A shadow fell over Benguet Corp.’s third quarter, as the company reported a net loss of P68.3 million – a significant downturn from the P11.1 million loss recorded just a year prior. Despite a surge in revenue, escalating operating costs proved to be a formidable obstacle.
The company experienced a 29.2% jump in mineral revenue, reaching P379.5 million, largely fueled by a remarkable 35.8% increase in the average price of gold, soaring to $3,397.27 per ounce. This positive trend, however, was quickly overshadowed by mounting expenses.
Operating costs ballooned by 63.4%, climbing to P520.1 million from P318.4 million. This dramatic increase was primarily attributed to a substantial rise in the volume of nickel ore being shipped, a logistical challenge that strained resources.
Despite the challenging third quarter, the year-to-date performance painted a more optimistic picture. From January to September, Benguet Corp. achieved a net income of P555.5 million, more than doubling the P256.7 million earned during the same period last year.
The Acupan Gold Project (AGP) demonstrated strong performance, with Q3 revenue climbing 36.7% to P345 million. This growth was driven by both increased gold prices and a higher volume of ore processed.
A deeper look at AGP reveals a strategic increase in milling activity. The project processed 7,755 tons of ore in the third quarter, with an average gold content of 8.01 grams per ton – a notable increase from the 7,333 tons milled with 8.49 grams per ton during the same period last year.
The Sta. Cruz Nickel Project (SCNP) showed signs of improvement, narrowing its Q3 net loss by 63% to P19.3 million, compared to a P52.2 million loss the previous year. However, progress was hampered by external forces.
Unforeseen weather events – intense rains and swells caused by typhoons and low-pressure systems – disrupted operations at Benguetcorp Resources Management Corp., preventing any nickel ore shipments during the quarter. This logistical setback directly impacted revenue generation.
The Irisan Lime Project (ILP) experienced a slight decline, with revenue falling 7.1% to P21.1 million. Facing competitive pressures, the company is actively exploring innovative solutions.
Benguet Corp. is proactively investigating energy-efficient machinery and evaluating potential relocation sites to bolster the ILP’s competitiveness. A long-term strategy also involves transforming the current ILP site into a real estate development.
Looking ahead, Benguet Corp. remains committed to growth through exploration and development. Ongoing research initiatives are underway in Bataan, Zamboanga City, Surigao del Sur, and Agusan del Norte, seeking new opportunities for expansion.
The market reacted to the Q3 results on Thursday, with “A” shares of Benguet Corp. declining 5.6%, closing at P4.20 apiece. “B” shares, however, remained stable, holding steady at P4.88 apiece.
