28th Jan 2015 08:01
LONDON (Alliance News) - FTSE 100 miners Anglo American PLC, Fresnillo PLC and Antofagasta PLC all reported their fourth quarter production results Tuesday, with Anglo American warning there will be impairment charges for its 2014 financial year, whilst Fresnillo saying it expects production to increase in 2015 and Antofagasta expecting gold production to fall.
Anglo American reported a 10% increase in iron ore production from its Kumba project in the fourth quarter ended December 31 to 12.4 million tonnes from 11.3 million tonnes in the third quarter. Production increased due to the implementation of a production recovery plan, it said.
Anglo American's Minas-Rio mine also began producing iron ore in the fourth quarter, adding an additional 700,000 tonnes of iron ore in the quarter.
Export metallurgical coal production was up 4% quarter on quarter to 4.9 million tonnes from 4.7 million tonnes and export thermal coal production rose 2% to 9.7 million tonnes from 9.5 million tonnes. The increases were caused by production increases in Australia and South Africa.
Anglo American's copper production fell 18% in the fourth quarter to 174,800 tonnes from 214,300 tonnes in the third quarter, which was caused by grade declines at Los Bronces and Collahuasi, it said.
Nickel production fell 34% quarter on quarter to 6,700 tonnes, whilst equivalent refined platinum production dropped by 14% to 593,900 ounces. Diamond production fell by 8% to 8.4 million carats, mainly caused by lower grades.
Anglo American said exploration and evaluation expenditure for the fourth quarter totalled USD110 million, down 34% from the comparable period a year earlier. The total expenditure consisted of USD61 million on exploration, mainly attributable to nickel and USD49 million on evaluation.
"Given the sharply lower commodity price environment, particularly for the bulk commodities, Anglo American expects to record certain non-cash impairment charges as special items for the 2014 financial year," said Anglo American.
Fresnillo reported increased production figures for the fourth quarter, with gold production up 77% year on year to 173,471 ounces. Gold production for the full year totalled 595,920 ounces, down 2.4% from the 610,884 ounces produced in 2013.
The company produced 12.3 million ounces of silver in the quarter, up 15.5% from the fourth quarter in 2013. For the full year, the company has produced 45 million ounces of silver, up 4.9% from 2013 and ahead of the company's full year guidance of 43 million ounces.
During 2015, Fresnillo is expecting gold and silver production to increase. The company has set production guidance of 45 million to 47 million ounces of silver and between 670,000 to 685,000 ounces of gold.
Fresnillo also said it has slashed its 2015 exploration budget by 8% to USD170 million from the USD185 million spent in 2014.
Antofagasta increased gold and copper production in the fourth quarter, but full-year production decreased, and it warned that gold production will decrease further in 2015.
Copper production totalled 187,500 tonnes, up 10.8% quarter on quarter, with all copper mines increasing production during the period. However, full-year copper production dropped by 2.3% to 704,800 tonnes, mainly caused by lower grades at Los Pelambres.
Gold production significantly increased in the fourth quarter to 82,300 ounces, up 28% from the third quarter. Gold production for the full year was down to 270,900 ounces in 2014 from 293,800 ounces a year earlier, mainly reflecting lower grades.
Molybdenum production for the full year also fell to 7,900 tonnes in 2014 from 9,000 tonnes in 2013, also caused by lower grades.
Antofagasta is aiming to produce 710,000 tonnes of copper, 250,000 ounces of gold and 8,000 tonnes of molybdenum during 2015, and said its cash cost is expected to remain fairly flat at around USD1.85 per pound.
By Joshua Warner; [email protected]; @JoshAlliance
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