Teck Posts $600 Million Loss
Hurt by declining commodity prices and debt payments, Teck posted a massive $607 million loss for the fourth quarter of last year.
Although Teck’s operations on their own would have produced a healthy profit despite tumbling prices for zinc and copper, debt payments and impairment losses have plunged the company deeply into the red.
Last fall, Teck purchased Fording Canadian Coal Trust for $14 billion, with debt comprising about $10 billion of that amount. Since the purchase, commodity prices have been collapsing.
Teck president Don Lindsay said, at a conference call last week, “We are examining all of our options ranging from financing options… to various asset sales and we’ll just have to evaluate them on their own merits.”
Teck has recently announced that it is cutting 1 400 jobs globally, or about 13 per cent of its workforce. The company also plans to cut coal and zinc production.
In related news, Moody’s Investor Service has downgraded Teck’s credit rating to Ba3 from Ba1 and changed its outlook on the company’s future to ‘negative’, citing concerns about the corporation’s debt and low commodity prices.