FNI’s 9-month net profit surges to R780 M

Global Ferronickel Holdings, Inc. (FNI) reported that its net income shot up by more than a hundred-fold to R779.9 million in the first nine months of 2017 compared to only R7.0 million in the same period last year.

In a statement, the nickel miner said earnings before interest, tax, depreciation and amortization amounted to R1.41 billion from R398.7 million while revenues grew by 72 percent year-on-year to R4.65 billion from R2.9 billion.

“We are in a business with high degree of operating leverage. We have successfully addressed both the revenue and cost side which directly translate to our bottom line,” said FNI President Atty. Dante R. Bravo.

He noted that, “such brisk growth reflects good progress on our previously announced productivity initiatives which drove higher shipped volume. We also benefited from improved selling prices, better product mix, and favorable foreign exchange rate.”

Shipped volume rose 43 percent in the first nine months to 4.9 million WMT. Average realized price climbed to US$18.77 per WMT, as more medium-grade ore were sold which command higher market prices.

Product mix was 58 percent low-grade ore and 42 percent medium-grade ore versus the previous years’ mix of 65 percent low-grade and 35 percent mediumgrade ore.

“We continue to balance capital investments through our mineral exploration program as well as share buybacks. We have repurchased over R636 million worth of FNI stock year-to-date and we did this without raising debt levels. We financed the share repurchases from free cash flow because we are focused on long-term shareholder value,” said Bravo.

“We are encouraged by current strong trends for fixed asset investments in China particularly real estate development and water, environment and public facilities infrastructure,” said Bravo. (JAL)