Business
Results for the first quarter ended March 31, 2009
TORONTO, May 5 /CNW/ - Labrador Iron Ore Royalty Income Fund (TSX: LIF.UN) announced its results ...
About this update from Labrador Iron Ore Royalty Corporation
[{"type":"text","content":"\n\n\n\nTORONTO, May 5 /CNW/ - Labrador Iron Ore Royalty Income Fund (TSX:\nLIF.UN) announced its results for the first quarter ended March 31, 2009.\n\n\nRoyalty income for the first quarter of 2009 amounted to $16.27 million\nas compared to $16.36 million for the first quarter of 2008. The Fund's cash\nflow from operating activities after adjustments for changes in amounts\nreceivable, accounts payable and income taxes payable (adjusted cash flow) for\nthe first quarter was $11.11 million or $0.35 per unit as compared to $10.36\nmillion or $0.32 per unit for the same period in 2008. Net income was $16.53\nmillion or $0.52 per unit compared to $10.78 million or $0.34 per unit for the\nsame period in 2008.\n\n\nThe first quarter sales of Iron Ore Company of Canada (IOC) are\ntraditionally adversely affected by the closing of the St. Lawrence Seaway and\ngeneral winter shipping conditions and are not indicative of the full year's\nsales.\n\n\nThe current world recession which resulted in a sharply reduced demand\nfor iron ore in the fourth quarter of 2008 continues to cause reduced iron ore\ndemand and as a result pellet sales in the quarter were substantially lower\nthan last year with the decreased volume partially offset by increased sales\nof concentrates. Royalty revenue for the quarter was approximately the same as\n2008 with the lower volume being offset by the lower value of the Canadian\ndollar against its U.S. counterpart and prices that were higher than those\nreceived in last year's first quarter. Last year's first quarter prices were\nat 2007 levels as the 2008 price increases were not settled until the second\nquarter. Last year's price increase which occurred in the second quarter\nresulted in retroactive income relating to the 2008 first quarter of\napproximately $0.20 per unit which would have increased adjusted cash flow to\n$0.52 per unit. Prices for 2009 are still under negotiation and when settled\nthey are expected to be significantly lower than 2008. Royalties for the first\nquarter are not expected to be materially affected when 2009 benchmark pricing\nis settled.\n\n\nEquity earnings from IOC amounted to $6.8 million ($0.21 per unit) as\ncompared to $1.3 million ($0.04 per unit) in 2008. If the retroactive price\nincrease had been included in the first quarter of 2008 IOC equity earnings\nwould have been ...