Global Ferronickel Holdings, Inc. a leading nickel ore producer in the Philippines, reported revenues of ₱7.611 billion, net income attributable to shareholders of ₱743.9 million, and earnings per share of ₱0.1451 for the year 2024. Mining revenues were ₱7.592 billion, down 13.4% due to lower nickel ore prices partially offset by strong volumes. By mine site, Surigao revenues decreased 3.1% to ₱4.667 billion (61% of total revenues), and Palawan revenues decreased 25.9% to ₱2.925 billion (39% of total revenues). By geography, shipments to China made up 93% of revenues followed by Indonesia at 7%.
“While market conditions are beyond our control, we are laying a strong foundation for the future by funding growth and unlocking efficiencies,” said FNI President Dante R. Bravo. “In 2024, we sustained double-digit volume growth, reduced our average cash operating cost per volume sold, and reinvested back in the business. Looking ahead, we will build on these achievements as we continue to advance on our strategy to capture new revenue streams and deliver profit growth.”
The average realized nickel ore price declined to US$24.26 per wet metric ton (WMT), down 27.1% from US$33.28 in 2023. Low-grade ores sold for an average of US$19.58 per WMT, down 23.9%, while medium-grade ores were priced at US$33.06 per WMT, down 29.1%. Various factors affected market prices, including but not limited to: demand fluctuations in China and Indonesia, stainless steel and low-grade nickel pig iron production, supply chain disruptions from maintenance shutdowns of some steel mills, and the supply growth in Indonesia which outweighed production cuts and mine closures in the rest of the world.
Total volume shipped rose to 5.448 million WMT, up 15.5%, with growth in both Surigao and Palawan mine sites. This increase was fueled by investments to expand production and improve productivity. Sales of low-grade ores grew 18.1% and comprised 65% of total volume from 64% in 2023, while sales of medium-grade ores grew 11.0%, accounting for 35% of total volume from 36% a year ago.
Surigao led the company’s volume growth with 3.991 million WMT, an increase of 21.1%, following the addition of more equipment, including chartered landing craft tanks (LCTs) and dump trucks, along with favorable weather conditions at the beginning of the year, which allowed ore extraction and stockpiling activities to be in place ahead of the mining season.
In Palawan, the volume shipped was 1.457 million WMT, up 2.6%, driven by favorable weather conditions, further development of infrastructure such as mine facilities and causeway, increased equipment availability, and beneficial impact from efficiency initiatives mostly in logistics and human resources.
Total costs and expenses were ₱6.658 billion, up 11.2%. Cost of sales was ₱4.070 billion, up 13.3%, reflecting higher costs for: (a) contract hiring needed to handle higher volumes and address a rise in effective rates due to sales mix and hauling distance, (b) labor in light of additional employees and changes in mandatory labor and social security costs, (c) depreciation, depletion, and amortization in relation to equipment acquisitions and higher sales volume, and (d) environmental protection for additional sedimentation ponds in Palawan. Meanwhile, operating expenses totaled ₱2.588 billion, up 8.0%, due mainly to legal costs, which were partially offset by lower marketing and entertainment expenses. Overall, with increased volume and improved efficiency, the average cash operating cost per volume sold dropped to ₱1,094.77 per WMT, a decrease of 4.8% over the prior year.
After accounting for non-controlling interests, net income attributable to FNI shareholders amounted to ₱743.9 million, down 51.8%. On a per-share basis, earnings were ₱0.1451 from ₱0.3021 the previous year.
Continuous investment into the business
The company’s capital expenditure reached ₱1,004.8 million, up 15.6% from ₱869.0 million in 2023, representing 13.2% of revenues. Investments in the Services segment accounted for 56.8% of the total, where three new LCTs were acquired for operational reliability and efficiency. The remainder consisted mostly of additional investments in the Mining segment such as machinery and equipment including excavators, dump trucks, and water trucks, transportation and handling, causeway and land improvements, and other equipment.
FNI also spent ₱26.5 million on mine exploration as part of the strategy to expand its nickel resource. This program is a continuing activity aimed at increasing the company’s resource and reserve inventory and extending the life of existing mines as well as maintaining accuracy in resource reporting and regulatory compliance. As a result, as of 15 October 2024, total measured and indicated mineral resources in Surigao were 99.2 million WMT with 53% in limonite and 47% in saprolite and an estimated average grade of 1.1% nickel and 30.5% iron. Additionally, proven and probable mineral reserves were 49.6 million WMT at 1.13 % nickel and 29.98 % iron. In Palawan, as of 31 December 2024, total measured and indicated mineral resources were 77.4 million WMT with 39% in limonite and 61% in saprolite and an estimated average grade of 1.2% nickel and 25.1% iron. The estimate of ore reserves is expected to be completed within March 2025.
Delivering meaningful programs for the environment and communities
Driving economic impact, FNI distributed the economic value it created to various stakeholders, supporting local businesses and working with more than 290 suppliers. A total of ₱5.6 billion was paid to suppliers for operating costs, ₱63.6 million was used for Social Development and Management Program (SDMP) and ₱280.7 million for Environmental Protection and Enhancement Program (EPEP). Meanwhile, the national and local governments received ₱1.330 billion in the form of income tax, royalties, excise tax on minerals, and other taxes and fees. Indigenous cultural communities were provided ₱75.4 million during the year.
Within SDMP, initiatives remained focused on strengthening local communities, particularly in education and health. Within EPEP, efforts to mitigate environmental impacts were the construction of additional settling ponds and flood control structures in Palawan, progressive rehabilitation and reforestation across mine sites with 63.6 hectares rehabilitated or 93.5% of target, and Adopt-a-River program in partnership with the Department of Environment and Natural Resources in Surigao.
In recognition of its contributions to environmental responsibility and local community engagement, FNI’s subsidiary Platinum Group Metals Corporation (PGMC) was conferred the Platinum Achievement Award–Surface Mining Operation Category at the 70th Annual Mine Safety and Environment Conference. PGMC was also recognized as 1st Runner-Up in the Best Mining Forest – Metallic Category. Established in 1997 by Executive Order No. 399, the Presidential Mineral Industry Environmental Awards are the highest distinction for mining companies in the country. Since 2014, PGMC has received numerous awards in key areas of sustainable development, including safety and health management, environmental stewardship, innovation, social and community engagement, and economic development.
2025 Outlook
FNI is committed to maintaining strong financial stability and operating performance. Through careful planning and execution, FNI expects to increase its revenues with a double-digit growth rate in 2025. The significantly higher production capacity in Palawan (from 1.5 million WMT to 3 million WMT) combined with the increase in productivity in Surigao and improved contribution from port operations in Bataan will be the main drivers of the expected top-line growth. In response to input cost inflation, the company is intensifying its efficiency program through increased production volumes, process and cost optimization, and innovation to firm up profitability.
Aided by funds from operations, capital investments planned for the year amount to ₱711.8 million. Strategic priorities include the development of existing mines and expansion of resources, with ongoing exploration permit applications in North Luzon, Eastern Samar, Camarines, and additional areas in Surigao. It also covers further investments in warehouse and container terminal in Bataan as well as pursuing value-added nickel processing, primarily ferronickel and battery-grade nickel facilities.