High metal prices, forexbuoy Nickel Asia profits

Listed mining company Nickel Asia Corp. (NAC) reported higher profits in the first nine months of this year, sustained by higher metal prices and favorable currency exchange rates.

In a disclosure, NAC reported that net income attributable to equity holders of the parent company reached P6.9 billion, 12 percent higher than P6.17 billion in the same period a year ago.

Revenues inched up by 2 percent to P21.5 billion from P21.03 billion despite the decrease in ore sales volume, mainly because of higher nickel ore prices and favorable exchange rates.

“Despite the challenges in our mining operations due to adverse weather conditions at our mine sites, the favorable [London Metals Exchange] nickel price and strong US dollar helped drive revenues up by 2 percent from the prior year,” said NAC president and CEO Martin Antonio Zamora.

The firm’s five operating mines sold a total of 12.44 million wet metric tons of nickel ore, representing a decline of 14 percent.

“The drop in sales volume was almost in direct proportion to unrealized workable days caused by unfavorable weather that adversely affected the company’s mining operations during the period,” said NAC.

Yet, the weighted average nickel ore sales rose by 5 percent to $29.46 per WMT. The company realized P54.22 per US dollar from these nickel ore sales, up by 10 percent.

During the period, NAC exported 6.68 million WMT of saprolite and limonite ore at an average price of $38.87 per WMT.

It also shipped 5.76 million WMT of limonite ore to the Coral Bay and Taganito high-pressure acid leach (HPAL) plants at an average price of $11.66 per pound of payable nickel.

The price for the deliveries to the HPAL plants averaged $18.55.

Investment gains

NAC realized gains of P1.02 billion from its equity share in investments in the two HPAL plants due to higher nickel price on the London Metals Exchange.

Emerging Power Inc. (EPI), NAC’s renewable energy arm, saw its revenues surge by 60 percent to P393.67 million.

This developed as the generation capacity of its operating arm Jobin-SQM Inc. (JSI) rose by 56 percent to 79,022-megawatt hours after the completion of its 38-megawatt expansion last June, bringing its total capacity to 100 MW.

JSI’s Sta. Rita solar power plant sold electricity at an average realized tariff of P4.98 per kilowatt-hour, of which, 70 percent was sold to retail electricity suppliers through power supply agreements and the remaining 30 percent to the Wholesale Electricity Spot Market.

JSI logged a net income of P72.83 million, allowing EPI to trim its losses to P133 million.

NAC separately disclosed its board authorized to guarantee the P2-billion loan facility that EPI will obtain from Security Bank Corp., which will be used to bankroll the 68-MW Subic solar power plant expansion. It is scheduled to go online by the fourth quarter of 2023.

The NAC board also approved the renewal of promissory notes issued by JSI in favor of the company amounting to P1.095 billion, for the company’s advances that were used by JSI for Phase 3B of its solar power plant expansion project last year. INQ