Excellent TimingTHe article below may shed some light as to why investors are starting to look at FNI. When the Lockerby deal is complete it should be good.
EARNINGSInco restores dividend as nickel prices soarFirm increases first-quarter profitBy TARA PERKINS
Wednesday, April 20, 2005 Page B7
Canadian Press
TORONTO -- The highest nickel prices in 16 years have enabled nickel giant Inco Ltd. to increase its first-quarter profit, before one-time items, and reinstate its common share dividend.
It posted a profit of $313-million (U.S.) or $1.43 a diluted share for the three months ended March 31, up from $254-million or $1.20 in the first quarter of 2004. Adjusted for one-time items, share profit was $1.09, compared with forecasts ranging between 75 cents and $1.13 among analysts surveyed by Thomson One Analytics.
Quarterly sales totalled $1.12-billion, compared with $1.10-billion a year earlier as production dropped but prices rose.
The Toronto-based miner sold $894-million of nickel in the quarter, compared with $891-million in the first quarter of last year. Demand for the metal, used in everything from jet engines to DVDs, has soared, driving prices up. China is gobbling up the metal, which allowed Inco's profit to triple last year to the highest level since 1989.
The average nickel price during the latest quarter was $6.97 a pound, higher than in any quarter for the past 16 years, Inco said.
Inco's copper sales totalled $110-million during the quarter, up from $83-million a year earlier.
Inco booked a $25-million favourable adjustment relating to a minority interest in the Goro project in the South Pacific. Earlier this month, Inco announced a partnership with two big Japanese companies to develop the Goro project in New Caledonia, selling a 21-per-cent stake for $150-million, with about $300-million more to come.
A tax benefit of $45-million was also recorded from claims outstanding in prior periods, as well as $5-million in currency gains.
Inco's board declared a quarterly cash dividend of 10 cents a share. The dividend had been eliminated in February, 1999, to conserve cash.
Inco chairman and chief executive officer Scott Hand predicts strong nickel and stainless steel demand, particularly in China, will continue for the rest of 2005. He said market conditions will remain tight, given the continued shortfall in supply relative to demand.
Inco shares closed up $1.58 (Canadian) to $46.39 on the TSX.