GFNI 9-month profit surges to P780M on improved ore prices

GLOBAL FERRONICKEL Holdings, Inc. reported its profit surged to P779.9 million in the first nine months of 2017, driven by improved ore prices and production.

In a statement on Wednesday, the country’s second biggest nickel miner by output said net income in the January to September period stood at P779.9 million, a huge jump from the P7 million logged during the same period last year.

GFNI’s revenue soared 72% to P4.646 billion, as the company benefitted from better selling prices and product mix, as well as favorable foreign exchange rate.

“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. Such brisk growth reflects good progress on our previously announced productivity initiatives which drove higher shipped volume,” GFNi President Dante R. Bravo was quoted as saying in a statement.

During the nine months ending September, GFNI said shipments stood at 4.9 million wet metric tons ( WMT), up 43% from a year ago.

“Average realized price climbed to $18.77 per WMT, as more medium-grade ore were sold which command higher market prices,” the miner said.

The product mix for the nine- month period was 58% low- grade ore and 42% medium-grade ore. In previous years, the mix was 65% low-grade and 35% mediumgrade ore.

“With only a few days left before we close the mining season, I’m confident that we’ll finish the year strong and we’ll continue to invest in opportunities we see ahead for 2018 and beyond,” Mr. Bravo said.

He added GFNI continues to balance capital investments through its mineral exploration program as well as its buyback program. The firm has so far repurchased over P636 million worth of its stocks using free cash flow.

Earlier, GFNi said it completed exploration drilling activities at Cagdianao ( CAGA) deposit areas 2 and 3. Measured and indicated mineral resources at CAGA deposit areas 1 to 5 went up to 54 million dry metric tons ( DMT) with an average grade of 1.1% nickel and 31.4% iron.

Mineral reserves rose to 36 million WMT with an average grade of 1.22% nickel and 31.7% iron.

Shares in GFNi rose 2.72% on Wednesday to close at P2.64 per share. —