Jakarta. First-quarter earnings at two Indonesian miners reflect an operating climate made increasingly challenging by weak commodities prices.

Vale Indonesia, the local arm of the Brazilian nickel-mining giant, reported a 39 percent rise in net income to $25 million from January to March this year from the same period last year, according to a filing with the Indonesia Stock Exchange (IDX) on Thursday.

The company booked $212 million in revenue, down nearly 1 percent from last year on the back of declining nickel prices, but was able to cut costs by 6.5 percent to $165 million.

Vale also recorded $376,000 in finance income this year, nearly triple the $127,000 it made last year.

“In the first quarter of 2015, we continued to witness further nickel price decline from levels achieved in the fourth quarter in 2014,” Nico Kanter, the chief executive and president director of Vale Indonesia, said in a statement.

“Nevertheless, we decided to continue production and later in the quarter, we performed maintenance plans to benefit from the low nickel price environment.”

Coal miner Mitrabara Adiperdana reported far worse figures as the price of the fossil fuel continues to take a tumble. It reported a 13 percent drop in first-quarter profit to $6.3 million.

Although revenue grew 29 percent to $40.4 million, the cost of goods sold climbed 35 percent to $29 million, according to a listing on the stock exchange.

The company booked $1.7 million in selling expenses this year, which it did not spend in the same period last year.

Vale Indonesia’s shares fell 0.2 percent to Rp 2,795 in Jakarta on Thursday, while shares of Mitrabara Adiperdana remained unchanged at Rp 1,290.

The market was closed for trading on Friday, which was May Day, a public holiday.

Mining companies are among the top-five worst-performing stocks on the local bourse this year, falling by 12.5 percent.

Mining companies in Indonesia have struggled to maintain a positive performance amid low commodity prices globally, rising costs from increased electricity rates and wages, as well as a widely panned government ban on raw mineral ore exports that was implemented at the start of 2014.

GlobeAsia

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Source: The Jakarta Globe