Philex Mining Corp. income drops 23% in first half of 2018

MANILA, Philippines — Pangilinan-led Philex Mining Corp. reported a 23 percent drop in net income to P552 million in the first semester due to  lower metal production and the  impact of the government’s tax reform program.

In a regulatory filing, Philex said the lower bottomline was due to the doubling of excise tax and increased non-cash charges.

Revenue from gold was 13 percent lower at P2.35 billion, while revenues from silver decreased to P40 million. Copper revenues increased by 13 percent to P2.26 billion.

The Padcal mine milled 4.39 million metric tons (MT) of ore, six percent higher than the previous year, translating to 14.1 million pounds of copper and 35,583 ounces of gold.

However, ore grades, low metal recoveries, and equipment repairs resulted in lower volumes of metal.

“Engineering interventions as well as operational efficiency improvements will be the focus of our Padcal mine in the coming years, while waiting for the results of the explorations being undertaken in the vicinity of the Padcal mine,” Philex president and CEO Eulalio Austin said.

The higher average realized prices for gold at $1,314 per ounce and the increase in average copper prices at $3.11 per pound managed to partially offset the company’s lower production in the first half.

Meanwhile, the company continued to pare down debt to $39 million as it repaid short-term loans with local banks.

Philex is currently completing studies, focusing on the most effective and efficient means to expand the capacities of its existing tailings storage facilities to accommodate additional tailings and extend Padcal’s life  mine beyond 2022.

The company is also engaged in several concept studies including underground mining as one of the alternatives to the Silangan’s project’s approved surface mining design and development plan.