Semirara Q3 Earnings Fall 8% to P3.1B; 9M Net Income Declines 31% to P15.7B

Integrated energy company Semirara Mining and Power Corporation (SMPC) reported an 8% drop in third-quarter earnings to P3.1 billion, from P3.4 billion in the same period last year, primarily due to reduced contribution from the coal segment amid stabilizing market indices.

“As anticipated, stabilizing market prices exerted pressure on our margins. Our third-quarter results also reflect the seasonal impact of the rainy season on coal shipments and electricity prices, both of which we were able to partially offset through focused cost management and operational efficiency initiatives,” said SMPC president and COO Maria Cristina C. Gotianun.
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From July to September, average Newcastle Index (NEWC) dipped by 5% from US$147.8 to US$140.3, while Indonesian Coal Index 4 (ICI4) remained flat (-1%) from US$52.0 to US$51.7.

Overall average selling price (ASP) of electricity held steady, from P4.81/kWh to P4.80/kWh, on combined effect of better ASP from bilateral contracts and weaker spot market prices.

Quarter-over-quarter (Q2 2024 vs Q3 2024), SMPC net income dropped by 48% from P6.1 billion mainly due to seasonality, softer selling prices and reduced coal shipments.

From January to September, SMPC’s net income declined by 31%, from P22.62 billion in 2023 to P15.71 billion, attributed to softer selling prices and higher total cash and noncash costs, which were largely driven by increased coal and power sales volume.

“For the remainder of the year, we expect coal and electricity prices to remain stable. Our focus is on meeting our coal production target of 16 million metric tons and achieving a balance in our contracted generation capacity mix,” Gotianun added.

Coal Operating Results

For the third quarter, total shipments grew by 16% from 2.5 million metric tons (MMT) to 2.9 MMT on stronger export demand. Foreign shipments surged by 120%, from 0.5 MT to 1.1 MMT, propelled by higher sales to China.

During the same period, Semirara coal ASP receded by 15%, from P3,315 per metric ton (MT) to P2,811 per MT, influenced by normalizing coal indices and increased shipments of lower-grade coal.

Total production rose by 7%, from 2.8 MMT to 3.0 MMT, on low-base effect following the near-depletion of Molave mine and pre-stripping activities in Narra mine last year.

Power Operating Results

Total average capacity during running days expanded by 23%, from 613 MW to 755 MW, following the restoration of SCPC Unit 2’s dependable capacity to 300 MW on May 27, along with reduced deration in SLPGC plants.

Total gross generation jumped by 12%, from 1,167 GWh to 1,308 GWh, on improved output from both SEM-Calaca Power Corporation (SCPC) and Southwest Luzon Power Generation Corporation (SLPGC) plants.

Total power sales soared by 10%, from 1,099 GWh to 1,213 GWh, largely driven by better SLPGC plant performance. More than half (54%) of the generated electricity was sold to the spot market, with the remainder sold under bilateral contract quantities (BCQ).

BCQ ASP jumped by 13% from P4.13/KWh to P4.66/KWh, while spot ASP receded by 4% from P5.14/KWh to P4.92/KWh.

At the end of the third quarter, 33% of the 840MW dependable capacity of SCPC and SLPGC are contracted. Net of station service, which fluctuates periodically, SMPC has 482.60MW available for sale to the spot market.