Antofagasta share price: 2013 copper output hits record

iNVEZZ.com, Wednesday, January 29: Antofagasta plc (LON:ANTO) today reported a record year of copper production supported by a strong performance in the fourth quarter.

Antofagasta chief executive officer Diego Hernandez said in a statement that 2013 had been “a challenging year” in which the miner had to cope with a rise in costs as well as weaker commodity prices.
Antofagasta’s share price was up 4.87 percent at 862.56p as of 8:38 UTC, valuing the Chile-based copper miner at £8.5 billion. This compared with a 1.28 percent rise in the Basic Materials sector and a 0.92 percent advance in the benchmark FTSE 100 index.

The group produced 721,200 tonnes of copper last year, up 1.6 percent from 2012. Antofagasta had previously forecast that 2013 copper output would be 700,000 tonnes. Fourth-quarter output was up 4.9 percent from the previous quarter at 182,900 tonnes, which helped ensure that the company achieved its production and cash cost guidance for the year, Hernandez said.

Group gold production was 63,300 ounces in the fourth quarter, a 6.4 decrease on the previous quarter as a result of lower gold output at the Esperanza mine. Full-year gold production was 293,800 ounces, down two percent on 2012, reflecting lower production at the mine in northern Chile due to lower grades of ore, which was partially offset by increased throughput.

Molybdenum production fell to 9,000 tonnes last year, from 12,200 tonnes in 2012. The company attributed the 26.3 percent drop to “particularly high” molybdenum grades in 2012.

Cash costs before by-product credits last year were $1.79 per pound, compared with $1.63 per pound the previous year. Group net cash costs in 2013 came in at $1.36 per pound, up 32 percent on 2012. The company said the increase in cash costs was mainly due to higher mine movement costs at Esperanza, higher energy prices at the Los Pelambres mine and because by-product credits were impacted by lower production and realized prices of molybdenum and gold.

In 2014, production across Antofagasta’s three asset classes – copper, gold and Molybdenum – is forecast to fall this year.
Group production is expected to be approximately 700,000 tonnes of copper, 270,000 ounces of gold and 7,500 tonnes of molybdenum. Group cash costs before by-product credits are expected to remain stable at $1.80 per pound, while net cash costs are expected to be $1.45 per pound, similar to those in the second half of last year.
“This year we remain focused on controlling our cost base whilst achieving the most from our operations,” Hernandez said.
**As of 8:38 UTC buy Antofagasta shares at 863.00p.**
**As of 8:38 UTC sell Antofagasta shares at 862.00p.**
Trade stocks with Hargreaves Lansdown from £5.95 per deal.
Prices can go up and down meaning you can get back less than you invest. This is not advice. Dealing services provided by Hargreaves Lansdown.