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Copper producer Antofagasta says its 2022 EBITDA down 39% on lower revenue and higher costs

Kitco News

(Kitco News) - Chile-focused mining company Antofagasta (LSE: ANTO), one of the world's senior copper producers, announced Tuesday that its revenue for the full year 2022 was $5,862 million, 22% lower than in 2021 reflecting a 12% decrease in copper sales and a 12% decrease in realized copper prices.

The company said that 2022 EBITDA was $2,930 million, 39% lower than the previous year on lower revenue and operating costs that increased by 10% mainly due to inflation and higher input prices, adding that profit before tax including exceptional items decreased by 26% to $2,559 million.

According to a company press release, underlying earnings per share from continuing operations and excluding exceptional items were 59.7 cents, 82.8 cents lower than in 2021, while earnings per share from continuing operations including exceptional items were 155.5 cents, 19% higher than in 2021.

The company reported exceptional gain of $945 million, following the completion of the definitive agreements for the company to exit its indirect interest in the Reko Diq project.

Antofagasta also announced that final dividend of 50.5 cents per share recommended, to be approved by shareholders at the AGM, bringing the total dividend for the year to 59.7 cents per share, equal to 100% of underlying earnings per share.

Previously, the company reported that its copper production for the full year 2022 was 646,200 tonnes, within guidance and 10.4% lower than last year.

Antofagasta said that lower copper production was mainly due to the temporary reduction in throughput (-12.0%) at Los Pelambres as a result of the drought and the reduced concentrate pipeline availability in June, and expected lower grades (-18.3%) at Centinela Concentrates.

Gold production for the full year was 176,800 ounces, within guidance and 29.9% lower than in the previous year as a result of the expected lower grades at Centinela.

For the full year, the company's molybdenum production was 9,700 tonnes, within guidance and 7.6% lower than in 2021 due to lower throughput and grades at Los Pelambres.

The company said that cash costs before by-product credits in 2022 were $2.19/lb, 22.3% higher than last year mainly due to the impact of the drought and higher input prices during the period, particularly for diesel and sulphuric acid.

Net cash costs for the full year were $1.61/lb, slightly below guidance and 34.2% higher than in 2021 due to higher cash costs before by-product credits, it added.

Importantly, the company said that total mineral resources increased by 921 million tonnes during the year, including a maiden inferred resource at Encierro of 522 million tonnes at 0.79% CuEq and an additional 100 million tonnes of inferred resources at Cachorro, both of which are in northern Chile

Group production in 2023 is expected to be 670-710,000 tonnes of copper (as previously announced), 220-240,000 ounces of gold and 10-11,500 tonnes of molybdenum.

Antofagasta operates four mines in Chile: Los Pelambres, Centinela, Antucoya and Zaldívar. All of the company's mines are open pit operations.

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