Diversified major Noranda (NOR-T) plans to keep busy this year spending the money it had expected would be required for two acquisitions, which never materialized.
Noranda unsuccessfully bid for the Antamina copper-zinc project in Peru last year, while its 46.3%-owned affiliate Falconbridge (FL-T) lost the battle for the Voisey’s Bay nickel-Copper-Cobalt project in Labrador.
Flush with cash no longer required for those projects, Noranda has earmarked a record $2.2 billion for capital expenditures in 1997, of which 37% will go to Falconbridge and 29% to Noranda’s oil and gas interests. A large portion of the 1997 budget will also be used on several projects Noranda Metallurgy has on the go.
Chairman David Kerr told shareholders gathered for the annual meeting that the company’s net debt will rise by 25% as on-hand cash drops dramatically.
Noranda’s revenue for the first quarter of 1997 was $2.5 billion, compared with $2.4 billion in the same period in 1996. Earnings fell to $59 million (or 22 cents a share) from $101 million (43 cents a share). However, earnings for the recent quarter were 64% higher than in the last quarter of 1996.
Falconbridge reported first-quarter earnings of $46.1 million (26 cents a share), down from $72.4 million (41 cents a share) in the comparable period last year. Revenue was $502.9 million — $70.6 million lower than in the first three months of 1996. The company said the decreases were a result of lower realized prices for nickel, copper and cobalt.
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