Marcventures sees better profit despite double excise tax

MANILA, Philippines — Marcventures Mining and Development Corp. (MMDC) expects an 82 percent increase in its net income for the year despite the government’s imposition of double excise tax on the mining industry.

MMDC, a wholly-owned subsidiary of listed Marcventures Holdings Inc., said net earnings are forecast to rise to P200 million from P110 million last year despite the expected 10 percent decline in nickel ore shipments to two million wet metric tons (WMT).

“We suspended the mining of  lower-grade ores and we are focusing our operations on high grade ores which fetch higher prices,” MMDC president and CEO Yulo Perez told The STAR.

Mining companies are now slowly shifting to the export of medium and high-grade ores amid declining prices of the usual low-grade.

Last year, global prices reached up to $16 per WMT have now dipped to a low of $10 per WMT.

MMDC, for one, plans to ship 80 percent high-grade ores and 20 percent low-grade. Last year, it only exported around 65 percent of high-grade ores.

The shift to the export of higher grade ores is also a major factor why MMDC is not expecting a drop in bottomline despite the impact of fuel tax and doubling of mining excise tax as part of the government’s implementation of the new tax regime at the start of the year.

“We are also working on significant improvement in efficiencies and managing our costs. We are building bridges in our mine site to improve transport (of ores),” Perez said.

MMDC holds a mineral production sharing agreement covering 4,799 hectares in Cantilan in Surigao del Sur. It exports its nickel ores to China.