Atlas Mining records net loss of Php879M, 53% improvement in underlying earnings
21 March 2017
Atlas Consolidated Mining and Development Corporation (“Atlas Mining”) registered a consolidated net loss of Php879 million for 2016. Excluding a Php495 million onetime provision for loss on disputed input tax credits, the company reported an underlying net loss of Php384 million, representing a 53% improvement on the prior year.
The company realized both higher revenues and lower operating costs, benefitting from an ongoing cost and efficiency program.
An increase in revenues of 7% to Php12.080 billion year-on-year was driven by both the increase in copper volume shipped and higher gold revenues that tempered the impact of lower copper prices.
Copper revenue showed a slight improvement by 2% due to the increase in copper concentrates shipped by 4%, from 169,304 to 176,130 dmt, despite the decrease in copper price by 10% from an average of US$2.46/lb. to US$2.21/lb. Gold revenue increased by 34% as volume shipped increased by 4,879 ozs to 32,211 ozs and the average price increased from USD1,154/oz. to USD1,241/oz. Additional revenue was also realized from the sale of 25,000 dmt of magnetite for Php12 million as compared to none in 2015.
Operational efficiencies and cost optimization have been the key strategies of Atlas Mining during the recent period of lower copper prices. C1 cash cost decreased by 19% to $1.39/lb Cu, brought about by lower waste charged to operation, lower energy and materials and supplies costs. The decrease in operating expenses was further attributed to lower labor cost as a result of the right sizing program implemented and also lower smelting charges as market rates decreased in 2016. With higher revenues and lower cash operating costs, Earnings before interest, tax, depreciation and amortization (EBITDA) improved by 46% from Php2.169 billion to Php3.174 billion.
Meanwhile, at the Special Shareholders Meeting held on 21 February 2017, the Board’s recommended plan to refinance Atlas Minings’ debt obligations was Approved.