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Philex income up 86%; PXP losses widen

PHILEX MINING Corp. reported an 86% increase in its second-quarter net income to P599.53 million on the back of sustained levels of metal output and higher revenues.

The listed mining company also said in a stock exchange disclosure on Friday that its revenues for the April-to-June period rose 21% to P2.38 billion. Operating costs and expenses climbed 2.6% to P1.59 billion due to higher excise taxes and royalties from increased revenues.

“The slight increase was tempered by lower non-cash production costs in the second quarter of 2021 amounting to P271 million compared with non-cash production costs in the second quarter of 2020 amounting to P330 million,” Philex Mining said.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) for the quarter rose 44% to P1.02 billion.

For the first six months of the year, Philex Mining recorded a 29% year-on-year increase in net income to P1.16 billion. Revenues rose 29% to P4.75 billion due to higher realized metal prices.

“The higher revenues are due mainly to the sustained higher realized metal prices for both gold and copper at $1,807 per ounce and $4.21 per pound, respectively,” Philex Mining said.

“The satisfactory execution of the mining plan and mill operations resulted in the production of 13,612 ounces of gold and 6.44 million pounds of copper for the second quarter of 2021, bringing the first half total metal output at 27,025 ounces of gold and 13.21 million pounds of copper,” it added.

Operating costs and expenses for the semester rose 4.5% to P3.24 billion, while its EBITDA for the period increased 80% to P2.03 billion.

“The increase is attributable to increasing production cost brought about by the effects of the pandemic to the supply chain, including logistics and coronavirus

disease 2019 (COVId-19) response undertaken by the company,” Philex Mining said.


Meanwhile, Philex Mining also announced that its board of directors had approved the in-phase development of its Silangan copper and gold project in Surigao del Norte and will be appointing a financial advisor to help in the fund-raising activity to be done as soon as possible.

The mining company disclosed that Silangan’s development will start by the second quarter of 2022, while commercial operations is estimated to begin in January 2025.

“With the in-phase development of Silangan, the capital expenditure requirement will be made in stages, and can be funded from a variety of potential resources including internally-generated cash and potentially through equity and debt from investors and creditors,” Philex Mining said.

Eulalio B. Austin Jr., Philex Mining president and chief executive officer, said the company will be working with its financial advisor to implement the fund-raising activity for the Silangan project’s in-phase development.

“We believe that the recent government pronouncements related to the mining industry will increase the level of interest and confidence of investors and lenders to mining companies. The launch of Silangan will be very timely,” Mr. Austin said.

Philex Mining Chairman Manuel V. Pangilinan said the company is set to benefit from the positive global outlook on metal prices, together with the execution of its plans amid the pandemic.

“In the next couple of months, we set to launch our Silangan Project under an in-phase development approach. Silangan will be an exciting project for Philex,” Mr. Pangilinan said.


In a separate stock exchange disclosure on Friday, PXP Energy Corp. said its

second-quarter net loss attributable to parent company equity holders widened by 51.5% to P18.81 million.

PXP Energy said its petroleum and other revenues for the April-to-June period reached P19.61 million compared to none last year, while total costs and expenses amounted to P36.41 million, up 184.2%.

For the first half of the year, PXP Energy incurred a P23.15-million attributable net loss, down 47.8% from a year ago.

Petroleum revenues reached P19.61 million, up 220.4%, due to a 250% surge in Galoc crude sale price to $63.48 per barrel in the first half from $18.13 per barrel last year.

PXP Energy’s consolidated costs and expenses climbed 37.8% to P54.43 million against P39.50 million in 2020.

“This is brought about by lower petroleum production costs in Service Contract (SC) 14C-1 Galoc at P13.9 million offset by the increase in general and administrative expenses at P40.5 million,” PXP Energy said.

On Friday, shares of Philex Mining fell 0.97% or six centavos to end at P6.14 apiece while stocks of PXP Energy dropped 2.93% or 21 centavos to close at P6.95 each.

Philex Mining is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Metro Pacific Investments Corp. and PLDT Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls. — Revin Mikhael D. Ochave

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