MAC Copper (MTAL) Q2 2024 earnings summary

Executive summary

• Achieved record quarterly copper production of 10,864 tonnes in Q2 2024, up 24% quarter-over-quarter, despite a planned 10-day plant shutdown in April, and set a record daily output of 265 tonnes.

• Operational turnaround included improved consistency, increased headcount, better dilution control, and productivity gains such as higher tonnes milled per employee and increased truck load factors.

• Life of mine extended by 67% to end of 2034, with all deposits open and ongoing exploration drilling.

• Balance sheet strengthened with $88.6M–$89M cash at quarter-end, $37M in pre-sold concentrate, and $21M in unsold concentrate.

• Board strengthened with new Non-Executive Directors, including Anne Templeman-Jones, and changes to Glencore nominee director.

Financial highlights

• Cash and cash equivalents rose 25% quarter-on-quarter to $88.6M–$89M, even after a $23.2M one-off stamp duty payment.

• Operational cash inflow was $74.1M, with $36.7M from operations (excluding pre-sold concentrate); $21M in unsold concentrate at quarter-end.

• Net debt reduced to $231M at quarter-end, with $140M in interest-bearing liabilities repaid since the start of 2024.

• Sustaining capital expenditure for the quarter was $12.8M, in line with annualized guidance.

• Unaudited preliminary revenue (excluding pre-sales) was $78M, up 18% quarter-on-quarter.

Outlook and guidance

• 2024 copper production guidance maintained at 38,000–43,000 tonnes, tracking to midpoint, with three-year guidance expecting over 50,000 tpa by 2026.

• Q3 expected to be similar or slightly weaker than Q2, with Q4 anticipated to be strong.

• Over 70% of forecast remaining copper sales for 2024 are unhedged, providing leverage to spot prices.

• Guidance does not include potential upside from CSA South Upper; exploration update expected soon.

• Ventilation project (AUD 42M) to be completed by mid-2026, enabling higher mining rates and production growth.