A significant shift occurred in the financial landscape of Semirara Mining and Power Corp., with earnings declining by 33% to P13.1 billion. This downturn stemmed from a confluence of factors: weakening coal and electricity prices, reduced shipment volumes, and escalating production expenses.
The final quarter of the year revealed a similar trend, with consolidated net income dropping 19% to P3.2 billion compared to the same period the previous year. Despite these challenges, the company highlighted operational achievements, including record-breaking coal production and electricity sales.
Record coal output reached 19.9 million metric tons, a testament to improved access within the Narra mine and a government-approved increase in annual production capacity to 20 million metric tons. This surge in production was a key operational win for the company.
Shipment volumes also saw an increase, rising 7% to 15.4 million metric tons, largely due to strategic timing of exports. However, demand for certain lower-calorific coal types experienced a softening effect during the period.
The average selling price of Semirara coal experienced a notable decrease, falling 19% year-on-year to P2,302 per metric ton. This decline mirrored broader trends in global coal benchmarks and a shift towards a higher proportion of lower-calorific coal shipments.
Global indices reflected this downward pressure, with the Newcastle Index dropping 22% to $105.60 and the Indonesian Coal Index 4 decreasing by 15% to $46.10. These international market forces directly impacted Semirara’s revenue streams.
The company is actively pursuing strategies to expand its market reach and maintain optimal performance across its mining and power plant operations. This proactive approach aims to mitigate the impact of challenging market conditions.
Despite price pressures, energy sales reached a record high of 5,296 gigawatt-hours, representing a 7% increase. This growth was supported by improvements in plant reliability and consistent operational performance.
However, the average electricity selling price decreased by 8% to P4.38 per kilowatt-hour, influenced by increased supply margins within the Wholesale Electricity Spot Market. This wider supply impacted the revenue generated per unit of electricity sold.
Average prices in the Wholesale Electricity Spot Market fell significantly, dropping 27% to P3.73 per kilowatt-hour as overall supply levels improved. This market dynamic contributed to the lower selling price for Semirara’s electricity.
At the close of 2025, 42% of the company’s 860-megawatt dependable capacity was secured through contracts, leaving 422.3 MW available for sales in the spot market. This balance between contracted and spot market sales provides flexibility.
Semirara Mining and Power Corp. remains the dominant force in the Philippine coal industry, responsible for an impressive 97% of the nation’s domestic coal production. Its position as a key player is undeniable.
However, a significant uncertainty looms over the company’s primary asset on Semirara Island in Antique province. The coal operating contract, crucial for continued operations, is scheduled for auction this year.
Semirara Island, spanning approximately 55 square kilometers, boasts the capacity to produce at least 16 million metric tons of coal annually. This substantial resource is the foundation of the company’s operations.
For nearly half a century, SMPC has held the operating contract, enabling exploration, development, and mining activities within the area. This long-standing relationship has been vital to the company’s growth.
While the current contract is set to expire in July 2027, the government has decided to initiate a bidding process this year, encompassing other confirmed mineable reserves. This decision introduces a competitive element to securing future access.
In anticipation of the auction, SMPC is diligently finalizing its mine plan and focusing on fulfilling the obligations of its existing contract. The company is preparing for all potential outcomes.
Trading activity on the local bourse saw the company’s shares close unchanged at P28.40 each on Wednesday. Market response remained stable amidst the unfolding developments.
