Philex Mining Corp., one of the largest gold and copper producers in Southeast Asia, reported Friday that first-quarter net income dropped 44 percent year-on-year to P389.6 million as lower metal output trumped favorable gold prices and foreign exchange rates.
The production level in the first quarter returned operating revenues of P2.11 billion, down 11 percent even as gold prices rose to $1,889 per ounce. Price of copper was down slight at $4 a pound.
Production cost declined 15 percent to P1.26 billion while issues with the grinding equipment resulted in a 6 percent slide in milling output to 1.71 million tons from 1.82 million tons in the first quarter of 2022. Replacement parts for the grinding equipment have already been ordered.
Ore grades for both gold and copper were the same as last year. Output of gold, however, was down 17 percent to 10,062 ounces, while copper output was 11 percent lower at 5.531 million pounds.
Even with the lower bottomline in the first quarter, Philex remains hopeful for the rest of the year as current global commodity outlook has turned bullish for gold while price levels “were sustained within safe margins.”
The outlook for copper, however, remains bearish.
Work on the Silangan Project in Surigao del Norte are on schedule, with tunneling set to start next month.
Philex said it will also continue with its funding plan for Silangan, which commenced last year with the stock rights offering. The company is in the final stages of the debt syndication process with several financial institutions while funds from cash reserve are ready for infusion in the project.
“We will continue to push the frontier of the Silangan development, pursue improvements towards our recovery program and sustain the extension of the life of our Padcal mine,” Philex president and chief executive officer Eulalio Austin Jr. said in a statement. “Resilience is still the name of the game as we look for other business opportunities and for more participation in the ‘green metals space’,” he added.
