Inco withholds dividend payment on concerns over fuel and nickel price
Thursday, April 5 2001 - 10:00 AM WIB
Nickel producer PT International Nickel Indonesia (Inco) a unit of Canadian miner Inco Ltd. said Thursday it would not pay dividend for year 2000 because it needed money to boost cash reserve despite a sharp increase in earnings.
"We decided not to pay dividend this year because we want to save money to anticipate lower nickel price and fuel price increase," Inco's chief executive Rumengan Musu told reporters after a shareholders' meeting in Jakarta.
He also said it was getting more difficult to obtain loan from international banks because of uncertain political condition in Indonesia.
Earlier, Tempo daily reported Inco said it would soon make the payment of US$40 million in principal to Japan's Export Development Corporation Exim Bank and its Canadian holding company Inco Ltd.
Inco Indonesia's vice president of operation Bing Tobing said the company wanted to use the money to pay its debts.
Company corporate secretary Fatturohman was quoted by Tempo as saying that the company owed a total of $500.05 million, including $421.25 million to the Japanese bank and $78.8 million to Inco Ltd.
Musu said the debt would be fully repaid in 2006.
He said the company's production costs were on the rise this year due to the recent increase in fuel price.
Inco said last month its 2000 net income rose to US $80.48 million from US$21.25 million in 1999 and operating income jumped toUS $151.43 million in 2000 from US$35.67 million booked in 1999.
The company said it produced 130.5 million pounds of nickel in matte in 2000, an increase from 100 million pounds in 1999.
Nickel in matte, an intermediate product, is sold by PT Inco mainly to Japanese market.
The shareholders' meeting also approved the appointment of Andre Daenuwy, Shane Desjardin, Benny Mahulete and Bing Tobing as company directors. (alex)