NICKEL Asia Corp. (NAC) on Tuesday said its net income jumped 131 percent in the first nine months of the year driven by strong sales of nickel ore and higher prices of the metal in the world market.
In a disclosure to the Philippine Stock Exchange, NAC said its net income rose to P3.26 billion in the January to September period from P1.41 billion a year ago.
The company attributed the strong earnings performance to the higher sales of nickel ore combined with higher prices, enabling revenues to increase by 74 percent to P10.19 billion from the previous year’s P5.87 billion.
The total volume of nickel ore sold and delivered by four operating mines reached 8.25 million wet metric tons, up from 5.78 million WMT in 2010.
“Laterite ore imports into China have been at record levels this year, owing to the strong position of nickel pig iron as the primary choice for nickel and iron among stainless steel producers,” said Gerard Brimo, NAC president and chief executive.
Brimo said the company met the significant increase in demand for nickel ore because of its ability to consistently supply quality ore at various grades.
Of the total volume of ore shipped during the nine-month period, 2.85 million WMT were saprolite ore, while 5.40 million WMT were limonite ore—of which, 2.15 million WMT was shipped to the company’s Coral Bay hydro-metallurgical processing plant.
As of October 4, the London Metal Exchange spot nickel price stood at $8.63 per pound, while the average realized exchange rate during the period was P43.10 to the US dollar.
The realize LME nickel price applicable to 3.27 million WMT of ore shipped in the first nine months averaged $10.88 per pound of payable nickel, as against $9.57 per pound of payable nickel in the same period in 2010.
The balance of the shipment sold was on the basis of the negotiated price per WMT of ore, which averaged $23.79 in 2011 compared with $17.86 last year.
The company also disclosed that mining operations at its 65 percent-owned subsidiary Taganito Mining Corp. has normalized following the raid by armed insurgents early this month.
Brimo said ore shipment is expected to commence in the first week of November.
“Our Taganito team has worked hard to get operations back to normal almost immediately,” Brimo said, adding that an expenditure program to replace a substantial amount of equipment damaged during the raid at TMC is already in place.
“While the replacement value is approximately P500 million, the write down, which will be recognized by TMC in the fourth quarter, is approximately P250 million corresponding to the book value of the damaged equipment and structures,” he said.
Brimo said that partial work to the Taganito HPAL facility has commenced. Project completion, which was originally set for mid-2013, is expected to take a few more months.
The NAC board approved the declaration of a special cash dividend amounting to P0.15 per share, payable to all common shareholders as of November 11, with payment date due on December 8.
