Antofagasta Posts 34 Percent Drop in Revenue for 2015

Antofagasta Plc (LSE:ANTO) reported a 34 percent drop in revenues for 2015, coming in at $3,394.6 million. The company noted that realized copper prices fell nearly 24 percent during the period.
As quoted in the press release, highlights of the company’s financial performance included:

• Revenue 34.0% lower at $3,394.6 million, with realised copper prices falling almost 24% during the period and sales volumes down by 9.5%, following a challenging year for the Group.
• Operating cost savings of $245 million, higher than targeted reducing unit cash costs by 11c/lb and mining division operating costs by 8%.
• EBITDA from continuing operations fell 58.4% to $890.7 million, as revenues declined.
• Net earnings from continuing operations fell to $5.5 million, from $422.4 million following lower prices and, lower taxes and minority interests. Including the profit from the water division net earnings were $608.2 million.
• Consistent with the Group’s dividend policy, 35% minimum payout achieved. Given the 3.1 cents per share interim dividend and the minimum payout of full year earnings policy, the Board is not recommending a final dividend.
• Cash flow from operations decreased by 65.8% to $858.3 million, compared with $2,507.8 million in 2014.
• Capital expenditure for the year was $1,048.5 million, $591.8 million lower than in 2014 and some $250 million less than originally planned driven by savings identified to protect cash flow.
• Attributable net debt at the end of 2015 was $525.4 million from a net cash position of $315.4 million at the end of the previous year, following the acquisition of a 50% interest in the Zaldívar mine.

Antofagasta CEO, Diego Hernandez, said:

Each of our mines continued to generate cash flow at the operating level despite the exceptionally challenging operating environment. The year was one of change and the Group has emerged stronger, more focussed on its core business and operating at significantly lower costs.
During the year we started production at the Antucoya mine, sold the water division and purchased 50% of the Zaldívar copper mine while closing our oldest operation, Michilla. Now, in 2016 we expect our net cash costs to return to levels we have not seen since 2012. Combined with our healthy balance sheet we will be in a better position to weather the current market conditions.
We know that copper is a cyclical industry and as a result of the actions that we have taken over the past year we will be positioned to benefit from the recovery when it comes. In the meantime, our focus is on optimising our operations and projects under construction to cut costs and free-up cash flow whilst retaining the flexibility to accelerate investment for future growth if circumstances are appropriate.

Click here for the full press release.