Mexican silver miner Fresnillo (FRES) will report its financial results for 2013 on Tuesday, having already pre-announced its production figures. Those surprised to the upside but the income statement is still unlikely to be pretty, at least in comparison with prior-year figures. Precious metals prices fell year-on-year for the first time in over a decade, with gold ending the year down by a quarter and silver by a third.
As a result, analyst Anna Mulholland from Deutsche Bank expects Fresnillo’s cash profits from mining operations to have halved to $747m in 2013 from $1.3bn (£0.8bn) in 2012. The good news is that Fresnillo’s cost of production remains very low compared with peers while output is also on the rise: full-year silver production climbed 4.3 per cent year-on-year and came in ahead of guidance at 42.7m ounces.
