Inco 9 months net profit down 3%

Nickel miner PT International Nickel Tbk (Inco) said its nine months to September net profit stood at US$319.9 million, 3 percent lower than in the corresponding period last year at $328.5 million, partly due to lower sales volume and average price.

In the third quarter alone, its net profit reached $81.7 million, decreased from $126.3 million the second quarter of 2011 due mainly to a lower volume of deliveries as well as a lower average realized price during the period.

Earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $134.2 million in 3Q11, compared to $193.9 million in 2Q11. EBITDA in 9M11 stood at $500.8 million, slightly less than $507.7 million EBITDA obtained in the same period of 2010.

The company recorded an average realized price of nickel in matte of $17,735 per metric ton during 3Q11, compared to $19,895 per metric ton in 2Q11. Revenues in 3Q11 reached $290.1 million, down 26 percent compared to $393.0 million in 2Q11.

In 3Q11 deliveries totaled 16,084 metric tons compared to 19,438 metric tons in 2Q11. The lower volume of deliveries is a result of shipment schedules and should be compensated for in the next quarter since the levels of production in 3Q11 were close to those in 2Q11.

Production of nickel in matte in 3Q11 was 18,073 metric tons, a decrease of 3 percent compared to 18,598 metric tons in 2Q11.

The company?s total cost of goods sold in 3Q11 decreased by 21 percent to $166.8 million from $212.4 million in 2Q11 mainly due to lower delivered volume of nickel in matte.

In 3Q11 the company used 18,492 kilolitres of diesel fuel at an average cost of $0.87 per liter while in 2Q11 it consumed 28,173 kilolitres at an average cost of US$0.89 per liter.

This lower consumption was partly offset by a higher usage of High Sulphur Fuel Oil (HSFO) because the company had to test‐run its steam turbine generators that had been repaired.

The company said it started to see early benefits from the plant commissioning tests on the Karebbe hydroelectric project with the ensuing power supply replacing some of our thermal power.

In 3Q11, the company used 697,872 barrels of HSFO at an average cost of $105.56 per barrel compared to 652,063 barrels at an average cost of $101.45 per barrel in the previous quarter. (godang/giok)