TUBA, Benguet – Philex Mining Corporation Thursday announced that operations in the first nine months of 2016 (9M2016) yielded a Core Net Income of P1.332 billion, 64 percent higher than the previous year’s P811 million. Similarly, Reported Net Income increased 76 percent to P1.333 billion (9M2015: P756 million) with Net Income Attributable to Equity Holders of the Parent Company rising 59 percent to P1.355 billion (9M2015: P851 million).
The 9M2016 performance was attributed to improved tonnage, complemented by higher copper output and favorable average gold prices.
Padcal mine operated for 271 days in the period (9M2015: 269 days) and milled 7.2 million tonnes of ore (9M2015: 6.9 million tonnes). The tonnage translated to 27.1 million pounds of copper produced, which was 6 percent more than the previous year’s 25.7 million pounds as copper grades improved to 0.209% (9M2015: 0.205%) and offset the slight drop in recovery at 81.7 percent (9M2015: 82.5 percent).
Meanwhile, gold production reached 79,845 ounces (9M2015: 81,599 ounces) due to lower gold grades of 0.419 grams/tonne (g/t) (9M2015: 0.440 g/t) and metal recovery of 82.1 percent (9M2015: 83.6 percent).
The July 2016 tonnage of 861,000 was the highest year-to-date production and a record over the last five (5) years. In addition, gold production for July of 11,332 ounces was the highest since January 2011 while copper output of 3.53 million pounds was the highest since May 2013. The strong performance was generally attributed to operational enhancements, higher equipment efficiency, and fully depreciated draw points still yielding good grades of copper and gold.
Revenues for the first nine months of 2016 increased 7 percent to P7.705 billion (9M2015: P7.173 billion), with gold contributing P4.797 billion (9M2015: 4.366 billion) and copper accounting for P2.841 billion (9M2015: P2.752 billion) – both higher than the previous year’s levels by 10 percent and 3 percent, respectively. Revenues from silver amounted to P66.4 million (9M2015: P55.4 million).
The higher average realized prices for gold at US$1,273 per ounce (9M2015: US$1,171 per ounce) more than offset the lower gold output while the increase in copper output more than compensated for the 11 percent drop in average copper prices to US$2.19 per pound (9M2015: US$2.45 per pound).
Despite the 5 percent increase in tonnage, the company continued to proactively manage its costs and expenses, resulting in a 5 percent reduction in consolidated costs and expenses to P5.048 billion (9M2015: P5.339 billion), with general and administrative expenses (GAE) declining 17 percent to P282.3 million (9M2015: P341.3 million). From 2013-2015, GAE declined by an average of 26 percent annually as a result of the Company’s relentless efforts to continuously enhance efficiencies and improve productivity through cost rationalization and spend management.
Meanwhile, the company repaid a total of US$7.5 million in debt during the period, which brought total short-term debt to US$63.0 million (P3.055 billion) as of end-September 2016, from US$70.5 million (P3.317 billion) as of end-December 2015.
Over and above its financial performance, the company takes pride that its efforts over the last three (3) years to manage its costs and expenses by improving business processes through periodic operational reviews, policy changes and organizational streamlining have enhanced its Core Profitability and strengthened its Balance Sheet. The foregoing has allowed the company to sustain its corporate social responsibility and environmental protection programs as well, even under difficult circumstances.
“Our corporate initiatives have provided us with an optimal organizational structure and operational framework that will allow us to sustain the long-term viability of operations and continuously and consistently perform our mandate as a responsible and conscientious mineral resource development company,” said Eulalio B. Austin, Jr. President and CEO of Philex Mining Corporation.
“We are glad that the government, through the Department of Environment and Natural Resources and other bodies, has taken note of our efforts to practice and continuously undertake responsible mining during the recent audit conducted at our Padcal Mine. In addition, we also appreciate the business community’s recognition of our strong governance practices by being chosen as one of the recipients of the first-ever Institutional Investors’ Governance Award during the recently held Investor Forum sponsored by the Institute of Corporate Directors, the Fund Managers Association of the Philippines and the Trust Officers Association of the Philippines. We take all these as a source of encouragement and inspiration as we continue to move forward to promoting inclusivecbusiness,” Austin added.
“On the Silangan Project, the completion of the Definitive Feasibility Study’s (DFS) third party review is on track and expected to be completed by early next year. An extensive review is being conducted to generate the best return from the project,” Austin further said.