Kaz Minerals PLC audited results for the year ended 31 december 2015

FINANCIAL HIGHLIGHTS

  • Group EBITDA of $202 million

-  East Region and Bozymchak EBITDA of $240 million

  • Strong cost control in a low commodity price environment

-  Gross cash cost of 230 USc/lb, below guidance of 260-280 USc/lb

-  Net cash costs of 109 USc/lb, first quartile operations

-  Sustaining capital expenditure limited to $68 million, below guidance of $80 - $100 million

  • Significant liquidity

-  Available funds of $1,501 million, includes $250 million of undrawn facilities at 31 December 2015

-  Net debt $2,253 million as at 31 December 2015

 

OPERATIONAL HIGHLIGHTS

  • Achieved production targets for all metals

-  Underlying copper in concentrate production of 89 kt

-  Copper cathode production of 81 kt, in line with guidance of 80-85 kt

-  All by-products in line or ahead of guidance

 

MAJOR GROWTH PROJECTS ON TRACK

  • Bozshakol

-  Mining activity ramping up, 7 million tonnes of ore mined in 2015

-  Copper concentrate production commenced in February 2016

-  Production guidance for 2016: 45-65 kt copper cathode equivalent and 50-70 koz gold bar equivalent

-  $50 million reduction in project capital budget

  • Aktogay

-  3 million tonnes of oxide ore mined in 2015

-  Oxide operations contributed initial copper cathode production in 2015

-  Production guidance for 2016: 15 kt of copper cathode from oxide operations

-  Sulphide operations on schedule for 2017 start up

 

OUTLOOK

  • Industry leading copper production growth of over 50% per annum to 2018

-  Group’s copper cathode equivalent production to increase to 130-155 kt in 2016

  • Continued focus on cost control

Gross cash cost guidance for 2016:

-  East Region and Bozymchak 200-220 USc/lb

-  Aktogay oxide 110-130 USc/lb

-  Bozshakol 150-170 USc/lb

 

$ million (unless otherwise stated) 

 

2015   

2014

Revenues1

665   

846

EBITDA (excluding special items)1

202   

355

Profit/(loss) before taxation1

12   

(169)

Underlying (Loss)/Profit1

(10)  

86

EPS – basic and diluted ($)2

(0.03)  

(5.28)

EPS – based on Underlying Profit($)1,3

(0.02)  

0.19

Free Cash Flow  

(145)  

(31)

Free Cash Flow before interest4

2

119

Gross cash cost (USc/lb)1,5

230   

257

Net cash cost (USc/lb)1,6

109

 85

Net debt  

2,253   

962

1 2014 reflects continuing operations only.

2 Group basic and diluted EPS in 2014 includes the net loss on divestment of the Disposal Assets ($2.3 billion) and the profit on disposal of Ekibastuz GRES-1 ($0.2 billion).

3 Reconciliation of EPS based on Underlying Profit is found in note 10(b).

4 Net cash flow from operating activities before interest, capital expenditure, non-current VAT and accruals associated with expansionary and new projects, less sustaining capital expenditure on tangible and intangible assets. Free Cash Flow reflects continuing and discontinued operations for the year end 31 December 2014.

5 Group cash operating costs excluding mineral extraction tax, divided by the volume of copper cathode equivalent sales. The full year cash operating costs for 2014 include East Region costs only on an allocated basis prior to the Restructuring of the business. The second half of 2014 gross cash cost of 277 USc/lb is considered more representative of the performance of the East Region as a stand-alone business.

6 Group cash operating costs excluding mineral extraction tax less by-product revenues, divided by the volume of copper cathode sales. The full year cash operating costs for 2014 include East Region costs only on an allocated basis prior to the Restructuring of the business. The second half of 2014 net cash cost of 107 USc/lb is considered more representative of the performance of the East Region as a stand-alone business.

 

Oleg Novachuk, Chief Executive, said: “In 2015 we made excellent progress in the delivery of our major growth projects, Bozshakol and Aktogay, and the operating mines in the East Region and Bozymchak hit their production targets at a first quartile net cash cost of 109 USc/lb. Our immediate priorities in 2016 are the ramp up of Bozshakol, the construction of Aktogay and to keep operating costs low across the Group. The delivery of our world class projects will enable us to de-gear the balance sheet and complete our transformation into a low-cost operator of large scale, open pit copper mines in Kazakhstan.”

 

KAZ Minerals_Preliminary_Results_2015_25Feb_2016 (to read)

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