Kazakh mining group ENRC says Q2 trends positive

LONDON (Reuters) - Positive trends for Kazakh mining group Eurasian Natural Resources Corp (ENRC.L) in the first three months have fed through into the second quarter, the firm said on Wednesday.

"Into the second quarter of 2008 the trends underlying trading this year have continued. Significant price increases will feed through to benefit ferroalloys and iron ore revenues," Chairman David Cooksey said in a statement for the firm's annual general meeting.

Also helping would be a new revenue stream from the firm's aluminium smelter, which was expected to generate sales of about 100,000 tonnes this year, he added.

In a trading statement on May 14, ENRC said high commodity prices had boosted revenue in the first quarter, laying the foundation for an expected robust performance in the full year.

The world's biggest ferrochrome producer said the strongest performances in terms of earnings before interest, tax, depreciation and amortisation during the first three months of the year were in the ferrochrome and iron ore divisions.

Overall production also rose, up 2.5 percent for total ferroalloys and 3 percent for high-carbon ferrochrome.

Prices were the main driver of the strong revenue growth, with ferroalloys prices soaring 91 percent, iron ore jumping 42 percent and thermal coal up over threefold.

In Wednesday's AGM statement, ENRC noted an announcement on Tuesday that Kazakh rival Kazakhmys (KAZ.L) had agreed to purchase a further 7.7 percent stake in ENRC, making it the biggest shareholder, but offered no comment on the move which analysts said could make more likely a merger of the two.

ENRC shares, which have more than doubled so far this year, ended on Tuesday up 6.2 percent at 1,363 pence.

(Reporting by Eric Onstad; editing by Rory Channing/Elizabeth Fullerton