The country’s largest listed copper and gold miner, Philex Mining Corp., more than doubled its net income last year due to the higher number of operating days and cost streamlining, which offset lower ore grades and weakness in metal prices.
In a disclosure to the Philippine Stock Exchange, Philex said its net income amounted to P703 million in 2014, up from P312 million the year before, while revenue totaled P10.9 billion, 4 percent higher than in 2013.
Philex Mining’s Padcal mine operated for a full year in 2014 compared with only about 10 months in 2013, when the government lifted the suspension on the mine. The increase in operating hours delivered a 23 percent increase in tonnage, the company said.
“However, lower metal grades resulted in moderate improvements in metal output,” it said.
Gold output increased 5 percent to 105,008 ounces in 2014, which yielded 6 percent higher revenues at P5.9 billion despite the 2-percent drop in realized gold price to $1,270 per ounce from $1,297 previously.
Also, copper production improved 9 percent to 35.4 million pounds and contributed P4.6 billion in revenues, despite 9 percent lower realized prices for copper at $2.98 per pound from $3.27 per pound in 2013.
Revenues from silver, coal, petroleum and others, which comprised the remainder of revenues, rose 31 percent to P394 million from P300 million in 2013 due mainly to increased production from the Galoc oil field’s Phase II project.
“Against a backdrop of lower metal prices, it was important for the company to reduce the cost base and considerable progress has been made in this area,” said Eulalio Austin Jr., Philex Mining president and chief executive officer.
“While the business environment remains challenging, with lower metal prices and restrictive legislative measures being contemplated, especially the proposed new tax laws on the industry, we remain committed to creating value for our shareholders, business partners and employees,” Austin added.
He said the company continues to make progress on the Silangan project, noting that the completion of the project’s Definitive Feasibility Study is expected to be finalized within the year.
The company plans to employ the open-pit mining method, which involves excavating the surface of the ground to extract minerals whereas underground mining requires digging tunnels to reach the mineral zones.
The Silangan project is located in Surigao del Norte in northern Mindanao. It combines the development of the Boyongan and Bayugo deposits. These deposits are comprised of gold, copper, and silver.