Strong coal, power sales fuel SMPC record profit

SEMIRARA Mining and Power Corp. (SMPC) posted a record-high net income of P39.9 billion in 2022, more than double the P16.2 billion recorded a year earlier, on strong domestic coal shipments and higher electricity sales at the spot market.

“Last year, we focused on the Philippine, South Korean, and other ASEAN markets to lessen our dependency on China, which had been importing heavily discounted Russian coal,” SMPC President and Chief Operating Officer Maria Cristina C. Gotianun said in a statement on Tuesday.

SMPC also attributed the profit increase to elevated market prices.

For 2022, the company said domestic coal sales increased to 7.7 million metric tons (MT), up by 32.8% from 5.8 million MT a year earlier, while exports dropped by 24.5% to 7.1 million MT from 9.4 million MT.

The average selling price of Semirara coal surged by 90.6% to P5,136 from P2,695 on increasing index prices and higher-grade coal sold.

SMPC also said that combined spot electricity sales from its subsidiaries SEM-Calaca Power Corp. and Southwest Luzon Power Generation Corp. increased by 83% to 1,881 gigawatt-hours (GWh) from 1,028 GWh.

Meanwhile, the average selling price of spot electricity went up by 35.4% to P7.46 per kilowatt-hour (kWh) from P5.51 per kWh on high fuel costs and thin supply-demand margins.

In the fourth quarter, SMPC saw its consolidated net income decrease to P3.9 billion, down by 33.9% from P5.9 billion in the corresponding period a year earlier.

The company attributed the decline to higher stripping costs, a lower average foreign exchange rate, an income tax and other expenses of P1 billion in relation to the deferral of the income tax holiday of its Molave mine for 2020.

Coal sales for the October-December period went up by 20% to 3 million MT from 2.5 million MT as domestic shipments surged by about 72.7% to 1.9 million MT from 1.1 million MT.

In the fourth quarter, the average selling price of Semirara coal increased by 9.2% to P4,861 from P4,452 on higher market prices and as lower-grade coal sales saw a significant increase to 736,674 MT from 212,431 MT.

SMPC’s power segment reported spot market sales of 335 GWh, down by 37.7% from 538 GWh due to the 86-day maintenance outage of SEM-Calaca’s unit 1 and the 42-day unplanned outage of its unit 2.

On Tuesday, shares in the company rose 0.17% or five centavos to close at P30 each on the stock exchange. — Ashley Erika O. Jose