ENRC output up, warns on costs
Output at Eurasian Natural Resources Corporation grew substantially in the first quarter, but the FTSE 100 Kazakh company warned that costs are rising.
ENRC's ferrochrome production was ahead by 4.2pc.
By Rowena Mason 6:32PM BST 12 May 2011
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Aluminium production rose 38pc, ferrochrome was ahead by 4.2pc and iron ore pellet rose by 2.6pc, while copper and cobalt also grew.
The company said it benefited from "strong production and sales volumes and a positive pricing environment, partially offset by higher costs".
It has secured a new $500m credit facility, and has cash of $2.1bn and total debt of $1.6bn. ENRC predicted revenue growth in line with expectations and production to be maintained at full capacity.
In spite of this, Felix Vulis, the outgoing chief executive, cautioned that costs are rising. He said: "ENRC had a strong start to the year. Production was at effectively full capacity across all of our principal commodities. However, cost pressures continue to represent a key challenge for the business."
It emerged last month a boardroom split had divided the Kazakh miner, with directors called to their third emergency meeting in two weeks. Sources said there were a number of "fiery" rows between the British non-executives, management and Kazakh state representatives.
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