PROFIT & LOSS

Cobre Panama costs increase but First Quantum achieves record copper production

Miner also reports positive developments in Zambia and Spain but reduced earnings

Staff reporter
 The Cobre Panama development is expected to achieve commercial production this quarter

The Cobre Panama development is expected to achieve commercial production this quarter

The company said the increased project capital was due to higher costs associated with construction completion and commissioning "to further mitigate risks associated with and to accelerate the ramp-up of this large-scale project".

First Quantum also said it had achieved record quarterly copper production to June 30, reached a tax settlement in Zambia and resumed normal mining at Las Cruces in Spain but reported reduced earnings.

It said its production for the June period of 168,399t of copper, including 30,896t of pre-commercial production from Cobre Panama, was a quarterly record and 12% higher than the previous corresponding period.

All-in sustaining costs were reported as $1.77 per pound.

It did not specify the amount but said it had reached a settlement with the Zambia Revenue Authority over a $7.6 billion bill received in March 2018 over an assessment for import duties.

"The settlement amount agreed was in line with the company's previously disclosed expectations and no further provision is required," First Quantum Minerals said.

It had said last year based on the work undertaken to date, the final value of the claim was "not expected to be material".

The company received regulatory approvals and had resumed "normal mining activities" on July 11 at Las Cruces, where mining was suspended in January due to a land slippage.

First Quantum reported net earnings of $78 million or 11c per share, down from $135 million and 20c/share a year earlier.

Its gross profit was down from $271 million to $196 million.

The company ended the quarter with $802 million in net unrestricted cash and equivalents and declared an interim dividend of C0.5c per share.

Its shares, which have ranged from $20.63-$9.45 over the past year, closed down 2.16% to $12.24 to capitalise it at $8.4 billion (US$6.4 billion).

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining Journal Intelligence team.

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining Journal Intelligence team.

editions

ESG Mining Company Index: Benchmarking the Future of Sustainable Mining

The ESG Mining Company Index report provides an in-depth evaluation of ESG performance of 61 of the world's largest mining companies. Using a robust framework, it assesses each company across 9 meticulously weighted indicators within 6 essential pillars.

editions

Mining Journal Intelligence Global Leadership Report 2024: Net Zero

Gain insights into decarbonisation trends and strategies from interviews with 20+ top mining executives and experts plus an industrywide survey.

editions

Mining Journal Intelligence Project Pipeline Handbook 2024

View our 50 top mining projects, handpicked using a unique, objective selection process from a database of 450+ global assets.

editions

Mining Journal Intelligence Investor Sentiment Report 2024

Survey revealing the plans, priorities, and preferences of 120+ mining investors and their expectations for the sector in 2024.