North American Palladium has seen its profits rise along with production, as the firm continues to outperform expectations.

For the third quarter the mill has seen palladium production hit 79,174 ounces at a recovery rate of 74.8 per cent.

The figure marks an improvement on the performance in the same period in 2003, when the mill produced 76,729 ounces of palladium at a recovery rate of 74 per cent.

With these figures including a dip in production as a result of a scheduled mill shutdown, which was necessitated by plans for a new secondary crusher, the performance has proved encouraging.

In a statement the company declared: "Production from the Lac des Iles Mine continued to be ahead of budget in the third quarter of 2004, which the company expects to result in the total year's production also being better than planned."

"Both the new secondary crusher construction and the underground mine development continue to progress on schedule.

"The construction of our new crusher progressed as planned during the third quarter and as a result we look forward to a successful start-up later this month."

Production costs at the firm did increase, but the company said that was primarily due to a 29 per cent increase in tonnes of ore and waste mined.