Antam reports gold, nickel output down in the first nine months

State-owned diversified mining company PT Aneka Tambang Tbk said on Friday that its ferronickel and gold production fell sharply in the first nine months of 2005, partly due to smelter repairs in Sulawesi.

Antam produced 4,001 tons of ferronickel, a raw material for stainless steel, which was a decline of 38 percent from the same period last year.

As a result of lower output, ferronickel sales fell 28.5 percent to 4,197 tons. The firm received an average price of US$6.88 per pound, up 11 percent, because of soaring demand as China's economy expanded.

Antam postponed the restart of its FeNi II smelter in March, when its furnace showed signs of damage during test runs after a five-month overhaul designed to raise capacity by 10 percent.

The firm resumed full ferro-nickel output in October and targeted production of 7,400 tons this year. Last year it produced 7,945 tons.

Gold production in the first nine months of this year fell 10 percent to 2,353 kg from 2,616 kg in the same period of 2005, due to lower-than-expected grade levels. A tunnel ceiling accident in September at its Pongkor mine in Java also caused a brief halt to activities.

Antam said gold sales in the nine months rose 6.5 percent to 2,933 kg, exceeding output as Antam reduced its inventories to capitalise on high gold prices.

Higher commodities prices helped the firm post a 32 percent gain in net profit in its first nine-months to Rp711 billion ($71 million) compared to the same period last year. Its earnings per share (EPS) rose to Rp372.75 from Rp282.36.

Average prices for gold received by the company increased 11 percent to $443.64 per ounce.

The firm's nine-month revenue rose 12 percent to Rp2.216 trillion ($222 million) because of strong commodity prices.

Antam is developing a new ferronickel smelter, expected to begin operating in 2006, which would boost its production capacity to 26,000 tons a year from 11,000 tons. (*)