MMG Limited (MMG) today released its full year financial results for the year ended 31 December 2022.
Highlights:
- MMG Recorded a Total Recordable Injury Frequency (TRIF) of 1.25 per million hours worked for the full year 2022. This result represents a continuation of the low TRIF when compared to MMG’s ICMM peers.
- Net profit after tax was US$243.5 million, including a profit of US$172.4 million attributable to equity holders of the Company.
- EBITDA of US$1,535.4 million was 44% lower than 2021, due to lower sales of concentrate at Las Bambas and Rosebery, lower realised commodity prices and higher consumable unit prices in line with cost escalation across the mining industry.
- Las Bambas’ third ball mill was successfully commissioned during the fourth quarter. Supported by the third ball mill, the mine achieved the highest quarter milling throughput since 2020, which was also the second highest quarter throughput in the mine’s history.
- Construction of the Kinsevere Expansion Project (KEP), including the transition to the mining and processing of sulphide ores and the commencement of cobalt production, continues to advance. All civil work for the cobalt plant has been completed, long-lead time equipment is being shipped to the site and the installation of equipment has commenced. First Cobalt production is expected in 2023.
Commentary from Liangang Li, Interim Chief Executive Officer:
“I am pleased to present MMG’s 2022 annual results.
In 2022, our business contended with some significant challenges including an extended operational shut at Las Bambas due to community protests and escalating costs as global inflationary pressures persisted.
Despite these challenges, we continued to focus on finding a long-term solution to the Las Bambas community challenges and on pursuing value optimisation opportunities across all operations.”
Safety
“The entire MMG team has been deeply impacted by the tragic deaths of Dylan Langridge and Trevor Davis at our Dugald River operation in February 2023. Dylan and Trevor who were employed through our mining contract partner Barminco, were involved in a safety incident at site and sustained fatal injuries.
The incident remains subject to both internal and external investigations and we are committed to applying any learnings to ensure this never happens again.
In 2022, MMG sites recorded a TRIF of 1.25 for the full year. This result continues to rank amongst the lowest of all ICMM members but we recognise that the recent incident at Dugald River is a reminder that more work remains to be done as we seek to achieve an injury-free workplace.”
Financial Performance
“MMG achieved an EBITDA result of US$1,535.4 million in 2022. This result was 44% below the full year 2021 reflecting the challenging external conditions marked by lower sales at Las Bambas, lower realised commodity prices and higher costs.
Net profit after tax was US$243.5 million, including a profit of US$172.4 million attributable to equity holders.
As we look ahead to 2023, we expect that global inflation may take some time to abate and will continue to put pressure on costs. To mitigate this, we continue to place significant effort on cost reduction and productivity improvements across all operations. We are also committed to progressing the Chalcobamba development, now expected to commence in the second half of 2023 and critical to this, is our ongoing work to drive a new model of managing relationships with communities that is based on shared governance, transparency and mutual success.”
Outlook
“We remain confident about future opportunities and the demand for our products, particularly as the global energy transition becomes more urgent for every government, industry and individual.
We will continue to pursue disciplined growth, most imminently through the Kinsevere Expansion Project and the Chalcobamba development at Las Bambas which will add more than 150,000 tonnes of copper equivalent production per annum, compared to 2022. We also continue to actively evaluate value accretive external opportunities as we seek to grow our exposure to the minerals of the future.
In 2023, MMG expects copper production at Las Bambas to be in the range of 265,000 and 305,000 tonnes. This target is contingent on a swift resolution to wide-spread political protests in Peru and a resumption of stability in concentrate transport logistics. Kinsevere copper cathode production is expected to be in the range of 40,000-48,000 tonnes.
Total zinc production is expected to be in the range of 225,000-250,000 tonnes.”
Please download the full copy of the MMG 2022 Annual Results Announcement here.