(Kitco News) - First Quantum (TSX: FM) today reported that its total copper production for Q3 2022 was 194,974 tonnes, up from the 192,668 tonnes in Q2 2022 (Q3 2021: 209,859 tonnes) as Sentinel achieved strong production, while production at Kansanshi was impacted by lower grades and recoveries during the quarter.
In Q3 2022, the company also produced 67,417 ounces of gold, down from the 74,959 ounces in Q2 2022 (Q3 2021: 78,124 ounces) and 5,849 tonnes of nickel, up from the 4,853 tonnes in Q2 2022 (Q3 2021: 4,248 tonnes).
First Quantum said that its total copper production guidance for 2022 has been lowered from 790,000 – 855,000 tonnes to 755,000 – 785,000 tonnes, mainly attributable to lower production at Kansanshi.
The company’s copper cash cost averaged $1.82 per lb in Q3 2022, up from $1.74 per lb in Q2 2022 as a result of broad cost inflation that was partially mitigated by an improvement in production volumes. Copper AISC cost averaged $2.34 per lb in Q3 2022, down from $2.37 per lb in Q2 2022.
The company added that its copper C1 cash cost guidance range for 2022 has increased from $1.45 – $1.60 per lb to a range of $1.70 – $1.80 per lb, primarily due to lower production at the Zambian operations and broad cost inflation. The copper AISC cost guidance range has increased to $2.35 – $2.45 per lb.
First Quantum also noted that its financial results for the third quarter include net earnings attributable to shareholders of the company of $113 million ($0.16 net earnings per share) and adjusted earnings of $96 million ($0.14 adjusted earnings per share), a decrease from Q2 2022 which had net earnings attributable to shareholders of the company of $419 million ($0.61 net earnings per share) and adjusted earnings of $337 million ($0.49 adjusted earnings per share).
The company explained that these decreases are attributable to a lower realized copper and gold price and cost inflation, partially mitigated by higher copper sales volumes.
“It is pleasing to see that the focus on operational improvements has resulted in strong production from Cobre Panama and Sentinel in the quarter. However, the headwinds from recessionary concerns and broad cost inflation have led to substantial margin compression across the industry. In the longer term, we continue to see structural upside in our markets from the ongoing challenges of bringing on new copper supply. We are well positioned to navigate the current period of challenging macroeconomic conditions,” commented CEO Tristan Pascall. “We remain focused on driving productivity and cost improvements at our operations, managing capital expenditures prudently, and exercising financial discipline.”
First Quantum is one of the world’s top 10 copper producers, exporting millions of tonnes of concentrate from multiple countries to customers worldwide. The company produces copper in the form of concentrate, cathode and anode, and has inventories of nickel, gold and cobalt.
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