By Robert Sullivan — Exclusive to Rare Earth Investing News
Strong FY 2011 results released by Molycorp Inc . (NYSE: MCP ) last month have revealed th at the Colorado-based rare earth miner managed to survive a tough Q4 for the rare earth sector, and confirmed that the company still expects to hit its 2012 ramp up plans ahead of schedule.
Both rare earth prices and the shares of miners in the sector soared during the first half of 2011, but a drop off in demand over the second half of the year dragged down many high fliers in Q4, including Molycorp. Over the final quarter of the year, Molycorp saw its stock value trimmed by 27 percent, an abrupt reversal following a record Q3 for sales and profits. But even though net income was down by 39 percent in Q4, Molycorp still managed to beat performance forecasts for the quarter, with an adjusted net income of 41 cents per share topping estimates by one cent. And while Q4 may have been underwhelming, Molycorp's FY 2011 figures tell a much different story. Net income was up by $169.1 million over the previous year, while net sales soared by 1,127 percent to $396.8 million. Sales volume at Molycorp's core property, Mountain Pass in California, was reported to be 3,050 tonnes of REO equivalent. Molycorp also produced 52 tons of rare earth alloy from its Tolleson property in Arizona during Q4. President and CEO Mark Smith cited alloy sales as a key contributor to the company just edging out the bleak estimates for Q4. 2012 ramp up underway The bullish 2011 results for one of the leading rare earth miners outside of China may ease some of the misgivings that have been growing among investors since the downturn of Q4.