Noranda’s earnings get big boost from minerals

Strong markets during the normally slack summer period are reflected in a healthy Noranda Inc. (TSE) balance sheet to the end of September.

The resources giant recorded third-quarter net earnings of $139 million (72 per share after preferred dividends) compared with $89 million (55 per share) for the same period in 1987.

For the first nine months, the company reported earnings of $453 million ($2.36 per share) compared with $222 million ($1.35 per share) last year.

Helping to boost the parent company’s 9-month income was an almost 40% increase in the earnings of Noranda Minerals, which attributes the increase to higher metal prices partly offset by a substantial increase in net exploration expenses. Noranda Minerals has spent $60 million this year on exploration to the end of September, almost three times the amount spent during the same period last year.

One of the company’s successes is the Golden Giant mine at Hemlo in northern Ontario, which is operated by Hemlo Gold Mines (TSE), in which Noranda has a 51% interest.

The company says the contribution from Noranda Forest was also higher to the end of September despite the public issue of a 19% minority interest in the forestry division during the second half of 1987.

Noranda Energy earnings also rose substantially because of the acquisition of Norcen and North Canadian at the end of 1987, although those earnings were below expectations because of weak oil and gas prices, the company says.

A $100-million increase in Noranda Manufacturing results was attributed to buoyant aluminum markets.

During the third quarter, Noranda spent $334 million to acquire a 19.9% interest in Falconbridge Ltd. (TSE). The company has been stalled in its attempt to acquire more shares in the nickel producer.