MANILA, Philippines - Two mining companies are raising their stake in listed miner Apex Mining Co. Inc., enabling it to raise funds for expansion of production capacity.
In a regulatory filing, Apex announced that its board of directors has approved the P87.3 million capital infusion of Monte Oro Resources and Energy Inc. for the issuance of 31.29 million shares of class A common stock at P1 per share.
Apex corporate secretary Rosanna Parica said this would raise Monte Oro’s holdings in the company to 12.02 percent from the previous 10.89 percent.
The company’s board also approved the P174 million capital infusion of Mindanao Gold Limited for the issuance of 62.58 million class B common stocks at P1 per share.
This would hike Mindanao’s holdings in Apex to 34.52 percent from 32.82 percent.
The transaction is expected to be completed this week.
“The proceeds (of the share sale) will be used to fund the expansion of the capacity of the mill plant in the Campostela Valley mine,†said Parica.
Parica said the processing capacity of the mill in the Maco gold mine is expected to be raised by yearend to 1,500 ton of ore per day from the current 850 tons daily.
This would be further raised to 2,000 tons of ore daily by 2014 and 2,500 tons daily by 2015.
The company intends to gradually increase ore production over the next two years to lower the production cost per ounce.
The upgrade of the plant started in June 2012 and is expected to be completed this year.
New production zones within the mine are also being identified.
Apex registered a net loss of P56.18 million in the second quarter of the year from a net income of P27.84 million in the same period last year despite higher revenues on higher expenses and foreign exchange losses.
Revenues from sales of gold and silver in the second quarter of the year rose to P455.83 million from P389.26 million in the same period last year.
Cost of sales for the quarter ending June 2013 rose to P313.34 million from P251.44 million in the same quarter in 2012. General and administration expenses rose to P137. 18 million from P125.88 year-on-year.
Income from operations in the second quarter thus fell to P5. 32 million in the second quarter of the year, from P11.93 million in the same period last year.
Other expenses for the period, which comprises foreign exchange losses, also rose to P61.50 million from P15.91 million in the same quarter last year, resulting to a net loss.