Antofagasta, the UK-based mining giant, announced a significant uptick in revenue for the first half of the year, attributed largely to soaring copper prices and enhanced sales volumes of copper cathodes. In a robust financial performance, the mining company reported revenue totaling $2.96 billion for the first six months, marking a 2.3% increase year-over-year.
This growth was fueled by a remarkable 10.3% rise in the average realized copper price, which surged to $4.40 per pound. Notably, EBITDA rose to $1.39 billion, an increase from $1.33 billion recorded in the prior year, while cash flow from operations witnessed a striking 14.5% increase, culminating at $1.48 billion. However, despite these positive financial metrics, profit attributable to the company’s parent owners did experience a decline, falling to $259.6 million from $330.4 million the previous year.
This decrease can be largely attributed to escalating operating costs and increased income tax expenses that the company has been navigating. "Antofagasta demonstrated its resilience in the first half of the year, maintaining EBITDA margins while generating savings and productivity improvements amounting to $130 million.
Additionally, we are making significant strides with major projects that lay a solid foundation for future growth," stated Chief Executive Officer Iván Arriagada in the earnings release of the company. He added, "Importantly, our growth plan remains on track. The Centinela Second Concentrator is progressing ahead of schedule, and initial work has commenced on the new Los Pelambres projects." However, amidst these positive indicators, Antofagasta noted a decline in copper production, which decreased by 4% year-over-year to 284,700 tonnes during the first half.
This decline was influenced by reductions in production at Centinela concentrates offset by increased outputs from Centinela Cathodes and Los Pelambres. Looking forward, Antofagasta reaffirmed its full-year production guidance, expecting total production to remain at the lower end of the projected range of 670,000 to 710,000 tonnes. Market analysts responded positively to the results.
RBC Capital Markets indicated, "We anticipate a favorable market reaction to today's results, considering the positive earnings beat and the reaffirmation of our guidance. ANTO expects to achieve copper volumes towards the low end of its forecast, with an anticipated production increase of 35% in the latter half of the year, aided by the release of inventories from Los Pelambres and improvements in the grades from Centinela." Despite the overall positive outlook, Antofagasta's shares exhibited a slight decline during midday trading.
The trading price stood at $1882.50, reflecting a change of $+2.5, equivalent to a percent change of +0.13%. $ANTO.