SINGAPORE (Nov 2): AsiaPhos has reported $0.1 million in earnings for the third quarter ended Sept, compared to a loss of $0.6 million in the same period a year ago on higher revenue.
This brings the group’s earnings for 9M17 to $1 million, as opposed to its loss of $1.1 million in the previous year.
See: AsiaPhos swings back to profitability in 1H17
Revenue for the quarter grew 28% to $11.8 million from $9.2 million in 3Q16 due to a 76% surge in contributions from the upstream segment to $2.2 million on the growth in quantity of phosphate rocks sold over the quarter, with 42,300 tonnes of phosphate rocks sold in 3Q17 compared to 23,000 tonnes a year ago.
This was however offset in part by a reduction in average selling prices, mainly due to differences in quality of phosphate rocks sold and change in customer mix as compared to 3Q16.
Revenue from the downstream segment grew 21% to $9.7 million from $8 million in the previous year on higher average selling prices, which helped to offset the impact from a lower quantity of P4 sold over the quarter due to the environmental inspection in Sichuan Province, China, in Aug 2017.
Gross profit for the quarter grew to $2.3 million from $1.3 million a year ago, while gross profit margin increased to 19% from 14% previously.
In response to the environmental inspections conducted by China’s Ministry of Environmental Protection in Sichuan, which have affected AsiaPhos along with other factories in the vicinity, the group has brought forward its P4 maintenance programme originally scheduled for Dec, to August.
Production has since resumed in Sept.
“It was timely for us to bring forward the P4 plant maintenance programme during the environmental inspections, which means we can continue production in December which will allow us to ride on the current firm prices of P4,” comments Ong Hian Eng, CEO and executive director of AsiaPhos.
“We will continue to monitor the production costs and step up our marketing efforts in order to build on the improvements seen in P4 margins during the quarter.”
Looking ahead, AsiaPhos says it will be implementing new sustainability-driven initiatives that will improve efficiency and minimise wastage, in line with the China government’s ongoing environmental initiatives.
The group is also in discussions with customers and strategic partners to explore other areas of cooperation that will enhance shareholder value.
Shares in AsiaPhos closed 2.1% higher at 9.8 cents on Thursday.
