Copper miner Antofagasta (ANTO) says its operations in Chile have not yet been impacted by Covid-19, but will aim to cut spending this year to cope with the crisis.
The copper price is down to $5,210 (£4,252) a tonne (t), or $2.36 per pound (lb), its lowest point in three years. Antofagasta was forecasting a capital spend of $1.3bn to $1.5bn in 2020, but the company is now aiming to cut this through savings or deferrals.
Chief executive Iván Arriagada was bullish about the copper price. “We expect that when the global impact of the virus diminishes, combined with the stimulus by the Chinese and other governments, which is developing strongly at the moment, the market will experience a quick recovery,” he said.
Net production costs last year were $1.22/lb, with the high gold and silver price influential in the 5 per cent year-on-year drop alongside operational savings. Antofagasta kept its dividend payout steady at 67 per cent of net earnings, although a $42m decline in net earnings meant the final dividend came down almost a quarter to 34.1ȼ. This was well above the consensus estimate of 27ȼ, however.
Broker Peel Hunt sees cash profits (Ebitda) increasing 6 per cent this year to $2.4bn.
| ANTOFAGASTA (ANTO) | ||||
| ORD PRICE: | 694p | MARKET VALUE: | £6.1bn | |
| TOUCH: | 693-694p | 12-MONTH HIGH: | 1,026p | LOW: 575p |
| DIVIDEND YIELD: | 4.1% | PE RATIO: | 16 | |
| NET ASSET VALUE: | 750ȼ | NET DEBT: | 6%* | |
| Year to 31 Dec | Turnover ($bn) | Pre-tax profit ($bn) | Earnings per share (ȼ) | Dividend per share (ȼ) |
| 2015 | 3.23 | 0.24 | -0.5 | 3.10 |
| 2016 | 3.62 | 0.28 | 12.1 | 18.4 |
| 2017 | 4.75 | 1.83 | 76.1 | 50.9 |
| 2018 | 4.73 | 1.25 | 51.5 | 43.8 |
| 2019 | 4.96 | 1.35 | 50.9 | 34.1 |
| % change | +5 | +8 | -1 | -22 |
| Ex-div: | 23 Apr | |||
| Payment: | 22 May | |||
| £1=$1.21 *Includes lease liabilities of $244m | ||||
