Fresnillo profit misses on weak output, mine curtailment
Precious metals miner Fresnillo posted a 63% slump in 2019 pretax profit on Tuesday, much worse than analysts' estimates, as low-grade ore hit production and it curtailed operations at its Noche Buena mine in Mexico.
The company cut its production forecast four times last year, as it grapples with lower quality ore and construction delays at its Herradura mine in Mexico.
Profits halved in the first half of 2019, forcing the Mexico-based gold and silver producer to rein in expenditure by cutting its capital investments and delaying renewals of equipment and infrastructure.
"2019 was a more challenging year as expected ...," CEO Octavio Alvídrez said in a statement.
The company's shares, which tumbled about 26% in 2019, slipped 1.5% to 610.6 pence in early trading.
Mexico's largest gold producer said profit before income tax for the year ended December 31 fell to $178.8-million from $483.9-million a year earlier, far behind analysts' estimates of $222.44-million according to Refinitiv IBES.
Gold output from the Noche Buena mine dropped 23.9% in 2019 as volumes of ore processed fell. The mine, which accounted for almost 18% of the group's total gold output in 2018, will be closed next year as it reaches its end of life.
The company, which operates six mines in Mexico, reaffirmed its 2020 production outlook for gold and silver.
Fresnillo last week said it expected to start production at its Mexican joint venture with Canada's MAG Silver earlier than anticipated this year.
Comments
Research Reports
Projects
Latest Multimedia
Latest News
Showroom
Education: Consulting with member companies to obtain the optimal benefits from their B-BBEE spending, skills resources as well as B-BBEE points
VISIT SHOWROOM
John Thompson, the leader in energy and environmental solutions through value engineering and innovation, provides the following: design, engineer,...
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
