March 6, 2012 / 5:29 PM / 8 years ago

UPDATE 2-Mexican miner Penoles' profit drops

* Q4 profit 1.614 bln pesos vs 2.354 bln pesos yr ago

* Revenue up 63 pct on higher metals prices (Adds details on currency loss; updates share movement)

MEXICO CITY, March 6 (Reuters) - Mexican mining company Industrias Penoles posted a 31 percent drop in fourth-quarter profit on Tuesday as exchange-rate and derivative losses ate into higher revenue.

In spite of higher metals prices, Penoles earned 1.614 billion pesos ($115.5 million) between October and December, down from 2.354 billion pesos a year earlier.

Revenue at the miner and metals producer, which controls the world’s largest primary silver producer Fresnillo PLC, rose to 25.5 billion pesos, 36 percent above results in the same quarter of 2010, as prices for silver and gold jumped.

But the company said it lost 91.5 million pesos on derivative instruments, deeper than its loss of 5.3 million pesos in the year-earlier quarter.

A weaker peso also cut into Penoles’ profit. Mexico’s peso declined 11.5 percent in 2011.

Fresnillo earlier reported that core profit, or earnings before interest, tax, depreciation and amortization, rose 63 percent to $1.54 billion in 2011, helped by robust metals prices.

Penoles shares were down 1.9 percent at 633.34 pesos in local trading.

$1 = 13.9725 pesos at end Dec Reporting By Elinor Comlay; Editing by Tim Dobbyn and Matthew Lewis

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