MINING firm Global Ferronickel Holdings (GFH) Inc. said its net income jumped to P779.9 million for the nine months of the year, a turnaround from a mere P7 million it made last year, on higher shipments.
“We are in a business with high degree of operating leverage,” GFH President Dante R. Bravo said in a statement. “We have successfully addressed both the revenue and cost side, which directly translates to our bottom line.”
“Such brisk growth reflects good progress on our previously announced productivity initiatives which drove higher shipped volume,” Bravo added. “We also benefited from improved selling prices, better product mix and favorable foreign-exchange rate.”
Shipped volume rose 43 percent during the period to 4.9 million wet metric tons. Average realized price climbed to $18.77 per WMT, as more medium-grade ore were sold, which command higher market prices, the company said.
For the period, its mix of products was 58-percent low-grade ore and 42-percent medium-grade ore versus the previous years’ mix of 65-percent low-grade and 35-percent medium-grade ore.
“We continue to balance capital investments through our mineral exploration program, as well as share buybacks,” Bravo said. “We have repurchased over P636 million worth of FNI stock year-to-date and we did this without raising debt levels. We financed the share repurchases from free cash flow because we are focused on long-term shareholder value.”
The company earlier announced the completion of its exploration drilling activities at Cagdianao deposit areas 2 and 3.
Measured and indicated mineral resources at Cagdianao areas 1 to 5 increased to 54 million dry metric tons with an average grade of 1.1 percent nickel and 31.4 percent iron. Mineral reserves increased to 36 million WMT with an average grade of 1.22 percent nickel and 31.7 percent iron, GFH said.
“We are encouraged by current strong trends for fixed asset investments in China, particularly real-estate development and water, environment and public facilities infrastructure. We are also positive on long-term prospects for new energy vehicles, which saw double-digit sales growth year-to-date,” Bravo said. “With only a few days left before we close the mining season, I’m confident that we’ll finish the year strong and we’ll continue to invest in opportunities we see ahead for 2018 and beyond.”