Inco's net earnings plunge to $7.4m in Q2<\/p>\n
JAKARTA (JP): Publicly listed nickel mining company PT
\nInternational Nickel Indonesia (Inco) reported on Thursday that
\nits net earnings for the second quarter period this year had
\nplunged to US$7.4 million from $29.2 million recorded in the same
\nperiod last year.<\/p>\n
Inco president and chief executive officer Rumengan Musu
\nattributed the drop in earnings to weaker nickel prices amid
\nweaker global economic activities resulting in softer nickel
\ndemand.<\/p>\n
Rumengan said that the company tried to diminish the impact of
\nthe decline in nickel prices by increasing the efficiency of its
\noperations.<\/p>\n
\"Our low-cost structure, which is enhanced by our recently
\ncompleted expansion, has helped us keep the cash flow strong,\"
\nRumengan said.<\/p>\n
The company's realized price for matte nickel averaged $5,139
\nper ton in the second quarter of this year, down from $7,871 per
\nton in the corresponding period last year.<\/p>\n
Rumengan said the production of nickel in the second quarter
\nthis year rose by 13 percent to 15,700 tons from 13,800 last
\nyear.<\/p>\n
\"The production is affected by the lower grade of nickel ore
\nmined, resulting in an annualized production rate of 138 million
\npounds, slightly below our objective of 140 million pounds for
\nthis year,\" he said.<\/p>\n
Cash provided by Inco's operating activities, but before
\ncapital expenditures, increased to $87.5 million in the first
\nhalf of 2001 from $65.5 million in the same period of 2000,
\nreflecting a decrease in working capital, he said.<\/p>\n
Rumengan said Inco must continue to maintain its cash levels
\nduring a slower nickel market given the continued lack of new
\ncredit lines available for corporate borrowers and the rapid
\namortization rates of loans.(03)<\/p>",
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