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Antofagasta's momentum to continue

Copper mining is currently very profitable, but Antofagasta will need to reassure investors it can avoid industrial action in 2017
March 9, 2017

Helped along by lower unit costs and a surging copper price at the end of 2016, Antofagasta (ANTO) is expected to show a leap in earnings when the Chilean miner opens its books next week. Then again, higher output prices are never a one-way street for miners vulnerable to the threats of well-timed industrial action. Already this year, Chile has witnessed a stand-off between labour and management at BHP Billiton's (BHP) Escondida mine. That's located in the same state as Antofagasta's Zaldivar project, where wage talks are expected later this year.

IC TIP: Buy at 778p

Peel Hunt expects adjusted pre-tax profits of $1.06bn and EPS of 43¢ for 2016, and $1.02bn and 38¢ this year.