MMG 1208

MMG 1208

Postby winston » Wed Aug 23, 2017 6:33 pm

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MMG fast tracks Australia zinc project to ride on zinc price rally

The miner returns to a US$113.7 million net profit in the first half of 2017, versus a loss last year

MMG, the Hong Kong-listed overseas mining unit of state-owned metals trading giant China Minmetals, says it will start trial production at its Dugald River zinc mine earlier than it planned, after reporting its best interim profit in five years.

“Our capital expenditure will also be at the lower end of our guidance of US$600 million to US$620 million,” chief executive Jerry Jiao Jian told reporters and analysts via teleconference on Wednesday.

The Dugald River zinc mine in Queensland, Australia with targeted annual output of 170,000 tonnes, would partially replace lost output from its much larger Century mine in the same state that was decommissioned late 2015.

Average spot market zinc price in London has jumped 50 per cent year on year to US$2,690 a tonne in the year’s first half.

Asked to comment on the rally’s sustainability, Jiao said he saw tight supply to persist for both zinc and copper prices until at least 2019, supported by demand recovery in the United States and Europe, and infrastructure demand in nations along the modern Silk Road and Maritime Silk Road thanks to Chinese funding of projects there.

MMG on Tuesday reported a net profit of US$113.7 million in the year’s first six months, matching its own projection indicated earlier this month, compared to a loss of US$93 million in the same period last year.

First half revenue jumped 231 per cent year on year to US$1.94 billion.

The marked turnaround was driven by a 248 per cent rise in first half copper sales to 295,934 tonnes after last year’s commissioning of its Las Bambas project in Peru, one of the world’s 10 largest copper mine by output.

The first half profit was also lifted by a 22 per cent year on year rise in average copper price in London’s spot market to US$5,749 a tonne, as well as a US$173.7 million pre-tax profit on the divestments of a gold mine and a zinc mine, both in Australia.

The company derived the vast majority of its profit from copper sales. It has copper, zinc, lead and gold production in Australia, Democratic Republic of Congo, Laos and Peru.

For the full year, MMG has maintained its targets first indicated in March, to achieve 560,000 to 615,000 tonnes of copper, and 65,000 to 72,000 tonnes of zinc.

It produced 290,758 tonnes of copper and 37,519 tonnes of zinc in the first half.

The Las Bambas project achieved an output of 430,000 tonnes of copper output in its 12 months of operation since commercial operation began in July last year, exceeding its designed annual capacity of 400,000 tonnes.

Jiao said MMG was seeking to reduce its production cost of US$1 per pound which already ranks in the lowest 25 per cent among copper projects globally, despite cost inflation pressure in the industry.

The company’s US$1.1 billion of cash from operations in the year’s first half, allowed it to pay down US$868 million of debt. Net debt stood at US$8.9 billion at the end of June.
Its net finance cost amounted to US$260 million of in the year’s first half.

MMG shares closed 4.4 per cent higher on Tuesday at HK$3.77. They have rallied 89.5 per cent year to date, outperforming the Hang Seng Index’s 24.6 per cent gain.

Source: SCMP

http://www.scmp.com/business/companies/ ... rice-rally
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Re: MMG 1208

Postby winston » Thu Aug 24, 2017 1:07 pm

<Result Ann>MMG Swings to US$17.8M Interim Net Profit

MMG (01208.HK) announced the result for the six months ended 30 June 2017.

During the period, revenue amounted to US$1942 million, growing 231% yearly;

Net profit amounted to US$17.8 million, as compared to a loss of US$92.5 million a year ago;

EPS amounted to US0.22 cents. No interim dividend was declared.

Source: AAStocks Financial News
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Re: MMG 1208

Postby winston » Thu Aug 24, 2017 1:11 pm

July 27, 2017

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MMG (01208.HK) 1H17 Copper Production Up 83% YoY to 219,100 Tons

MMG (01208.HK) announced that for the three months ended 30 June 2017, the production of copper rose 23% yearly to about 107,400 tonnes;

The production of zinc fell 9% yearly to about 18,400 tonnes;

The production of lead fell 9% yearly to 6,147 tonnes;

The production of molybdenum amounted to 332 tonnes.

For the first half of 2017, the production of copper rose 83% yearly to about 219,100 tonnes; the production of zinc fell 6% yearly to about 37,500 tonnes; the production of lead fell 3% yearly to about 12,400 tonnes; the production of molybdenum amounted to 472 tonnes.

Source: AAStocks Financial News
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Re: MMG 1208

Postby winston » Thu Aug 24, 2017 1:16 pm

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Aug 15, 2017

Analysis:

According to the profit alert issued by MMG Limited (1208), the Group is expected to record a net profit for the half year ended 30 June 2017 of approximately US$113 million, as compared to the loss of US$93million recorded for the half year ended 30 June 2016.

The expected result represents substantial improvement in underlying operating conditions with commodity prices increasing relative to H1 2016, the addition of Las Bambas to the operating portfolio and high production levels for the Group.

MMG expects to produce 560,000-615,000 tonnes of copper and 65,000-72,000 tonnes of zinc i n 2017.

The Dugald River project is now more than 70% complete and progress favorably against target for first production in early 2018. (I do not hold the above stock)

Strategy:
Buy-in Price: $3.40, Target Price: $3.70, Cut Loss Price: $3.25

Source: Phillips
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Re: MMG 1208

Postby winston » Thu Aug 24, 2017 1:18 pm

June 25, 2015

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Conference and NDR highlights

We reiterate BUY on MMG – our top pick in the sector with 39% upside to our DCF-based TP of HKD4.

We see further DCF upside with Las Bambas (LB) at full production in early 2017.

The LB project (Cu/Au/Ag) is on schedule and budget. When at full production it will generate USD1.2b of EBITDA or twothirds of MMG’s total at our LT copper price of USD2.85/lb.

Most frequently asked questions were the progress of the LB project, plans to restructure the balance sheet and improve share liquidity, and recent weakness in metals prices.

Source: Maybank

https://factsetpdf.maybank-ke.com/PDF/C ... 4394b6.pdf?
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Re: MMG 1208

Postby winston » Mon Aug 28, 2017 3:37 pm

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MMG RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2017

KEY POINTS

Net Profit After Tax of US$113.7 million including US$107.5 million from current operations. A US$206.7 million improvement on corresponding period in 2016.

Net Operating Cash Flow of US$1,116.0 million, an increase of 1,834% on the prior corresponding period due to the contribution from Las Bambas, higher commodities prices and a strong focus on cash generation.

MMG’s Net Debt reduced by US$868.2 million as a result of increased cash generation. The gearing ratio has reduced from 79% to 77% at 30 June 2017. Net Finance Costs for the period totalled US$260.1 million. Cash on hand at the end of the period was US$914.3 million.

Subsequent to the balance date, on 31 July 2017, Minera Las Bambas S.A. voluntarily prepaid US$500.0 million under its secured project facility. The prepayment was funded with surplus cash generated by the Las Bambas operation and will result in gross annualised interest savings of approximately US$25.0 million (based on prevailing LIBOR rates).

Reported EBITDA of US$1,028.6 million included US$173.7 million of pre-tax profit on the divestments of Golden Grove and Century in the first half of 2017. EBITDA from Continuing Operations was US$854.9 million compared with US$134.3 million in the prior corresponding period.

Las Bambas produced 430,054 tonnes of copper in copper concentrate in its first 12 months of
commercial production. Total EBITDA for the first half of 2017 was US$756.4 million and C1 costs were US$1.01/lb.

Operating EBITDA at Sepon and Kinsevere of US$59.1 and US$65.9 million respectively was in line with the prior corresponding period.

Operating EBITDA at the Australian Operations improved 20% to US$70.9 million.

The development of Dugald River is advancing ahead of schedule and the production of first concentrate is now expected in late 2017. When operating at design rates it will be one of the world’s top 10 zinc mines.

Total capital expenditure for the six months to 30 June 2017 was US$349.2 million, including US$137.0 million for the Dugald River development. We expect full year capital expenditure to be around US$850 million, including approximately US$330.0 million for Dugald River.

The divestment of the Golden Grove mine and disposal of the assets and infrastructure of the Century mine were completed on 28 February 2017 resulting in a pre-tax profit of US$173.7 million (post-tax profit of US$6.2 million) reported in the first half of 2017.

The Board does not recommend the payment of a dividend for the period.

MMG expects to produce 560,000 – 615,000 tonnes of copper and 65,000 – 72,000 tonnes of zinc in 2017.

http://www.hkexnews.hk/listedco/listcon ... 822700.pdf
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Re: MMG 1208

Postby winston » Fri Oct 13, 2017 9:49 am

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China Minmetals-owned MMG seeks M&A in copper, zinc, other commodities

MMG Ltd, the international mining unit of state-owned China Minmetals Corp, has become China’s preferred developer of overseas projects and is looking at acquisitions beyond its core strengths of copper and zinc, MMG’s chief executive said.

As well as actively looking for copper and zinc projects to develop, “We continue to assess other commodities,” Jerry Jiao told reporters at a Melbourne Mining Club lunch. Jiao said that could include other materials needed for electric vehicles.

China’s government is supporting moves overseas by state-owned industries with a keen focus on commodities in which China is short, said the CEO of MMG, headquartered in Melbourne.

“Minmetals has been selected as a pilot programme for SOE (state-owned enterprise) reform – the only one in the metals sector,” he said. “This has now positioned MMG as a preferred vehicle for foreign direct investment into international resource investment in ‘China-short’ commodities.”

Jiao said it is becoming more difficult to make acquisitions, as his firm is chasing the same copper assets that other miners, now cash-rich after fixing their balance sheets, want to snare.

“The competition is getting more severe. It’s just not easy to do what we planned,” he told reporters after speaking at the event in Melbourne. As a result, MMG may look more towards partnering other companies on the assets it wants to acquire, rather than going for acquisitions paid fully in cash, he said.

Beijing is trying to streamline and modernise its bloated and debt-ridden state-owned sector and create conglomerates capable of competing globally. It has ordered all state-run enterprises to modernise their ownership structures and introduce private capital as part of a far-reaching reform programme for its debt-ravaged state sector.

Minmetals’ selection for the trial was partly due to MMG’s successful development of the Las Bambas copper mine in Peru and its zinc mine, Dugald River, in northern Australia, Jiao said, a “demonstration that China can deliver and operate world scale international mining projects – and deliver value.”

MMG expects to produce 65,000-72,000 tonnes of zinc and 560,000-615,000 tonnes of copper this year, it said in August. It will release its third-quarter production report on Oct. 18.

The company posted a half-year profit of $17.8 million in August.

Source: Deal Street Asia

https://www.dealstreetasia.com/stories/ ... 69cc61b4c8
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Re: MMG 1208

Postby winston » Tue Oct 31, 2017 1:44 pm

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Oct 19, 2017

MMG (01208.HK) Buys 1st Batch of Dugald River Zinc Concentrate, Involving US$12M

MMG (01208.HK) announced that on 18 October 2017, the seller entered into the Dugald River Zinc Concentrate Sale agreement with Minmetals North-Europe in relation to the sale of the zinc concentrates produced by the group at its Dugald River Mine by the seller to Minmetals NorthEurope AB.

Minmetals North-Europe is a wholly owned subsidiary of CMC, the ultimate controlling shareholder of the company, and is therefore an associate of CMC and a connected person of the company under the Listing Rules.

As a result, the Dugald River Zinc Concentrate Sale agreement constitutes a connected transaction for the company.

The amount of zinc concentrates is approximately 10,000 dry metric tonnes. The pricing of the concentrate was determined after arm's length negotiations and is comparable with the market for concentrate qualities such as Dugald River zinc concentrate.

If the transaction was executed on 18 October 2017, it would be valued at approximately US$12 million.

The Dugald River operation will produce approximately 340,000 dry metric tonnes of zinc concentrate at full production.

Concentrate production is forecast to commence before the end of 2017.

Minmetals North-Europe has agreed to purchase the first shipment of the product on terms which are consistent with prevailing market rates and conditions for comparable zinc concentrate.

Source: AAStocks Financial News
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Re: MMG 1208

Postby winston » Tue Oct 31, 2017 1:45 pm

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Oct 19, 2017

MMG (01208.HK) 3Q Copper Cathode Output Down 16% YoY


MMG (01208.HK) announced that for the third quarter ended 30 September 2017, output of copper cathode totaled 33,416 tons, down 16% yearly or 6% quarterly.

Source: AAStocks Financial News
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Re: MMG 1208

Postby winston » Tue Oct 31, 2017 1:47 pm

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Oct 19, 2017

MMG (01208.HK) Gold Resources Down 14% as of Jun

MMG (01208.HK) released its mineral resources and ore reserves statement as of June.

Gold reduced 14% and molybdenum dropped 3%.

Source: AAStocks Financial News
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