Japanese Copper Smelters Gain High Profits in 1H Due to Metal Price Upsurge

Sumitomo Metal Mining (SMM) announced on Tuesday the firm’s consolidated recurring profit improved by 29.8% to 61.5 billion yen for April-September 2011 compared with the corresponding period of fiscal 2010. Equity method profits increased in Mineral Resources business unit and Smelting & Refining business unit along metal market price upsurge. Meanwhile, consolidated operating profit decreased by 0.2% year-on-year due to sales volume down of electronic materials and inventory evaluation loss for nickel. Consolidated net sales increased by 1.1% year-on-eyar.

SMM also announced its full-year capex plan at total 114.9 billion yen for fiscal 2011 ending in March 2012. This is the largest full-year capex for SMM ever, revised largely upward from previously planned 35.7 billion yen by adding a share acquisition project in Chilean copper mine. Main capex plans are Taganito nickel development in the Philippines at 43.1 billion yen, capacity expansion for electrolytic nickel at 2.8 billion yen and refinement of Toyo smelter’s furnace at 2.2 billion yen.

Mitsubishi Materials also announced its half-year financial results for April-September 2011 on Tuesday. The firm posted consolidated recurring profit of 40.4 billion yen, 22% positive against the same period of fiscal 2010 and higher than estimated 34 billion yen. Recurring profit expanded by 36.6% in the copper business unit. High copper ingot price and sales increase at Indonesian copper smelting subsidiary canceled disaster loss at Onahama smelter. Price upsurge of precious metals also contributed to the profit improvement.

However, Mitsubishi Materials left full-year consolidated recurring profit forecast unchanged at 60 billion yen due to unstable business circumstances. The forecasted profit is 6.3% positive against the recurring profit in fiscal 2010.