IAMGOLD Profits Jump on Tax Break

Quarterly profits at IAMGOLD(IAG Quote), the Canadian-Botswanan mining company, got a boost from a huge tax break on the sale of gold bullion -- although revenue and production dropped off from a year ago after the company closed a mine.

Excluding the gain on taxes, which amounted to $29 million, along with other items, IAMGOLD met analysts' per-share earnings targets of 10 cents for the first quarter. Net earnings, including the items, came in at $52.5 million, or 17 cents a share, up 53% from last year's $34.4 million, or 12 cents a share.

The company produced 212,000 ounces of gold in the first quarter, down from the 234,000 it mined in the same period last year, it said. IAMGOLD blamed the decline on the closure of its Sleeping Giant mine in Quebec in late 2008. Average prices during the quarter fell to $884 an ounce from $900, and sales volumes dropped to 215,000 ounces from 232,000 ounces a year ago.

In February IAMGOLD acquired Orezone Resources Inc. and an undeveloped gold reserve in Burkino Faso, in West Africa. Construction of a mine at the reserve began in September, and the company said it expects production to begin in the second half of 2010.

Shares of IAMGOLD slipped lower Thursday, ending the session at $9.76, down 9 cents, on lighter-than-average volume. The stock has been on a northward run -- along with gold prices -- since the financial crisis reached a head in November. It notched a 52-week high of $10.40 on Tuesday.