Photo Credit: dmcihouse.net
DMCI Mining Corporation saw its net income decline by 17 percent from P1.41 billion to P1.17 billion during the first nine months of the year owing to lower nickel ore shipments and average nickel grade sold.
“We expected a severe profit decline because of the depletion of our Berong mine late last year. Fortunately, the bullish nickel market allowed us to ship even the low-grade inventory of Berong,” said DMCI Mining president Tulsi Das C. Reyes.
“Strong nickel prices and local currency weakness also moderated the impact of lower shipments on our bottom line,” he added.
For the third quarter alone, net income tumbled by 56 percent from P181 million to P80 million due to the combined effect of lower shipment (-50%), flattish nickel grade sold (-1%), higher selling prices (+31%) and favorable average foreign exchange rates (+10%).
Total shipments declined at a slower pace from January to September as the Berong mine did better than expected in the first half. Consequently, nickel ore shipments only fell by 25 percent from 1.45 million wet metric tons (WMT) to 1.09 million WMT.
Despite a 4-percent decrease in average nickel grade sold from 1.38% to 1.33%, DMCI Mining posted a 16- percent improvement in nine-month average selling price from US$43 to US$50.
Magnifying the impact of higher selling prices was a 10-percent increase in foreign exchange rates from US$ 1:Php 49 to US$ 1:Php 53.
At the end of September, total inventory plummeted by 76 percent from 450,000 WMT to 109,000 WMT, mostly (81%) coming from Zambales.
Article courtesy of the Philippine Stock Exchange
