Higher costs at the Red Lake mine, lower realized gold prices and lower revenues at Havelock Lime contributed to a 82% drop in earnings at Dickenson Mines (TSE) for the first nine months of the year.
The Toronto-based gold producer reported earnings of $1.14 million (7 cents per share) compared with $6.22 million (35 cents per share) for the first nine months of 1991. Third-quarter earnings dropped to $528,000 from $2.2 million in 1991.
New operating methods introduced at the Red Lake mine in northwestern Ontario early in the year led to “unacceptable cost overruns,” said Chief Financial Officer Rolando Francisco. For the 9-month period, cash production costs jumped to $445 per oz. from $357. Dickenson is looking for a new mine manager. But lower earnings at the Dickenson operations were partially offset by higher earnings at 36% owned Wharf Resources (TSE).
Reporting a 19% reduction in cash production costs at its open-pit heap-leach mine in South Dakota, Wharf realized third-quarter earnings of $2.3 million (12 cents per share) compared with $2 million (10 cents per share) a year ago. Combined total gold production from the Red Lake and Wharf mines for the first nine months was 122,883 oz.
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