Atlas trims capex to $27 M

MANILA, Philippines - Listed Atlas Consolidated Mining and Development Corp. is reducing its capital expenditures to $27 million from the original planned spending of $104 million as it lowered the throughput of its mine in Cebu.

The planned capital spending is 74 percent lower than last year’s capex.

Atlas said it would continue to trim its capex to $12 million next year.

“We must respond to market conditions to optimize cash flows while protecting our large mineral resources to be realized at higher prices in the longer term,” Atlas Mining president Adrian Ramos said on the sidelines of the company’s annual stockholders meeting yesterday.

The company has decided to reduce mill throughput at the Carmen Copper Mine in Toledo, Cebu to 40,000 tons per day (tpd) from its nameplate capacity of 60,000 tpd.

“The lower throughput allows us for a temporary halt of stripping activities for 2016 and 2017, which results in a significant reduction in our near term capex requirements,” Ramos said.

Despite the challenging backdrop, Atlas said it continues to remain positive about the long term outlook on copper.

Based on forecasts, the current down cycle is expected to be reversed this year until 2017 and low prices will improve as large producers are closing mines, curtailing supply and global demand continues to grow at a steady pace.

Prices are seen to rally to $5,600 per ton next year from $4,650 per ton this year.

Last year, Atlas incurred a net loss of P814 million, a reversal of the P397 million profit reported in 2014 due to low metal prices.

Average daily milled volume remained at levels comparable to 2014 and consolidated copper metal produced slightly declined four percent to 101.7 million pounds.