Ivanhoe Mines reports record profit for Q2 2022 as Kamoa-Kakula sets new copper production record
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(Kitco News) - Ivanhoe Mines (TSX: IVN) yesterday reported record profit of $351.5 million for Q2 2022 compared to a loss of $108.6 million for the same period in 2021.
The company also said it recorded a total comprehensive income of $340.9 million for Q2 2022 compared to a total comprehensive loss of $95.7 million for the same period in 2021.
Ivanhoe explained that the profit for the period principally relates to the company's share of profit from the Kamoa Holding joint venture, the gain on fair valuation of embedded derivative liability and the recognition of the deferred tax asset relating to the Kipushi project.
The company noted that its share of profit from the Kamoa Holding joint venture was $49.7 million in Q2 2022 compared to a loss of $10.0 million in Q2 2021.
Importantly, Ivanhoe said Kamoa-Kakula set a new quarterly production record during the period, with 87,314 tonnes of copper in concentrate produced, adding that Kamoa sold record 85,794 tonnes of payable copper and recognized revenue of $494.1 million in Q2 2022.
More importantly, the company pointed out that after the end of Q2, Kamoa Copper set another new monthly production record, with 32,877 tonnes of copper produced in July, equivalent to an annualized production rate of 387,100 tonnes.
Ivanhoe's management expects that with the early commissioning of the Phase 2 concentrator plant, Kamoa-Kakula will be able to deliver the upper end of its original 2022 copper production guidance of 290,000 to 340,000 tonnes. As a result, Ivanhoe Mines increases its 2022 production guidance range for Kamoa-Kakula to between 310,000 and 340,000 tonnes of copper in concentrate.
The company added it has a strong balance sheet with cash and cash equivalents of $507.1 million as at June 30, 2022, and expects that Kamoa Copper's operating and expansion capital expenditures on Phase 3 will be funded from copper sales and facilities at Kamoa-Kakula.
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Ivanhoe Mines is a Canadian mining company developing and expanding its four principal mining and exploration projects in Southern Africa: the Kamoa-Kakula Mining Complex in the Democratic Republic of Congo (DRC), which commenced commercial production in July 2021; the Platreef palladium, rhodium, nickel, platinum, copper and gold discovery in South Africa; the historic Kipushi zinc-copper-lead-germanium mine in the DRC; and the expansive exploration program for new copper discoveries on Ivanhoe's Western Foreland exploration licences, near Kamoa-Kakula.
The company indicated that the Kamoa-Kakula Mining Complex, operated as the Kamoa Copper joint venture between Ivanhoe Mines and Zijin Mining, has been independently ranked as the world's fourth-largest copper deposit by international mining consultant Wood Mackenzie.
Ivanhoe and Zijin Mining each hold an indirect 39.6% interest in Kamoa-Kakula, Crystal River holds an indirect 0.8% interest, and the DRC government holds a direct 20% interest.