UK Markets open in 6 hrs 8 mins

France's Eramet says sales buoyed by mining unit, passes on A&D offer

  • Oops!
    Something went wrong.
    Please try again later.
·2-min read
  • Oops!
    Something went wrong.
    Please try again later.

PARIS (Reuters) - France's Eramet reported a rise in first-quarter sales on Monday as higher prices and output boosted its mining division, offsetting a slide at Aubert & Duval (A&D), the struggling aeronautics alloys supplier it is trying to sell.

Group sales reached 838 million euros ($1.01 billion), up 8% compared with the same period a year earlier, including an 18% rise for its mining and metals branch to 683 million euros, the French company said in a statement.

The market context for the mining and metals division remained favourable at the start of the second quarter, "mainly thanks to the momentum of the Chinese economy, with an improved short-term outlook in Europe and the United States," it said. [MET/L]

Eramet cited "exceptional progress" at its Weda Bay nickel operations in Indonesia, which launched about a year ago, and said they should make a strong cash contribution in 2021.

It raised its target for mine production at Weda Bay to more than 10 million wet tonnes in 2021, compared with more than 6 million expected previously, while confirming its objective for 40,000 tonnes of low-grade nickel ferroalloys.

It maintained other targets.

At its SLN nickel unit in New Caledonia, higher prices and ore exports offset disrupted ferronickel production, with the subsidiary's cash position stable in the first quarter, Eramet said.

The group said it had received a takeover offer for A&D that it did not pursue, adding a sale remained its preferred option.

The handling of A&D, hurt by a slump in aviation during the pandemic, was among issues that led Eramet's largest shareholder, the Duval family, to raise doubts about renewing the tenure of Chairwoman and Chief Executive Christel Bories.

The group's board last month agreed to a new term for Bories during which her dual role would be split.

($1 = 0.8261 euros)

(Reporting by Gus Trompiz; Editing by Edmund Blair)