High metal prices, forexbuoy Profits from Nickel Asia

The listed mining company Nickel Asia Corp. (NAC) posted higher profits in the first nine months of this year, supported by higher metal prices and favorable exchange rates.

In a statement, NAC said net profit attributable to shareholders of the parent company reached 6.9 billion pesos, up 12 percent from 6.17 billion pesos in the same period a year ago.

Revenue increased 2% to 21.5 billion pesos from 21.03 billion pesos despite lower ore sales volume, mainly due to higher nickel ore prices and favorable exchange rates .

“Despite the challenges to our mining operations due to adverse weather conditions at our mine sites, the favorable conditions [London Metals Exchange] the price of nickel and the strength of the US dollar helped drive revenue up 2% year over year,” said NAC President and CEO Martin Antonio Zamora.

The company’s five operating mines sold a total of 12.44 million wet metric tonnes of nickel ore, a decline of 14%.

“The decline in sales volume was almost directly proportional to unrealized business days caused by adverse weather conditions that adversely affected the company’s mining operations during the period,” NAC said.

Still, weighted average nickel ore sales rose 5% to $29.46 per WMT. The company earned 54.22 pesos per US dollar on these nickel ore sales, up 10%.

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 high pressure acid leach (HPAL) plants in Coral Bay and Taganito at an average price of $11.66 per pound payable nickel.

The price of deliveries to HPAL factories averaged $18.55.

Investment gains

NAC realized gains of P1.02 billion on its stake in the investments in the two HPAL plants due to the rise in the price of nickel on the London Metal Exchange.

Emerging Power Inc. (EPI), the renewable energy arm of NAC, saw its revenue increase by 60% to 393.67 million pesos.

That grew as generating capacity at its Jobin-SQM Inc. (JSI) operating arm rose 56% to 79,022 megawatt-hours after completing its 38-megawatt expansion last June, bringing its total capacity to 100 MW.

Sta of JSI. The Rita Solar Power Plant sold electricity at an average realized tariff of 4.98 pesos per kilowatt-hour, 70% of which was sold to retail electricity providers under power supply agreements and the remaining 30% in the electricity wholesale spot market.

JSI recorded a net income of 72.83 million pesos, allowing EPI to reduce its losses to 133 million pesos.

NAC separately disclosed its board of directors authorized to guarantee the 2 billion peso loan facility that EPI will obtain from Security Bank Corp., which will be used to finance the expansion of the 68 MW solar power plant at Subic. It is expected to go live by the fourth quarter of 2023.

The NAC Board of Directors also approved the renewal of the promissory notes issued by JSI in favor of the company in the amount of 1.095 billion pesos, for advances from the company which were used by JSI for the phase 3B of its solar power plant expansion project last year. INQ

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