Molycorp Earnings Not So Rare


Molycorp Inc. (NYSE: MCP) reported second quarter 2013 results after markets closed today. The rare earths miner posted an adjusted diluted loss of $0.36 per share on revenues of $136.9 million. For the second quarter of 2012 the company posted an earnings per share (EPS) loss of $0.03 on revenues of $104.58 million. Second-quarter results compare to the Thomson Reuters consensus estimates for a net loss of $0.23 a share and $157.56 million in revenues.

On a GAAP basis, Molycorp posted a loss of $0.44 a share, which does not include "operational expansion items, out-of-ordinary business expenses, and certain other non-cash items." The largest single exclusion was $14.33 million, which the company noted is an inventory write-down.

The average selling price of the company's rare metals was $272.14 per kilogram in the second quarter of 2013, compared with $187.35 in the same period a year ago. Unfortunately, production of rare metals was flat to a year ago, while production of other materials doubled while prices mostly fell.

The company's CEO said:

We are seeing increasingly bullish signals from customers across several segments for product demand, and increased demand will coincide nicely with increased production capacity at Mountain Pass and declining production costs. As we continue to optimize operations at Mountain Pass, and bring up the chloralkali plant in the second half of 2013, we should be ready to adjust production to meet customer demand and be price competitive with any rare earth producer in the world.

The company did not offer guidance in its press release, but the consensus third-quarter estimates call for a net EPS loss of $0.21 on revenues of $197.45. For the full-year, estimates call for an EPS loss of $0.73 on revenues of $703.62 million

Shares are down about 5.5% in after-hours trading, at $7.00 in a 52-week range of $4.70 to $14.44. Thomson Reuters had a consensus target price for the shares at around $8.50 before today's report.

Filed under: Commodities & Metals Tagged: MCP

Originally published