Antofagasta earnings expand in third quarter despite cost climb

14th Nov 2013 07:14

- EBITDA up 57 per cent in Q3- EBITDA down 28 per cent YTD- Costs up 34 per centCopper production growth slowed at Chilean mining giant Antofagasta in the third quarter, although earnings improved month-on-month.The FTSE 100 group's revenue in the nine months to September 30th was down 9.2% year-on-year to $4.4bn, improving from 12% decline recorded in the first half-year.Chile-based Antofagasta said the decrease in revenue mainly reflected the impact of lower realised copper, gold and molybdenum prices and lower molybdenum volumes, partly offset by increased copper and gold volumes in the period.Earnings before interest, tax, depreciation and amortisation (known as EBITDA) were $777m compared to $494 in the second quarter, but are down 27.9% year-on-year to $2.05bn, hit by higher costs reflecting increased volumes and higher unit costs.Net cash costs were up by a third partly due to lower by-product credits at its Los Pelambres and Esperanza mines. The realised copper price in the period decreased from $3.74 per lb to $3.26/lb year-on-year, lower than the market price due to the decrease in the copper price in 2013, resulting in negative provisional pricing adjustments of $141.5m from the settlement of provisionally priced invoices, which were closed out during the period.Copper production in the year to date was up 4.4% to 583,300 tonnes, slowing from the 8.4% growth in the first half. Sales volumes were slightly lower than production volumes due to shipping and loading schedules. The company, which revealed net cash of $1.6bn, informed that this would be its last third quarter report as from 2014, first and third quarter financial reports will no longer be prepared, with production reports used for the purposes of the UK Listing Authority's disclosure and transparency rules.OH