Nickel Asia profit jumps to P7.8 billion

MANILA, Philippines — Nickel Asia Corp. reported a net income of P7.81 billion in 2021, nearly double the P4.07 billion net income a year before, mainly due to high ore prices.

In a disclosure to the Philippine Stock Exchange, Nickel Asia said it sold a total of 17.94 million wet metric tons (WMT) of nickel ore at the weighted average realized price of $29.13 per WMT in 2021.

“Accordingly, total revenue increased by 26 percent to P27.4 billion from P21.77 billion in the prior year,”the company said.

Nickel Asia  exported 10.79 million WMT of saprolite and limonite ore to customers in Japan and China at the average price of $40.40 per WMT in 2021. This is higher than the 10.02 million WMT at $33.99 per WMT exported in 2020.

The company delivered 7.14 million WMT of limonite ore to the Coral Bay and Taganito HPAL plants, the prices of which are linked to the London Metal Exchange (LME), and realized an average price of $8.36 per pound of payable nickel.

“In the face of the second year of the COVID-19 pandemic and the continuing economic and social hardships it has brought to our country and our communities, we remained focused on our people and our business objectives, on our diversification into renewables through our subsidiary Emerging Power (EPI), and we even crafted and adopted a new vision for our future,” Nickel Asia president and CEO Martin Antonio Zamora said.

“At the same time, the surging demand for nickel fueled by a doubling in sales of electric vehicles and strong growth in stainless steel production coupled with lower than expected nickel production, particularly out of Indonesia, resulted in a nickel deficit of about 150,000 tons rather than a projected surplus. This has clearly been a significant tailwind for the global nickel industry and for us,” Zamora said.

In a separate disclosure yesterday, Nickel Asia said its board of directors approved the business plan  to develop renewable energy power plants with a target total capacity of one gigawatt by 2028 through the completion of the expansion of the solar plant of the company’s subsidiary Jobin SQM, Inc. (JSI) .

“The company also approved the grant of shareholders’ advances of P760.5 million to EPI to fund EPI’s acquisition and development costs for the projects forming part of EPI’s business plans,”Nickel Asia said.

These advances shall be payable in five years and shall be subject to interest.

The board of directors also authorized the provision of shareholder advances of P952 million to JSI for the Phase 4 expansion of JSI’s solar power plant in Subic Bay Freeport Zone, which would bring total solar plant capacity to 180-megawatts (MW).

“These advances shall be payable in 50 percent bullet payments in 2032 and 2034, or earlier upon refinancing from financial institutions, and shall be subject to interest at six percent per annum,”Nickel Asia said.

Moreover, the board of directors also approved the exercise by the company of its option to purchase an additional 33 million common shares in Coral Bay Nickel Corp.  (CBNC) for $25.9 million under an option agreement with Sumitomo Metal Mining Co. Ltd.

“The company intends to exercise its option in October 2022 or earlier, to increase the company’s equity share in CBNC from 10 percent to 15.625 percent,”Nickel Asia said.

CNBC operates a hydrometallurgical processing plant in Rio Tuba, Bataraza, Palawan.