KGHM, Polish Copper Producer, Raises 2010 Profit Forecast to $1.28 Billion

Sep 6 (Bloomberg)--

KGHM Polska Miedz SA, Poland’s sole copper producer, raised its profit and revenue forecasts for this year on higher output and a weaker-than-expected zloty.

KGHM forecast net income will reach 3.91 billion zloty ($1.28 billion) in 2010, raising its previous guidance published in February by 35 percent, the company said in a regulatory statement today. Profit last year was 2.54 billion zloty.

Revenue, according to the new budget, will increase to 14.4 billion zloty from 11.1 billion zloty last year. That compares with 11.7 billion zloty in the previous revenue forecast.

Lubin, southwestern Poland-based KGHM now says it will produce 541,000 tons of copper this year, 5.7 percent more than it had earlier forecast. Revenue from KGHM’s copper exports will also be increased by the exchange rate for the zloty, earlier seen at 2.7 per dollar on average in 2010, which will probably trade at 3.1 per dollar, the company said.

The copper producer kept its estimate for the average price of the metal in 2010 at $6,700 a ton.

KGHM shares extended gains, climbing 1.7 percent to 112.9 zloty at the 4:30 p.m. close in Warsaw, the highest level in more than four months. The benchmark WIG20 Index rose 0.5 percent.

KGHM, which earlier had planned to spend 1.63 billion zloty on capital expenditure and 1.64 billion zloty for acquisitions in 2010, will now spend 1.54 billion zloty and 2.1 billion zloty respectively, after it bought a stake in utility Tauron Polska Energia SA.