PT Inco?s 2002 net earnings tripled on higher nickel price

Despite lower production, JSX listed nickel miner PT International Nickel Indonesia Tbk (PT Inco) posted net earnings of US$30.3 million ($0.12 per share), more than tripled compared to $9.3 million ($0.04 per share) in 2001 of net earnings. The company said the surge in 2002 net earnings was due to increasing in nickel price.

?The London Metal Exchange cash nickel price at the start of 2002 was US$5,680 per ton. It improved strongly during the year as the world economy began to recover from low levels of the fourth quarter of 2001 and by year-end stood at $7,100 per ton,? Edward W. Hodkin, Inco?s President and Chief Executive Officer said in a statement.

PT Inco produced 59,500 tons of nickel in matte in 2002, down from 62,600 tons in 2001 due to constrained in ore body complexity and the advancement of the start the rebuild of Electric Furnace No. 3.

The company said its production was exceeded from the target of 58,955 tons of nickel in matte in 2002.

?In the fourth quarter of 2002 we demonstrated that our processing plant can consistently operate at feed rates equivalent to its design capacity of 68,026 tons of nickel per annum. Moreover, it is planned that Electric Furnace No. 3 will be up to full production again by March 31, following a scheduled rebuild. Accordingly, we are targeting production of 63,490 tons of nickel in matte in 2003,? Hodkin added.

Meanwhile, the company said outstanding balance on long-term debt is currently $269 million ? about half the amount due when it began repayment program in 2000. This debt will be fully repaid in March 2006.

PT Inco operates huge nickel mining operations in South Sulawesi. Toronto-based Inco Limited holds 58.7 percent shares in PT Inco, while Japanese Sumitomo Metal Mining Co. Ltd holds 20 percent shares. (robert)