UPDATE KGHM Net Profit 78 On Weak Zloty High Copper Price

Aug 13, WARSAW (Dow Jones)—
Copper producer KGHM Polska Miedz SA (KGH.WA) Friday said its unconsolidated second-quarter net profit rose 78%, due to a weaker zloty and high copper prices.

Net profit rose to PLN1.50 billion ($499.3 million) from PLN844.8 million in the second quarter of 2009, beating an average forecast of PLN1.16 billion from a Dow Jones Newswires poll of eight analysts.

KGHM said unconsolidated revenue rose 44% on the year to PLN3.93 billion, also above analysts' average forecast of a PLN3.74 billion. The rise was due to high copper prices, both in U.S. dollar and Polish zloty terms.

In the second quarter, copper prices remained close to the level of $7,000 a metric ton. This was up 20% from the second quarter of last year, but 3.4% lower than the first quarter of this year.

However, in zloty terms, average copper prices rose by 27% on the year in the second quarter and by 4% on the quarter, thanks to a more than 6% average slide of the zloty against the U.S. dollar.

KGHM's unconsolidated earnings before interest and taxes was up 92% on the year in the second quarter, to PLN1.86 billion, while its earnings before interest, taxes, depreciation and amortization rose by 82% on the year, to PLN2.01 billion.

Thursday, KGHM shares closed up 0.7% at PLN104.10, against a 0.5% rise in the blue-chip index WIG20.