May 3, 2017 / 11:20 PM / a year ago

UPDATE 1-Mexican miner Penoles 1st-qtr profit surges on metals prices, peso

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MEXICO CITY, May 3 (Reuters) - Mexican miner and metals processor Industrias Penoles on Wednesday posted a 444 percent year-on-year rise in first-quarter net profit to 2.196 billion pesos ($117.26 million), thanks to rebounding metals prices and a weaker peso.

The company, which runs the world’s largest primary silver producer, Fresnillo, made 404 million pesos in net profit during the first quarter of 2016, when it was hit by a tripling of financial costs due to losses on options it bought.

In the 2017 quarter, higher prices for the metals that Penoles produces drove a robust recovery. Silver, zinc and copper all logged double-digit increases in the first quarter from the same period a year earlier, the company said.

A weaker average peso in the first quarter compared with the first three months of 2016 also helped, as the company sells metals in dollars.

The company reported a 12 percent increase in revenue to 21.9 billion pesos, which helped offset a 33 percent rise in administrative costs.

Shares of Penoles were down 1.32 percent before the company reported.

$1 = 18.7275 pesos on March 31 Reporting by Adriana Barrera and Mitra Taj; Editing by Leslie Adler

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