Molycorp, the largest U.S.-based rare earths miner, reported a narrower first-quarter loss, but the shares of the high-flying stock were getting slammed by 6.5% in after-hours trading because the company missed Wall Street's adjusted profit and sales growth missed estimates.
Colorado-based Molycorp (MCP) posted a first-quarter loss of a loss of $909,000, or 3 cents a share, compared with $7.7 million, or 16 cents a share, a year earlier. Revenue soared to to $26.3 million from $3 million. On an adjusted basis, the company earned a penny a share, well short of the 10 cents on sales of $42 million Wall Street was expecting.
Molycorp sold 696 metric tons of rare-earth oxide products, up 65% from a year ago as average selling prices totaled $37.73 per kilogram for the quarter, up sharply from $7.13 per kilogram last year, the Wall Street Journal reported.
Molycorp CEO Mark Smith reiterated his view that China, the dominant rare earths exporter with 95% market share, is likely to continue restricting rare earths exports and that the country is on its way to becoming a net importer of rare earths in the next several years.
The drop in Molycorp's shares could be made worse by the fact that the company's lockup period expires on Wednesday and more than 39 million shares will be eligible for sale by insiders and early investors.