Sherritt International Corporation

Combined revenue was $135.6 million, lower year over year, mainly because nickel revenue fell on a 15% decline in average realized price and a 14% drop in sales volumes. Net earnings from continuing operations were $10.4 million, while adjusted net loss from continuing operations was $25.6 million, excluding a $32.4 million gain tied to the debt and equity transactions. Net direct cash cost was USD 5.27 per pound of nickel sold, down 8% year over year. The company ended the quarter with $45 million of available liquidity in Canada. For 2025, nickel production guidance was cut to 27,000 to 29,000 tons from 31,000 to 33,000 tons, cobalt to 3,000 to 3,200 tons from 3,300 to 3,600 tons, sustaining capital metals to $30 million from $35 million, and tailings facility spending to $35 million from $40 million. Power guidance was maintained, but expected closer to the lower end of the 800 to 850 gigawatt hour range; NDCC and Power unit operating cost guidance were unchanged. Management said annualized cost savings of about $20 million are expected from the latest reductions, in addition to $17 million of annualized savings from last year.

Leon Binedell framed the quarter as one where external pressure and operating issues in Cuba weighed on results, but management responded by prioritizing margins, liquidity, and balance sheet repair. He highlighted the recovery plan underway for Moa, the scheduled ramp-up of Phase 2, and the closing of financing transactions that extended maturity and reduced financing risk. His tone was cautious but constructive, with repeated emphasis on resilience and the potential for better margins if nickel prices improve.

Yasmin Gabriel focused on the numbers behind the quarter and the actions taken to protect cash flow. She cited $135.6 million of combined revenue, $10.4 million of net earnings from continuing operations, and a $45 million cash liquidity position in Canada, while also noting $10.3 million of transaction fees, $8.7 million of interest on second lien notes, $6.2 million of rehabilitation and closure costs, and $4.4 million of capex. She also said the company expects lower-end Energas dividends of the previously disclosed $25 million to $30 million range and that cobalt swap distributions in 2025 will be limited and will not meet the annual minimum amount.

Only one analyst question appeared before the call disconnected, and it centered on the pressures in Cuba: labor shortages requiring expat support, limited third-party feed, and sulfuric acid pricing. The analyst also asked how the reduced 2025 production guidance should translate into 2026, including the expected MSP contribution from the expansion. Management did not answer before the call ended, so no further clarification was provided on those topics.