Major nickel miner Eramet expects continuing losses H2
France's Eramet, the world's sixth largest nickel miner, made a €223 H1 operating loss and sees further negative figures in second half as it sees no pick-up in non-Chinese demand
PARIS (Reuters) -
French nickel and manganese group Eramet (ERMT.PA: Quote) said on Thursday it expected to post an operating loss in the second half, despite improved demand in China, as it reported a heavy first-half loss.
"Prospects for an upturn in activity outside China are highly uncertain," the company said in a statement, adding economic stimulus plans and inventory movements had provided "positive but temporary effects" on its markets.
The world's sixth-largest nickel miner said it swung to a current operating loss of 223 million euros in the first half, compared with its guidance for a "very significant" loss and a year-earlier operating profit of 769 million euros.
Sales fell 44 percent to 1.292 billion euros, although the decline was much less sharp in the second quarter due to some improvement in nickel prices and manganese volumes, it said.
The group said its financial position remained strong, with net cash of 926 million euros at the end of June, compared with 1.113 billion at the end of 2008.
In view of better sales and signs of improving global steel output, Eramet said it would raise manganese output in the third quarter to 55 percent of capacity in ore and sinter and 65 percent of capacity in alloys.
Third-quarter nickel output is expected to stay at the "low level" of the second quarter, while the alloys division is better to see slacker activity, Eramet said.
(Reporting by Gus Trompiz)
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