PT Vale posts net loss but positive EBITDA for 2017

Jakarta, February 27, 2018 – PT Vale Indonesia Tbk (“PT Vale” or the “Company”, IDX Ticker: INCO) today announced its audited results for 2017. The average realized price in 2017 increased compared to 2016, but was offset by the impact of lower production and higher consumables costs.

“While there was a 10% increase in the average nickel price in 2017, the cost of consumables increased significantly,” said Nico Kanter, CEO and President Director of the Company. “The cost of fuel and coal increased by 36% and 39% respectively, on a unit cost basis. These two consumables represent PT Vale’s largest cost items. The combination of a relatively suppressed nickel price, and higher prices for consumables created a unique challenge in 2017 for the Company.

This experience underlines the importance of remaining focused on optimizing production capacity, improving efficiency and reducing costs.”

Nico Kanter

We believe the nickel price in 2018 will remain volatile. There is also uncertainty in the global nickel market over whether the Indonesian ore export quota will add additional volume or simply replace a diminishing ore supply from the Philippines to China.”

In 2017, PT Vale produced 76,807 metric tons of nickel in matte, a decrease of around 1% from last year’s production of 77,581 metric tons. The volume of ore processed actually increased in 2017, however, nickel production declined due to lower grades. The Company will maintain its focus on improving cost efficiency to sustain competitiveness in the long term without compromising the Company’s foremost value: Life Matters Most.

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Quarterly Result Financial Statement Production Report

PT Vale posts net loss but positive EBITDA for 2017