Buenaventura Announces First Quarter 2024 Results for Production and Volume Sold per Metal

Rhea-AI Summary

Buenaventura, Peru's largest publicly-traded precious metals mining company, announced its 1Q24 results for production and volume sold. The company provided detailed figures for gold, silver, lead, zinc, and copper production across its various operations.

Insights

Financial Analyst

Reviewing Buenaventura's production figures for the first quarter of 2024, we see a snapshot of the company's operational efficiency and resource management. The total direct operations in gold production, for instance, came in at 36,495 ounces, which we must benchmark against the full-year guidance of 122.8k to 137.2k ounces. This represents approximately 29% of the lower end of the guidance, indicating a strong start to the year. Similarly, the silver production performance shows a total of 3,070,773 ounces, positioning the company to potentially meet or exceed the annual forecast.

When it comes to base metals like lead and zinc, the production figures are also telling. For lead, production is in line to meet the annual guidance, assuming a steady production throughout the rest of the year. However, for zinc, with 8,814 metric tons produced out of a guidance of 24.1k to 26.9k metric tons, there might be concerns about meeting annual targets unless production ramps up in subsequent quarters. Copper, a key industrial metal, shows a strong production output, which could be an indicator of robust demand and favorable market conditions.

Investors should consider these production numbers in light of global commodity prices, geopolitical factors and mining sector trends, as they will influence revenues and, by extension, the stock performance of Buenaventura. Any significant variance from projected volumes, especially in gold and silver, which are key drivers of Buenaventura's revenue, should be a focal point for shareholders' assessments of the company's performance.

Mining Sector Analyst

Delving into Buenaventura's operational performance provides insight into the company's strategic positioning within the mining sector. The production numbers reflect not only the output efficiency but also the resource quality and mine life expectancy. It's important to note that, for the precious metals industry, maintaining consistent production levels is critical due to the high fixed costs associated with mining operations.

Furthermore, investors should be aware of the sustainability and environmental challenges that the mining industry faces. These challenges can impact operational costs and regulatory compliance. For example, stricter environmental regulations can lead to increased costs or even production halts. Buenaventura's ability to effectively manage these aspects can significantly affect its long-term profitability and stock valuation.

Assessing the company's exploration efforts and reserves replacement is important for understanding its long-term outlook. A company that is not replacing its mined reserves could be facing a diminishing production profile, which would be a red flag for investors looking at long-term growth. Buenaventura's current production performance and future projections may offer some reassurance, yet the details of reserve replacement rates and the success of exploration activities should be considered for a comprehensive analysis.

LIMA, Peru--(BUSINESS WIRE)-- Compañía de Minas Buenaventura S.A.A. (“Buenaventura” or “the Company”) (NYSE: BVN; Lima Stock Exchange: BUE.LM), Peru’s largest publicly-traded precious metals mining company, today announced 1Q24 results for production and volume sold.

Production per Metal

		Three Months Ended March 31, 2024		2024 Guidance (1)
Gold ounces produced
El Brocal		6,675		17.0k - 20.0k
Orcopampa		19,026		70.0k - 75.0k
Tambomayo		9,124		28.0k - 32.0k
Julcani		281		2.8k - 3.2k
La Zanja		1,390		5.0k - 7.0k
Total Direct Operations (2)		36,495		122.8k - 137.2k
Coimolache		22,795		38.0k - 43.0k
Total incl. Associated (3)		43,060		131.5k - 146.7k
Silver ounces produced
El Brocal		873,021		1.4M - 1.7M
Uchucchacua		507,052		2.2M - 2.5M
Yumpag (4)		964,996		6.5M - 7.2M
Orcopampa		7,988		-
Tambomayo		329,066		1.7M - 1.9M
Julcani		386,340		1.7M - 1.9M
La Zanja		2,311		-
Total Direct Operations (2)		3,070,773		13.5M - 15.2M
Coimolache		103,958		0.1M - 0.2M
Total incl. Associated (3)		2,775,730		13.0M - 14.6M
Lead metric tons produced
Uchucchacua		3,910		13.0k - 15.0k
Tambomayo		1,028		2.4k - 2.7k
Julcani		249		0.9k - 1.0k
Total Direct Operations (2)		5,187		16.3k - 18.7k
Zinc metric tons produced
El Brocal		1,985		3.1k - 3.5k
Uchucchacua		5,494		17.0k - 19.0k
Tambomayo		1,335		4.0k - 4.4k
Total Direct Operations (2)		8,814		24.1k - 26.9k
Copper metric tons produced
El Brocal		15,441		55.0k - 60.0k
Total Direct Operations (2)		15,441		55.0k - 60.0k

1. 2024 projections are considered to be forward-looking statements and represent management’s good faith estimates or expectations of future production results as of April 2024.
2. Considers 100% of Buenaventura’s operating units, 100% of La Zanja and 100% of El Brocal.
3. Considers 100% of Buenaventura’s operating units, 100% of La Zanja, 61.43% of El Brocal and 40.094% of Coimolache.
4. Considers ore from the pilot stope approved within Yumpag EIA-sd

Volume Sold per Metal

	Three Months Ended March 31, 2024
Gold ounces sold
El Brocal	4,572
Orcopampa	18,831
Tambomayo	8,444
Julcani	325
La Zanja	1,413
Total Direct Operations (1)	33,585
Coimolache	21,701
Total incl. Associated (2)	40,523
Silver ounces sold
El Brocal	740,867
Uchucchacua	436,313
Yumpag (3)	1,104,128
Orcopampa	7,912
Tambomayo	289,380
Julcani	383,373
La Zanja	6,052
Total Direct Operations (1)	2,968,025
Coimolache	97,891
Total incl. Associated (2)	2,721,521
Lead metric tons sold
El Brocal	72
Uchucchacua	3,489
Tambomayo	916
Julcani	230
Total Direct Operations (1)	4,707
Zinc metric tons sold
El Brocal	1,592
Uchucchacua	4,535
Tambomayo	1,067
Total Direct Operations (1)	7,194
Copper metric tons sold
El Brocal	14,566
Julcani	22
Total Direct Operations (1)	14,588

1. Considers 100% of Buenaventura’s operating units, 100% of La Zanja and 100% of El Brocal.
2. Considers 100% of Buenaventura’s operating units, 100% of La Zanja, 61.43% of El Brocal and 40.094% of Coimolache.
3. Considers ore from the pilot stope approved within the Yumpag EIA-sd

Average realized prices⁽¹⁾⁽²⁾

	Three Months Ended March 31, 2024
Gold (US$/Oz)	2,111
Silver (US$/Oz)	23.44
Lead (US$/MT)	2,012
Zinc (US$/MT)	2,336
Copper (US$/MT)	8,258

1. Considers Buenaventura consolidated figures.
2. Realized prices include both provisional sales and final adjustments for price changes.

Commentary on Operations

Tambomayo:

• Gold, lead and zinc production exceeded 1Q24 projections due to a change in mining sequence, prioritizing higher-margin prepared areas with higher gold, lead and zinc grades, partially offset by lower silver production.

Orcopampa:

• 1Q24 gold production was in line with expectations.

Coimolache:

• 1Q24 gold production was in line with expectations. Environmental permitting delays reduced available space on the leach pads, adversely impacting the volume of fresh ore which could be placed on the pad, as was previously announced.
• Silver production exceeded 1Q24 projections due to higher grade silver ore processed from the Tantahuatay NW-Ext, which was placed on the leach pad during 4Q23.

Julcani:

• Silver and lead production was in line with expectations for 1Q24.

Uchucchacua:

• Silver, lead and zinc in line with expectations for 1Q24.
• Uchucchacua production increased to an average 1,000 tpd during 1Q24 from 800 tpd reported during the 4Q23, aligned with the Company’s plan to reach 1,500 tpd by the end of 2024.

Yumpag:

• In January 2024, Yumpag successfully completed processing 124,600 tonnes of ore from its pilot stope.
• Yumpag received final operating permitting approval on March 18, 2024, enabling uninterrupted mining of up to 1,000 tons per day.
• Silver production exceeded 1Q24 projections as ore processing was initiated earlier than expected due to the operating permit approval. Processing had previously been expected to start during the 2Q24.

El Brocal:

• Copper production was in line with expectations for 1Q24.
• Silver production exceeded 1Q24 projections due to higher than anticipated grades from the open pit’s remaining stockpiled inventories. This was partially offset by lower than anticipated zinc grades during the quarter.
• As was previously reported, El Brocal’s lead and zinc open pit mine has been placed under care and maintenance for up to three years until the Company receives the approval of the mine’s Modification of Environmental Impact Assessment.
• El Brocal’s 1Q24 underground mine exploitation rate reached 10,500 tpd, in line with the Company’s target to reach 11,000 tpd by the end of 2024.

Company Description

Compañía de Minas Buenaventura S.A.A. is Peru’s largest, publicly traded precious and base metals Company and a major holder of mining rights in Peru. The Company is engaged in the exploration, mining development, processing and trade of gold, silver and other base metals via wholly-owned mines and through its participation in joint venture projects. Buenaventura currently operates several mines in Peru (Orcopampa*, Uchucchacua*, Julcani*, Tambomayo*, La Zanja*, El Brocal and Coimolache).

The Company owns 19.58% of Sociedad Minera Cerro Verde, an important Peruvian copper producer (a partnership with Freeport-McMorRan Inc. and Sumitomo Corporation).

(*) Operations wholly owned by Buenaventura.

Note on Forward-Looking Statements

This press release may contain forward-looking information (as defined in the U.S. Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties, including those concerning Cerro Verde’s costs and expenses, results of exploration, the continued improving efficiency of operations, prevailing market prices of gold, silver, copper and other metals mined, the success of joint ventures, estimates of future explorations, development and production, subsidiaries’ plans for capital expenditures, estimates of reserves and Peruvian political, economic, social and legal developments. These forward-looking statements reflect the Company’s view with respect to Cerro Verde’s future financial performance. Actual results could differ materially from those projected in the forward-looking statements as a result of a variety of factors discussed elsewhere in this Press Release.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240416802844/en/

Contacts in Lima:

Daniel Dominguez, Chief Financial Officer

+51 1 419 2540

Gabriel Salas, Head of Investor Relations

+51 1 419 2591

gabriel.salas@buenaventura.pe

Contact in NY:

Barbara Cano, InspIR Group

+1 646 452 2334

barbara@inspirgroup.com

Source: Compañía de Minas Buenaventura S.A.A.

FAQ

How many gold ounces were produced at El Brocal in 1Q24?

6,675 gold ounces were produced at El Brocal in the first quarter of 2024.

What is the 2024 production guidance for silver ounces at Uchucchacua?

The 2024 production guidance for silver ounces at Uchucchacua is 2.2M - 2.5M.

How many metric tons of lead were produced at Julcani in 1Q24?

Julcani produced 249 metric tons of lead in the first quarter of 2024.

What is the total copper production projection for 2024?

The total copper production projection for 2024 is 55.0k - 60.0k metric tons.

Which metal had the highest production volume in 1Q24?

Silver had the highest production volume in the first quarter of 2024, with 3,070,773 ounces produced.

What is the total zinc production projection for 2024?

The total zinc production projection for 2024 is 24.1k - 26.9k metric tons.