Sign up United Kingdom
Proactive Investors - Run By Investors For Investors

Antofagasta nearly doubles 2017 dividend as it posts sharp rise in earnings, thanks to higher copper prices

The FTSE 100-listed Chilean miner said its 2017 underlying earnings (EBITDA) rose by 59% to US$2.6bn, up from US$1.63bn in 2016, as its EBITDA margin improved to 54.5% from 44.9%
Mining truck
Antofagasta is paying a final dividend of 40.60 US cents, boosting its total payout by 177% to 50.9 US cents per share

Antofagasta PLC (LON:ANTO) reported a sharp rise in full-year earnings, thanks to higher copper prices and said it would nearly double its dividend.

The FTSE 100-listed Chilean miner said its 2017 underlying earnings (EBITDA) rose by 59% to US$2.6bn, up from US$1.63bn in 2016, as its EBITDA margin improved to 54.5% from 44.9%.

READ: Antofagasta's production challenges should subside in 2019, says Berenberg

Antofagasta's revenue increased by 31% to US$4.75bn, up from US$3.62bn in 2016., and its free cash flow jumped to US$1.20bn, well above the US$343.0mln seen in 2016.

The miner’s net debt at the year-end was US$456.4mln, compared to US$859.6mln at the end of June 2017, while capital expenditure rose, as planned, to US$899.0mln from US$795.1mln.

The firm reiterated its forecasts for 2018 copper production guidance of between 705,000 and 740,000 tonnes, which would compare to 704,300 tonnes in 2017.

It said it expects the copper market to tighten in the second half of 2018, and to be in balance or in a slight deficit for the whole year, with 2019 more likely to be in deficit

Antofagasta’s CEO Iván Arriagada said: "Our priorities for 2018 are continued capital discipline and the next phase of our growth - notably the review and expected approval of the Los Pelambres Incremental Expansion project and progressing expansion plans at Centinela."

The group is paying a final dividend of 40.60 US cents, boosting its total payout by 177% to 50.9 US cents per share, up from 18.40 US cents in 2016.

In a note to clients, analysts at RBC Capital said: “The better-than-expected dividend, and better net debt will help to offset the ~25% increase in Pelambres expansion capex (c.2% of ANTO market cap), however we highlight ANTO is trading at its lowest relative level to consensus in the past 2 years at (5.7x EV/EBITDA, RBC 5.5x).”

RBC repeated a ‘sector perform' rating on Antofagasta with a price target to 1,060p.

In afternoon trading, Antofagasta shares were up 1.9% at 904.8p.

 -- Adds broker comment, updates share price --

View full ANTO profile View Profile

Antofagasta Plc Timeline

Related Articles

periodic table
September 10 2018
W Resources should be in production from La Parrilla next year
Tomingley gold open pit operation
March 26 2018
The Dubbo Project hosts zirconium, hafnium, niobium, tantalum, yttrium and rare earth elements.
map showing Cobalt belt in East Ontario with projects marked
August 14 2018
A historical 8-tonne bulk sample from the Mulligan project averaged 10% cobalt grade.

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2018

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use