February 7, 2014 / 1:15 AM / 4 years ago

UPDATE 2-Mexican miner Grupo Mexico Q4 profit falls more than 40 pct

MEXICO CITY, Feb 6 (Reuters) - Mexican metals miner and railroad operator Grupo Mexico’s profit fell 42 percent to $453.9 million in the fourth quarter, the company said on Thursday, as precious metals’ output and prices sank.

In a filing with the Mexican stock exchange, the company said revenues for the quarter totaled $2.33 billion, down 6.5 percent from the year-earlier period.

Grupo Mexico said gold production fell 24 percent to 10,265 ounces for the quarter, while silver production dropped 1.2 percent to 3.8 million ounces.

Copper output for the quarter rose 1.2 percent at 206,712 tonnes.

The company also pointed to weaker metals prices during the quarter.

The price of silver fell 36 percent, gold dropped 26 percent and copper 8.9 percent, compared to average prices during the same quarter a year earlier.

The company said that the Mexican government’s recently passed fiscal overhaul, which includes a new 7.5 percent mining royalty, “will not have a significant impact” on the company’s mining unit.

At a price of $3.50 per pound of copper, the new royalty would represent a $53 million net impact, the company said in its filing.

Grupo Mexico’s stock closed 1.5 percent higher at 43.43 pesos per share on Thursday before the company reported its quarterly results.

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