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Release of 2022 Interim Report

MMG Limited (MMG) today reported its 2022 interim result delivering a Net Profit After Tax of US$89.8 million, including a profit of US$79.5 million attributable to the equity holders of the Company.

“The Company’s first half result was significantly impacted by lower sales of Las Bambas copper concentrate following community protest activities which halted production for more than 50 days during the second quarter,” said MMG Chief Executive Officer, Liangang Li.

Production at Las Bambas recommenced on 11 June following an agreement by community members to cease protest activities and engage in a peaceful dialogue process.

Las Bambas produced 101,009 tonnes of copper in copper concentrate in the first half of 2022, a result that is 30% below the prior corresponding period. Las Bambas EBITDA of US$411.9 million was 65% lower than the first half of 2021. This result was largely due to lower realised copper prices and lower concentrate sales volumes.

“Our Las Bambas team has continued to engage in dialogue and every effort has been made to transparently and comprehensively review the existing commitments with community members”, Mr Li said. “We remain committed to achieving a sustainable outcome through productive dialogue and by building a future based on strong relationships and shared goals.”

“A sustainable solution to the community challenges at Las Bambas is our utmost priority and the key to unlocking the significant potential of this world-class asset”, Mr Li said. “We are proud of our contribution to local communities and committed to ensuring that our communities and our people share in the success of our mining investments.”

Despite a stronger second quarter, Kinsevere produced 22,090 tonnes of copper cathode in the first half, a result that was 12% lower than the first half of 2021.  As mining activity resumed, and with the supply of higher-grade ores from third parties, feed grades will continue to improve in the second half of the year.

Dugald River produced 79,587 tonnes of zinc in zinc concentrate in the first half, 11% below the first half result in 2021. The result was impacted by lower ore mined early in the year due to workforce availability. Workforce availability has improved in the second quarter stabilising production rates.

Rosebery produced 23,664 tonnes of zinc in zinc concentrate and 9,324 tonnes of lead in concentrate during the first half of 2022, representing respectively a 37% and 32% reduction on the prior corresponding reporting period. Productivity was negatively impacted by COVID-19 related workforce availability and lower ore grades due to a temporary focus on mining lower grade stopes.

Liangang Li said: “Managing the impact of COVID-19 has remained a priority across all our operations, particularly due to the emergence of new, more readily transmissible variants.  Our focus and ongoing efforts continue to be directed towards implementing updated guidelines from our host governments and ensuring infection controls remain firmly in place.”

Full year copper production at Las Bambas and Kinsevere is now expected to be around 290,000 tonnes. Zinc production guidance is maintained in the range of 225,000 and 255,000 tonnes.

“As we look to the rest of 2022, MMG will continue its focus on maintaining stable operations, advancing the critically important long-term solution to community challenges at Las Bambas and careful cost management and capital allocation in the face of industry-wide cost pressures.

Growing our assets remains a management priority with works advancing on the Kinsevere Expansion Project and future-proofing the Rosebery mine by securing a tailings storage solution. Advancing the Chalcobamba development at Las Bambas remains a key focus of ongoing community dialogue,” Mr Li noted.

Please download a full copy of the MMG 2022 Interim Results Announcement here.