UPDATE 1-Xstrata H1 copper, nickel output off, sees strong H2

Tag : refined copper

(Adds analyst comment, shares)
By Eric Onstad
LONDON, July 30 (Reuters) - Mining group Xstrata (XTA.L: Quote , Profile , Research ) posted mixed first-half production data on Wednesday, withslightly weaker output in two key metals, but forecast a strongrise in the second half.
Mined copper and nickel output fell by 1.1 percent and 6.1 percentrespectively, but the Anglo-Swiss group achieved record output forthe first six months of the year in ferrochrome, platinum,semi-soft and coking coal and refined nickel.
Copper and nickel were responsible for the bulk of Xstrata'soperating profit last year, with copper accounting for 46 percentand nickel for 24 percent.
"Xstrata has delivered generally sound H1 production data versusour forecasts except total mined copper, which was slightly lower,"said analyst Simon Toyne at Numis Securities.
"H2 is expected to be markedly better for the group as a whole so,while we will probably reduce our H1 EPS forecast from 276 cents toaround 265 cents, we expect the market to take the data in itsstride."
Toyne, who rates Xstrata as "hold", said he would leave hisfull-year EPS forecast unchanged at $7.10, a rise of 27 percentfrom 2007.
Xstrata shares, which have shed 11 percent over the past month asinvestors worry about demand, rose 3.8 percent to 3,566 pence by0835 GMT, compared to a 3 percent increase in the UK mining index . Continued...