Sherwood Copper reports $85M earnings in third quarter

Sherwood Copper Corp. has reported third-quarter net earnings of $85.4 million compared with a year-ago loss of $36.9 million.

The latest quarter's results released Monday include $18.6 million in earnings from mining operations and $78.2 million in unrealized gains on hedging. Net revenue was $55.1 million.

Sherwood (TSXV:SWC) had a year-ago loss of $1.5 million from mining operations and a loss of $38.1 million on derivatives.

The year-over-year operating numbers are not comparable, as the company's Minto copper-gold mine in the Yukon was in the development stage a year ago.

Sherwood said Monday that third-quarter production was down from the second quarter as the mill processed lower-grade stockpiles with lower recoveries.

However, the rest of 2008 and all of 2009 will see higher-grade mill feed and higher mill throughput, stated CEO Stephen Quin.

This, "combined with Sherwood's significant copper hedge book, puts the Minto mine in an excellent position to prosper in the current world financial situation," Quin said.

During the quarter, Sherwood agreed to merge with Capstone Mining Corp. in an all-stock transaction valued at $244 million.

And early this month, it agreed to sell all the gold and silver from Minto over the life of the mine to Silverstone Resources Corp. for $37.5 million US upfront plus $300 per ounce of gold and $3.90 per ounce of silver.