Inco earns $5.2 million in first quarter
Inco earns $5.2 million in first quarter
JAKARTA (JP): Nickel producer PT International Nickel
Indonesia (Inco) announced unaudited earnings of $5.2
million for the first quarter of 1998, compared to $7.1 million
for the first quarter of 1997.
The company said the decrease in net earnings for the first
quarter of 1998 was due to lower nickel price realizations,
partially offset by higher deliveries and reduced production
costs, the company said in a statement.
Inco suffered a loss of US$1.1 million for the fourth quarter
of last year.
The improvement seen between the last quarter of last year and
the first quarter of 1998 was due to higher deliveries, partially
offset by lower price realization, it said.
The realized price for matte nickel averaged $2.09 per pound
in the first quarter of 1998, compared to $2.59 per pound in the
corresponding period last year. US$2.30 per pound was achieved in
the fourth quarter of 1997.
Production of matte nickel in the first quarter of 1998 was
20.1 million pounds, compared to 17.7 million pounds for the same
period in 1997, and 8.6 million pounds in the fourth quarter of
last year.
Production in the first quarter of 1997 was affected by the
renovation of one of the company's three electric furnaces.
In the first quarter of 1998, all processing facilities were
available but production was constrained by the availability of
electric power. The company receives its electricity from a
hydroelectric generator which is currently unable to operate at
full capacity because of low water levels in the Soroako project
area, the company explained.
However, the adverse effect of subnormal rainfall caused by
the El Nio weather phenomenon has been mitigated by the benefits
of a project to increase the flow of water to the company's
hydroelectric facilities during periods of low rainfall, which
was completed last December.
"Company production was approximately 75 percent of capacity
in the first quarter of 1998," the company said.
The company's long term debt increased by 32.2 percent to
$322.7 million at the end of March this year, reflecting draw-
downs from available credit facilities to finance a project to
increase the annual production capacity by 50 percent.
"The project remains within its budget and on schedule," the
company said. (jsk)