By Myrna M. Velasco
With the combined effect of reduced coal sales and cheaper energy prices, the net income after tax (NIAT) of Consunji-led Semirara Mining and Power Corporation (SMPC) had dropped 43-percent to P1.2 billion in this year’s first quarter vis-à-vis a more robust P2.3 billion financial performance in the same period in 2019.
Because of the lingering coronavirus pandemic, the company indicated its coal production had been down 22-percent from January to March this year to 3.2 million metric tons compared to a heftier 4.1 million MT last year.
Export sales at the same time declined by 20-percent to 1.6 million tons as against 2.0 million in the comparable three-month stretch a year ago; while domestic sales had been flattish at 1.6 million tons.
The listed firm noted that net of eliminations, the income contribution of its coal segment had been at P1.2 billion; and that was valuable reinforcement to the very marginal profitability of one of its power generating assets – with its SEM-Calaca Power Corporation (SCPC) just logging in P0.1 billion income; while Southwest Luzon Power Generation Corporation (SLPGC) even posted a net loss of P0.2 billion.
“Drop in global coal prices translated to a 16-percent decrease in coal average selling price quarter-on-quarter and year-on-year from P2,272 per ton to P1,900 per ton this quarter,” the company stressed.
According to SMPC, energy sales from its power plants had a slight climb of 8.0-percent to 692 gigawatt hours from the previous year’s 638 GWh. However, it qualified that “softer global coal prices and Covid-19 pandemic affected average energy prices.”
As emphasized, the average selling price of SCPC had been trimmed by 25-percent; while its SLPGC plant had been lower by average 33-percent, mainly “because of higher excess capacity to spot market and lower WESM (Wholesale Electricity Spot Market) prices.”
Relative to the firm’s coal production, it reported that its strip ratio for the quarter had been at 18:1, which was 46-percent higher versus a ratio of 12.5:1 within the same period last year.
It explained that such outcome was anchored on the fact that “part of the mine capacity had been diverted to South Molave while preparatory dewatering works were being done at North Molave.”
The company emphasized “deferred stripping asset of P952 million was recognized for the strip ratio above the standard strip ratio for the Molave mine.”
Concurrently, for the firm’s power assets, the generating unit 2 of its SCPC plant is still on scheduled shutdown during the first quarter – a process that started October 17 last year “for life extension program,” while unit 1 was under operation in the reckoned three months of the year.
For its SLPGC power facility, both units were also considered “not fully operational” within the financial review period, with unit 1 encountering planned outage from December 13, 2019 to February 12, 2020; while unit 2 was down starting February 19 this year.