Inco (N) said it expects to blow out third-quarter earnings targets, given the strength of the market for nickel products.
The Toronto-based miner said it expects to make $2.66 to $2.75 a share, well above the $1.88 Thomson Financial view and triple year-ago earnings.
Inco also said it lowered its production estimates for nickel and copper for the third quarter following equipment breakdowns at its Ontario and Manitoba operations. These production losses are in addition to the previously announced extended outage at the company's Indonesian operations and the ongoing strike at its Voisey's Bay operations in Labrador. The company has now restored full production at both Indonesian and Ontario operations and expects the Manitoba operations to return to full production in early October. Contract talks between Inco and the union representing workers at Voisey's Bay resumed this week.
Inco continues to expect that robust market conditions will lead to record second half earnings, despite the lower production estimates. "We believe that the great strength we are seeing in the nickel market will continue through the remainder of the year, and we continue to expect unprecedented earnings and cash flow in the second half of 2006," said CEO Scott Hand.