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

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.

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)

(By Gus Trompiz; Editing by Edmund Blair)