Boliden (BOL) Q2 2024 earnings summary

Executive summary

• Q2 2024 results were driven by a SEK 2.4 billion insurance income from the Rönnskär fire and the decision to reopen Tara mine, with restructuring costs of SEK -358M.

• Production was strong in smelters, with maintenance activities completed on time and on budget, while Aitik faced low mill volumes due to ramp-up issues at Liikavaara and equipment availability challenges.

• Garpenberg achieved record-high milled volume, though zinc grade was slightly below guidance.

• Key expansion projects, including Odda, Aitik dam reinforcement, Kristineberg, and Rävliden, are progressing on schedule.

• Improved base and precious metal prices supported results, but lower treatment charges and premiums impacted profitability.

Financial highlights

• Revenues reached SEK 22,748 million, up from SEK 18,442 million in Q2 2023.

• Operating profit excluding process inventory revaluation was SEK 4,000 million, including SEK 2,042 million in one-offs (insurance and Tara restructuring).

• Net profit reached SEK 3,610 million, with earnings per share at SEK 13.20, significantly impacted by insurance income.

• Free cash flow improved to SEK 401 million, supported by SEK 600 million in insurance proceeds and improved operational working capital.

• CapEx for the quarter was SEK 3.7 billion, in line with full-year guidance.

Outlook and guidance

• CapEx guidance for 2024 remains at SEK 15.5 billion.

• Most planned maintenance is completed, with minimal impact expected in Q3 and none in Q4.

• Tara mine is expected to incur an operating loss of EUR -25 million per quarter in H2 2024, with breakeven expected in Q1 2025.

• No changes to grade guidance; Aitik's full-year copper grade guidance of 0.17 is maintained.