Japan's Sumitomo Metal Mining Showcases High Annual Profit, Declares Dividends

Sumitomo Metal Mining of Japan raised its full-year net profit and dividend forecasts on Wednesday, citing higher-than-expected nickel, copper, and gold prices.

Net profit is now expected to be 158 billion yen ($1.2 billion) for the fiscal year ending March 31, up 15% from its November guidance of 137 billion yen, and the annual dividend is expected to be 202 yen per share, up from 175 yen.

"Higher profit contributions from overseas copper mines boosted earnings estimate of resource segment, and firmer nickel prices helped bolster profit outlook in smelting segment," Executive Officer Kunihiko Miyamoto told a news conference.

However, its net profit for the April-December period fell 10.2% year on year to 152.8 billion yen due to lower mining gains following the sale of its stake in Chile's Sierra Gorda copper mine last year.

"The electronic materials segment is struggling as the market is going through an adjustment of accumulated inventories," Miyamoto said.

When asked about the impact of Peruvian political protests, Miyamoto said there had been no impact on production at the Cerro Verde copper mine, in which Sumitomo Metal has a stake.

"It's unclear what will happen to the political unrest and the operation on the mine may be affected depending on the situation," he said.

Meanwhile, the Philippines is looking at taxing nickel ore exports to encourage miners in the world's second-biggest supplier of the material - which is used in making stainless steel and batteries for electric vehicles - to invest in domestic processing instead of just selling raw ore.

Sumitomo Metal has two nickel processing plants, which are both partly owned by the Philippines' biggest ore producer Nickel Asia Corp.

Asked whether Sumitomo Metal would expand its nickel business in Philippines, Miyamoto said securing nickel resources remained a top priority for the Japanese company and building a third plant there could be an option.