Sherritt narrows Q3 loss as higher commodity prices, lower costs boost the bottom line

TORONTO (miningweekly.com) – Canadian diversified miner Sherritt International has reported improved headline earnings for the three months ended September, as higher realised prices for nickel, cobalt and oil and lower unit operating costs, mainly for nickel and electricity boosted earnings.

Excluding special items, the net loss narrowed to C$84.4-million, or C$0.29 a share, compared with an adjusted net loss of C$104.3-million, or C$0.34 a share in the same period a year earlier.

The net loss was C$69.5-million, or $0.24 a share, down from a net loss of C$120.8-million, or $0.41 a share, in the comparable period of 2016.

Revenue increased its revenue for the period by 8% year-on-year to C$63.3-million, with combined revenue rising 27% to C$234.7-million.

Sherritt’s adjusted earnings before interest, depreciation and amortisation was C$33.8-million, up 194% from $11.5-million in the third quarter of 2016.

The Toronto-headquartered company, which has operations focused on the mining and refining of nickel from lateritic ores with projects and operations in Canada, Cuba and Madagascar, focused on the mining and refining of nickel from lateritic ores with projects and operations in Canada, Cuba and Madagasca, said it and its Ambatovy Joint Venture (JV) partners continue to work towards implementation of an agreement in principle that will result in the re-structuring of the JV and the elimination of about C$1.3-billion of non-recourse debt. Closing of the transaction is expected to occur before year end.

At its Cuba-based Moa JV, net direct cash cost for nickel was $1.94/lb, representing the lowest total since the fourth quarter of 2004. The decline was driven mainly by high cobalt prices and a $0.50/lb cost savings achieved with the commissioning of the third acid plant at Moa in 2016.