Global Ferronickel Holdings Inc., a leading nickel ore producer in the Philippines, reported a sharp drop in first-quarter net income as a glut in the nickel industry sent prices sharply lower that nearly halved mining revenue during the period.
Global Ferronickel, which trades under the symbol FNI, said net income in the January-March quarter plunged 93 percent to P10.6 million as mining revenue dropped 47 percent to P586.2 million as lower selling price more than offset increased sales volume.
The average realized nickel ore price fell 55 percent to USD27.42 per wet metric ton amid continued oversupply, predominantly attributable to Indonesia’s output of nickel pig iron to China. Total shipments reached 0.381 million WMT of medium-grade ores, up 15 percent over prior year.
“In this uncertain environment, we are focused on boosting productivity and cost efficiency, which is critical to protecting value,” FNI president Dante Bravo said.
“This includes optimizing our operations both in Surigao and Palawan, reviewing service contract rates, and reexamining planned capital investments. We are also working to improve our resilience to weather challenges, ensuring timely completion of projects, including flood control measures to reduce risks to operations and production arising from La Niña,” he added.
Cost of sales rose 13 percent to P309.8 million, a reflection of higher volumes produced and shipped during the quarter. Operating costs, namely excise taxes and royalties, general and administrative, and shipping and distribution declined 19 percent to P279.6 million.
Earnings per share plunged to P0.0021 from P0.0296.
