The French mining group Eramet saw its net profit fall by 85%, to 109 million euros in 2023, due to the fall in the prices of strategic metals such as nickel and manganese last year.
“Our businesses are cyclical and we are clearly at the end of the cycle,” said the group’s CEO, Christel Bories, during a telephone interview with the press. The group “has demonstrated its ability to resist” and “to continue its development projects despite the economic situation,” she added, confirming in particular the start of lithium production in Argentina “this summer.”
Last year, the average price of manganese ore fell 20% year-on-year, that of manganese alloys fell 43%, said Nicolas Carré, the group’s financial director.
Regarding class 2 nickel (intended for the manufacture of stainless steel), prices fell by an average of 24%, he added, highlighting however “the excellent operating results of the group” in the second half, due to a level manganese record. production in Gabon after the logistical problems previously suffered.
“Structural deficit”
2023 turnover fell by 35%, to 3,250 million euros. But taking into account Eramet’s indirect 38.7% stake in PT Weda Bay Nickel in Indonesia, which posted production records last year, this adjusted turnover fell by 29% to €3.8 billion.
The group recorded a charge of €218 million for the depreciation of the value of the assets of the seriously distressed Société Le Nickel (SLN) in New Caledonia. “The conditions for the continued operation of the Caledonian subsidiary are no longer met to date,” the group’s press release states.
“Despite good operating results, SLN remains structurally in deficit, due to the price of energy, access to resources and the cost of labor,” explained Christel Bories.
Reduce debt burden
Eramet and the French State will announce “in the coming weeks” the solution adopted to reduce the weight of SLN’s debt in the accounts of its parent company, he added: “The State again granted a loan of 60 million euros to SLN in February , which should allow it to last until April 10, the end of the so-called ‘consignment’ period,” he explained.
“We are discussing with the State how to de-correlate the impact of this debt in our consolidated accounts” while awaiting an “industrial solution” and the outcome of the conversations between the State, local authorities and local manufacturers on the future “pact of the nickel”. clarified Christel Bories.
Source: BFM TV
