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MANILA, Philippines – Nickel Asia Corporation (PSE:NIKL) announced its financial standing during the year’s first nine months through September 2016 with a net income of P980 million.
The net income of the company is lower than its last year’s record of P2.49 billion during the same period. The earnings before interest, tax, depreciation, and amortization (EBITDA) totaled to P3.97 billion, which is lower than previous year’s booking of P5.92 billion.
The decline in earnings is attributed to its lower sales volume and ore prices. In addition, the company also had losses in its Taganito HPAL Nickel Corporation (THPAL) equity interest by 22.5 percent. Its 10 percent equity interest in Coral Bay Nickel Corporation also reported losses. The amount of decline from the two HPAL plants reached P561 million, which is subjected to the equity method. Very low prices of nickel during the period affected their profitability.
On September 15, 2016, NAC announced that it will sell its THPAL 12.5 percent shareholdings, which means there will be remaining 10 percent equity interest in the company. The stake will be acquired by Sumitomo Metal Mining Co., Ltd. of Japan with an amount of $42 million. The purchase is expected to be recognized in the year’s fourth quarter after the generation of Deed of Sale on October 17, 2016.
In the first nine months, the company sold 15.2 million wet metric tons (WMT) of nickel ore, which is lower than its record last year of 16 million WMT. Shipment delays from its Cagdianao and Hinatuan mines caused the drop in volumes. The postponements are credited to lengthened rainy seasons and northeastern Mindanao’ sea swells. In the second quarter, the Taganito HPAL plant also had lower limonite deliveries during the one-month corrective work in the area.
There are 5.67 million MWT of saprolite ore and 9.52 million MWT of limonite ore shipped during the first nine months of the year. The shipment includes the 5.44 million MWT brought to Taganito and Coral Bay processing plants.