By: Philippine Resources May 13, 2024

Photo credit: Bilyonaryo

Integrated energy company Semirara Mining and Power Corporation (SMPC) saw its net income fall by 28 percent to P6.5 billion in the first quarter from P9.0 billion the previous year, as weaker market prices muted the impact of higher coal shipments and energy sales volume.

Global coal indices declined due to weak demand from developed countries, driven by changes in energy policies, a shift toward renewable sources and slowing economic activities.

The Newcastle index plummeted by 49 percent from an average of US$247.8 to US$126.0 while the Indonesian Coal Index 4 (ICI4) retreated at a slower pace (25%) from an average of US$76.5 to US$57.2.

In the Luzon-Visayas electricity market, average spot prices fell by 27% from P6.28 to P4.61 on lower fuel costs and increased supply.

“While we faced some pricing challenges this quarter, our robust export sales and improved plant performance demonstrate the resilience and adaptability of our operations,” said SMPC president and COO Maria Cristina C. Gotianun.

Better Operating Results

Coal sales jumped by 37 percent from 3.5 million metric tons (MMT) to 4.8 MMT, largely driven by exports which accelerated by 78 percent from 1.5 MMT to 2.7 MMT.

Domestic shipments grew by 6 percent from 2.0 MMT to 2.1 MMT, influenced by an uptick in internal sales due to the highest recorded overall plant availability in the company's history, reaching 92%.

With better overall plant availability, gross generation increased by 7% from 1,316 gigawatt hours (GWh) to 1,408 GWh.

In turn, electricity sales volume increased by 3% from 1,241 GWh to 1,281 GWh. This growth was primarily due to higher bilateral contract quantity (BCQ) sales, which offset the decline in spot market dispatch for the period.

BCQ sales rallied by 38% from 361 GWh to 499 GWh while spot sales sank by 11% from 880 GWh to 782 GWh.

Lower Selling Prices

From January to March, average selling price (ASP) for Semirara coal shrank by 33 percent from P4,427 per metric ton (MT) to P2,978/MT.

During the same period, the company’s electricity ASP dropped by 28% from P6.17/KWh to P4.47/KWh, largely due to the sharp drop in wholesale electricity spot prices.

Spot prices plunged by 35 percent from P6.69/KWh to P4.35/KWh while BCQ prices slipped by 5 percent from P4.90/KWh to P4.66/KWh.


Article courtesy of the Philippine Stock Exchange

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