Nickel Asia swings to profitability in Q1

MANILA, Philippines - Nickel Asia Corp. earned P378 million in the first quarter,  a reversal of the P300.8 million loss incurred  in the same period last year, owing to improved market prices.

In a report to the local bourse, Nickel Asia said the turnaround in earnings was due to higher-value ore shipped, stronger US dollar and lower losses from the company’s equity share in its processing plants.

Nickel Asia’s net share of the losses on its 10 percent stake in Coral Bay and Taganito processing plants amounted to only P10 million, significantly lower than the P226 million loss the previous year.

“We are pleased with our first quarter results despite the business challenges and tough market conditions we continue to face. We will build on this momentum as we now approach our peak shipment season which starts in the second quarter of the year,” Nickel Asia president and CEO Gerard Brimo said.

Nickel Asia’s operating mines sold 3.05 million wet metric tons (WMT) of nickel ore, down 13 percent year on year.

The company experienced low shipment volumes since operations at the Taganaan and Cagdianao mines in northeastern Mindanao do not commence until the second quarter which is the onset of the dry season.

Prices of nickel ore exports averaged at $31.34 per WMT, which is double the average selling price of $15.78 per WMT during the same period last year.

Low-grade limonite ore shipped to the Coral Bay and Taganito processing plants, which remain linked to prices at the London Metal Exchange, fetched an average price of $4.66 per pound of payable nickel compared to $3.85 per pound sold a year earlier.

Nickel prices hit a 13-year low during the first quarter of last year, mainly due to an economic slowdown in China.

The company is a global supplier of lateritic nickel ore and exports both saprolite and limonite ore to customers in Japan and China.

Its operating mines are Rio Tuba, Taganito, Cagdianao and Taganaan, all located in the southern part of the Philippines.