Antofagasta (LSE: ANTO) reported an 11% year-on-year decline in copper production for the first quarter, citing lower ore grades and increased ore hardness at its Centinela mine in Chile. The company left its annual copper production guidance unchanged, targeting 670,000 to 710,000 tonnes.
The lower first-quarter copper output of 129,400 tonnes was attributed to the anticipated lower grades and elevated ore hardness at Centinela, in line with the mine plan. Maintenance and cleaning activities at Los Pelambres delayed concentrate transportation to port facilities.
Gold output saw a 21% dip, a consequence of expected lower gold grades at Centinela and the delay in moving material through the Los Pelambres concentrate pipeline.
Molybdenum production rose 8%, thanks to higher output at Los Pelambres, unaffected by the recent maintenance work as transportation occurs via road.
Antofagasta expects quarterly copper production to increase throughout the year. Cash cost guidance, before and after by-product credits, remains at $2.25 per pound and $1.60 per pound, respectively. Capital expenditure guidance is maintained at $2.7 billion.
In Q1, cash costs before by-product credits stood at $2.67 per pound, up 7% year-on-year due to lower production volumes at Centinela and Los Pelambres, offset by lower unit costs and Chilean peso depreciation.
Net cash costs climbed 25% to $1.93 per pound, reflecting lower production volumes and reduced by-product credits.
Antofagasta’s shares were up 1% on Wednesday morning, having gained 35% year-to-date.
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