen victim to the global recession as the Vancouver company's net profits plummeted in 2008 even though annual revenue rose.
Net profit for the year dropped to US$45.9 million, down from US$520.3 million in 2007. A US$254.2 million asset write-down and declines in net copper sales from its various mines resulted from a rapid plunge in the per-pound price of copper.
It fell 54% to $1.32 at the end of the fourth quarter compared with $2.90 at the end of the third quarter. Net sales of copper and gold fell to $12.4 million in the fourth quarter of 2008 ending December 31, compared to net sales of $443.3 million.
For the year, however, net sales rose to US$1.7 billion from US$1.5 billion.
For 2009, the company plans to produce 380,000 tonnes of copper and 240,000 ounces of gold. It also plans to cut costs at its various mines and operations in light of declining commodities demand and prices.
First Quantum has also completed a short-term hedging program for the next six months to protect against any further declines in copper prices.
The company's share price range during the past week: between $31 and $33.66; 52-week high: $95.39; 52-week low: $12.75.