Vancouver As has been the case with other metal producers, declining prices have taken their toll on Australian-based diversified miner WMC (WMC-N).
“Our major businesses have followed last year’s good returns with performances competitive with those of our peer group,” says Hugh Morgan, the company’s CEO.
The company posted earnings of A$273.9 million, or 25 per share, in the six-month period ended June 30. This compares with a profit of A$404.1 million, or 35 per share, in the corresponding period of 2000. Revenues inched up to A$1.56 billion from A$1.52 billion in 2000. The earnings shortfall was mainly due to declining metal prices.
WMC saw the pretax earnings from its nickel business drop by 47% to A$228.9 million, while its aluminum business rose by 31% to bring in A$352 million. Copper and uranium branches contributed A$128 million, while WMC’s gold business added A$21.9 million. The shortfall from the nickel division was attributed to substantially lower prices and planned shutdowns that reduced production.
Despite the reduced earnings, the company managed to generate an 11.3% rate of return on equity during the first half of 200. Net operating cash flow increased by 8.8% to A$784.6 million.
Looking forward, the company sees weak metal prices continuing for the remainder of the year.
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