Nickel Asia earnings dip to P1.07 B in H1

MANILA, Philippines — Nickel Asia Corp. saw its first semester net income plunge by 44 percent to P1.07 billion as higher production failed to offset the decline in world market prices.

In a regulatory filing, Nickel Asia said earnings before interest, tax, depreciation and amortization declined by 14 percent to P2.17 billion.

Nickel Asia president Martin Antonio Zamora said nickel ore shipments from Indonesia increased significantly in the first half.

“Nevertheless, we remain positive as to the outlook for London Metal Exchange nickel on the back of expectations of the stainless steel industry and the steep rise in electronic vehicle production over the next five years. The LME nickel-linked segment of our market accounts for close to 50 percent of our total shipments,” he said.

Nickel Asia said the lower profit was due to P198.8 million in foreign exchange losses booked during the period as against the P535 million gain last year.

It also reported a consolidated net loss of P81 million from  equity investments in Coral Bay Nickel Corp. and Taganito HPAL Nickel Corp. compared to net earnings of P526 million the previous year.

Overall, Nickel Asia sold an aggregate 9.08 million wet metric tons (WMT) of nickel ore, up two percent.

Ore deliveries to the two processing plants, which increased to 4.41 million WMT managed to slightly offset the decline in ore export volumes, which fell to 4.67 million WMT from 4.89 million WMT.

In terms of prices, the firm realized an average $5.56 per pound of payable nickel on its shipments, lower than the average price of $6.27 per pound of payable nickel sold in 2018.

As to export sales, prices are quite better at $20.70 per WMT but on a combined basis, the average price received for sales of both ore exports and ore deliveries was only $14.25 per WMT from $14.90 per WMT last year.

Total operating cash costs, meanwhile,  went up 12 percent to P4.87 billion .

Nickel Asia is the country’s largest producer of lateritic nickel ore and is one of the largest in the world. It exports saprolite and limonite ore to processors in China and Japan, and sells limonite ore to downstream processing plant affiliates.