Norilsk Nickel boosts H1 IFRS earnings 5.3-fold to $2.345 bln, above forecast
MOSCOW. Oct 4 (Interfax) - MMC Norilsk Nickel boosted net profit to International Financial Reporting Standards (IFRS) 5.3-fold year-on-year in H1 2010 to $2.345 billion, the Arctic mining and smelting giant said in a statement.
This was higher than the $2.262 billion that analysts predicted in a consensus forecast for Interfax.
Sales revenue jumped 68% year-on-year to $6.837 billion, or slightly below a forecast $6.877 billion.
Revenue from metal sales increased by 78% to $5.852 billion compared to the same period of 2009. The main driver of revenue growth in the first half of 2010 was the increase in prices of base and precious metals produced by the Group and the growth in physical volumes of metal sales except for the copper.
In the first half of 2010 revenue from nickel contributed 52% to total metal sales and increased by 86% from $1.647 billion in the first six months of 2009 to $3.058 billion. The growth in revenue from nickel sales was driven by a significant increase of the average selling price of nickel produced by the Russian divisions and Norilsk Nickel Harjavalta (Finland) by 82%.
Revenue from copper sales amounted to 22% of total metal sales and increased in the first half of 2010 by 59% to $1.262 billion as compared to $793 million for the same period of 2009. The growth of revenue from copper sales is mainly due to the increase in average selling price by 77% from $4,073 per tonne in the first six months of 2009 to $7,216 per tonne in the first half of 2010.
Physical volumes of copper sales produced by Russian divisions decreased in the first six months of 2010 by 10% (or by 19 thousand tonnes) to 167 thousand tonnes as compared with 186 thousand tonnes for the same period of 2009 due to selling in the first half of 2009 of inventories accumulated at the end of 2008. Traditionally the seasonality factor makes an adverse impact on the metal sales results in the first half of a calendar year as well.
Physical volumes of sales of copper in semi products, produced by Norilsk Nickel International (including Norilsk Nickel Harjavalta), in the first half of 2010 increased by 13% as compared to the same period of 2009.
In the first half of 2010 sales of palladium contributed 13% of total metal sales of the Group. Revenue from palladium sales more than doubled from $373 million in the first half of 2009 to $774 million in the first six months of 2010.
Revenue from sale of palladium produced by Russian divisions increased by 128% from $287 million in the first half of 2009 to $655 million in the first six months of 2010. The main reasons of revenue growth include an increase in physical volumes of sales and growth of the average selling price of the metal. Physical volume of sales of palladium produced by the Russian divisions in the first half of 2010 amounted to 1,402 thousand ounces, representing a 6% growth as compared to the same period of 2009 - 1,321 thousand ounces. Moreover, the average selling price of palladium increased by 2.2 times from $217 per ounce in the first half of 2009 to $467 per ounce in the reporting period.
In the first half of 2010 revenue from palladium produced by Stillwater Mining Company increased by 39% - from $77 million in the first half of 2009 to $107 million in the first half of 2010. In the reporting period physical volumes of palladium sales made by Stillwater Mining Company grew by 8% and amounted to 241 thousand ounces as compared to 223 thousand ounces in the first half of 2009. Moreover, the average selling price increased by 29% from $345 per ounce in the first half of 2009 to $444 per ounce in the reporting period.
In the first half of 2010 sales of platinum contributed 12% of total metal sales of the Group. Revenue from platinum sales increased by 63% from $ 415 million in the first half of 2009 to $676 million in the first six months of 2010.
Revenue from sale of platinum produced by the Russian divisions increased by 60% from $333 million in the first half of 2009 to $533 million in the first six months of 2010. The main reason of revenue growth is explained by the growth of the average selling price by 44% from $1,096 per ounce in the first half of 2009 to $1,582 per ounce in the reporting period. Physical volumes of sales of platinum produced by the Russian divisions in the first half of 2010 amounted to 337 thousand ounces, representing an 11% growth as compared to the same period of 2009 - 304 thousand ounces.
In the first half of 2010 revenue from sale of platinum produced by Stillwater Mining Company increased by 65% - from $78 million in the first half of 2009 to $129 million in the first half of 2010. The growth in revenue is attributable both to the growth of physical volumes of sales by 16% from 75 thousand ounces in the first half of 2009 to 87 thousand ounces in the reporting period, as well as to the growth of the average selling price of platinum from $1,040 per ounce in the first half of 2009 to $1,479 per ounce in the reporting period.