First Quantum Minerals (FM) Q2 2024 earnings summary

Executive summary

• Q2 2024 copper production rose 2% sequentially to 102,709 tonnes, driven by Kansanshi's higher output and Sentinel's solid performance; Enterprise declared commercial production as of June 1, 2024.

• EBITDA increased 86% quarter-over-quarter to $336 million, with net loss improving to $46 million; adjusted loss per share was $0.02.

• Commercial production at Enterprise was declared ahead of schedule; Ravensthorpe was placed on care and maintenance in May 2024 due to high costs.

• Shareholder Rights Agreement signed with Jiangxi Copper, formalizing governance, board nomination, and support provisions.

• Cobre Panamá remains offline, with ongoing constructive dialogue with Panama's new government, environmental audit, and arbitration proceedings underway.

Financial highlights

• Q2 copper production reached 103,000 tonnes, up 2% sequentially; Kansanshi output rose by 10,034 tonnes to 41,507 tonnes, Sentinel declined by 8,630 tonnes to 53,595 tonnes.

• Revenue reached $1.2 billion, up 19% quarter-over-quarter, driven by higher copper prices and Kansanshi performance.

• EBITDA was $336 million, up $156 million from Q1 2024; net loss improved to $46 million, adjusted loss $13 million.

• C1 cash costs averaged $1.73/lb, a 14% improvement from Q1, aided by strong gold prices and higher gold production.

• Net debt rose by $160 million to $5.44 billion, mainly due to S3 Expansion capex; liquidity at $1.6 billion.

Outlook and guidance

• 2024 copper and gold production guidance maintained; copper guidance is 370,000–420,000 tonnes, Kansanshi expected at 130,000–150,000 tonnes, Sentinel at 220,000–250,000 tonnes.

• Nickel production guidance narrowed to 17,000–20,000 tonnes at Enterprise; Ravensthorpe guidance withdrawn due to care and maintenance.

• C1 cash cost guidance for 2024 reaffirmed at $1.80–$2.05/lb, with cost pressures from power imports offset by gold price tailwinds.

• S3 Expansion at Kansanshi on track for first production mid-2025, with majority of capex in 2024.

• Capital expenditure for 2024 expected at $1,250–$1,400 million, focused on Kansanshi S3 Expansion.