Atlas Consolidated Mining and Development Corp. registered a net loss of P814 million in 2015, up from P397 million in 2014 on low copper prices.
The company said the full-year loss eased from a loss of P1.3 billion in the first nine months of 2015. Atlas said higher production volumes and cost efficiency improvements helped cushion the impact of low copper prices.
Atlas Mining said the narrower net loss for the full year benefitted from the share in net income of Berong Nickel Corp. in the amount of P244 million. It also reduced the loss from a net foreign exchange gain of P138 million and realized gains on derivatives of P295 million attributable to the recognition of derivative assets and liabilities from provisional pricing contracts still outstanding at the end of the year for copper concentrate shipments.
Intensified improvements in production volumes were recorded in the second half of the year, benefitting from ongoing improvements in maintenance and process efficiencies at Atlas Mining’s wholly-owned subsidiary Carmen Copper Corp.
Copper metal in concentrate production in the second semester rose 20 percent to 55.6 million pounds, spurred by relatively higher head grade, improvement in copper recovery and increased milling tonnage.
Copper grade improved to 0.307 percent from 0.292 percent and copper recovery accelerated further to 86.3 percent compared with 85.2 percent in the first semester average. Milling tonnage expanded 13 percent to 9.5 million tons as average daily throughput delivered 51,800 ton per day for the second half from 46,600 tpd in the previous semester.
Copper prices fell to a six-year low on concerns over the future demand from China. The average realized copper price ended the year at $2.46/lb, 21 percent lower than the $3.12/lb average in 2014. The average realized gold price, meanwhile, dropped 9 percent to $1,152/oz from $1,265/oz in the previous year.
Total operating cash costs shrank 16 percent to P9.4 billion in 2015 due to cost containment initiatives. Average cash cost per pound of copper declined to $1.71/lb from $1.99/lb in 2014.
Due to the challenging environment for copper, Atlas Mining announced the reduction of its mill throughput at the Carmen Copper mine from its nameplate capacity of 60,000 tpd to 40,000 tpd.
“While management views the long term outlook for copper positively, the company must respond to current market conditions to optimize cash flow while protecting its large mineral resources for the longer term and to position the company to enhance performance and throughput when copper prices improve,” it said.