5th Aug 2025 10:34
(Alliance News) - Fresnillo PLC on Tuesday reported a jump in revenue thanks to higher gold and silver prices, while profit also got a boost from the devaluation of the Mexican peso against the US dollar.
The company hiked its interim dividend dramatically in response.
Fresnillo shares were up 6.6% to 1,528.00 pence Friday morning in London. They were the second biggest gainers in the FTSE 100 index, itself up just 0.3%.
The London- and Mexico City-based silver and gold miner operates eight mines in Mexico and also has mining concessions and exploration projects there and in Peru and Chile. It is one of the world's largest silver producers and is Mexico's largest gold producer.
Late last month, Fresnillo had said silver production rose by 1.0% in the second quarter of 2025 from the first but was down 15% from a year before. Gold production also was up 1.0% in the second quarter from the first and was up 21% from a year before.
On Tuesday, Fresnillo said pretax profit was USD660.3 million in the six months that ended June 30, up from USD277.8 million a year before. Profit for the period after tax was GBP467.6 million, multiplied from USD117.7 million.
Profit would have been up by even more but for a USD190.1 million hit from the revaluation of Fresnillo's Silverstream contract, swung from a USD66.5 million such gain a year before. The contract is being bought out. Excluding this, profit before net finance costs and income tax was USD860.8 million, up from USD253.2 million.
Revenue was USD1.94 billion in the recent half-year, up 30% from USD1.49 billion a year before.
Despite the surge in revenue, cost of sales actually decreased to USD913.2 million from USD1.10 billion. This was thanks to a 20% decrease in adjusted production costs due to the devaluation of the Mexican peso, the closure of the San Julian mine, and cost reduction initiatives at the the Herradura mine.
Fresnillo declared an interim dividend of 20.8 US cents, tripled from 6.4 cents a year before.
Looking ahead, Fresnillo said its silver production guidance for all of 2025 remains unchanged, except to remove Silverstream. Following the buyback of Silverstream, there will be no further Silverstream contribution from the second half of 2025 onward, the company said.
Gold production guidance was increased due to the better performance of the Herradura mine in the first half. Gold production is now guided at 555,000 to 590,0000 ounces in 2025, up from previous guidance of 525,000 to 580,000. Gold production in 2026 is guided at 515,000 to 565,000 ounces, followed by 535,000 to 595,000 in 2027, but unchanged from previous guidance.
Lead and zinc production guidance for all three years also is unchanged.
By Tom Waite, Alliance News editor
Comments and questions to [email protected]
Copyright 2025 Alliance News Ltd. All Rights Reserved.
Related Shares:
Fresnillo