Global Ferronickel Holdings, Inc., one of the country’s top nickel exporters, reported a 48 percent jump in consolidated net income to P625.3 million in the first half of 2023 from P417.4 million in the same period last year. 

In a disclosure to the Philippine Stock Exchange, the firm said though that attributable net income declined 19.4 percent to P349.5 million from P433.7 million after deducting the share of non-controlling interests amounting to P275.8 million.

It added that, the net income of an associate of P54.0 million cushioned some of the impact.

Consolidated revenues amounted to P3.1 billion for the first six months of 2023, up 41.2 percent from P2.2 billion in the prior-year period.

Strong volumes and higher-grade ores at Palawan mine were the main drivers of growth, partially offset by weaker prices and lower-than-average volumes at Surigao mine. 

Total sold volume was 1.46 million wet metric tons (WMT), 41.0 percent higher than in the first half of 2022, comprising 52 percent medium-grade and 48 percent low-grade nickel ore. 

The Palawan mine maintained solid momentum in the second quarter, while activities at Surigao mine reflected constraints in the operating environment stemming from heavy rains which prevented stronger production and shipment. 

“There are risk factors which we cannot predict or control but could adversely affect our business. Weather events such as changes in rainfall patterns that we experienced in Surigao is one of them,” said FNI President Dante R. Bravo. 

He added that, “We continue to assess and monitor such factors. Additionally, our ongoing diversification aims to respond to such risk and ultimately improve FNI’s portfolio quality and performance.”

Bravo noted that, “The Palawan mine benefits from milder weather and a wet season that is not very pronounced thereby allowing year-round operations. It also adds greater scale to our resources and reserves and points to long-term business volume.”

“As we step up efforts to further diversify, the combined strength of the Surigao and Palawan mines enable us to better navigate the short-term challenges ahead,” he said. 

The average realized nickel ore price was $38.37 per WMT, down 2 percent compared to $39.21 per WMT a year ago, due to available product mix and lower selling prices in the second quarter, which were affected by expanded market supply from capacity additions in Indonesia and muted demand in China following a tepid post-pandemic reopening. 

The average realized exchange rate was P55.34 to the U.S. dollar as against P52.60 in the previous year.

“Looking forward, we remain committed to our capital management strategy that is balanced between investing in growth initiatives, providing returns to shareholders, while maintaining a strong balance sheet,” Bravo said.