While Sherritt Gordon (TSE) is on the hunt for new feed for its Alberta nickel refinery, buoyant nickel prices and coinage product profits combined to produce a record second-quarter.
Net earnings increased to $23.1 million or $1 per share for the three months ended June 30, from $5.8 million or 22 cents per share at the same time last year.
Sherritt Gordon’s net earnings for the first six months of 1988 were $40.5 million or $1.74 per share compared to $2.9 million or 5 cents per share in the first half of 1987.
Although first-half revenues increased to $292 million from $155.5 million reported last year, the company has also managed to reduce its long-term debt position which stood at $80.8 million on June 30, down substantially from $105 million at the same time last year.
News that Inco Ltd. (TSE) will not renew a nickel concentrate purchase contract scheduled to expire at the end of 1989 is a significant blow to Sherritt Gordon. As reported (N.M., Aug 8/88), Inco supplies about 6 0% of the nickel concentrate handled by Sherritt’s Fort Saskatchewan facility.
Hudson Bay Mining and Smelting (TSE) has been lined up as a replacement supplier for about one- third of the lost Inco concentrate. Feed will come from Hudson Bay’s 60%-owned Namew Lake nickel- copper mine near Flin Flon, Man., due to start production late in 1988.
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