Philex income falls 30% to P303 million

MANILA, Philippines — Pangilinan-led Philex Mining Corp. reported a net income of P303 million in the first quarter, down 30 percent amid lower production levels.

In a filing with the Philippine Stock Exchange, Philex said revenues declined seven percent to P2.37 billion due to lower metal production, caused by low ore grades, higher non-cash charges, and the doubling of excise tax under the government’s new tax regime.

Revenue from gold was 13 percent lower at P1.24 billion, while revenues from silver decreased to P19 million. Copper revenues managed to increase by three percent to P1.12 billion.

The Padcal mine milled 2.2 million metric tons (MT) of ore, 10 percent higher than the previous year.

“The results of the first three months of the year reveals the challenges for Padcal as it mines the fringes of its current ore body. This makes achieving an extension to mine life imperative to sustain operations and continue our commitment to our stakeholders,” Philex president and CEO Eulalio Austin said.

The higher average realized prices for gold at $1,338 per ounce and the increase in average copper prices at $3.10 per pound partially offset the company’s lower production during the period.

Philex trimmed its debt to $44 million from $62 million in 2016 following continued repayment of short-term loans with local banks.

Subsidiary PXP Energy Corp. narrowed its net loss by 30 percent  to P3.7 million due to improved petroleum sales and foreign exchange gains.

The firm registered 3.4 percent decrease in crude production, but this was offset by a 24 percent jump in crude oil prices, resulting in slightly higher consolidated petroleum revenues of P30.7 million.

PXP Energy booked a foreign exchange gain of P15.5 million, which was offset by other charges amounting to P11.9 million and a provision for income tax of P1.6 million.

The company and its partners have  a new investor in the Peru oil prospect called Block Z-38 –  Tullow Oil, a UK-listed oil explorer.

Tullow will fund 43.75 percent of the cost of the first exploration well amounting to $27.5 million at 100 percent.

Block Z-38 sits in the heart of the Tumbes Basin, adjacent to the prolific oil producing Talara Basin which has produced 1.7 billion barrel of oil equivalent (BOE) since 1880. – With Danessa Rivera