Weatherly International, the owner of the copper mines and smelter in Tsumeb said this week that revenue increased to US$108.5 million from US$105.4 million in the prior year as a result of new agreements to process copper blister in the smelter for third-party clients in Zambia, Chili and Bulgaria.
The mines have been shut down last year when the copper price collapsed just before the international financial crisis, and were put on maintenance and care.
Chairman, Wolf Martinick said in a statement that these agreements, which have subsequently been replaced by new agreements, left the group exposed to the drop in copper prices in the first half of the year, which played a large part in the gross loss of US$16.2 million for the year.

The group also shut all its mining operations with subsequent redundancy costs and ongoing care and maintenance costs, and wrote off all development costs. The smelter, under Namibia Custom Smelters, has reverted to operating on a toll basis on its 2009 contracts and is no longer exposed to copper price variation.
Martinick said the year under review continued to represent a challenging commercial environment for Weatherly.
“The year started with mining operations reporting record production during the quarter ending September 2008, but this achievement was quickly overshadowed by the dramatic decline in copper prices to well below our cost of production. Although we had copper hedges in place, these only provided protection until the end of the calendar year,” he said.
Weatherly entered into an agreement with Chelopech Mining EAD (Chelopech), a wholly owned subsidiary of Dundee Precious Metals Inc (DPM), and Louis Dreyfus Commodities Metals Suisse SA (Louis Dreyfus) that provided the company with US$11.3 million of new funds, underpinning the continued operation and expansion of the Tsumeb smelter. Under the terms of these loans, the existing three-year supply agreements to process imported concentrates from Chelopech and Louis Dreyfus were extended to five years, thus ensuring the future of the smelter operations.
“These funds, together with money raised from the sale of non-core mining equipment and real estate in Namibia, enabled us to close the mines in a proper and orderly manner, with all staff receiving redundancy payments, and to meet the ongoing cost of care and maintenance,” he said.
He said in the overall restructuring of the company’s debt profile, the company also renegotiated the terms of the US$12 million convertible loan notes agreed with significant shareholders in May 2008, with repayment now due to be phased over three years.
Namibia Custom Smelters (Pty) Ltd (NCS), that operates the Tsumeb smelter, is now a stand-alone tolling business, Martinick said.