Higher prices help Inco boost quarterly earnings

Positive first-quarter results reflect mainly higher metals prices and increased deliveries of nickel, copper and precious metals, together with significantly improved results in the alloys and engineered products business, Inco (TSE) says.

The company reported net earnings of US$71.7 million (US60 cents per share) for the first quarter, compared with a net loss of US$60 million (US53 cents per share) for the same 3-month period of 1994.

(First quarter, 1994, results included one-time charges associated with planned production shutdowns and employment reductions in the company’s primary metals business.)

Western world nickel demand, which is estimated to have reached a record level in 1994, continued to grow in the first quarter of this year, the company says.

Relative to the fourth quarter, 1994, first-quarter results reflect higher realized prices for nickel and copper, partially offset by lower deliveries of company-produced nickel, attributable, in part, to lower finished production and to the recently settled Canadian rail and port strikes, Inco says

First-quarter nickel production, constrained by operating problems, was some 8 million lb. lower than fourth-quarter, 1994, production. Consequently, deliveries of purchased nickel, on which little or no profit is realized, increased in the first quarter.

In addition, deliveries of platinum group metals declined in the first quarter compared with higher-than-normal deliveries in the fourth quarter, 1994.

The company’s realized nickel price averaged US$3.97 per lb. in the first quarter, compared with US$2.77 in the first quarter of 1994 and US$3.29 in the fourth quarter of 1994.

Inco’s realized copper price averaged US$1.38 per lb. in the first quarter, compared with US86 cents in the first quarter of 1994 and US$1.25 in the fourth quarter of 1994.

As of March 31, the company’s total debt was US$989 million, down slightly from US$993 million at Dec. 31, 1994, and its total debt:equity ratio was 35:65..