Inco defers payment of interim dividend

JAKARTA (JP): The board of commissioners of PT International Nickel Indonesia Tbk (Inco) agreed during its meeting in Toronto, Canada, to defer the company's interim dividend for 2000.

The company's president commissioner, Scott M. Hand, said in a statement the decision was made because the company's net cash flow, after required debt repayments, was not sufficient at the present time to support an interim dividend.

Inco, which operates nickel mines in South Sulawesi, booked net earnings of US$47.3 million, or 19 cents for per share for the first half of 2000, compared with $2 million, or one cent per share in the corresponding period in 1999.

According to the company, the increase was partly the result of significantly higher nickel prices. Also, cash flow from the company's operations prior to debt servicing and capital expenditures was $58.3 million, more than double that in the first half of 1999.

The company said increased production resulting from its recently completely expansion contributed significantly to this operating cash flow, and was expected to contribute to an even greater extent as the company moved toward full production capacity.

The completion of the expansion project also marked, however, the beginning of significant semiannual repayments of debt incurred to finance the project, Hand said.

As a result, the company's net cash flow after debt servicing and capital expenditures was $1.3 million for the first half of 2000.

"With a cash balance of $3.5 million at the end of the first half of 2000, and given the company's continuing debt repayment requirements and planned capital expenditures over the remaining of 2000, the board commissioners determined that the interim dividend for 2000 should be deferred," Hand said.

He said the company's board of commissioners would consider the company's final dividend for 2000 at its next meeting, scheduled for April 2001.(hen)