Top nickel miner PT Vale Indonesia booked a sharp decline in first-quarter profit after the world’s largest nickel ore-producing country enforced a game-changing export ban in January.
The publicly listed miner booked US$29 million in profit in the Jan-March period, which is half that achieved in the preceding quarter but marks a turnaround from a $20.2 million loss recorded a year earlier.
Vale’s financial performance declined on a quarter-to-quarter (qtq) basis but significantly improved year-on-year (yoy). Revenue was $174.7 million in the first quarter, down 36.6 percent qtq, as production fell by 14.1 percent qtq to 17,614 tons due to “planned maintenance.”
“Assuming COVID-19 does not have a huge impact on our operations, we are certain about maintaining production levels in 2020,” said Vale CEO Nico Kanter in a statement on Tuesday.
The company’s statement added that revenue was affected by slumping nickel demand, as downstream nickel industries shut down amid the coronavirus pandemic.
“This ended up lowering nickel prices in 2020’s first quarter, a trend that will potentially continue into the second quarter,” reads the statement.
The company’s operational costs were $154.2 million in the first quarter, 14.5 percent lower qtq, due to less mining activity. Vale noted that its diesel spending rose 9 percent qtq as trucks drove longer distances in the company’s expanding mine.
Vale’s shares, traded at Indonesia Stock Exchange (IDX) as INCO, rose 1.28 percent on Wednesday against the benchmark Jakarta Composite Index (JCI) rise of 0.44 percent.
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