H1 Results22 Aug 2019 08:55
Financial performance
· Revenue up 19.1% to $2,525.6 million as higher copper sales volumes and by-product revenues were partially offset by a 6.3% lower realised copper price
· EBITDA for the first six months of the year was $1,305.9 million, 44.0% higher than in the first half of 2018
· EBITDA margin of 51.7%, increased from 42.6% during same period last year as unit production costs decreased
· Cost and Competitiveness Programme achieved savings of $61 million in the first half of 2019, equivalent to 7c/lb of unit cash costs
· Cash flow from operations of $1,514.5 million, 70% higher than in the same period last year predominantly due to higher EBITDA
· Capital expenditure of $465.5 million, 38.8% of full year guidance
· Net debt decreased by $78.9 million to $517.4 million during the period, representing a Net Debt to EBITDA ratio of 0.20 times on higher cash flow from operations despite a drawdown of $198.0 million of the Los Pelambres Expansion debt facility, the $131.3 million initial impact of the adoption of IFRS 16, the payment of an increased final dividend and higher taxes
· Earnings per share of 30.7 cents, a 55.1% increase on the same period in 2018
· Interim dividend of 10.7 cents per share, equivalent to a payout ratio of 35% of Net Earnings. An increase of 57.4% on last year's interim
Operating performance
· The Group had no fatalities during the period
· Group copper production increased by 22.2% to 387,300 tonnes, with higher production at all of the Group's operations
· Group cash costs before by-product credits for the half year were $1.66/lb, down from $1.92/lb in the same period last year due to gains arising from the Cost and Competiveness Programme, higher production and a weaker Chilean peso
· Group net cash costs of $1.19/lb, a decrease of 21.7% from $1.52/lb in the same period in 2018, on lower cash costs before by-product credits and higher by-product revenues
· Construction of the Los Pelambres Expansion project has started on-site and project completion (engineering, procurement and construction) was at 22% as of the end of June. Capital expenditure in the first six months of 2019 was $77.6 million. The rate of expenditure is expected to accelerate in the second half of the year as the project advances
Guidance
· As previously reported, Group copper production guidance for the full year is unchanged at 750-790,000 tonnes and net cash cost guidance has been reduced by 5c/lb to $1.25/lb, assuming by-product prices and the Chilean peso exchange rate remain at similar levels to the first half of the year
· Capital expenditure guidance for the full year is unchanged at $1.2 billion
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