Vancouver-based Teck Resources Ltd. (TSX:TCK.B) this morning announced plans to defer approximately $1.5 billion in capital spending this year and next, and slash operating spending by at least $200 million.
Teck made the announcements in its third-quarter report, which identified that the company’s quarterly adjusted profit was down 53% relative to the third quarter of 2011.
“The uncertainty in global economic conditions resulted in lower commodity prices and sales volumes of steelmaking coal compared with the third quarter of 2011,” said company president and CEO Don Lindsay.
Lindsay said that those conditions dampened profits and cash flow for the third quarter relative to 2011 levels.
However, he deemed the company’s quarterly operating results “strong,” pointing to quarterly “record” copper production at 99,000 tonnes – a 29% increase from the previous year.
Lindsay said the company’s balance sheet remains strong, with a current cash balance of $4.2 billion, and that the company is well-positioned to continue with its growth plans. He noted, however, that the company has plans to rein in its spending.
“Notwithstanding our strong financial position, some of our planned capital spending has been deferred for a variety of reasons and we have also implemented a cost reduction program,” he said.
In July, Teck reported that its second-quarter profits were down by half compared with 2011 levels.
