Canadian miner Sherritt posts wider loss as nickel prices drop

Tue Jul 28, 2015 7:10pm EDT
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July 28 (Reuters) - Canadian miner Sherritt International Corp reported a bigger loss for the second quarter, hurt by lower nickel prices.

The Toronto-based company said on Tuesday its adjusted net loss from continuing operations widened to C$75.2 million ($58.2 million), or 25 Canadian cents per share, in the three months ended June 30 from C$56.2 million, or 19 Canadian cents per share, a year earlier.

Sherritt operates nickel mines in Madagascar and Cuba.

Average realized prices for nickel fell about 19 percent to $7.13 per pound in the quarter, the company said.

Sherritt, which also produces coal and oil and gas, said its combined revenue fell about 12 percent to C$268.4 million.

Sherritt said it expected total production of 78,000-82,000 tonnes of nickel in 2015, down from a previous estimate of 80,000-86,000. The company cut the estimate for the Ambatovy mine in Madagascar to 45,000-48,000 tonnes from 47,000-52,000.

Sherritt has a 40 percent stake in the Ambatovy mine and a 50 percent stake in the Moa nickel-cobalt operation in Cuba.

Sherritt and other nickel miners have been grappling with a plunge in the price of nickel, which is mainly used to make stainless steel, due to a supply glut and softer demand from China, the largest consumer of the metal.

Benchmark nickel prices fell 3.34 percent in the April-June quarter.

Sherritt, which also produces fertilizer, said earlier on Tuesday that David Bacon will become chief financial officer in November. Bacon, who will join the company on Sept. 9, replaces Dean Chambers. [ID: nCCNbLD0Fb]

Up to Tuesday's close, Sherritt's stock had fallen about 55 percent this year. ($1 = 1.2925 Canadian dollars) (Reporting by Tanvi Mehta in Bengaluru; Editing by Ted Kerr)