Turquoise Hill third-quarter income shoots to $114.3 million on fair value gain

Nov 15 • Business, Mining, News • 705 Views • No Comments on Turquoise Hill third-quarter income shoots to $114.3 million on fair value gain

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Turquoise Hill Resources (TSX:TRQ) says its third-quarter net income shot up to $114.3 million, largely due to a $176.2 million increase in the fair value of certain derivatives.
The Vancouver-based company formerly known as Ivanhoe Mines Ltd., which keeps its books in U.S. dollars, said net income for the quarter amounted to 12 cents per share, compared to income of $7.3 million, or a penny per share, in the same quarter of 2011.
The most recent quarter also included $55.3 million in exploration expenses, $57.2 million in cost of sales, $18.3 million in general and administrative expenses, a $12.5 million writedown of current assets.
Those charges were offset by a $12.9 million change in the fair value of SouthGobi’s embedded derivatives, a $176.2 million change in the fair value of the derivative on its 2012 rights offering, and $4.7 million in interest income.
Revenue was $23.8 million, though the company, now majority-owned by Anglo-Australian mining giant Rio Tinto PLC (NYSE:RIO), did not provide a year ago comparison.
The Vancouver-headquartered company announced earlier this month the signing of a key power purchase agreement for its Oyu Tolgoi copper-gold mine in Mongolia.
The deal with Inner Mongolia Power Corp. will allow for the completion of commissioning of Oyu Tolgoi, leading to the first production of copper-gold concentrate.
Within the next few weeks Oyu Tolgoi is expected to begin a seven-week commissioning of the ore-processing equipment, the company said in a statement.
First concentrate production will follow within one month and commercial production is expected to begin three to five months after that.
The company has also agreed that all of the project’s power requirements would be sourced from within Mongolia no later than four years after the start of commercial production.
Turquoise Hill owns a 66 per cent interest in the Oyu Tolgoi copper-gold-silver mine in southern Mongolia.

Source: http://www.canadianbusiness.com/article/106798–turquoise-hill-third-quarter-income-shoots-to-114-3-million-on-fair-value-gain

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