The country’s biggest nickel miner on Tuesday said that its net income dropped by half in the first half of the year because of lower nickel prices, offsetting increase in shipment volumes.
In a disclosure to the Philippine Stock Exchange, Nickel Asia Corp. (NAC) said that its attributable net income reached P645.6 million in January to June 2013, or 49.5 percent lower than the P1.28 billion reported a year ago.
NAC attributed the drop in earning to the much lower nickel prices during the period.
The total volume of nickel ore sold and delivered from the company’s four operating mines reached 5.54-million wet metric tons (WMT), or 10 percent higher compared to the 5.02 million WMT last year.
Of the total volume of ore shipped, 1.80 million WMT was saprolite ore and 3.74 million WMT was limonite ore, which includes 1.61 million WMT transported to the Coral Bay processing plant and 32,000 WMT delivered to the Taganito processing plant.
The realized London Metal Exchange nickel price application to the 1.97 million WMT of ore shipped in the first half averaged $7.54 per pound of payable nickel, as against the $8.60 per pound in 2012. The balance of the shipments, on the other hand, were sold on the basis of negotiated prices per WMT of ore, which averaged $20.14 per WMT compared to $26.41 per WMT in the same period last year.
“Notwithstanding global economic factors affecting prices of all commodities in general, we remain optimistic that our shipment volumes will continue to increase in the second half of the year,” said Gerard Brimo, NAC president and chief executive officer.
At present, the new plant in Taganito is undergoing testing and debugging, and is on schedule to start commercial production in the fourth quarter of 2013. Once operational, all limonite ore will be supplied by the Taganito mine, which has a full capacity of more than 4.5 million WMT of ore each year. NAC, through its 71.25-percent-owned subsidiary Cordillera Exploration Co. Inc., also disclosed that it has terminated its drilling program in its Manmanok project in Apayao because of “generally unsatisfactory” results.