Atlas Q1 profit down on low copper prices

Atlas Consolidated Mining and Development Corp. reported a slight dip in sales and a 77.7- percent year-on-year drop in profit in the first quarter due to higher production costs and lower copper prices.

In a first-quarter report to the Philippine Stock Exchange, Atlas booked a consolidated net income of P298 million, down from P1.338 billion a year ago due to a “surge in production cost and the incurrence of extraordinary charges.”

Atlas said that in the first quarter of 2011, copper prices were “relatively high” and the cost of energy was “comparatively low.”

Atlas said its consolidated revenue for the first quarter of 2012 reached P3.23 billion, which was 1 percent lower than the P3.276 billion in the first quarter of 2011. Atlas said that despite the recent decline in copper prices, its wholly-owned subsidiary Carmen Copper Corp. improved copper production and gold by-product credits, which resulted in only a slight dip in revenue.

Consolidated revenue also benefited from the P184.5 million contribution of its nickel project which continues to be pursued by Berong Nickel Corporation since resuming mining operations last year, Atlas said.

However, the increase in CCC’s copper production took up higher operating expenses. The conduct of more intensive exploration activities by Atlas’ exploration subsidiary likewise contributed to the build up of expenses during 2012 Q1.

Atlas also said CCC recognized a non-recurring charge amounting to P176 million. This represents the derivative loss on the exercise of the option to effect full settlement of certain loan obligations prior to their maturity, Atlas said.

In a statement, Atlas executive vice-president Adrian Ramos said the parent company, through CCC, has started “a fully-funded, aggressive expansion program” to increase productivity and cost-efficiency.

“The production milestones achieved during the first quarter of this year provide a strong indication that such undertaking is on track and that its goals are realizable,” Ramos said.