Semirara profit hits record on high coal, power prices

BY LENIE LECTURA – NOVEMBER 3, 2022
from Business Mirror

Consunji-led Semirara Mining and Power Corp. (SMPC) reported a new profit record, as its consolidated net income in nine months surged 250 percent to P36 billion from P10.3 billion.

The increase was mainly due to the combined effect of elevated market prices, all-time high coal production and higher spot electricity sales volume.

“Historically, the third quarter is our slowest because of the rainy season and sluggish demand. But because of improved market prices, we did much better than expected,” said SMPC President and COO Maria Cristina C. Gotianun.

For the third quarter alone, SMPC netted P10.2 billion, a 153-percent upswing from P4 billion during the same period last year.

From January to September, average selling prices of Semirara coal rallied by 122 percent to P5,224 per metric ton (MT), from P2,351/MT to P5,224/MT due to the surge in global index prices following Russia’s invasion of Ukraine.

Average Newcastle prices surged by 191 percent from $121.70 to $353.80 while average Indonesian Coal Index 4 expanded by 50 percent $84.30 from $56.10.

Nine-month coal production grew by 27 percent from 10.8 million metric tons (MMT) to a record 13.7 MMT due to controlled water seepage levels in Molave mine and better coal access in East Block 4 and South Block 5.

Meanwhile, its power business posted a 216-percent increase in spot market sales from 489 gigawatt hours (GWh) to 1,546 GWh owing to a 5-percent uptick in plant availability, 7-percent improvement in gross generation and pivot away from bilateral contracts.

Its average spot selling price rose by 38 percent to P7.33 from P5.30 on recovering demand, higher fuel costs and thin power supply margins.

In February, the company reported that it posted its highest-ever net income last year.

It ended 2021 with a net income of P16.2 billion, a 393-percent leap from the previous year’s P3.3 billion, mainly due to an 8-percent rise in coal production, 16-percent jump in coal shipments and 71-percent surge in average coal selling prices.

Contributions from the coal segment grew by 535 percent to P11.4 billion from P1.8 billion while both power subsidiaries delivered improved performances.

Sem-Calaca Power Corp. contributed P3.3 billion, a 154-percent upturn from P1.3 billion the previous year. Meanwhile, Southwest Luzon Power Generation Co. recorded a 1,563-percent rise in contributions to P1.4 billion from P87 million.