Last checked at 28 May 2010 07:00
Fresnillo Plc
28 Grosvenor Street
London W1K 4QR
United Kingdom
www.fresnilloplc.com
28 May 2010
Annual General Meeting Statement
Fresnillo plc will hold its Annual General Meeting today at 11.30 am in London, and Mr Alberto Baillères, Chairman, will make the following comment:
"It is a privilege to be able to report that Fresnillo delivered another year of strong performance in 2009. We continued to build on the commitments that we made at the time of our initial public offering in 2008, despite very volatile global markets and a sharp recession in many western economies.
Silver production reached record levels, rising 8.8% over 2008 to 37.9 million ounces. At the same time a number of cost reduction and efficiency projects were completed, and progress at our exploration and development sites was on target.
The result was an 18 per cent increase in total revenues to US$849.9 million, while net profit rose 140 per cent to US$308 million.
Since the end of the year, we have further emphasised our leadership position with the start-up of operations at Soledad-Dipolos. This is just the latest milestone in our sustainable growth plan.
The current year has also started well. Gold production in the first quarter exceeded our expectations, due to the better than expected initial operating results at Soledad-Dipolos. Silver production has also increased. Work has continued at our development project at Saucito during the period and the progress we have made has been encouraging. Meanwhile, the exploration programme at Noche Buena has been completed. We are now carrying out a calculation of reserves and we will shortly launch a pre-feasibility study.
We are also pleased to be able to announce that we have reached agreement with union representatives at our operating mines regarding the revision of the labour contract for 2010.
On another matter, we have invested almost US$3 million in community development projects which reflects our commitment to sustainability and corporate responsibility.
We continue to operate to the highest international environmental standards and work to protect biodiversity. In 2009 Fresnillo plc became a founding member of the Corporate Commitment to Wilderness. This is an initiative of the WILD Foundation, an international non-profit organisation dedicated to wilderness protection around the world. The Company also endorsed the Copenhagen Communiqué, an initiative of the Prince of Wales' Corporate Leaders Group on Climate Change.
So far this year, precious metals prices have been stronger than expected. This is in part due to the ongoing global financial crisis and the concern over the fiscal position of many countries. But while the markets on which we depend have been favourable so far, this has been partially offset by rising energy costs and the strengthening of the Mexican peso which increases our costs when they are translated into dollars. Nevertheless, our strong operational position means we remain confident of achieving another successful year for Fresnillo plc.
In summary, we achieved success last year across all our activities and the current year has also started well. I would like to thank all our workers and employees, our management team and the Board of Directors for the excellent performance they continue to deliver. In their hands we can be confident of another successful year for your company.
ENDS
For further information, please visit our website, www.fresnilloplc.com or contact:
Fresnillo plc
London Office, Tel: +44 (0)20 7399 2470
Octavio Alvidrez, Head of Investor Relations
Mexico City Office, Tel: +52 55 52 79 3203
Gabriela Mayor
JPMorgan Cazenove Tel: +44 (0)20 7588 2828
Ian Hannam
Andrew Wray
Brunswick Tel: +44 (0)20 7404 5959
Carole Cable
David Litterick
About Fresnillo plc
Fresnillo Plc is the world's largest primary silver producer and Mexico's second largest gold producer, listed on the London Stock Exchange under the symbol FRES.
Fresnillo has four producing mines, all of them in Mexico - Fresnillo, Ciénega, Herradura and Soledad-Dipolos; one development project - Saucito; and three exploration prospects - San Juan, San Julian, Orysivo, as well as a number of other long term exploration prospects and, in total, has mining concessions covering approximately 1.75 million hectares in Mexico.
Fresnillo has a strong and long tradition of mining, a proven track record of mining development and reserves replacement, and a low cost of production, being in the lowest quartile of the cost curve for both silver and gold.
Fresnillo's goal is to maintain the Group's position as the world's largest primary silver company, producing 65 million ounces of silver and over 400,000 ounces of gold by 2018.