Philex more than doubles net income to P1.33B in first quarter

Manila, Philippines - Philex Mining Corp. more than doubled its earnings in the first quarter this year on the back of surging prices of metals and improved output.

In a financial report filed with securities regulators, Philex said its core net income surged 156 percent to P1.33 billion from P520.1 million a year earlier on the back of a 59 percent growth in revenues.

Revenues amounted to P3.86 billion, the second-highest level recorded in the company’s history and 59 percent higher than the P2.43 billion a year ago due to higher metal prices, output and oil revenues.

“With this quarter’s results, the company is on its way potentially to generating record earnings for the year. We are benefitting from the continuing improvement in the price of gold, which has now breached the $1,500 per ounce mark,” said Manuel V. Pangilinan, chairman and chief executive officer of Philex.

Gold revenues climbed 88 percent to P2.099 billion from P1.11 billion while copper revenues improved 31 percent to P1.651 billion from P1.257 billion. Gold contributed 54 percent of total revenue, with copper accounting for 43 percent and the balance of three percent from silver, petroleum and coal.

The company’s metal production averaged $1,315 per ounce gold and $4.13 per pound copper, as compared with $1,003 per ounce and $3.37 per pound a year ago, net of amortization of hedging costs which amounted to $67 per ounce of gold and $0.14 per pound of copper in the quarter.

Ore milled of 2.3 million tons from the Padcal mine had average grades of 0.221 percent copper and 0.613 grams of gold per ton.

The higher tonnage and better grades resulted in higher production of copper concentrates to 16,792 dry metric tons this quarter compared with 14,893 dry metric tons a year earlier.

Revenue contribution from petroleum (principally from Forum Energy Plc, a 64.5 percent controlled subsidiary through wholly-owned Philex Petroleum Corp.) also improved to P64.5 million from P35 million a year ago.

Pitkin Petroelum Plc, an 18.46 percent-owned affiliate of Philex Petroelum, recently announced encouraging results from its ongoing drilling activities in the Ca Rong Do (Red Emperor) appraisal well in Block 07/03 in offshore Vietnam.

Philex said the company is close to finalizing an agreement with Manila Mining Corp. for a joint venture on the Kalayaan property of Manila Mining in northern Mindanao. “This will enhance the attractiveness of the company’s Silangan project, particularly that of its Bayugo ore body which has a common boundary with Kalayaan. Further, advanced exploration activities are being done in the nearby Boyongan ore body which will be developed separately by Philex Mining,” Pangilinan said.

“The completion in March 2011 of the seismic exploration activity with respect to a potential gas field in the Service Contract 72 contract area located in Northwest Palawan is a significant step towards enhancing the status of the petroleum/energy assets of the Philex Group,” Pangilinan added.