Hochschild Mining extends dividend break as gold losses grow
Gold and silver miner Hochschild Mining will not restore its final dividend after revenue slumped and losses widened for the last financial year.
In its 2023 report, published this morning, the firm, which operates mines across North, Central, and South America, said it moved from a $25.8m (£20.1m) profit before tax in 2022 to a $43.5m (£34m) loss in 2023 while revenue ticked down from $735.6m (£574.9m) to $693.7m (£542.2m).
Net debt swelled from $175.1m (£136.8m) in 2022 to $257.9m (£201.5m) last year, while the firm reported a basic loss per share of $0.10 (£0.07) against a $0.01 (£0.007) earning per share the year prior.
Net income of $9.5m (£7.4m) was lower than Peel Hunt analysts’ expectations of $27m (£21.1m) due to higher-than-expected currency headwinds.
Cash levels as of 31st December last year were 38 per cent lower than the year prior, at $89.1m (£69.5m) against $143.8m (£111.7m)
Hochschild reported earnings before interest, taxes, depreciation and amortisation (EBITDA) of $274m (£214m), ahead of Peel Hunt analysts’ expectations of $260m (£203.2m), helped by beneficial exchange rates on some of its Argentinean sales.
The company said that to reduce debt levels, it would focus on capitalising on the high gold price and added that it would be “inappropriate to restore the final dividend at this stage.”
This approach will be reviewed at the interim results in August.
Nevertheless, chief executive Eduardo Landin hailed a “robust” 2023 performance.
“We made strong progress at our new Mara Rosa mine in Brazil, which is now in production, on time and on budget and furthermore, we obtained a crucial permit at Inmaculada in Peru, ensuring an exciting, long-term future for the operation.
“We remain confident of a strong year ahead as we continue to execute our stated strategy of driving long-term production growth whilst reducing costs.”
As wars in the eastern part of the world rage on and elections in both the US and UK loom, gold bullion rose to $2,141.79 (£1,683.98) an ounce last week, beating its previous record of $2,135.39 (£1,679.59) set on December 4 last year.