MDKA - Net profit turnaround to US$ 26.4 mn in 3Q23

MDKA - Net profit turnaround to US$ 26.4 mn in 3Q23 Merdeka Copper Gold (MDKA) booked USD26.4 mn of net profit in 3Q23, a turnaround from losses in 2Q23. This was mainly attributed from the higher production and lower cash cost of NPI due to the higher utilization of ZHN's RKEF plant. Additionally, a USD35.4 mn reversal of final tax provisions further contributed to the improved financial performance. Despite the profit turnaround in 3Q23, MDKA still recorded a net loss of USD23.77 mn in 9M23. (Source: IDX, Company) Comment: While the positive results are encouraging, the reversal of final tax provision is not a sustainable contributor. Moving forward, the higher volume of nickel ore sales starting in 4Q23 presents more upside for revenue growth. However, the declining nickel price will pose a significant challenge for MDKA.