Philex revenue down 50% in 3 quarters

MANILA, Philippines — Pangilinan-led Philex Mining Corp. reported a net income of P570 million in the first nine months, down 50 percent due to lower production and the impact of the government’s tax reform program.

In a regulatory filing, Philex said revenues declined eight percent to P6.59 billion.

The lower bottomline was attributed to lower metal production, caused by low ore grades, higher non-cash charges, and the doubling of excise tax under the government’s new tax regime.

Revenue from gold fell 18 percent to P3.33 billion, while revenues from silver decreased to P48.7 million. Copper revenues managed to post an increase of four percent to P3.21 billion.

The Padcal mine milled 6.53 million metric tons (MT) of ore, four percent higher than the 6.26 million MT in 2017.  This translated to 20.5 million pounds of copper and 48,929 ounces of gold.

However, ore grades, low metal recoveries, and equipment repairs resulted in lower volumes of metal.

“We are cognizant that our existing ore body is challenged to deliver the desired grades due to its mature state. To improve ore grades, a new mining level is being commissioned using sub-level caving mining method,” Philex president and chief executive officer Eulalio Austin said.

Over the long-term, Philex intends to develop a fresh ore body within the Padcal vicinity to upgrade its revenue sources.

“While waiting for the results of our exploration efforts, we will continue to implement operational efficiencies and cost enhancements to support our profitability,” Austin added.

The company’s parent debt dropped to $39 million from $49 million last year  due to continued repayment of short-term loans with local banks.

Philex is currently completing studies, focusing on the most effective and efficient means to expand the capacities of its existing tailings storage facilities to accommodate additional tailings and allow for Padcal’s  mine life be extended beyond 2022.