November 10, 2010 / 11:23 PM / 7 years ago

UPDATE 1-Neo Material posts higher Q3 profit

* Q3 EPS $0.12 vs $0.08 last year

* Q3 rev up 41 percent

Nov 10 (Reuters) - Canada’s Neo Material Technologies Inc NEM.TO reported higher third-quarter profit, helped by strong performance of its division that makes magnetic powders.

For the July-Sept quarter, the maker of magnetic powders and rare earth products reported net income of $14.3 million, or 12 cents a share, compared with $9.3 million, or 8 cents a share, last year.

Revenue for the company, which operates rare earth processing plants in China, rose 40.7 percent to $91.3 million.

The company said revenue at its Maqnequench divison, which makes the magnetic powders used in the production of precision motors and sensors, rose 32 percent to $45 million.

“We remain optimistic in the face of continuing uncertainty in the Chinese regulatory environment,” the company said in a statement.

China’s increasing reluctance to supply the rest of the world with rare earths is whipping up a gold rush-like frenzy to find new producers of the elements needed to manufacture everything from high-tech weapons to mobile phones.[ID:nSGE69Q0G9]

Neo Material, which is emerging as leading processor of minor metals through its recent acquisitions, has signed a key agreement with U.S.-based Molycorp Inc MCP.N to manufacture, supply and distribute rare earth products. [ID:nSGE6570FH]

The company’s shares, which have gained more than 48 percent since it inked the deal with Molycorp in June, closed at C$5.67 on Wednesday on the Toronto Stock Exchange. (Reporting by Aftab Ahmed in Bangalore; Editing by Prem Udayabhanu) (aftab.ahmed@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800; Reuters Messaging: aftab.ahmed.reuters.com@reuters.net))

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