Noranda Income Fund Announces That It Is Suspending Its Cash Distribution
Published July 20th, 2009
The Noranda Income Fund (the “Fund”) (TSX:NIF.UN) announced today it is suspending its monthly cash distribution.
Since March 2009, the Fund has operated the production of sulphuric acid and zinc at 80% of 2008 levels because of the weak demand for sulphuric acid. The Fund’s profitability and cash flow have been negatively impacted by operating at less than full capacity and by weak market conditions. As a result, the Board of Trustees feels that it is prudent to stop paying the monthly cash distribution until there is an overall improvement in the economic outlook for the Fund.
The suspension will impact both the Ordinary and Priority Unitholders. Ordinary Unitholders have not received a monthly distribution since March when the subordination feature became effective. Starting in July, the Priority Unitholders will no longer receive a distribution.
The Fund is unable to predict with any certainty the expected duration of weak market conditions, including the demand for sulphuric acid.
A more detailed update will be available when the Fund releases its second quarter earnings on July 30, 2009.
Noranda Income Fund is an income trust whose units trade on the Toronto Stock Exchange under the symbol “NIF.UN”. The Noranda Income Fund owns the CEZinc processing facility and ancillary assets (the “CEZinc processing facility”) located in Salaberry-de-Valleyfield, Quebec. The CEZinc processing facility is the second-largest zinc processing facility in North America and the largest zinc processing facility in eastern North America, where the majority of its customers are located. It produces refined zinc metal and various by-products from zinc concentrates purchased from mining operations. The Processing Facility is operated and managed by Canadian Electrolytic Zinc Limited.
Further information about the Noranda Income Fund can be found at www.norandaincomefund.com.
