Improved world metal prices helped listed firm Atlas Consolidated Mining and Development Corporation (Atlas Mining) to recover and book a net income of P118 million in 2020, coming from a net loss of P565 million in 2019.
Atlas Mining told the local bourse that such a recovery is attributed to the sustained stability of its operation and production, the significant increase in gold volume, the increase in metal prices in the second half, and the decrease in operating costs.
During the period, Atlas Mining’s wholly-owned subsidiary, Carmen Copper Corporation, reported copper metal production of 107.24 million pounds in 2019 to 107.09 million pounds in 2020. Its gold production increased by 27 percent from 37,786 ounces to 47,857 ounces.
The increase in gold production resulted from higher tonnage milled and higher realized gold grades, respectively.
Milling tonnage increased by 5 percent from 17.57 million tonnes to 18.37 million tonnes. On the other hand, copper grades decreased by 5 percent from 0.319 percent to 0.304 percent; while gold grade significantly improved by 31 percent from 6.24 grams/dmt to 8.17 grams/dmt.
Copper metal content of concentrate shipped decreased by 4 percent to 106.07 million pounds while gold content increased by 23 percent to 43,480 ounces due to higher gold grade.
The increase in metal prices that started in June 2020 continued to improve in the last quarter when Copper price increased by 6 percent to $2.79/lb versus the nine-month realized average price of USD2.64/lb.
Gold price also continued to improve in the last quarter by 3 percent to USD1,777/oz compared to the nine-month average of USD1,730.
Year-on-year, the average realized copper price for the whole year increased by 2 percent to USD2.79/lb from USD2.72/lb in 2019; while the average realized gold price increased by 27 percent to USD1,777/oz in 2020 from USD1,394 in 2019.
The improvement in operating performance from increased output, the increase in by-product credits from gold due to higher gold production and higher gold prices, and the decrease in operating costs resulted in a lower average cost per pound by 34 percent from USD1.38/lb in 2019 to USD0.90/lb in 2020.
Cash costs decreased by 14 percent from P11.09 billion in 2019 to P9.51 billion in 2020.
The decrease in cash costs was due primarily to significant decreases in waste stripping, fuel, power, explosives and maintenance parts.
Earnings before interest, tax, depreciation and amortization (EBITDA) settled at P8.919 billion, 46 percent higher compared to P6.115 billion of 2019 on the strength of improving metal prices and operating efficiencies.
This pushed core income for the period higher by 510 percent to P2.576 billion in 2020 from P422 million in 2019.
Accordingly, cash generated from operations improved which enabled the payment of $80 million of Atlas Mining’s loans this year in addition to $52.7 million of loan payments in 2019.
“We are confident as well that these improvements will serve as an effective hedge against any downturn in the commodities market. We will continue to focus on operational stability and safety, cost efficiencies and sustainability,” Atlas Mining President Adrian Ramos said.
Atlas Mining is majority-owned by Ramos Group and SM Group.
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