The drop in earnings during the first half of 2011 was mainly the result of much lower nickel LME prices, despite shipment volume increasing by 19%. Total volume of nickel ore sold and delivered from the Company's four operating mines in 2012 reached 5.02 million wet metric tons (WMT), compared with 4.22 million WMT in 2011.
Of the total volume of ore shipped during the first half of the year, 1.70 million WMT was saprolite ore and 3.32 million WMT was Iimonite ore, of which 1.67 million WMT was shipped to the Coral Bay hydrometallurgical processing plant. The corresponding figures for the same period in 2011 were 1.82 million WMT, 2.40 million WMT and 1.31 million WMT, respectively. The average realized exchange rate during the period January to June 2012 was P42.87 to the dollar.
The realized LME nickel price applicable to 2.37 million WMT of ore shipped in the first half averaged $8.60 per pound of payable nickel, as against $11.48 per pound of payable nickel in the same period last year. The balance of the shipments sold in the first half was on the basis of a negotiated price per WMT of ore, which averaged $25.87 per WMT of ore compared to $ 21.73 per WMT of ore in the same period last year.
Due to increase in shipment volume and mining activities, total cash operating costs and expenses rose by 38% from P 2.08 billion in the first half of 2011 to P 2.88 billion in the first half of 2012. On a per WMT of ore sold, total cash costs and expenses increased to $13.37 per WMT in 2012 compared to $11.33 per WMT in 2011.
With respect to the outlook for the current year, Mr. Gerard H. Brimo, NAC President and CEO, said that, "ail indications point to the Company achieving record shipment volumes once again this year notwithstanding global macro-economic factors affecting all commodities in general".
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