Taguig—(PHStocks)—Nickel Asia Corp. (NAC; PSE: NIKL) has announced its audited financial and operating results for 2015 with attributable net income (net of minority interests) at PhP2.04 billion compared to PhP8.55 billion reported in 2014. Earnings before interest, tax, depreciation and amortization (EBITDA) amounted to PhP6.51 billion compared to PhP15.84 billion in the prior year.
The company’s net income in 2015 is inclusive of a PhP811 million equity loss from it’s 22.5% investment in Taganito HPAL Nickel Corp. and its 10% equity interest in Coral Bay Nickel Corp. due to much lower nickel prices. This compares to PhP522 million equity income reported in 2014.
While the company reported higher volume of shipments in 2015, total revenues dropped to PhP15.43 billion from PhP24.75 billion the previous year as the price of nickel, like most other metals, has been on a continuous decline throughout the year under review.
The company’s total volume of nickel ore sold from it’s four operating mines in 2015 reached 19.67 million wet metric tons (WMT) as against 17.87 million WMT in 2014. Higher shipment volumes were mostly accounted for by an increase in the direct exports of ore, mainly to China, from 10.47 million WMT in 2014 to 11.88 million WMT in 2015. Ore deliveries to the HPAL plants likewise increased to 7.80 million WMT in 2015 compared to 7.41 million WMT in 2014.
Of the total volume of ore shipped in 2015, 7.06 million WMT was saprolite ore and 12.61 million WMT was limonite ore – the latter includes deliveries of limonite to both the Coral Bay and Taganito processing plants. This compares to 5.74 million WMT and 12.13 million WMT, respectively, in 2014.
In terms of price, the company realized an average of $5.36 per pound of payable nickel on its shipments of ore to the two HPAL plants in 2015, the pricing of which remains linked to the LME. This compares to an average price of $7.69 per pound of payable nickel sold in the previous year. With respect to export sales, the company achieved an average price of $22.64 per WMT in 2015 compared to $45.10 realized in 2014.
While shipment volumes increased by 10%, total cash operating costs and expenses decreased from PhP9.26 billion in 2014 to PhP8.98 billion in 2015, as a result of stringent cost cutting measures implemented at the mine sites. On a per WMT of ore sold, total cash costs and expenses decreased to $10.07 per WMT in 2015 as against $11.77 per WMT in 2014.
“The year 2015 saw commodity prices falling to multi-year lows, mainly on the back of slower growth in China and a very strong US dollar. Notwithstanding the pronounced drop in nickel prices and its effect particularly on the profitability of the processing plants, the Company managed to show positive results,” said Gerard H. Brimo, president and CEO of the company. “We see more challenges in the coming year. However, our dominant position as a low cost producer will help the Company ride-out the current down-cycle.”
Finally, the company’s Board of Directors approved the declaration of cash dividend of PhP0.08 per common share payable on April 12, 2016 for shareholders of record on 31 March 2016.