Marcventures posts huge gains in Q3

MANILA, Philippines - Marcventures Holdings Inc., a newly-listed nickel mining firm, posted huge profits of P157.33 million in the third quarter, completing a turnaround from its P73.87-million loss for the comparative period last year.

In a disclosure to the Philippine Stock Exchange, the firm said its wholly-owned subsidiary Marcventures Mining and Development Corp. was still in the exploration stage with no income generating activities until last year.

With four shipments to China with an estimated total volume of 217,265.74 wet metric tons from its causeway in Carrascal, Surigao del Sur, the company had total nickel ore sales of P381.07 million.

The company, which is just mining 2.5 percent of its nickel hectarage, is expected to earn almost P1 billion next year, about 150 percent over its forecast profit of P384 million this year, as it enters its first full year of production.

The optimistic assessment for Marcventures arose from a research report released by Abacus Securities this month where it detailed rosy projections arising from positive developments in the world nickel prices as well as growing nickel demand especially from economic powerhouse China.

In an in-depth report, the brokerage firm which charts the prospects of listed firms forecast Marc’s profits to hit over P900 million. Abacus usually conducts in-depth industrial company research and analyses for the guidance of its investors.

According to the report Marc shipped approximately 110,000 WMT of high-grade nickel ore worth around P300 million in the third quarter of 2011. On top of this, Marc has pre-sold the rest of its 2011 high-grade nickel ore production for shipment in the last quarter of 2011.

In 2012, with a full year of operations, Marc projects at least 700,000 WMT of high-grade nickel ore sales, which could fetch a net income of P968 million based on a conservative estimate of $55 per wet metric ton.

Abacus said that with the upward trend in nickel prices, Marc is seen to further expand its operations and increase its deliveries to up to one million tons of high-grade nickel ore shipments on an annual average by 2013. By 2014, the company, together with other nickel mines, is expected to profit from the government policy in Indonesia to stop the export of nickel ore.

Indonesia wants to have its own nickel processing plants to increase its nickel revenues.