Inco’s 3Q Net Profit $124.6m Vs $62.4m

PT International Nickel Indonesia (Inco) said Monday (30/10/06) its net profit nearly doubled to $124.6 million in the third quarter of the year from $62.4 million a year earlier due to higher nickel prices.

Sales during the July to September period rose to $307.6 million from $219.4 million a year before.

Meanwhile, net profit increased to $247.9 million during the January to September period from $211.1 million a year earlier. Sales rose to $748.1 million from $653.7 million.
Its output of nickel in matte fell to 37.8 million pounds in the third quarter from 43.3 million pounds a year earlier due to a fire in one of its furnaces in late May.

"However, the financial impact of lower production was more than offset by higher prices received for our nickel in matte," president and chief executive officer, Arif Siregar said in a press release, according to Dow Jones Newswires.
The furnace was back in operation middle of August, thus Inco expects its output to be in the range of 158 million and 159 million pounds for the whole 2006, from a record 168 million pounds in 2005, and slightly below the 2004 output of 159.1 million pounds.

The company said it is still negotiating an insurance claim for the fire, including about $5 million of claims for physical damages, and a business interruption claim that would result in the recovery of a portion of lost profits, it said.

Inco Indonesia also said it has decided to delay the completion of a hydroelectric dam to the first quarter of 2010 from the first quarter of 2009 as it is still finalizing amendments to a forestry permit related to the project.

The delay and higher major commodity prices will likely raise the cost of the project from the previous estimate of between $275 million and $280 million, it said.
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