ATLAS Consolidated Mining Corp. reported a wider consolidated net loss of P939 million for the first nine months of the year, nearly double the P470-million net loss incurred in the same period last year, as profitability was pressured by the provision for copper price hedges.
“Without a P400 million mark-to-market loss provision for copper price hedges, the net loss would have been P539 million,” the company told the stock exchange on Tuesday.
“The provision for mark to market loss represents the accounting valuation of outstanding copper price hedges as copper price increased above the hedge prices at the end of the third quarter,” it said.
“This provision changes as the copper prices change and the final variance is determined at the month of settlement,” it added.
However, it said earnings before interest, tax, depreciation, and amortization (Ebitda) improved by 9 percent to P2.5 billion from P2.3 billion last year due to improved production and higher copper prices in the third quarter.
Wholly-owned subsidiary Carmen Copper Corp. milled 10.5 million metric tons of ore and produced 58 million pounds of copper metal in the nine-month period, down from the 12.7 million MT milled and 77.1 million pounds produced year-on-year. Production showed steady improvement in the third quarter by 12 percent or 21.42 million pounds copper metal produced against 19.07 million pounds in the second quarter.
“Metal prices year-on-year showed that average realized copper price continued to increase at $2.70 per pound, 27 percent higher than $2.13 per pound, while average realized gold price remained stable at $1,255 per ounce from $1,258 per ounce in 2016. For the third quarter, copper price improved by 12 percent at $2.87 per pound from the average price in the second quarter of $2.56 per pound,” the company said.
Cash costs were lower by 2 percent to P6.5 billion in the nine months to September this year.
Average cost per pound however increased by 30 percent from $1.36 per pound to $1.77 per pound for the nine months, due to one-off costs related to loan refinancing, higher waste charged to operations, lower by-product credits and lower volume shipped, the company said.