Nickel Asia Corp. said Wednesday net income in the first six months plummeted 98 percent to P24.4 million from P1.49 billion a year ago, on lower shipment and value of nickel.
Nickel Asia said in a disclosure to the stock exchange the drop in income was also affected by its share of the losses on its 22.5-percent equity interest in Taganito HPAL Nickel Corp. and its 100-percent equity interest in Coral Bay Nickel Corp.
“The profitability of the two plants was affected by very low nickel prices realized during the period,” Nickel Asia said.
Earnings before interest, tax, depreciation and amortization fell to P1.84 billion from P3.54 billion in 2015. Revenues also dropped to P5.52 billion from P7.97 billion.
Nickel Asia said it sold 8.54 million wet metric tons of nickel ore in the six-month period, down from 9.68 million WMT in the same period last year.
It said of the total volume of ore shipped, 2.76 million WMT was saprolite ore and 5.78
million WMT was limonite ore, which included 3.40 million WMT delivered to both Coral Bay and Taganito processing plants.
Nickel Asia said the lower shipment volume was due to the delayed start of shipments from Hinatuan and Cagdianao mines caused by the prolonged rainy season in northeastern Mindanao, where the two mines are located, and a temporary reduction in the deliveries of limonite ore to the Taganito HPAL plant while it was undergoing remedial work.
The company realized an average price of $3.92 per pound of payable nickel on its shipments of ore to the two HPAL plants, down from an average price of $6.22 per pound of payable nickel sold in the same period last year.
Nickel Asia said for export sales, it achieved an average price of $18.21 per WMT this year, down from $23.20 per WMT in 2015.
Nickel Asia president and chief executive Gerard Brimo said the company’s mining operations continued to show great resiliency and remained profitable despite record low nickel prices.
“Our first-half performance was, however, affected by our investments in our downstream processing plants, which, as with most other processing plants world-wide, could not maintain profitable operations during this dismally low price environment,” Brimo said.