PARIS - Eramet raised its outlook for full-year core earnings on Thursday due to a jump in manganese prices, though the French miner expected the nickel market to remain tough after it contributed to a drop in the group's first-half results.

The company reported a 27% drop in first-half adjusted earnings before interest, tax, debt and amortisation (EBITDA) to 247-million euros ($268.17-million), notably pressured by weaker nickel prices in a sector faced with a supply surplus.

However, a rally in manganese ore prices, triggered by weather-related disruption to Australian production, led the group to increase its full-year adjusted EBITDA guidance range to 1.2-billion to 1.3-billion euros from the 750-million to 900-million euros projected previously.

The manganese rally, which saw ore prices double in the second quarter, would be fully reflected in Eramet's activity from the third quarter and represented "the main if not to say the sole reason" for the increased guidance, Eramet CFO Nicolas Carre told reporters on a call.

Eramet's manganese mine in Gabon is one of its biggest activities.

The group continued to expand nickel output in Indonesia in its joint venture with Chinese steel giant Tsingshan, though it lowered its full-year volume sales target after failing to secure permits for marketing lower-content ore.

Lower nickel prices and unrest in New Caledonia have increased pressure on Eramet's troubled subsidiary SLN.

SLN recorded another operating loss in the first half as violence in the southern Pacific territory brought its nickel production to a near standstill.

Eramet this year agreed with the French government to remove SLN debt from its group balance sheet. The government this month provided 80-million euros in funding to keep SLN operating, on top of 140 million euros in the first half of this year, Eramet said.

In a shift towards producing minerals for electric vehicle batteries, Eramet is due to start lithium production at a mine in Argentina later this year, also in partnership with Tsingshan.

The group has delayed to next year the start of work on a second lithium plant at its Argentine mine as it studies potentially more favourable investment terms under new legislation, it said.