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LUXEMBOURG - Nexa Resources S.A. (NYSE: NYSE:NEXA), a significant zinc producer with a market capitalization of $808 million, announced that it met its consolidated mining production guidance for 2024, with zinc, lead, and silver production within the annual guidance range and copper production surpassing it. According to InvestingPro data, while the company currently operates with a significant debt burden, analysts expect it to return to profitability this year. The company provided its production and sales guidance for the 2025-2027 period, as well as cash cost, capital expenditure, and other operating expense forecasts for 2025.
For 2024, zinc production reached 327 kilotons, with copper production totaling 36 kilotons, exceeding the upper guidance range. Lead and silver production were 69 kilotons and 12 million ounces, respectively, both aligning with guidance. Metal sales came in at 591 kilotons, driven by higher production volumes and enhanced operational stability, particularly at the Cajamarquilla and Juiz de Fora smelters. Despite challenging market conditions that led to a -30.68% year-to-date return, InvestingPro analysis suggests the stock is currently undervalued, with analyst price targets ranging from $7 to $10.
Operational efficiencies and cost management contributed to achieving consolidated run-of-mine mining costs and C1 cash cost guidance, which were reduced by 65% in October 2024. Factors such as reduced energy consumption, optimized personnel expenses, and lower third-party service costs played key roles in these results.
For the 2025-2027 period, Nexa forecasts a slight increase in zinc production at mid-range levels for 2025, primarily due to higher output from Aripuanã and El Porvenir mines. This will be partially offset by lower production volumes at Cerro Lindo and Vazante. Copper production is anticipated to decline by 10% in 2025 compared to 2024, mainly due to lower grades in prepared areas. Lead and silver production are expected to decrease by 7% and 1%, respectively, in 2025.
Total (EPA:TTEF) metal sales are projected to decrease by 3% in 2025, mainly due to lower treatment charge levels. This strategy aims to preserve margins in the smelting segment, resulting in slightly lower metal sales. Remediation efforts following a fire incident at the Juiz de Fora wet electro-filters at the end of December 2024 are expected to be completed by the second half of 2025, with production adjustments factored into the guidance.
The company also outlined its CAPEX guidance for 2025, set at $347 million, with sustaining investments totaling $316 million. Investments will focus on projects such as the Cerro Pasco Integration Project and the expansion of tailings filter capacity at Aripuanã. With a debt-to-equity ratio of 1.94 and EBITDA of $474.5 million in the last twelve months, the company’s financial health score on InvestingPro is rated as "FAIR". For deeper insights into Nexa’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
Nexa’s financial results for the fourth quarter and full year 2024 will be published on Thursday, February 20, 2025, after trading hours, with a conference call scheduled for the following day.
This article is based on a press release statement from Nexa Resources and contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those projected in the forward-looking statements due to various factors, including but not limited to changes in metal prices, operational performance, and economic conditions.
In other recent news, Luxembourg-based Nexa Resources S.A. has successfully met its 2024 production and cost guidance, notably exceeding its targets for copper production. This achievement has been documented in a Form 6-K report filed with the U.S. Securities and Exchange Commission. The company has also provided an outlook for the years 2025 to 2027, offering valuable insights for investors and market analysts assessing the firm’s long-term prospects.
In parallel developments, EMX Royalty Corporation has finalized a Royalty Agreement with Minera Pampa de Cobre S.A.C., securing royalties from the Chapi copper mine in southern Peru. The agreement grants EMX up to a 2% Net Smelter Returns royalty on minerals from the mine and surrounding areas. This acquisition expands EMX’s portfolio in the Paleocene-Eocene copper-molybdenum porphyry belt, a region known for significant copper production.
These recent developments highlight both Nexa Resources and EMX’s strategic planning and operational efficiency in the metal mining industry. Further details on these achievements and future plans can be found in the respective reports filed with the SEC and the press release statements issued by the companies.
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