Sherritt sees growth in Cuba
Feb 23, 2007 11:59 AM
Sherritt International Corp. (TSX: S) said Friday it expects growth to
come this year through expansion of its power and metals mining projects
in Cuba as well as coal projects in Canada, after doubling its full year
The diversified energy company said metals expansion at its Moa nickel
mine in Cuba will lead to a 12 per cent increase in the project's mixed
sulphide capacity in 2008, with further expansions planned.
In power production capacity increased to 311 megawatts in 2006 and will
reach 376 MW in 2007 – a 66 per cent increase in capacity from the 226
MW at the beginning of 2006.
Sherritt is also developing plans for its first commercial coal
gasification plant in Canada with its joint-venture partner the Ontario
Teachers' Pension Plan.
"With the main growth initiatives that we have underway, the foundation
is in place to grow the company each and every year into the forseeable
future," Jowdat Waheed, Sherritt's president and chief executive
officer, said during a call with analysts Friday.
His comments came after the Toronto-based company reported full-year net
earnings of $245.6 million, $1.42 per share, almost doubling its
year-ago profit of $124.3 million or 70 cents per share in 2005, as
revenue increased to $1.11 billion from $1.02 billion.
The year included $127.8 million in proceeds following the spinoff of
the Royal Utilities Income Fund (TSX: RU.UN) in June, as Sherritt cashed
in on its mature coal holdings, retaining 41 per cent of the trust.
Fourth-quarter earnings were $78.6 million or 47 cents per share, up
from $9.1 million or five cents per share in the year-ago period on
strong commodity prices, especially for nickel. Revenue swelled 26 per
cent to $304.2 million from $241.3 million, Sherrit said late Thursday.
Sherritt is active in coal mining in Alberta and Saskatchewan, oil and
gas production in Cuba, Spain and Pakistan and nickel and cobalt mining
in Cuba and electricity generation in Cuba.
Despite his upbeat outlook, Waheed said Sherritt's first quarter
results, primarily for Coal Valley and its metals business, could be
impacted by an ongoing CN Rail strike.
The federal government is currently preparing to table legislation
ordering 2,800 striking employees at CN Rail back to work, ending a
walkout that has all but crippled key sectors of the Canadian economy.
"At this time, our full year sales should not be materially impacted,"
On the TSX Friday, shares in Sherritt were trading up 46 cents, or three
per cent, to $14.96, near the company's 52-week high of $15.