Prominent Hill’s 2018 financial performance has given OZ Minerals further leeway to continue investing in its copper-focused growth strategy.
A strong 2018 performance from OZ Minerals’ (ASX:OZL) Prominent Hill asset in South Australia has given the company further leeway to continue investing in its copper-focused growth strategy.
On Wednesday (February 27), the company released its annual and sustainability report for 2018, which detailed the company’s after-tax net profit of $222 million on revenue of $1.1 billion. According to OZ Chief Executive Andrew Cole, operating cash flows of $450 million were up 31 percent from the previous year, while the company’s cash flow now sits at $505 million.
“2018 marked a step-change for OZ Minerals as the consistent performance from Prominent Hill supported the development of our asset base,” Cole said in a statement.
“The Carrapateena copper-gold project in South Australia is now in peak construction; the West Musgrave copper-nickel project in Western Australia is advancing through its prefeasibility study; new copper and gold assets were acquired in Brazil and we grew our exploration pipeline.”
Prominent Hill exceeded copper and gold production guidance last year, reaching 110,111 tonnes of copper and 130,856 ounces of gold, while its operating costs were below their guided ranges. Additionally, the copper-gold mine had its lifespan extended to 2030 with a 50 percent increase to its proved underground ore reserves.
“The 2018 financial performance provides a quality foundation for delivering our growth plans in 2019, anchored on our province approach to maximizing the potential of our assets,” Cole added.
Going forward, the company intends to focus on ramping up Prominent Hill’s underground operations to 3.7 to 4 million tonnes and exploring further underground expansion options. Additionally, plans are underway to optimize and prioritize the company’s newly acquired Brazilian assets through expanding exploration efforts.
Copper prices saw a small drop on Wednesday, clocking in a 0.23 percent drop at US$6,510 per ton as of 3:18 a.m. EST.
OZ’s share price was down 0.93 percent on the ASX at the end of trading on Wednesday, closing the day at AU$10.61 per stock.
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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.