BVN - Earnings call transcript Q2 2022 | Compañía de Minas Buenaventura S.A.A.

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Operator

Good day, ladies and gentlemen, and welcome to the Compañía de Minas Buenaventura Second Quarter 2022 Earnings Conference Call. At this time, all participants will be in a listen-only mode. Please note that this call is being recorded. I would now like to introduce your host for today's call, Mr. Gabriel Salas, Investor Relations. Mr. begin. may you Salas,

Gabriel Salas

Also Benavides, and second for discussion are quarter Mr. Dominguez, Executive Manager; led everyone, Carlos Juan available Raul today to Officer; your to will us discuss by Officer. Chief and Salazar, Garcia, and our XXXX Leandro Exploration Chief questions our thank Roque morning, call joining and you today be joining Good Mr. Vice Benavides, Ortiz, Mr. results. Mr. Carlos Mr. Project Operations; of Manager; Daniel Mr. Chairman; President Mr. Financial Juan Director. Renzo Macher, Geology Today's

hand note over, website, assumptions. on you I today's statements forward-looking that after that based me Buenaventura's a our find first yesterday press release remarks the and include Before touch views our are management call current will was that On Please few on close. items. posted let market

not the on forward-looking you view that the concerning information, statements you While in on reasonable management full we July press to expectations within cautioned filed the place are believes XXXX. and I XX, release currently disclosure encourage available forward-looking predictions statements. to its undue of read assumptions, the are these reliance

to Let the Garcia. turn call Leandro me now Mr.

Leandro Garcia

and Thank conference you, Good thank morning you all Gabriel. for this attending to call.

this and we Before friend's we this start wish time. family to presentation, health would at you, your like difficult and well-being

the the quarter second of XXXX present de results pleased Minas Compañía to Buenaventura. We are from

is a available which our PowerPoint prepared presentation, We have in website.

Slide go to the we review cautionary statement Before please X. shown on take further, moment a

reported operations compared follows: from the quarter Slide quarter to as was to in XXXX $XX.X of second direct X, XXXX. on negative Moving the million second $XX.X million were EBITDA highlights

$XXX.X second flow XXXX compared million of year. million operating last quarter $XX.X reached Second in quarter cash to

income Second quarter $XX.X XXXX. million was loss compared the net million XXXX period $XX.X same for in to net

company's revised million is to mine. quarter strategy in XXXX to exploration of quarter the exploration focus its This part of in increase XXXX. $XX.X increase $XX.X operating to second on increased million of at order compared life Second units the extend to

expenditures the same period million XXXX to quarter $XX.X $XX.X capital compared Second were in XXXX. million for

Net relative debt -- was last X.X Huanza's structure the the paid of company reducing April $XX.X includes Second reduced Buenaventura rate million efficiency X.XX% The stake to XX, mine Verde. Cerro strategy debt of XXXX when million of quarter quarter versus on a million X.X to Gabriel $XXX.X restarts. of second were at million $X.X million in maturity million of continued project. Cerro million per position $XXX the amounts of related related XXXX, received until quarter total million $XXX.X cost sorry. payable current of with million; project expenses On quarter costs XXXX. $XX.X the reported cash XXXX to its operation the second the to to from San reduced at the an June COVID-related in this a year, to Yumpag progressively second XXXX. of CapEx XX, years and XXXX. annum Verde the fixed improve in coupon Buenaventura's $XX average reached quarter dividend its years $XX.X Uchucchacua $XX to with

X, to strategy. Slide on corporate ESG Moving our

some ESG regarding key find strategy. can you indicators Here, our

will strategy, diligence. Sustainability Jones quarter, start second measurement, our conducted In during we of due human the our second we apply quarter rights with we the Dow line to During XXXX, carbon footprint ESG and our Index.

lower million, second Slide the Total to financial to is were during XXXX. of the quarter comparison XX% on in which second highlights. X, Moving quarter revenues $XXX

first The of half compared to first of million half decreased year, the $XXX total the revenues XXXX. to

comparison for XXXX. in for the XXXX of was to the quarter our quarter in $XX to EBITDA to EBITDA months transaction. million million six mainly XXXX. $XX period to second comparison year, second direct The in to second comparison million the in the $XXX of due the XXXX. months during EBITDA increase from $XXX for $XX Also, affiliates increased to same including year in in the million XXXX. million, million first XXXX. before, our reached XX% half of million negative the $XX EBITDA totaled the first direct to the of was increased $XXX this $XX million is second CapEx increase of six to of mentioned operations the compared second the during in same of The As million for period operations first $XXX months half million XXXX. quarter million In XXXX in $XXX quarter quarter to from our of the XXXX of CapEx Yanacocha we first the including year during comparison compared our the associate six $XX company for

XXXX, shows stockpiles the of common higher figure first XX,XXX which was the reported quarter second Moving mainly XX,XXX XX% our of on at was pad. It gold higher of production year the compared quarter treated XXXX. the of This on the the was the semester by the same second to of X% the ounces, explained decrease production. production than the which on is this to X X.X Silver production Slide a and year-over-year Orcopampa. XXXX quarter and leach previous in on year. rate decrease ore is aging attributable offset increase volume in reported the period [ph] total Total in ounces, XX% by partially than million XX% quarter the in attributable was the attributable XX% attributable for same XXXX. ounces, gold X, decrease higher In

of first case of of was previously of quarter the lead, of quarter year, second During at production first in X,XXX In ounces, of second In quarter sequence semester mainly XXXX, X.X than million XXXX. in suspension the tons decrease operations lower the the lower to of XXXX, primarily a Uchucchacua's XX,XXX was second metric the zinc as XXXX, were to the the the was In than and compared mine Brocal. XX% attributable half first period semester was silver announced tons production of XXXX. change XX% due XXXX. same lower tons, El This the plan explained quarter in equity reached metric the production the XXXX. to X,XXX in comparison is decrease metric second which of XX% of a produced, the zinc

comparison tons first The X,XXX XXXX. was XXXX, in lead in half XX,XXX tons of metric approximately production metric to

attributable second the tons. copper the for was XX,XXX our quarter year Finally, over metric production

and of period same to compared During half XXXX, the XX% copper of production first increase was the tons XX,XXX metric attributable XXXX.

applicable XX% a lead, $X,XXX XX% comparison which metric all-in is cost year-ago. sales for than year-ago, higher operations direct per sales. for semester than ounce. X% metric all-in from The decreased sustaining which the is is our ton, year-ago., were $X,XXX for per for is applicable $XX.XX to by to follows: to ounce, silver, sustaining than $X,XXX and per per of first costs semester Moving copper, a on to a to year-ago; The X, for as Slide which over ounce, first the per in XXXX lower XXXX cost gold, $X,XXX a lower XX% costs ton of which X% higher

zinc, per XX% which of the metric in a year-ago. is than the higher case ton, cost to was Finally, sales applied $X,XXX

to on of projects X, Moving update. pipeline Slide

Here, level of our development snapshot projects. for each we one are presenting current in one the a

San to Slide matters delayed XX, to Moving addressed. are that social The being Gabriel. construction due is on

power X.X activities are the Power underway, the started go. procurement We of following, procurement the secured, line -- XX% bidding expecting we to to at completion, kilometers level work completion. engineering in are at the are X.X on line resume packages are XX% and engineering XX% land

Moving to Trapiche. Slide on XX,

We control confirm metallurgical column temperature are recovery. finishing after on-site primary XXX column days first leaching; flow and design testing rate helped of

test ore leaching chloride report in have final process. completed Lima, We in

completed EIA the workshop. successfully have We missing

in have of We with operational remaining still one agreements two communities, signed process. five out

communities. three power-line corporate resumed have land to are land agreements be We agreements after started Access road agreement finalized. with

on for to and attention. XX. all. XX,XXX increase progress. certainty study. to I drilling Moving the plan approved Thank to go development ahead. acquisitions line questions. sulfide. Operator, open will are Tantahuatay's you to a call resource land That's the the The Coimolache's your please Coimolache's for prefeasibility of operator hand the Board Slide back in

Operator

you. Thank

begin come Stanley. Please from ahead. Instructions]. Morgan Spiess now [Operator question-and-answer will with session. go question Jens We will first And the the

Jens Spiess

call. zinc was, to cash thank the first was question for ton, was spot $X,XXX on My you current $X.X the is price. is taking my cash which close spot the which -- four the per reported. price. the It current Yes, point, I think copper above you cash that is And

you. So just wanted operations with currently know experiencing? considering, you're on strategy I what forward going don't going if there is you're the Thank what that stopping the know, costs or is to

Leandro Garcia

we that second you, for for more This questions. Thank making last the our slide complex in March, days quarter after Jens, Brocal, operations. land the your of have

in and can more plan when answer Carlos? your a have detail question, Carlos we please. However, Juan

Juan Carlos Ortiz

for Thank Jens, Leandro. you, you, the Thank Sure. question.

in stockpile Brocal, have this we metallurgic some grade we previously processing plant also plant we for production. zinc low low after the lower we this reason from the land the produced we polymetalic into has increased slide than Regarding we during for that have previous feel cost recoveries, had supply that ore, -- the the the where have pit, in with open that to we stockpiles, quarter, low-grade years. zinc reason that's obtained That's the and the the grade processing the

in the into to that normal material rehabilitation contractors during have plant year, components in production contractors, fit along in from with processing will the one this the working progress. And the inflation, continue the by the open all up reach underground the quarter copper us this, of will case the to the diesel underground the have the we And works are that quarter pit. need services terms the second mainly copper, mine We mine. we from the cost two together impact was is open that the production the this this renegotiate impacted Number of ramping and as quarter. we In we this pit processing of plant. this operate last the we building we where the in

So of we development are meters investing underground. more

of at day day. almost per tons tons X,XXX now are from X,XXX We per previously stable production

at we X,XXX of tons per to year. day, Now be are close day to expect we X,XXX the per the by and end tons

That's we the second development we in have in in meters in mine. more that the copper the quarter. production impact this to the of second allow ramp-up from in underground second now quarter, order for invest more costs So infrastructure

Jens Spiess

Okay.

quarter? say? when was tons lower last per would versus day much XXX,XXX And last So comparison year how you or that

Juan Carlos Ortiz

At were the beginning of X,XXX around year, day. the we tons per

we X,XXX tons. are Now

by We X,XXX end expect this tons per of to the day be year.

Jens Spiess

I Perfect. Okay. question. follow-up make And if a

$XX as along those And not pricing? to million. by pricing on Is any well. Cerro the provisional Were they Verde, results around impact correct? lines, Just was color provisional were that very the for also you, just it impacted good confirm,

Daniel Dominguez

Jens, Sorry, impact this Daniel was is the Buenaventura million. for quarter in The $XX Dominguez.

Jens Spiess

$XX million, okay.

Daniel Dominguez

by Yes, a and adding there the the that that million that $XX way to -- $XX reconciliation, million $XX the loss should million. be is the is in loss, up is

as We call. as this will correct we finish soon

Jens Spiess

on? experiencing higher perfect. -- on Okay, there, they costs color price? mainly or And there having provision what's Are over any it also going is

Daniel Dominguez

higher They the should are are we in -- basically. X% due experiencing order inflation This be X%. cost of having to to

that will to confident higher We that of very for up only half expect $XX million entire add should for year were to were distributing second dividends feel they higher dividends the we They least do year, not we million. quarter. expecting million. the the dividends. $XXX But at $XXX approved for continue the second However,

Sorry, Leandro.

Leandro Garcia

the also add, may for in invoices for sales provisional copper the and I revenues Verde. if the derivative Cerro price embedded affected the Sorry,

Jens Spiess

Okay, much. perfect. Thank you Great. so

Leandro Garcia

Jens. you, Thank

Operator

[Operator Instructions].

question with Please will next Scotiabank. go Jakusconek Tanya Our come from ahead.

Tanya Jakusconek

Can Hello? hear morning me? everyone. you Good Great.

Leandro Garcia

Yes, Tanya. Yes.

Tanya Jakusconek

questions modeling. I'm just going ask quick very for to some

back anything Or three forward? you're something Just royalty quarter. none to come for with what get you this going that to please. we think wanted income, not the about happened royalty to Is income? should had On modeling, this that going

Leandro Garcia

our in participation, should receive The last used the rate Newmont, we with receiving [indiscernible]. royalty The a split royalty -- because revenue from from Tambomayo, from arrangements all and through we Tanya. the we and hi, this income have continue company, we lower year, Yanacocha income -- come reduced to our

Tanya Jakusconek

I one. worries. No Okay. understand that

then… And Okay.

Daniel Dominguez

If I may.

Tanya Jakusconek

Okay, go ahead.

Daniel Dominguez

in Yes, Tanya, you of sorry, line zero. the as can royalties, current we see have

Tanya Jakusconek

Yes.

Daniel Dominguez

We have the reclassified line. others this on

for in expecting around continue we to million million, this -- are but we reclassifying year $X entire $XX are others. the We

Tanya Jakusconek

and is I if with then two that to give for looks second development got still you separate then, previous have do to $XXX And valid $XX Daniel, million other months questions. half? idea a their also capital $XXX million. $XXX $XXX $XXX in overall. the to it. to can to within because of million lot One like modeling had ask an million Can done us $XXX million been spend has CapEx. million you've the million It you Got And you've guidance six Okay.

Daniel Dominguez

to disburse around and between to delays million. year for expect due We the San million Gabriel this $XXX $XXX

Tanya Jakusconek

million that CapEx? all is $XXX million that $XXX Or just So Gabriel? San for and is

Daniel Dominguez

This for million $XX is CapEx, including our just you that sustaining for mentioned. [indiscernible] Gabriel expect and the San we

Tanya Jakusconek

in CapEx CapEx? expect $XXX to $XXX So million development put the Like the total. the together, including still you all million,

Daniel Dominguez

Yes.

Tanya Jakusconek

for And Thank Daniel, question on two the that. just, Okay. lastly, modeling my assets. the on last you questions before

Just the looked and lower realized I your expected. and your revenue. and than pricing, revenue I at volumes still had it When the was at I line sales your looked much

it that, I with understand just the we I'm I provisional much thought lower So but again. can of forward have trying to do pricing, would how all was captured going

wondering why if there's much so just was lower. from clarity on any you it guys that, So I'm

Daniel Dominguez

provisional of quarter the this in the $XX sorry, when and the We -- price around concentrate derivative quarter. an the in was -- $XX. of the had end million of embedded order -- The we impact price $X,XXX we -- or $X,XXX at the the and provisional closed the pricing was sold

a there. big there's So gap

the revert expect part. in to following We this

Tanya Jakusconek

in So $XX the be should million two back quarters? thinking I that coming is next

Leandro Garcia

it Well the price. spot on depends

we Now have have that final we in QP will our that right? will sales, that the QP the

Tanya Jakusconek

And issues on they? that. an line, get and year but are we Thank other procurement have other to what then do the in is this I I'll are why got the weeks? some the be on you critical right. I All Can And will the through and resolved a Okay. San Maybe know you. about we've next project? next. where few on mentioned come quickly get stab Gabriel. they the Where what make are paths of at some social and just items? the power you update just think the that

me update maybe for on that? So an just

Leandro Garcia

question, your Sure, clarify Tanya. question the you Thank on to for Gabriel. San allow us

you Here, Gabriel. are give Manager Project Macher, Renzo, current will we more go Manager, with Renzo color ahead. -- San in with our Please and he situation

Renzo Macher

Tanya. Yes, Hi,

intact. we highlights part this them two That's are these are so still we this Until happened the each with at are a is them So we six less that actual influence we table. comment don't the that have than we with thing of working blocked. communities had our that decision. I authorities of events, to the keeping What direct two is area with one we're in to one And be of field problem. doing from our as the is Meanwhile, community of develop And discussion a it minimum. separate hours. with working our was our are find both What operations open exacerbate one -- not the we are to mid-June, the to at keep guess And to project. communities initial part mention influence that relationship is area we people of in or outside of and considered influence. first requirement our of first the

second actually go don't it's a of part today. stopped can not the main the impact That's You construction -- all. in those project at -- we we foresee year. engineering not not kind of that at And this the beginning and the will at are major the blocked. of activities start still activities since procurement project. hasn't point, of next the Most are have to And

today on we what activities preconstruction So it's minor seeing are is, only. delays

Tanya Jakusconek

second to on part get of construction? anything to year critical the And activities, next that preconstruction

Renzo Macher

at cannot side, being that example, currently we Nothing camp the factory. the for accommodate built because is

some this cannot factories, on nothing place the modules of the under them delays still but at The site, are accommodated maybe camp temporary that to be on when construction first on point.

Tanya Jakusconek

Okay.

place just camp you're just start path half in next So so is construction thinking to critical can the in that that the the second get you that of year.

Renzo Macher

one top. we Again, the preparing minimize to Actually things be try year come to of things. placed and kind footing on mix to and have Yes. for match that

Tanya Jakusconek

Okay.

So from events other it's two communities. just

communities out that social of understanding? other and a correct something influence your caused that So area that's what's fine, from issues. are these of communities you people Is want two the -- are you,

Renzo Macher

guess That's it's not point blocked. I not correct. -- Yes. is That's mean, the is I correct. it main

through two It You project. walk been can actually the ways. like has

Tanya Jakusconek

of mine done the And Okay. be to to can do All -- right. XXXX. that you the Thank a mine what up? I read you're you just for want of restart just back development ask from to then Uchucchacua until your needs me that. QX start-up underground bring in you of your at Uchucchacua. rate, now on I and development -- QX been Can doing and XXXX, remind this you've increasing

Gabriel Salas

Sure, that give Uchucchacua are are stop we are preparing as Yumpag and are the doing mine, gathering whole detail specific more areas can Tanya. here. the Remember, we you all focusing that. a on we Uchucchacua the to that Carlos on Juan work on that going

Juan Carlos Ortiz

as the of have Thank strategy. done areas prepare initial the XXXX Thank been of new original has planned you, well the along Tanya, tunneling Most quarters you, question. Yes, we been as exploration. for to exploration this for progressing two Gabriel. as for

XXX we the reached diamond we meters mine two confirmed the of percentage that the start along to increase of is and last exploration have That's areas of into of XXX drilling preparation. place. in only and resources. volume of six capacity those meters for we that development mine months, September, the exploration And in We years them. meters we per new to into in split will part and gradually one now. particularly that XXX developing XXX% have Now capacity, contractor already now that it of have month per August with level month this

we in some focus areas will of the the mine, [indiscernible] development of be part our have reserve, also, in area. doing drilling And will access We the are we the that that confirmation there. prepare area,

three rehabilitation that the that taking line The we from to need time, are basically developed the same operation mentioning the the all and our size we for in the project. of area facilities team in At for are in kilometers Yumpag. management a before, team, reduction the development new on next of mining Yumpag railroad is regulation been Yumpag require future or we We agenda project Uchucchacua. is mine works accesses, year. It's of coming same incoming reducing only the quarters. And as have straight that's for care ventilation the Uchucchacua the to same Remember, the mining. the cost

So the two same processing to both last And together team plant in the quarter into will of mines these the take of next year. care Uchucchacua will operations. fit

So try of it a the much effort third fourth advance to to to that next bit we speed all the of next year. doing into are the we now of little up, time our quarter to delivery year quarter try ahead as of can as leave

two development delivered from next that pumping, have it's of also at mining, all [indiscernible] agenda by warehouse, will main in like infrastructure quarter Yumpag and camps, we that be offices, and Uchucchacua, So time same the second Yumpag working the quarter ventilation, shops, the operations. mine with in these the second year.

Tanya Jakusconek

development like year? next you QX you're doing facility when with to development ready go big of in all will some to the processing you're you be spots? -- it ore a have stockpile Will and that in and And going ahead of looks of you're this

Juan Carlos Ortiz

year, most Yes. be development ramps the XXXX, That's the plan -- now, of accesses. The plan. in the will developing right the this waste, and to is

Next March. will start in to plan, year, developing ore by in March, we the according

the gradually ore of done next will September along So be between and March more year, the base bodies. developing

Tanya Jakusconek

have you are have you that ready? So the will to mill do a can stockpile size ready feed -- targeted when I you

Juan Carlos Ortiz

Well, days days, enough. we have believe XX between will XX to be

we're trade-off plant. the of the of to resume the operation part that's making speed So up that processing

sustaining XX the like days a right have on be plant will XX, we basis, turn time processing have stockpile. will Once We of again. days XX probably to the on

Tanya Jakusconek

mill. correctly, start so understand the will days I stockpile you have ultimately, So XX-day to

Juan Carlos Ortiz

to No, the XX in stockpile will to plant. days be of -- No, no. surface XX next the with days processing area XX

quarter we again, reach the a combines, the that's other with year. So operational that if to somewhere probably are for of with plan. level conservative a this that we the we now, sustainable level last next year, resuming sustainable, level Right quarter be will reach the in but of probably for time the that going of processing third

Tanya Jakusconek

asking you somebody it Thank to and thank insight. so much for Perfect. Okay. stop questions else. I will you. the leave But

Juan Carlos Ortiz

Thank you.

Daniel Dominguez

you. Thank

Renzo Macher

in to This Gabriel, ministry relationship are send is fact. just San very for Renzo. that letters They add stating proactive, in communities and they the our only is the I want to regards not not project. that to only -- of the support the it's

So…

Tanya Jakusconek

communities that going something your of is appears it's just in from but within where have piece some, are just it It space or and want of support. you're just operating be a outside Yes. something to -- you of influence your

deal some and So said you Yes, quickly it's hopefully, And authorities with you. matter you them, just you. of in a thank then how obviously, with do have helping resolution place will the you them. be

Renzo Macher

Thanks.

Operator

session question-and-answer call. over Leandro conference sir. our to concludes for the remarks. This Instructions]. ahead, turn I would Garcia now like of go Please closing Mr. any today's back [Operator to conference

Leandro Garcia

Thank you, sir.

call, a Thank very wonderful you, and day. to finish share time information. us our we and conference we today Before making want have join much for to with thank this you the

Operator

The you conference presentation. today's has now attending concluded. for Thank

may now disconnect. You

Compañía de Minas Buenaventura S.A.A. (BVN) 27 Jul 222022 Q2 Earnings call transcript