Inco Ltd., the world's second biggest nickel producer, said first-quarter net income almost tripled as higher metal prices boosted sales.
Net income rose to $30 million from $11 million a year earlier. Sales rose 17 percent to $593 million from $506 million.
Nickel production in the first quarter fell 16 percent to 50,228 metric tons, from 59,547 tons a year earlier. Nickel prices have risen 16 percent to $8,155 per ton in the year ended March 31 on the London Metal Exchange.
``We benefited from a strong nickel market during the quarter but we continued to face cost challenges at our operations, largely from sources that, as a practical matter, are not controllable,'' said Scott Hand, chief executive for Inco.
An 8.8 percent increase in the value of the Canadian dollar against the U.S. currency in the past year reduced profit by 66 cents a share for the year. The company may face higher costs at its Ontario plants as it renegotiates a new contract with about 3,000 unionized employees.
The company noted that strong nickel demand in the first quarter has been driven by continued growth in stainless steel production, the largest end-use for nickel, combined with tight stainless steel scrap availability.