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Lundin Mining reports record copper production in Q3, cuts attributable net loss

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(Kitco News) - Lundin Mining (TSX: LUN) announced Thursday that the company produced 89,942 tonnes of copper in Q3 2023, up 41% from Q3 2022 (63,930 tonnes) and a new quarterly record.

In Q3 2023, the company also produced 49,774 tonnes of zinc (Q3 2022: 40,327 tonnes), 4,290 tonnes of nickel (Q3 2022: 4,379 tonnes) and approximately 35,000 ounces of gold (Q3 2022: 45,000 ounces).

The company said it generated Q3 2023 revenue of $992.2 million (Q3 2022: $648.5 million), gross profit of $197.3 million (Q3 2022: $82.5 million) and adjusted EBITDA of $415.1 million (Q3 2022: $202.4 million).

According to Lundin, net loss attributable to shareholders of the company was $3.0 million or $0.00 per share in Q3 2023 (Q3 2022: net loss of $11.2 million), impacted by higher interest expense, non-cash unrealized losses on derivative contracts and increased deferred tax expense as a result of the enactment of the mining royalty law in Chile.

The company added that adjusted earnings attributable to shareholders of the company for the quarter of $85.6 million ($0.11 per share) were $49.5 million higher than the prior year quarter after adjusting for the non-cash revaluation of derivative contracts, fair value adjustments relating to the Caserones acquisition and deferred tax relating to the mining royalty rate change, among other things.

The company’s Q3 2023 free cash flow of $71.1 million was $234.3 million higher than the prior year comparable period and benefited from the inclusion of production from Caserones, combined with higher realized copper prices and higher overall changes in working capital.

Lundin said it completed the acquisition of 51% of the Caserones copper-molybdenum mine on July 13, 2023, “adding another long-life asset in a tier one jurisdiction.”

The company anticipates initial annual synergies from supply chain and service contracts between Caserones and Candelaria to be $20 million to $30 million per year.

"Our operations continued with a strong performance in the third quarter. As a result, we are increasing our production guidance for Caserones and Eagle. The acquisition of Caserones enabled us to achieve a new record in quarterly consolidated copper production, and we also achieved a record in quarterly zinc production. This led the company to an adjusted EBITDA of $415 million for the period," commented CEO Peter Rockandel.

“As we approach 2024, Lundin Mining is strategically, operationally, and financially, in a strong position to continue to deliver on our plans and execute on the next phase of growth,” he added.

Lundin Mining is a diversified Canadian base metals mining company with projects and operations in Argentina, Brazil, Chile, Portugal, Sweden and the United States of America, primarily producing copper, zinc, molybdenum, gold and nickel.

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