LIMA, Peru--(BUSINESS WIRE)--Compañia 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, announced today results for the second quarter 2012. All figures have been prepared in accordance with IFRS and are stated in U.S. dollars (US$).
Comments from the Chief Executive Officer:
Mr. Roque Benavides, Buenaventura’s Chief Executive Officer, stated:
“Net income in the second quarter was US$152.6 million, which was 23% lower than the figure reported in 2Q11 (US$197.6 million). EBITDA from Buenaventura’s Direct Operations was US$112.9 million, 38% lower than the figure reported in 2Q11 (US$182.5 million), while EBITDA including Affiliates decreased 16%, from US$406.3 million in 2Q11 to US$341.9 million in 2Q12.
These results were mainly explained by the higher cost of and exploration costs at non-operating mining sites.
|
Financial Highlights (in millions of US$, except EPS figures): |
||||||||||||||||||
| 2Q12 | 2Q11 | Var% | 6M12 | 6M11 | Var% | |||||||||||||
| Total Revenues | 350.5 | 343.3 | 2% | 727.5 | 719.0 | 1% | ||||||||||||
| Operating Income | 79.4 | 147.9 | -46% | 210.9 | 326.3 | -35% | ||||||||||||
|
EBITDA
(BVN Direct Operations)† |
112.9 | 182.5 | -38% | 284.0 | 390.9 | -27% | ||||||||||||
|
EBITDA
(inc. Affiliates) † |
341.9 | 406.3 | -16% | 755.0 | 804.3 | -6% | ||||||||||||
| Net Income | 152.6 | 197.6 | -23% | 360.0 | 422.3 | -15% | ||||||||||||
| EPS* | 0.60 | 0.78 | -23% | 1.41 | 1.66 | -15% | ||||||||||||
(*) As of June 30, 2012, Buenaventura had 254,442,328 shares outstanding.
† Within this release, Buenaventura presents financial measures in accordance with Peruvian GAAP, as well as on a non-GAAP basis. EBITDA (Buenaventura Direct Operations) and EBITDA (including Affiliates) included in this release are non-GAAP financial measures. Please see the consolidated financial information below for information reconciling non-GAAP financial measures with Peruvian GAAP financial measures.
Operating Revenue
During 2Q12, net sales were US$331.8 million, similar to the US$327.3 million reported in 2Q11. Higher silver, zinc and lead volume sold positively offset lower silver and base metal prices, as well as the decline in gold sales.
Royalty income increased 17%, from US$16.0 million reported in 2Q11 to US18.7 million in 2Q12 due to higher revenues at Yanacocha.
| Operating Highlights | 2Q12 | 2Q11 | Var% | 6M12 | 6M11 | Var% | ||||||||||||
|
Net Sales
(in millions of US$) |
331.8 | 327.3 | 1% | 690.7 | 690.8 | 0% | ||||||||||||
| Average Realized Gold Price Gold (US$/oz)* | 1,619 | 1,514 | 7% | 1,673 | 1,457 | 15% | ||||||||||||
| Average Realized Gold Price (US$/oz) inc. Yanacocha | 1,616 | 1,508 | 7% | 1,657 | 1,234 | 34% | ||||||||||||
| Average Realized Silver Price (US$/oz)* | 29.41 | 37.01 | -21% | 30.50 | 35.70 | -15% | ||||||||||||
| Average Realized Lead Price (US$/MT)* | 1,929 | 2,494 | -23% | 1,957 | 2,519 | -22% | ||||||||||||
|
Average Realized
Zinc Price (US$/MT)* |
1,922 | 2,260 | -15% | 1,963 | 2,320 | -15% | ||||||||||||
| Average Realized Copper Price (US$/MT)* | 7,828 | 9,103 | -14% | 8,253 | 9,334 | -12% |
(*) Buenaventura’s Direct Operations
| Sales Content | ||||||||||||||||||
| 2Q12 | 2Q11 | Var | 6M12 | 6M11 | Var | |||||||||||||
| Gold (in oz)* | 107,661 | 126,273 | -15% | 234,241 | 246,876 | -5% | ||||||||||||
| Gold (in oz) inc. Yanacocha | 274,290 | 275,387 | 0% | 554,571 | 519,413 | 7% | ||||||||||||
| Silver (in oz)* | 4,695,060 | 2,761,715 | 70% | 7,491,711 | 6,372,936 | 18% | ||||||||||||
| Lead (in MT)* | 9,471 | 4,560 | 108% | 11,589 | 7,307 | 59% | ||||||||||||
| Zinc (in MT)* | 14,449 | 8,198 | 76% | 22,381 | 16,133 | 39% | ||||||||||||
| Copper (in MT)* | 830 | 3,703 | -78% | 6,542 | 10,759 | -39% | ||||||||||||
(*) Buenaventura Direct Operations
Accumulated net sales in the first six-month period 2012 were US$690.7 million, in-line with the figure reported in the same period in 2011 (US$690.8 million), while royalty income was US$36.8 million, a 30% increase when compared to the US$28.2 million reported in 2011.
Production and Operating Costs
Buenaventura’s equity production1 in 2Q12 was 107,168 ounces of gold, 11% lower than the 120,641 ounces reported in 2Q11 mainly due to a decrease in Orcopampa and Poracota production. Silver production in 2Q12 was 4.5 million ounces, a 32% increase when compared to the figure reported in 2Q11 (3.4 million oz).
Equity production1 in the first six-month period 2012 was 225,022 ounces of gold and 8.5 million ounces of silver. This represented a 5% decrease in gold production (237,259 ounces in 2011), and 13% higher silver production compared to 2011 (7.5 million ounces).
| Equity Production 1 | ||||||||||||||||||
| 2Q12 | 2Q11 | Var% | 6M12 | 6M11 | Var% | |||||||||||||
| Gold (oz) | 107,168 | 120,641 | -11% | 225,022 | 237,259 | -5% | ||||||||||||
| Gold (oz) inc. Yanacocha | 277,394 | 269,778 | 3% | 555,191 | 512,202 | 8% | ||||||||||||
| Silver (oz) | 4,509,259 | 3,404,689 | 32% | 8,523,034 | 7,549,314 | 13% | ||||||||||||
| Lead ( MT) | 6,910 | 4,617 | 50% | 11,625 | 7,757 | 50% | ||||||||||||
| Zinc ( MT) | 11,842 | 6,164 | 92% | 19,245 | 8,772 | 119% | ||||||||||||
| Copper (MT) inc. Cerro Verde | 13,629 | 17,134 | -20% | 29,044 | 35,985 | -19% | ||||||||||||
1 Production includes 100% of Buenaventura’s operating units, 100% of CEDIMIN, 53.06% of La Zanja, 40.04% of Tantahuatay and 53.76% of El Brocal.
Orcopampa’s (100% owned by Buenaventura) production from the Chipmo mine in 2Q12 was 56,762 ounces, 18% lower than the 69,335 ounces reported in 2Q11 due to a 15-day strike and 15% lower ore grade (See Appendix 2). The old tailings treatment produced 3,984 gold ounces (compared to 5,876 ounces in 2Q11). As a consequence, total gold production in 2Q12 was 60,745 ounces, 19% lower than the 75,211 ounces reported in 2Q11. Accumulated total gold production in the first six-month period 2012 was 130,010 ounces, a 15% decrease when compared to 2011 (153,736 ounces).
Cash operating cost in 2Q12 was US$541.6/oz, 23% higher when compared to 2Q11 (US$441/oz). This was mainly explained by:
| 1. | A 18% decrease in gold ounces produced | ||||
| 2. | A 12% increase in reagents, basically explained by an increase in cyanide and sulfuric acid prices | ||||
| 3. | Contractor costs increased 32% due to an increase in waste moved from areas with narrow veins |
At Poracota, gold production in 2Q12 was 6,231 ounces, a 54% decrease when compared to 2Q11 (13,427 ounces) due to the aforementioned 15-day strike, lower ore grade and a decrease in the recovery rate (See Appendix 2). Accumulated gold production in the first six-month period 2012 was 17,551 ounces, 31% lower than the figure reported in 2011 (25,528 ounces). Cash operating cost was US$1,851/oz, 98% higher than the figure reported in 2Q11 (US$936/oz), mainly explained by the 54% decrease in gold ounces produced.
At Uchucchacua (100% owned by Buenaventura), total silver production in 2Q12 was 2.71 million ounces, a 33% increase when compared to 2.04 million ounces in 2Q11 due to higher tonnage treated and a higher recovery rate (See Appendix). Zinc production in 2Q12 was 2,036 MT, 94% higher than the figure reported in 2Q11 (1,050 MT), while lead production increased 39% (1,891 MT in 2Q12 vs. 1,359 MT in 2Q11). In the first six-month period 2012, silver production was 5.46 million ounces, zinc production was 4,247 MT, while lead production was 3,889 MT vs. 4.55 million ounces, 2,952 MT and 3,381 MT, respectively, in 2011.
Cash operating cost in 2Q12 was US$16.65/oz, a 6% decrease compared to US$17.63/oz in 2Q11. This decrease was primarily due to higher silver production (an increase of 33%).
At Julcani (100% owned by Buenaventura), total production in 2Q12 was 602,764 ounces of silver, 1% lower when compared to 2Q11 (604,985 ounces. In the first six-month period 2012, silver production was 1.23 million ounces, 2% higher than in 2Q11 (1.21 million ounces).
Silver cash operating cost in 2Q12 was US$12.33/oz, in-line with the 2Q11 cash cost (US$12.52/oz).
La Zanja (53.06% owned by Buenaventura) total production in 2Q12 was 27,687 ounces of gold, a 25% decrease when compared to 2Q11 (36,920 ounces). Accumulated gold production in the first six-month period 2012 was 54,016 ounces, 13% lower when compared to first six-month period 2011 (62,071 ounces in 2011). Cash operating cost in 2Q12 was US$607/oz, 100% higher than 2Q11 (US$303/oz) due to lower production (25% decrease), a 58% increase in labor expenses, a 40% increase in supply expenses (mainly explained by an increase of reagent consumption) and a 28% increase of contractor expenses. This product is in-line with the project’s forecast.
Tantahuatay (40.04% owned by Buenaventura) Total production in 2Q12 was 39,129 ounces of gold (15,652 ounces attributable to Buenaventura). In the first six-month period 2012, gold production was 66,735 ounces (26,695 attributable to Buenaventura). Cash operating cost in 2Q12 was US$385/oz and US$433/oz in the first six month period.
At El Brocal (53.76% owned by Buenaventura), Zinc production in 2Q12 was 14,044 MT, a 46% increase when compared to 2Q11 (9,650 MT). Silver production increased 18% from 1.1 million ounces in 2Q11 to 1.3 million ounces in 2Q12. During the six-month period 2012, total zinc production was 21,651 MT, a 124% increase when compared to the 9,650 MT reported in 2011. In the case of silver, total production increased 12%, from 1.5 million ounces in 2011, to 1.7 million ounces in the first six-month period 2012. Lead production in the first six-month period 2012 was 7,513 MT, 56% higher than 2011 (4,812 MT).
Zinc cash costs increased from a negative US$183/MT in 2Q11 to US$1,511/MT in 2Q12. This was explained by the 98% lower by-product contribution due to a decrease in silver and lead realized prices.
General and Administrative Expenses
General and administrative expenses in 2Q12 were US$25.0 million, 28% higher than the figure reported in 2Q11 (US$19.5 million) due to a provision for early retirement contingencies and metallurgical research studies. For the first six-month period 2012, general and administrative expenses were US$54.8 million versus US$36.5 million in 2011 (50% increase).
Exploration Costs in Non-Operational Mining Sites
Exploration costs at non-operational mining sites, which include care and maintenance in 2Q12 were US$26.4 million, a 118% increase compared to the US$12.1 million reported in 2Q11. Buenaventura’s main exploration efforts were focused at the Trapiche (US$3.9 million), Tambomayo (US$3.8 million), San Gregorio (US$3.6 million), Chancas (US$3.3 million) and Breapampa (US$2.2 million) projects.
Exploration costs at non-operational mining sites in the first six-month period 2012 were US$45.8 million, 102% higher than 2011 (US$22.7 million).
Operating Income
Operating income in 2Q12 was US$79.4 million, a 46% decrease compared to the US$147.9 million reported in 2Q11. This decrease was mainly due to a 32% increase in operating costs, while revenues increased 2%.
Accumulated in the first six-month period 2012, operating income was US$210.9 million versus US$326.3 million in 2011 (decrease of 35%).
Share in Associated Companies
During 2Q12, Buenaventura’s share in associated companies was US$122.0 million, in-line with the US$123.2 million figure reported in 2Q11. Yanacocha’s contribution to these results increased 33%, from US$64.9 million in 2Q11 to US$86.6 million in 2Q12, while Cerro Verde’s contribution decreased 49% from US$65.9 million in 2Q11 to US$33.9 million in 2Q12.
For the first six-month period 2012, Buenaventura’s share in associated companies was US$258.0 million, 9% higher than the US$236.2 million reported in 2011.
YANACOCHA
At Yanacocha (43.65% owned by Buenaventura), 2Q12 gold production was 389,979 ounces of gold, 14% higher than 2Q11 production (341,665 oz). Accumulated gold production in the first six-month period 2012 was 756,407 ounces, 20% higher than in 2011 (629,880 oz).
Costs applicable to sales (CAS) at Yanacocha in 2Q12 were US$488/oz, 13% lower than the figure reported in 2Q11 (US$564/oz) due to higher production and lower mining costs, partially offset by higher workers' participation costs and lower by-product credits. Net income at Yanacocha in 2Q12 was US$198.3 million, a 33% increase compared to the 2Q11 figure (US$149.1 million). Accumulated net income in the first six-month period 2012 was US$400.3 million, 54% higher than in 2011 (US$259.8 million).
During 2Q12, EBITDA totaled US$375.3 million, a 32% increase compared to 2Q11 (US$284.0 million). This increase was mainly due to an 18% increase in revenues (US$615.4 million in 2Q12 vs. US$520.2 million in 2Q11). Accumulated EBITDA in the first six-month period 2012 was US$739.2 million, 55% higher than 2011 (US$477.7 million).
Capital expenditures at Yanacocha were US$332.9 million in 2Q12 and US$560.3 for the first six-month period 2012.
CERRO VERDE
At Cerro Verde (19.41% owned by Buenaventura), 2Q12 copper production was 68,329 MT, an 11% decrease compared to the figure reported in 2Q11 (76,905 MT). Accumulated total copper production in the first six-month period 2012 was 131,625 MT, 16% lower than 156,368 MT in 2011.
During 2Q12, Cerro Verde reported net income of US$173.9 million, a 49% decrease when compared to US$343.3 million in 2Q11. This was mainly due to a 35% decrease in sales revenues (US$482.2 million in 2Q12 versus US$744.0 million in 2Q11). Accumulated net income in the first six-month period 2012 was US$406.1 million, 43% lower than US$710.9 million in 2011.
Capital expenditures at Cerro Verde in 2Q12 totaled US$169.8 million and US$252.0 in the first six-month 2012 period.
CANTERAS DEL HALLAZGO (Chucapaca project)
At Canteras del Hallazgo (49% owned by Buenaventura), expenses attributable for Buenaventura totaled US$8.1 million due to the execution of the exploration program (US$7.1 million in 2Q11). For the six-month period 2012, attributable expenses were US$13.4 million (US$13.1 million in 2011).
COIMOLACHE (Tantahuatay operation)
At Coimolache (40.04% owned by Buenaventura), attributable contribution was US$9.6 million (negative US$0.5 million in 2Q11). For the six-month period 2012, attributable contribution was US$17.9 million (negative US$0.8 million in 2011)
Net Income
Buenaventura’s 2Q12 net income was US$152.6 million (US$0.60 per share), a 23% decrease compared to the US$197.6 million (US$0.90 per share) reported in 2Q11. Accumulated net income in the first six-month period 2012 was US$360.0 million, 15% lower when compared to 2011 (US$422.3 million).
Project Development
LA ZANJA DEVELOPMENT PROGRAM
- The Pampa Verde Project will include the development of a new open pit, expansion of the current leach pad and improvements to the operation’s road access. Construction began in 2Q11. As of June 30, 2012, total project expenditures were US$39.02 million (total investment is US$70.4 million). Completion is expected in 1Q13.
| Progress as of June 30, 2012 | |||
| San Pedro Sur Leach Pad Stage II | 85.34% | ||
| San Pedro Sur Leach Pad Stage III | 15.64% | ||
| San Pedro Sur Waste Rock Deposit | 100% | ||
| Pampa Verde Pit | 8.50% | ||
| Pampa Verde Top Soil Deposit | 0% | ||
| Pampa Verde Waste Soil Deposit | 45% | ||
| Pampa Verde Acid Water Plant | 8.40% | ||
| Pampa Verde Auxiliary Access | 80% | ||
| Pampa Verde Waste Rock Deposit | 14% | ||
| Pampa Verde Haul Road to SPS | 20% |
TANTAHUATAY DEVELOPMENT PROGRAM
- The Cienaga Norte Project includes the Leach Pad’s Stage II (additional 10.5 Ha), development of the Cienaga Norte Pit and an access road between the leach pad and the open pit. Total CAPEX totaled US$20 million. Project construction will begin as soon as the environmental impact assessment is approved.
MALLAY
- Mallay mine construction was completed in March 2012. The project has already received the mine operating license. Production began April 2012.
- During 2Q12, Mallay production included 138,000 Ag Oz, 800MT Pb and 1050MT Zn.
- Currently, Mallay holds Brownfield exploration investments in the Chancas–Chiptaj area.
RIO SECO MANGANESE SULFATE PLANT
- Buenaventura continued with the construction of the manganese sulfate plant with a total budget of US$76.0 million. As of June 30, 2012, total expenditures were US$44.5 million. The project includes an acid leaching facility, a sulfuric acid production plant and a manganese sulfate crystallization plant.
- The leaching processing facilities are expected to be completed by the end of 4Q12. The construction of the Sulfuric Acid and the Manganese Sulfate Plant is expected to be ready 4Q12. Construction and start-up tests at both plants are scheduled at the end of 2012.
BREAPAMPA
- As of June 30, 2012, Buenaventura’s total investment at the Breapampa Project was US$40.3 million, representing 84% of the entire budget (US$48.0 million).
- Construction progress includes:
| Progress as of June 30, 2012 | |||
| Leach Pad Stage I | 99.2% | ||
| Process Plant | 100% | ||
| Dam Facilities | 98.5% | ||
| Internal Electric System | 99% | ||
| Waste Soil Deposit | 87.2% | ||
| Top Soil Deposit | 100% |
- This project should be completed by the end of 3Q12. Production will also begin at end of 3Q12
- Expected gold production in 2012 is approximately 22,000 ounces
HUANZA HYDROELECTRICAL PLANT
- As of June 30, 2012, construction progress at the Huanza Project included:
| 1. | Water Conduction Tunnel: 10,074 meters of excavation was 100% completed | ||||
| 2. | Powerplant: Civil works was 85% completed | ||||
| 3. | Pallca Dam: 78.2 % (39,907 m3 concrete) of work was completed | ||||
| 4. | Electromechanical equipment is nearly complete, and will be delivered on schedule. Equipment assembly is 13% complete |
Other Information
At the Board of Directors meeting held July, 31, 2012, the following resolutions were passed:
| 1. | Acceptance of Mr. Luis Coleridge’s resignation as a member of the Company’s Board of Directors who retired at the age of 75 after 12 years on the Board and President of the Audit Committee, in accordance with Buenaventura’s policy, | ||||
| 2. | Appointment of Mr. Jose Miguel Morales as a new member of the Board of Directors | ||||
| 3. | Appointment of Mr. German Suarez as President of the Audit Committee | ||||
| 4. | Appointment of Mr. Carlos del Solar as member of the Audit Committee | ||||
| 5. | Appointment of Ms. Gulnara la Rosa as General Council |
Company Description
Compañía de Minas Buenaventura S.A.A. is Peru’s largest, publicly traded, Precious Metals Company and a major holder of mining rights in Peru. The Company is engaged in the mining, processing, development and exploration of gold and silver and other metals via wholly owned mines as well as through its participation in joint exploration projects.
Buenaventura currently operates several mines in Peru (Orcopampa*, Poracota*, Uchucchacua*, Antapite*, Julcani*, Recuperada*, El Brocal, La Zanja, Coimolache and CEDIMIN*).
The Company owns 43.65% of Minera Yanacocha S.R.L. (a partnership with Newmont Mining Corporation), an important precious metal producer; 19.41% of Sociedad Minera Cerro Verde, an important Peruvian copper producer, and 49% of Canteras del Hallazgo S.A., owner the Chucapaca project.
For a printed version of the Company’s 2011 Form 20-F, please contact the persons indicated above, or download a PDF format file from the Company’s web site.
(*) Operations wholly owned by Buenaventura
(1) First time adoption of International Financial Reporting Standards (“IFRS”)
As part of the first adoption of the International Financial Reporting Standards (IFRS) in Peru, as of October 14, 2011, through Resolution N°102-2011-EF/94.01.1, the Superintendence of Securities Market (“SMV”, before CONASEV), required to all legal entities under its supervision to adopt IFRS since the year The first six-month period 2012.
For periods up to and including the year ended December 31, 2011, the Company prepared its financial statements in accordance with Generally Accepted Accounting Principles in Peru (Peru GAAP). These consolidated financial statements, for the year ended December 31, The first six-month period 2012, are the first the Company has prepared in accordance with IFRS, in which the Company has applied IFRS 1 “First Time Adoption of International Financial Reporting Standard” in the opening balance as of January 1, 2011, transition date to IFRS. The IFRS 1 application implies that all the standards are apply retrospectively at the transition date, including certain mandatory exceptions and voluntary exemptions defined in the standard.
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 the Company’s, Yanacocha’s and 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, economical, social and legal developments. These forward-looking statements reflect the Company’s view with respect to the Company’s, Yanacocha’s and 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.
**Tables to follow**
APPENDIX 1
|
Equity Participation in
Subsidiaries and Affiliates (as of December 31, The first six-month period 2012) |
||||||
| BVN | Operating | |||||
| Equity % | Mines / Business | |||||
| Cedimin S.A.C* | 100.00 | Shila / Paula | ||||
| Consorcio Energetico de Huancavelica S.A* | 100.00 | Energy – Huanza Hydroelectrical Project | ||||
| Buenaventura Ingenieros S.A* | 100.00 | Engineering Consultant | ||||
| Minera La Zanja S.A* | 53.06 | La Zanja | ||||
| Sociedad Minera El Brocal S.A.A* | 53.76 | Colquijirca and Marcapunta | ||||
| Canteras del Hallazgo S.A ** | 49.00 | Chucapaca Project | ||||
| Compañía Minera Coimolache S.A ** | 40.04 | Tantahuatay | ||||
| Minera Yanacocha S.R.L ** | 43.65 | Yanacocha | ||||
| Sociedad Minera Cerro Verde S.A.A ** | 19.41 | Cerro Verde | ||||
(*)Consolidates
(**) Equity Accounting
APPENDIX 2
|
|
||||||||||||||||||||||||||||||||||||
| GOLD PRODUCTION | ||||||||||||||||||||||||||||||||||||
| Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||||||||||||||||||||||||
| Orcopampa | Orcopampa Old Tailings | Orcopampa | Orcopampa Old Tailings | |||||||||||||||||||||||||||||||||
| 2012 | 2011 | % | 2012 | 2011 | % | 2012 | 2011 | % | 2012 | 2011 | % | |||||||||||||||||||||||||
| Ore Milled MT | 107,622 | 112,279 | -4% | 102,022 | 89,179 | 14% | 225,100 | 226,101 | 0% | 228,807 | 171,293 | 34% | ||||||||||||||||||||||||
| Ore Grade gr/MT | 17.00 | 20.19 | -16% | 1.37 | 2.70 | -49% | 17.13 | 20.64 | -17% | 1.71 | 2.61 | -34% | ||||||||||||||||||||||||
| Recovery Rate % | 96.5% | 95.2% | 1% | 84.8% | 75.8% | 12% | 96.1% | 95.3% | 1% | 86.7% | 75.4% | 15% | ||||||||||||||||||||||||
| Ounces Produced | 56,762 | 69,335 | -18% | 3,984 | 5,876 | -32% | 119,120 | 142,906 | -17% | 10,891 | 10,830 | 1% | ||||||||||||||||||||||||
| Orcopampa Total Production | 2Q12 | 60,745 | 2Q11 | 75,211 | 6M12 | 130,010 | 6M11 | 153,736 | ||||||||||||||||||||||||||||
| Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||||||||||||||||||||||||
| Antapite | Poracota | Antapite | Poracota | |||||||||||||||||||||||||||||||||
| 2012 | 2011 | % | 2012 | 2011 | % | 2012 | 2011 | % | 2012 | 2011 | % | |||||||||||||||||||||||||
| Ore Milled MT | 28,136 | 34,099 | -17% | 46,030 | 55,862 | -18% | 62,418 | 66,591 | -6% | 104,251 | 110,678 | -6% | ||||||||||||||||||||||||
| Ore Grade gr/MT | 4.34 | 7.37 | -41% | 5.55 | 8.71 | -36% | 4.30 | 7.81 | -45% | 6.64 | 8.54 | -22% | ||||||||||||||||||||||||
| Recovery Rate % | 95.2% | 96.9% | -2% | 73.1% | 85.8% | -15% | 95.2% | 96.2% | -1% | 76.8% | 84.0% | -9% | ||||||||||||||||||||||||
| Ounces Produced | 3,739 | 7,824 | -52% | 6,231 | 13,427 | -54% | 8,222 | 16,078 | -49% | 17,551 | 25,528 | -31% | ||||||||||||||||||||||||
| LA ZANJA | TANTAHUATAY | |||||||||||||||||||||||||||||||||||
| 2Q12 | 2Q11 | % | 6M12 | 6M11 | % | 2Q12 | 2Q11 | % | 6M12 | 6M11 | % | |||||||||||||||||||||||||
| Ounces Produced | 27,687 | 36,920 | -25% | 54,016 | 62,071 | -13% | 39,129 | 0 | 66,735 | 0 | ||||||||||||||||||||||||||
| SILVER PRODUCTION | ||||||||||||||||||||||||||||||||||||
| Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||||||||||||||||||||||||
| Uchucchacua | Colquijirca | Uchucchacua | Colquijirca | |||||||||||||||||||||||||||||||||
| 2012 | 2011 | % | 2012 | 2011 | % | 2012 | 2011 | % | 2012 | 2011 | % | |||||||||||||||||||||||||
| Ore Milled MT | 261,173 | 196,457 | 33% | 828,012 | 383,157 | 116% | 520,514 | 449,541 | 16% | 1,159,349 | 383,157 | 203% | ||||||||||||||||||||||||
| Ore Grade gr/MT | 448.52 | 462.86 | -3% | 87.97 | 103.26 | -15% | 451.74 | 446.18 | 1% | 74.21 | 103.20 | -28% | ||||||||||||||||||||||||
| Recovery Rate % | 72.1% | 70.0% | 3% | 58.9% | 77.9% | -24% | 72.2% | 70.6% | 2% | 60.3% | 77.9% | -23% | ||||||||||||||||||||||||
| Ounces Produced | 2,715,552 | 2,048,524 | 33% | 1,271,694 | 990,635 | 28% | 5,460,195 | 4,550,337 | 20% | 1,542,232 | 990,635 | 56% | ||||||||||||||||||||||||
| ZINC PRODUCTION | ||||||||||||||||||||||||||||||||||||
| Three Months Ended June 30 | Six Months Ended June 30 | |||||||||||||||||||||||||||||||||||
| Uchucchacua | Colquijirca | Uchucchacua | Colquijirca | |||||||||||||||||||||||||||||||||
| 2012 | 2011 | % | 2012 | 2011 | % | 2012 | 2011 | % | 2012 | 2011 | % | |||||||||||||||||||||||||
| Ore Milled MT | 261,173 | 196,457 | 33% | 662,709 | 383,157 | 73% | 520,514 | 449,541 | 16% | 994,046 | 383,157 | 159% | ||||||||||||||||||||||||
| Ore Grade % | 1.34% | 1.18% | 14% | 3.04% | 3.71% | -18% | 1.40% | 1.27% | 10% | 3.11% | 3.71% | -16% | ||||||||||||||||||||||||
| Recovery Rate % | 58.1% | 45.1% | 29% | 66.3% | 68.0% | -2% | 57.5% | 51.2% | 12% | 67.8% | 68.0% | 0% | ||||||||||||||||||||||||
| MT Produced | 2,036 | 1,050 | 94% | 13,330 | 9,650 | 38% | 4,247 | 2,952 | 44% | 20,936 | 9,650 | 117% | ||||||||||||||||||||||||
APPENDIX 3
| EBITDA RECONCILIATION (in thousand US$) | ||||||||||||
| 2Q12 | 2Q11 | 6M12 | 6M11 | |||||||||
| Net Income | 169,995 | 223,208 | 390,981 | 469,352 | ||||||||
|
Add / Subtract: |
-49,817 | -40,704 | -106,988 | -78,410 | ||||||||
| Provision for income tax, net | 31,598 | 48,690 | 79,273 | 94,229 | ||||||||
| Share in associated companies by the equity method, net | -122,020 | -123,238 | -258,006 | -236,157 | ||||||||
| Interest income | -2,542 | -2,042 | -5,291 | -5,377 | ||||||||
| Interest expense | 1,884 | 1,282 | 3,180 | 3,427 | ||||||||
| Loss on currency exchange difference | 496 | 25 | 781 | 823 | ||||||||
| Depreciation and Amortization | 28,391 | 24,431 | 51,795 | 45,934 | ||||||||
| Provision for long term officers´ compensation | 7,315 | 0 | 7,315 | 0 | ||||||||
| Workers´ participation provision | 5,061 | 10,148 | 13,965 | 18,711 | ||||||||
| EBITDA Buenaventura Direct Operations | 120,178 | 182,504 | 283,993 | 390,942 | ||||||||
| EBITDA Yanacocha (43.65%) | 163,837 | 123,954 | 322,661 | 208,517 | ||||||||
| EBITDA Cerro Verde (19.40%) | 56,458 | 99,883 | 130,255 | 204,793 | ||||||||
| EBITDA Coimolache (40%) + Canteras del Hallazgo (49%) | 8,761 | 0 | 18,109 | 0 | ||||||||
| EBITDA Buenaventura inc Yanacocha + Cerro Verde + Coimolache + Canteras del Hallazgo | 349,234 | 406,340 | 755,017 | 804,252 |
Note:
EBITDA (Buenaventura Direct Operations) consists of earnings before net interest, taxes, depreciation and amortization, share in associated companies, net, loss on currency exchange difference, other, net, provision for workers’ profit sharing and provision for long-term officers’ compensation.
EBITDA (including Affiliates) consists of EBITDA (Buenaventura Direct Operations), plus (1) Buenaventura’s equity share of EBITDA (Yanacocha) (2) Buenaventura’s equity share of EBITDA (Cerro Verde), plus (3) Buenaventura’s equity share of EBITDA (Coimolache) plus (4) Buenaventura’s equity share of EBITDA (Canteras del Hallazgo). All EBITDA mentioned were similarly calculated using financial information provided to Buenaventura by the affiliated companies.
Buenaventura presents EBITDA (Buenaventura Direct Operations) and EBITDA (including affiliates) to provide further information with respect to its operating performance and the operating performance of its equity investees, the affiliates. EBITDA (Buenaventura Direct Operations) and EBITDA (including affiliates) are not a measure of financial performance under Peruvian GAAP, and may not be comparable to similarly titled measures of other companies. You should not consider EBITDA (Buenaventura Direct Operations) and EBITDA (including affiliates) as alternatives to operating income or net income determined in accordance with Peruvian GAAP, as an indicator of Buenaventura’s, affiliates operating performance, or as an alternative to cash flows from operating activities, determined in accordance with Peruvian GAAP, as an indicator of cash flows or as a measure of liquidity.
APPENDIX 4
| Compañía de Minas Buenaventura S.A.A. and subsidiaries | ||||||
| Consolidated Balance sheet | ||||||
| As of June, 30 2012 and December, 31 2011 | ||||||
| 2012 | 2011 | |||||
| Assets | US$(000) | US$(000) | ||||
| Current assets | ||||||
| Cash and cash equivalents | 309,441 | 470,847 | ||||
| Financial asset at fair value through profit and loss | 56,662 | 62,299 | ||||
| Trade accounts receivable, net | 169,323 | 172,569 | ||||
| Other accounts receivable | 65,767 | 48,521 | ||||
| Accounts receivable from associates | 31,912 | 47,425 | ||||
| Derivative financial instruments | 538 | 1,283 | ||||
| Inventory, net | 168,289 | 149,108 | ||||
| Prepaid expenses | 14,911 | 16,234 | ||||
| Total current assets | 816,843 | 968,286 | ||||
| Other accounts receivable | 10,150 | 5,570 | ||||
| Accounts receivable from associates | 42,326 | 32,262 | ||||
| Long-term Inventory | 42,872 | 48,845 | ||||
| Prepaid expenses | 73 | |||||
| Investment in associates | 2,203,045 | 1,935,004 | ||||
| Mining concessions, development cost and property, plant and equipment, net | 942,258 | 830,997 | ||||
| Deferred income tax asset | 112,759 | 125,538 | ||||
| Other assets | 5,301 | 7,047 | ||||
| Total assets | 4,175,627 | 3,953,549 | ||||
| Liabilities and shareholders’ equity, net | ||||||
| Current liabilities | ||||||
| Trade accounts payable | 150,178 | 142,375 | ||||
| Income tax payable | 8,585 | 36,423 | ||||
| Dividends payable | 872 | 1,052 | ||||
| Other accounts payable | 72,134 | 40,098 | ||||
| Provisions | 55,590 | 91,287 | ||||
| Accounts payable from associates | 800 | 883 | ||||
| Embedded derivatives for concentrates sales, net | 6,894 | 7,306 | ||||
| Financial obligations | 197 | 1,042 | ||||
| Total current liabilities | 295,250 | 320,466 | ||||
| Other non-current provisions | 86,219 | 86,528 | ||||
| Other accounts payable to associates | 868 | 1,004 | ||||
| Financial obligations | 119,184 | 105,072 | ||||
| Total liabilities | 501,521 | 513,070 | ||||
| Shareholders’ equity net | ||||||
| Capital stock, net of treasury shares of US$62,622,000 | 750,540 | 750,540 | ||||
| Investments shares, net of treasury shares of US$762,000 | 1,399 | 2,019 | ||||
| Additional paid-in capital | 219,471 | 225,978 | ||||
| Legal reserve | 162,649 | 162,639 | ||||
| Other reserves | 269 | 269 | ||||
| Retained earnings | 2,293,022 | 2,034,768 | ||||
| Cumulative unrealized, gain (loss) | 703 | 2,068 | ||||
| 3,428,053 | 3,178,281 | |||||
| Non-controlling interest | 246,053 | 262,198 | ||||
| Total shareholders’ equity, net | 3,674,106 | 3,440,479 | ||||
| Total liabilities and shareholders’ equity, net | 4,175,627 | 3,953,549 | ||||
|
|
|
|||||
| Compañía de Minas Buenaventura S.A.A. and subsidiaries | ||||||||||||
| Consolidated Statements of income | ||||||||||||
| For the six month period ended June 30, 2012 and June 30, 2011 | ||||||||||||
| For the three month | For the six month | |||||||||||
|
period ended June, 30 |
period ended June, 30 | |||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||
| US$(000) | US$(000) | US$(000) | US$(000) | |||||||||
| Operating income | ||||||||||||
| Net sales | 331,768 | 327,302 | 690,749 | 690,782 | ||||||||
| Royalty income | 18,696 | 15,982 | 36,753 | 28,249 | ||||||||
| Total income | 350,464 | 343,284 | 727,502 | 719,031 | ||||||||
| Operating costs | ||||||||||||
| Cost of sales, without considering depreciation and amortization | (137,514) | (96,546) | (270,855) | (208,054) | ||||||||
| Exploration in units in operation | (38,143) | (24,065) | (66,812) | (46,324) | ||||||||
| Depreciation and amortization | (28,391) | (24,431) | (51,795) | (45,934) | ||||||||
| Royalties | (9,279) | (16,987) | (19,157) | (31,310) | ||||||||
| Total operating costs | (213,327) | (162,029) | (408,619) | (331,622) | ||||||||
| Gross income | 137,137 | 181,255 | 318,883 | 387,409 | ||||||||
| Operating expenses | ||||||||||||
| Administrative | (24,978) | (19,500) | (54,796) | (36,482) | ||||||||
| Exploring in non-operating areas | (26,402) | (12,096) | (45,829) | (22,700) | ||||||||
| Selling | (4,304) | (2,648) | (7,077) | (4,853) | ||||||||
| Other operating income, net | (2,042) | 914 | (263) | 2,923 | ||||||||
| Total operating expenses | (57,726) | (33,330) | (107,965) | (61,112) | ||||||||
| Operating income | 79,411 | 147,925 | 210,918 | 326,297 | ||||||||
| Other income (expenses), net | ||||||||||||
| Share in the results of associates | 122,020 | 123,238 | 258,006 | 236,157 | ||||||||
| Interest income | 2,542 | 2,042 | 5,291 | 5,377 | ||||||||
| Interest expense | (1,884) | (1,282) | (3,180) | (3,427) | ||||||||
| Loss from currency exchange difference, net | (496) | (25) | (781) | (823) | ||||||||
| Total other income, net | 122,182 | 123,973 | 259,336 | 237,284 | ||||||||
| Income before income tax and non-controlling interest | 201,593 | 271,898 | 470,254 | 563,581 | ||||||||
| Income tax | (31,598) | (48,690) | (79,273) | (94,229) | ||||||||
| Net income | 169,995 | 223,208 | 390,981 | 469,352 | ||||||||
| Net income attributable to non-controlling interest | (17,434) | (25,654) | (30,948) | (47,028) | ||||||||
| Net income attributable to Owners of the parent | 152,561 | 197,554 | 360,033 | 422,324 | ||||||||
| Basic and diluted earnings per share attributable to | ||||||||||||
| Buenaventura, stated in U.S. dollars | 0.60 | 0.78 | 1.42 | 1.66 | ||||||||
| Compañía de Minas Buenaventura S.A.A. and subsidiaries | ||||||||||||
| Consolidated Statements of cash flows | ||||||||||||
| For the six month period ended June 30, 2012 and June 30, 2011 | ||||||||||||
| For the three month | For the six month | |||||||||||
| period ended June, 30 | period ended June, 30 | |||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||
| US$(000) | US$(000) | US$(000) | US$(000) | |||||||||
| Operating activities | ||||||||||||
| Proceeds from sales | 299,871 | 322,494 | 693,644 | 719,289 | ||||||||
| Dividends received | 4,602 | - | 7,008 | - | ||||||||
| Royalties received | 20,845 | 9,495 | 35,253 | 23,645 | ||||||||
| Value Added Tax recovered | 4,505 | 8,405 | 13,277 | 12,440 | ||||||||
| Interest received | 3,333 | 1,721 | 5,378 | 4,201 | ||||||||
| Payments to suppliers and third parties | (239,961) | (164,473) | (395,179) | (350,730) | ||||||||
| Payments to employees | (23,031) | (27,689) | (121,827) | (86,143) | ||||||||
| Income tax paid | (54,343) | (31,285) | (75,819) | (61,517) | ||||||||
| Payment of royalties | (10,377) | (19,236) | (20,060) | (34,809) | ||||||||
| Payments of interest | (523) | (100) | (765) | (676) | ||||||||
| Net cash and cash equivalents provided by operating activities | 4,921 | 99,332 | 140,910 | 225,700 | ||||||||
| Investment activities | ||||||||||||
|
Additions to mining concessions, development activities, property, plant and equipment |
(92,215) | (66,032) | (168,686) | (109,166) | ||||||||
| Contributions to associates | (13,047) | (7,940) | (17,789) | (17,019) | ||||||||
| Decrease in time deposits | (750) | 3,102 | 6,846 | 17,935 | ||||||||
|
Net cash and cash equivalents used in investment activities |
(106,012) | (70,870) | (179,629) | (108,250) | ||||||||
| Financing activities | ||||||||||||
| Increase in financial obligations | 4,192 | 14,128 | 14,287 | 25,515 | ||||||||
| Payments of financial obligation | (1,020) | (1,007) | (1,020) | (1,007) | ||||||||
|
Dividends paid |
(101,779) | (83,967) | (101,779) | (83,967) | ||||||||
|
Dividends paid to non-controlling interest |
(4,953) | (2,433) | (34,175) | (25,551) | ||||||||
| Net cash and cash equivalents used in financing activities | (103,560) | (73,279) | (122,687) | (85,010) | ||||||||
| Decrease in cash and cash equivalents during the period, net | (204,651) | (44,817) | (161,406) | 32,440 | ||||||||
| Cash and cash equivalents at beginning of period | 514,092 | 660,118 | 470,847 | 582,861 | ||||||||
| Cash and cash equivalents at period-end | 309,441 | 615,301 | 309,441 | 615,301 | ||||||||
| For the three month |
For the six month |
|||||||||||
| period ended June, 30 |
period ended June, 30 |
|||||||||||
| 2012 | 2011 | 2012 | 2011 | |||||||||
| US$(000) | US$(000) | US$(000) | US$(000) | |||||||||
| Reconciliation of net income to cash and cash equivalents provided by operating activities | ||||||||||||
|
|
||||||||||||
| Net income attributable to owners of the parent | 152,561 | 197,554 | 360,033 | 422,324 | ||||||||
| Add (less) | ||||||||||||
| Depreciation and amortization | 28,391 | 24,431 | 51,795 | 45,934 | ||||||||
| Deferred income tax | (1,534) | 7,265 | 12,779 | 24,796 | ||||||||
| Net income attributable to non-controlling interest | 17,434 | 25,654 | 30,948 | 47,028 | ||||||||
| Accretion expense of the provision for closure of mining units | 1,363 | 1,184 | 2,417 | 2,752 | ||||||||
| Loss from currency exchange differences | 496 | 25 | 781 | 823 | ||||||||
| Share in the results of associates, net of dividends received in cash | (117,418) | (123,238) | (250,998) | (236,157) | ||||||||
| Provisions | 25,937 | 19,431 | (13,542) | (38,284) | ||||||||
| Provision for estimated fair value of embedded derivatives related of concentrates | ||||||||||||
| sales and adjustments on open liquidations | 9,256 | 16,468 | (10,093) | 9,511 | ||||||||
| Net changes in operating assets and liabilities accounts | ||||||||||||
| Decrease (increase) in operating assets | ||||||||||||
| Trade accounts receivable | (39,773) | (20,629) | 3,246 | 19,366 | ||||||||
| Other accounts receivable | 2,979 | 27,080 | (14,006) | 5,306 | ||||||||
| Other accounts receivable from associates | (4,254) | (20,706) | (6,980) | (12,550) | ||||||||
| Inventory | 3,499 | (32,650) | (13,214) | (59,478) | ||||||||
| Prepaid expenses | (20,558) | 3,291 | (5,235) | 2,416 | ||||||||
| Increase (decrease) of operating liabilities | ||||||||||||
| Trade accounts payable | 16,787 | 11,661 | 7,803 | (5,429) | ||||||||
| Income tax payable | (25,135) | (27) | (27,838) | (1,254) | ||||||||
| Other accounts payable | (45,110) | (37,462) | 13,014 | (1,404) | ||||||||
| Net cash and cash equivalents provided by operating activities | 4,921 | 99,332 | 140,910 | 225,700 | ||||||||