6-K 1 v351374_6k.htm FORM 6-K

 

 

 

FORM 6-K

 

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of the 

Securities Exchange Act of 1934

 

For the month of July 2013

 

BUENAVENTURA MINING COMPANY INC.

 (Translation of Registrant's Name into English)

 

CARLOS VILLARAN 790

SANTA CATALINA, LIMA 13, PERU 

(Address of Principal Executive Offices)

  

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F x Form 40-F ¨

  

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

 

Yes ¨ No x

  

 

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-________________.

 

 

 

 

 

 
 

 

 

 

\\10.9.9.16\Vineyard\Vineyard\Live jobs\2013\07 July\30 July\Shift III\BUENAVENTURA MINING CO INC\Draft\03-Production  

Buenaventura Announces Second Quarter and

Six-Month Period 2013 Results

 

Lima, Peru, July 30, 2013 – Compañia de Minas Buenaventura S.A.A. (“Buenaventura” or “the Company”) (NYSE: BVN; Lima Stock Exchange: BUE.LM), Peru’s largest, publicly-traded precious metals mining company, announced today results for the second quarter 2013 (2Q13) and six-month (6M13) periods, ended June 30, 2013. All figures have been prepared in accordance with IFRS (International Financial Reporting Standards), are on a non GAAP basis and are stated in U.S. dollars (US$).

 

Comments from the Chief Executive Officer:

 

Mr. Roque Benavides, Buenaventura’s Chief Executive Officer, stated:

 

“During the second quarter, metal prices declines significantly impacted our results, in addition to:

1.    Lower production in Uchucchacua due to a 10-day strike.

2.    Lower revenues and quotation period adjustments in El Brocal and Cerro Verde.

3.    Impairment and write-down adjustments at Yanacocha.

 

As a consequence, results were lower than expected. Net income in the second quarter was US$19.0 million, 88% lower than the figure reported in 2Q12 (US$153.2 million). EBITDA from Buenaventura’s Direct Operations was US$40.3 million, 65% lower than the figure reported in 2Q12 (US$114.6 million), while EBITDA, including Associates, decreased 47%, from US$351.8 million in 2Q12 to US$187.5 million in 2Q13.

 

The Company is focusing its activities on value creation by:

1.    Stopping production in non-profitable operations (Antapite, Poracota and Shila-Paula) and evaluating the performance of the other units.

2.    Focusing mine exploration activities on high grade and accessible targets.

3.    Increasing mining operation efficiency / Orcopampa and Uchucchacua.

4.    Focusing on brownfield explorations to reduce risk.

5.    Capital expenditures’ control.

 

Financial Highlights (in millions of US$, except EPS figures):

 
  2Q13 2Q12 Var% 6M13 6M12 Var%
Total Revenues 285.8 350.5 -18% 640.5 727.5 -12%
Operating Income -4.3 81.2 -105% 55.1 213.1 -74%
EBITDA Direct Operations 40.3 114.6 -65% 134.1 286.2 -53%
EBITDA Including Associates 187.5 351.8 -47% 455.9 770.6 -41%
Net Income 19.0 153.2 -88% 121.6 361.3 -66%
EPS* 0.07 0.60 -88% 0.48 1.42 -66%
 
 

(*) as of June 30, 2013, Buenaventura had 254,186,867 shares outstanding.

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 2 of 14

 

Operating Revenues  

 

During 2Q13, net sales were US$273.1 million, an 18% decrease compared to the US$331.8 million reported in 2Q12. This was explained by lower metal prices.

 

Royalty income decreased 32%, to US$12.7 million in 2Q13 compared to the US$18.7 million reported in 2Q12. This was due to lower revenues at Yanacocha.

 

Operating Highlights 2Q13 2Q12 Var% 6M13 6M12 Var%

Net Sales

(in millions of US$)

 273.1 331.8 -18% 614.0 690.7 -11%
Average Realized Gold Price Gold (US$/oz)* 1,388 1,619 -14% 1,477 1,673 -12%
Average Realized Gold Price (US$/oz) inc. Associates 1,401 1,614 -13% 1,499 1,660 -10%
Average Realized Silver Price (US$/oz)* 23.88 29.42 -19% 25.82 30.53 -15%
Average Realized Lead Price (US$/MT)* 2,066 1,927 7% 2,137 1,956 9%

Average Realized

Zinc Price (US$/MT)*

 1,841 1,922 -4% 1,897 1,963 -3%
Average Realized Copper Price (US$/MT)* 7,067 7,827 -10% 7,506 8,254 -9%

(*) Buenaventura’s Direct Operations

 

Sales Content
  2Q13 2Q12 Var% 6M13 6M12 Var%
Gold Oz Direct Operations 116,751 107,661 8% 241,377 234,241 3%
Gold Oz inc Associated 258,490 287,985 -10% 520,595 579,363 -10%
Silver Oz 4,541,688 4,558,020 0% 7,782,423 7,354,671 6%
Lead MT 7,934 9,358 -15% 14,617 11,476 27%
Zinc MT 10,775 14,449 -25% 20,979 22,381 -6%
Copper MT 4,503 824 446% 9,611 6,535 47%

(*) Buenaventura’s Direct Operations

 

Net sales for the first six months of 2013 were US$614.0 million, 11% lower than in the first six months of 2012, while royalty income was US$26.5 million in 6M13, a 28% decrease compared to the US$36.8 million reported in 6M12.

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 3 of 14

 

Production and Operating Costs  

 

Buenaventura’s equity production1 in 2Q13 was 98,210 ounces of gold, 8% lower than the 107,168 ounces reported in 2Q12, mainly due to a production decline at Orcopampa and Poracota. This was offset by a production increase at La Zanja and Breapampa. Silver production, including associated companies, during 2Q13 was 4,420,340 million ounces, a 2% decrease when compared to the figure reported in 2Q12 (4,509,259 million oz.).

 

Equity production1 in 6M13 was 203,673 ounces of gold and 9.1 million ounces of silver. This represented a 9% decrease in gold production (107,168 oz. in 2012), and a 7% increase in silver production compared to 6M12 (8.5 million oz.).

 

Equity Production 1
  2Q13 2Q12 Var% 6M13 6M12 Var%
Gold (oz) Direct Operations 98,210 107,168 -8% 203,673 225,002 -9%
Gold (oz) inc. Associated 239,604 277,394 -14% 483,433 555,191 -13%
Silver (oz) inc. Associated 4,420,340 4,509,259 -2% 9,145,136 8,523,034 7%
Lead ( MT) 6,552 6,910 -5% 13,603 11,625 17%
Zinc ( MT) 10,620 11,842 -10% 20,234 19,245 5%
Copper (MT) inc. Associated 14,911 13,629 9% 28,269 29,044 -3%

 

Orcopampa’s (100% owned by Buenaventura) total gold production in 2Q13 was 54,988 ounces, 9% lower than the 60,745 ounces reported in 2Q12. Production from the Chipmo mine during 2Q13 was 50,196 ounces, 12% lower compared to the 56,762 ounces reported in 2Q12, due to lower ore grade (see Appendix 2). The old tailings treatment produced 4,791 ounces of gold (compared to 3,984 oz. in 2Q12). Total gold production in 6M13 was 8,903 ounces, an 18% decrease when compared to 6M12 (10,891 oz.).

 

Cash operating cost in 2Q13 was US$792/oz., 46% higher when compared to 2Q12 (US$542/oz.). This was mainly explained by the lower gold production and higher contractor costs that resulted from an increase in drilling works and drifting to reach Pucay area.

 

At Uchucchacua (100% owned by Buenaventura), total silver production in 2Q13 was 2.7 million ounces, in-line with 2Q12 production. The lower ore treated, due to a 10-day strike in April, was offset by an increase in the recovery rate, from 72% (2Q12) to 83% (2Q13)(see Appendix 2). Zinc production in 2Q13 was 1,938 MT, 5% lower than the figure reported in 2Q12 (2,036 MT), while lead production increased 4% (1,966 MT in 2Q13 vs. 1,891 MT in 2Q12). During 2013, silver production was 5.7 million ounces; zinc production was 3,936 MT, while lead production was 4,171 MT vs. 5.5 million ounces, 4,247 MT and 3,981 MT, respectively, in 6M12.

 

Despite the 10-day strike impact, cash operating cost in 2Q13 was US$16.20/oz., 3% lower than the figure reported in 2Q12 (US$16.65/oz.) due to:

 

1.A better recovery rate
2.Lower reagent consumption (cyanide and lime) due to plant optimization
3.Lower treatment charges due to lower prices

 

 

1 Production from Direct Operations includes 100% of Buenaventura’s operating units, 100% of CEDIMIN, 53.06% of La Zanja, 40.10% of Tantahuatay and 53.76% of El Brocal.

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 4 of 14

 

At Julcani (100% owned by Buenaventura), total production in 2Q13 was 548,890 ounces of silver, 9% lower compared to 2Q12 (602,764 ounces) due to lower ore grade, a 20-day stoppage that was offset by the increase in plant capacity (from 400 TPD to 500 TPD). During 6M13, silver production was 1.16 million ounces, 6% lower than the 1.23 million figure reported in 6M12.

 

Silver cash operating cost in 2Q13 was US$15.64/oz., 27% higher than 2Q12 (US$12.33/oz.), mainly explained by higher expenses for contractors due to productivity bonuses that were paid in April and unexpected expenses related to the stoppage.

 

Breapampa’s (100% owned by Buenaventura) total production in 2Q13 was 19,342 ounces of gold with a cash cost of US$410/oz.

 

La Zanja’s (53.06% owned by Buenaventura) total production in 2Q13 was 37,045 ounces of gold, a 34% increase when compared to 2Q12 (27,687 oz.) due to an increase in the ore grade (0.73 g/MT in 2Q13 vs 0.55 g/MT in 2Q12). 6M13 gold production was 68,251 ounces, 26% higher than in 6M12 (54,016 oz.), but in-line with La Zanja’s mining plan.

 

Cash operating cost in 2Q13 was US$579/oz., 5% lower than 2Q12 (US$607/oz.) due to a better stripping ratio (0.22 in 2Q13 vs 0.67 in 2Q12).

 

Tantahuatay’s (40.10% owned by Buenaventura) total production in 2Q13 was 35,382 ounces of gold (14,188 oz. attributable to Buenaventura) 10% lower than the figure reported in 2Q12 (39,129 oz. and 15,691 oz. attributable to Buenaventura). During 6M13, gold production was 69,689 ounces (27,945 oz. attributable to Buenaventura).

 

Cash operating cost in 2Q13 was US$447/oz., 16% higher than 2Q12 (US$385/oz.) due to the lower tonnage treated, to keep within the limits of the permits, and silver by-product contribution.

 

At El Brocal (53.76% owned by Buenaventura), copper production was 5,050 MT vs 496 MT reported in 2Q12. For 6M13, copper production increased 57% (9,586 MT in 2Q13 versus 6,110 MT in 2Q12). Copper cash cost was US$6,524/MT, in-line with the figure reported in 2Q12 (US$6,500/MT).

 

Silver production decreased 69% from 1.3 ounces in 2Q12 to 0.4 ounces in 2Q13 due to lower tonnage treated and ore grade. For 6M13, silver production decreased 49% from 1.7 million oz. (in 2Q12) to 0.9 million oz. (in 2Q13).

 

During 2Q12, total zinc production was 10,832 MT, a 23% decrease when compared to the 14,044 MT reported in 2Q13. However, in 6M13, copper production increased 57% (9,586 MT in 2Q13 versus 6,110 MT in 2Q12). Zinc cash cost was US$1,073/MT, 29% lower than the figure reported in 2Q12 (US$1,511/MT).

 

General and Administrative Expenses

  

 

General and administrative expenses in 2Q13 were US$23.6 million, 6% lower than the figure reported in 2Q12 (US$25.0 million). This expense included a US$5.7 million charge related to the merger with our subsidiary CEDIMIN. For the six-month period of 2013, general and administrative expenses were US$39.6 million versus US$54.8 million in the same period of 2012, representing a decline of 28%.

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 5 of 14

 

Exploration in Non-Operating Areas

  

 

Exploration in non-operating areas during 2Q13 reached a positive US$4.1 million, compared to US$26.4 million reported in 2Q12. During the period, Buenaventura’s main exploration efforts were focused on the following projects: Chanca (US$1.3 million), Surichata (US$0.8 million) and La Zanja underground (US$0.8 million). For 6M13, exploration in non-operating areas were US$17.7 million versus US$45.8 million in 6M12, representing a decrease of 61%.

 

Operating Income

  

 

Operating income in 2Q13 was a negative US$4.3 million, compared to the US$81.2 million reported in 2Q12. This decrease was mainly due to 18% lower revenues and 30% higher operating costs.

 

For 6M13, operating income was US$55.1 million, versus US$210.9 million in 6M12, representing a decrease of 74%.

 

Share in Associated Companies

  

 

During 2Q13, Buenaventura’s share in associated companies were US$48.8 million, 60% lower than the US$122.2 million reported in 2Q12. Yanacocha’s contribution towards these results decreased 73%, from US$86.6 million in 2Q12 to US$23.8 million in 2Q13; Cerro Verde’s contribution decreased 39%, from US$34.0 million in 2Q12 to US$20.8 million in 2Q13. Coimolache’s (Tantahuatay mine) contribution decreased 79% (US$2.1 million in 2Q13 vs. US$9.6 million in 2Q12).

 

During 6M13, Buenaventura’s share in associated companies was US$133.0 million, 48% lower than the figure reported in 2012 (US$258.0 million).

 

YANACOCHA

At Yanacocha (43.65% owned by Buenaventura), 2Q13 gold production was 291,428 ounces of gold, 25% lower than 2Q12 production (389,979 oz.), but higher than previously mentioned in the guidance. Accumulated gold production in 2013 was 576,903 ounces, 24% lower than 2013 (756,407 oz.).

 

Costs applicable to sales (CAS) at Yanacocha in 2Q13 were US$676/oz., 39% higher than the figure reported in 2Q12 (US$488/oz.) explained by a US$163/oz. inventories write-down from La Quinua, Yanacocha and Maqui Maqui pads, due to the fall in gold prices. As a result of this US$48.5 million adjustment, net income decreased 73% (US$54.5 million in 2Q13 vs. US$198.3 million in 2Q12). Accumulated net income in 2013 was US$171.3 million, 57% lower than 2012 (US$400.3 million).

 

During 2Q13, EBITDA totaled US$177.2 million, a 53% decrease compared to 2Q12 (US$375.3 million). Accumulated EBITDA in 2013 was US$438.1 million, 41% lower than 2013 (US$739.2 million).

 

Capital expenditures at Yanacocha were US$119.6 million in 2Q13 (US$332.9 million in 2Q12) and US$253.3 million in 6M13 (US$560.3 million in 6M12).

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 6 of 14

 

CERRO VERDE

At Cerro Verde (19.58% owned by Buenaventura), 2Q13 copper production was 61,813 MT (12,103 MT attributable to Buenaventura), a 28% increase compared to 2Q12 (48,144 MT and 9,427 MT attributable to Buenaventura). Accumulated total copper production in 2013 was 117,026 MT (22,914 MT attributable to Buenaventura), 11% lower than 131,625 MT in 2013 (25,772 MT attributable to Buenaventura).

 

During 2Q13, Cerro Verde reported net income of US$106.3 million, a 39% decrease compared to US$173.9 million in 2Q12. This was mainly due to a 19% decrease in sales revenues (US$389.6 million in 2Q13 versus US$482.2 million in 2Q12) explained by the lower copper prices. Accumulated net income in 2013 was US$245.1 million, 40% lower than US$406.1 million in 2013.

 

Capital expenditures at Cerro Verde in 2Q13 totaled US$240.3 million and US$410.3 in 2013.

 

COIMOLACHE (Tantahuatay operation)

At Coimolache (40.10% owned by Buenaventura), attributable contribution was US$2.1 million (US$9.6 million in 2Q12). During 6M13, attributable contribution was US$10.2 million (US$17.9 million in 6M12).

 

CANTERAS DEL HALLAZGO (Chucapaca project)

Studies are currently being conducted towards evaluating a potential underground mining scenario, a review of capital expenditures, along with the construction of a decline towards the higher grade area oriented to the high grade resource enhancement.

 

Net Income

  

 

Buenaventura’s 2Q13 net income was US$19.0 million (US$0.07 per share), an 88% decrease compared to the US$153.2 million (US$0.60 per share) reported in 2Q12. Accumulated net income in 6M13 was US$121.6 million (US$0.48 per share), 66% lower compared to 6M12 (US$361.3 million).

 

Project Development

  

 

LA ZANJA DEVELOPMENT PROGRAM

 

·The Pampa Verde Project will allow the development of a new open pit, an expansion of the current leach pad and improvements to the operation’s road access. Construction began in 2Q11. Total investment in this project is US$78 million. Completion is expected for 3Q13.
·Additional geotechnical work was done for the slope stability during 1Q13.

 

RIO SECO MANGANESE SULFATE PLANT

 

·Buenaventura continued with the construction of the manganese sulphate plant. The total budget for this project is expected at US$ 90.0 million. As the conclusion of 2Q13, total expenditures had reached US$ 84.8 million.
·The project includes an acid leaching plant, a sulphuric acid production plant and a manganese sulphate crystallization plant; it also includes a warehouse to store low manganese Ag-Pb concentrate and one to store the finished manganese sulphate crystals.
·As of 2Q13, equipment commissioning for all three plants was being carried out.
·The project is expected to begin operations during 3Q13.

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 7 of 14

 

HUANZA HYDROELECTRICAL PLANT

 

·Construction progress at the Huanza Project during the quarter included:
1.Water Conduction Tunnel: 10,074 meters of construction - 100% complete.
2.Power plant: civil work - 100% complete.
3.Pallca Dam: 100% complete.
4.Penstock: 100% complete.
5.Construction of Generator Number 2 is nearly complete and Generator Number 1 is 50% completed.
6.Commissioning of the Pallca Dam has been completed, tunnel commissioning is almost completed, Penstock and the test running of unit 2 is expected by August 15.

 

Board Resolutions

  

 

As part of the cash control strategy, the Board of Directors proposed the modification of the dividend policy. The new policy is: Buenaventura will distribute an annual cash dividend of at least 20% of net income generated by majority-owned operations and subsidiaries. In the case of Buenaventura’s Associates (Coimolache, Cerro Verde and Yanacocha), 20% of their net income will be included if they distribute cash dividends to Buenaventura.

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 8 of 14

 

* * *

 

Company Description

Compañía de Minas Buenaventura S.A.A. is Peru’s largest, publicly traded, precious metals company and a major holder of mining rights in Peru. The Company is engaged in the mining, processing, development and exploration of gold and silver and other metals via wholly owned mines as well as through its participation in joint exploration projects.

 

Buenaventura currently operates several mines in Peru (Orcopampa*, Poracota*, Uchucchacua*, Breapampa*, Mallay*, Julcani*, Antapite*, Recuperada*, Shila-Paula* El Brocal, La Zanja and Coimolache.

 

The Company owns 43.65% of Minera Yanacocha S.R.L (a partnership with Newmont Mining Corporation), an important precious metal producer; 19.58% of Sociedad Minera Cerro Verde, an important Peruvian copper producer, and 49% of Canteras del Hallazgo S.A, owner the Chucapaca project.

 

For a printed version of the Company’s 2012 Form 20-F, please contact the investor relations contacts on page 1 of this report, or download the PDF format file from the Company’s web site at www.buenaventura.com.

 

(*) Operations wholly owned by Buenaventura

 

Note on Forward-Looking Statements

This press release may contain forward-looking information (as defined in the U.S. Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties, including those concerning the Company’s, Yanacocha’s and Cerro Verde’s costs and expenses, results of exploration, the continued improving efficiency of operations, prevailing market prices of gold, silver, copper and other metals mined, the success of joint ventures, estimates of future explorations, development and production, subsidiaries’ plans for capital expenditures, estimates of reserves and Peruvian political, economic, social and legal developments. These forward-looking statements reflect the Company’s view with respect to the Company’s, Yanacocha’s and Cerro Verde’s future financial performance. Actual results could differ materially from those projected in the forward-looking statements as a result of a variety of factors discussed elsewhere in this Press Release.

 

**Tables to follow**

 

APPENDIX 1

  

Equity Participation in

Subsidiaries and Affiliates (as of June 30, 2013)

  BVN Operating  
  Equity % Mines / Business  
Consorcio Energetico de Huancavelica S.A* 100.00 Energy – Huanza Hydroelectrical Project  
Buenaventura Ingenieros S.A* 100.00 Engineering Consultant  
Minera La Zanja S.A* 53.06 La Zanja  
Sociedad Minera El Brocal S.A.A* 53.76 Colquijirca and Marcapunta  
Canteras del Hallazgo S.A ** 49.00 Chucapaca Project  
Compañía Minera Coimolache S.A ** 40.10 Tantahuatay  
Minera Yanacocha S.R.L ** 43.65 Yanacocha  
Sociedad Minera Cerro Verde S.A.A ** 19.58 Cerro Verde  

 

(*)Consolidates

(**) Equity Accounting

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 9 of 14

 

 

APPENDIX 2

 

  GOLD PRODUCTION
  Three Months Ended June 30 Six Months Ended June 30
  Orcopampa Orcopampa Old Tailings Orcopampa Orcopampa Old Tailings
  2013 2012 % 2013 2012 % 2013 2012 % 2013 2012 %
Ore Milled  DST 118,818 118,633 0% 143,181 112,460 27% 251,018 248,130 1% 279,705 252,216 11%
Ore Grade OZ/ST 0.46 0.50 -7% 0.04 0.04 8% 0.45 0.50 -10% 0.04 0.05 -17%
Recovery Rate % 95.0% 96.5% -2% 77.6% 84.8% -8% 95.6% 96.1% 0% 75.14% 86.7% -13%
Ounces Produced 50,196 56,762 -12% 4,791 3,984 20% 108,565 119,120 -9% 8,903 10,891 -18%
                         
Orcopampa Total Production 2Q13 54,987 2Q12 60,745 6M13 117,468 6M12 130,010      
                         
  La Zanja Tantahuatay
  2Q13 2Q12 % 6M13 6M12 % 2Q13 2Q12 % 6M13 6M12 %
Ounces Produced 37,045 27,687 34% 68,251 54,016 26% 35,382 39,129 -10% 69,689 66,735 4%
                         
  Breapampa            
  2Q13 2Q12 % 6M13 6M12 %            
Ounces Produced 19,342   NA 39,826   NA            
                         
  SILVER PRODUCTION
  Three Months Ended June 30 Six Months Ended June 30
  Uchucchacua Colquijirca Uchucchacua Colquijirca
  2013 2012 % 2013 2012 % 2013 2012 % 2013 2012 %
Ore Milled  DST 257,940 287,893 -10% 638,003 912,726 -30% 546,714 573,767 -5% 1,046,298 1,277,962 -18%
Ore Grade OZ/ST 12.78 13.08 -2% 0.83 2.57 -68% 12.68 13.18 -4% 1.05 2.16 -51%
Recovery Rate % 82.6% 72.1% 15% 60.1% 58.9% 2% 81.6% 72.2% 13% 65.7% 60.3% 9%
Ounces Produced 2,723,364 2,715,552 0.29% 317,455 1,271,694 -75% 5,651,920 5,460,195 4% 722,648 1,542,232 -53%
                         
  ZINC PRODUCTION
  Three Months Ended June 30 Six Months Ended June 30
  Uchucchacua Colquijirca Uchucchacua Colquijirca
  2013 2012 % 2013 2012 % 2013 2012 % 2013 2012 %
Ore Milled  DST 257,940 287,893 -10% 638,003 730,511 -13% 546,714 573,767 -5% 1,046,298 1,095,747 -5%
Ore Grade % 1.25% 1.34% -7% 2.87% 3.04% -6% 1.20% 1.40% -14% 2.89% 3.11% -7%
Recovery Rate % 66.3% 58.1% 14% 65.18% 66.3% -2% 66.3% 57.5% 15% 64.91% 67.8% -4%
ST Produced 2,136 2,244 -5% 11,940 14,693 -19% 4,339 4,682 -7% 19,601 23,078 -15%

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 10 of 14

 

APPENDIX 3: EBITDA RECONCILIATION (in thousands of US$)

 

  2Q13 2Q12 6M13 6M12
Net Income 20,859 171,137 131,792 393,152
Add / Substract: 19,465 -56,497 2,316 -106,997
Provision for income tax, net 10,434 32,403 42,945 79,639
Share in associated companies by the equity method, net -48,806 -122,190 -132,974 -258,381
Interest income -700 -2,542 -1,656 -5,291
Interest expense 7,150 1,884 8,353 3,180
Loss on currency exchange difference 6,715 496 6,603 781
Long Term Compensation provision -8,692 0 -17,558 7,315
Depreciation and Amortization 46,494 28,391 85,670 51,795
Workers’ participation provision 1,178 5,061 5,241 13,965
Write-Down Adjustment 5,692 0 5,692 0
EBITDA Buenaventura Direct Operations 40,324 114,640 134,108 286,155
EBITDA Yanacocha (43.65%) 98,502 163,837 212,394 322,661
EBITDA Cerro Verde (19.58%) 39,054 56,458 84,282 130,255
EBITDA Coimolache (40.10%) 9,636 16,856 25,141 31,555
EBITDA Buenaventura + All Associates 187,516 351,791 455,925 770,626

 

Note:

EBITDA (Buenaventura Direct Operations) consists of earnings before net interest, taxes, depreciation and amortization, share in associated companies, net, loss on currency exchange difference, other, net, provision for workers’ profit sharing and provision for long-term officers’ compensation.

 

EBITDA (including Affiliates) consists of EBITDA (Buenaventura Direct Operations), plus (1) Buenaventura’s equity share of EBITDA (Yanacocha) (2) Buenaventura’s equity share of EBITDA (Cerro Verde), plus (3) Buenaventura’s equity share of EBITDA (Coimolache). All EBITDA mentioned were similarly calculated using financial information provided to Buenaventura by the affiliated companies.

 

Buenaventura presents EBITDA (Buenaventura Direct Operations) and EBITDA (including affiliates) to provide further information with respect to its operating performance and the operating performance of its equity investees, the affiliates. EBITDA (Buenaventura Direct Operations) and EBITDA (including affiliates) are not a measure of financial performance under IFRS, and may not be comparable to similarly titled measures of other companies. You should not consider EBITDA (Buenaventura Direct Operations) and EBITDA (including affiliates) as alternatives to operating income or net income determined in accordance with IFRS, as an indicator of Buenaventura’s, affiliates operating performance, or as an alternative to cash flows from operating activities, determined in accordance with IFRS, as an indicator of cash flows or as a measure of liquidity.

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 11 of 14

 

APPENDIX 5

 

Compañía de Minas Buenaventura S.A.A. and Subsidiaries

Consolidated Statement of Financial Position

As of June 30, 2013 and December 31, 2012

 

   2013   2012 
   US$(000)   US$(000) 
Assets          
Current assets          
Cash and cash equivalents   99,276    186,712 
Financial assets at fair value through profit and loss   52,982    54,509 
Trade and other accounts receivable, net   238,491    362,904 
Inventory, net   156,027    157,533 
Income tax credit   37,439    24,629 
Prepaid expenses   13,908    11,837 
Total current assets   598,123    798,124 
           
Non-current assets          
Trade and other accounts receivable, net   40,949    40,079 
Long-term inventory   27,501    40,253 
Investment in associates   2,570,455    2,441,039 
Mining concessions, development costs and property, plant and equipment, net   1,346,653    1,159,805 
Deferred income tax asset, net   100,089    111,701 
Other assets   4,865    5,123 
Total non-current assets   4,090,512    3,798,000 
           
Total assets   4,688,635    4,596,124 
           
           
Liabilities and shareholders’ equity          
Current liabilities          
Trade and other accounts payable   247,776    259,537 
Provisions   35,932    71,780 
Embedded derivatives for concentrate sales, net   17,420    4,939 
Income tax payable   3,808    7,935 
Financial obligations   22,686    5,815 
Total current liabilities   327,622    350,006 
           
Non-current liabilities          
Trade accounts payable and other liabilities   5,288    731 
Provisions   122,737    100,041 
Financial obligations   216,517    173,489 
Total non-current liabilities   344,542    274,261 
           
Total liabilities   672,164    624,267 
           
Shareholders’ equity          
Capital stock, net of treasury shares of US$(000)62,665   750,497    750,540 
Investment shares, net of treasury shares of (000) US$765   1,396    1,399 
Additional paid-in capital   219,055    219,471 
Legal reserve   162,663    162,663 
Other reserves   269    269 
Retained earnings   2,618,304    2,572,943 
Other equity reserves   491    925 
    3,752,675    3,708,210 
Non-controlling interest   263,796    263,647 
Total shareholders’ equity   4,016,471    3,971,857 
           
Total liabilities and shareholders’ equity   4,688,635    4,596,124 

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 12 of 14

 

Compañía de Minas Buenaventura S.A.A. and Subsidiaries

Consolidated Statement of Income

For the six-month periods ended June 30, 2013 and 2012

 

   For the three-month
period ended June 30,		   For the six-month period
ended June 30,		 
   2013   2012   2013   2012 
   US$(000)   US$(000)   US$(000)   US$(000) 
Operating income                    
Net sales   273,099    331,768    613,972    690,749 
Royalty income   12,693    18,696    26,495    36,753 
Total operating income   285,792    350,464    640,467    727,502 
                     
Operating costs                    
Cost of sales, without considering depreciation and amortization   (172,869)   (135,737)   (331,004)   (268,693)
Exploration in operation units   (49,681)   (38,143)   (96,050)   (66,812)
Depreciation and amortization   (46,494)   (28,391)   (85,670)   (51,795)
Royalties   (6,929)   (9,279)   (16,595)   (19,157)
Total operating costs   (275,973)   (211,550)   (529,319)   (406,457)
                     
Gross profit   9,819    138,914    111,148    321,045 
                     
Operating expenses                    
Administrative expenses   (23,602)   (24,978)   (39,561)   (54,796)
Exploration in non-operating areas   4,085    (26,402)   (17,675)   (45,829)
Selling expenses   (3,970)   (4,304)   (8,480)   (7,077)
Other, net   9,320    (2,042)   9,631    (263)
Total operating expenses   (14,167)   (57,726)   (56,085)   (107,965)
                     
Operating profit (loss)   (4,348)   81,188    55,063    213,080 
                     
Other income (expenses), net                    
Share in the results of associates   48,806    122,190    132,974    258,381 
Financial income   700    2,542    1,656    5,291 
Financial expenses   (7,150)   (1,884)   (8,353)   (3,180)
Net loss from currency exchange difference   (6,715)   (496)   (6,603)   (781)
Total other income, net   35,641    122,352    119,674    259,711 
                     
Profit before income taxes and minority interest   31,293    203,540    174,737    472,791 
                     
Income taxes   (10,434)   (32,403)   (42,945)   (79,639)
                     
Net profit   20,859    171,137    131,792    393,152 
                     
Attributable to:                    
Non-controlling interest   1,906    17,913    10,162    31,833 
Owners of the parent   18,953    153,224    121,630    361,319 
    20,859    171,137    131,792    393,152 
                     
Basic and diluted earnings per share attributable to                    
Buenaventura, stated in U.S. dollars   0.07    0.60    0.48    1.42 
                     
Common and investment shares (in units)   254,186,867    254,202,571    254,186,867    254,202,571 

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 13 of 14

 

Compañía de Minas Buenaventura S.A.A. and Subsidiaries

Consolidated Statement of Cash Flows

For the six-month periods ended June 30, 2013 and 2012

 

   For the three-month period
ended June 30,		   For the six-month period
ended June 30,		 
   2013   2012   2013   2012 
   US$(000)   US$(000)   US$(000)   US$(000) 
Operating activities                    
Proceeds from sales   343,935    299,871    748,397    693,644 
Value Added Tax (VAT) recovered   19,907    4,505    33,707    13,277 
Royalties received   13,976    20,845    26,178    35,253 
Dividends received   7,064    4,602    7,064    7,008 
Interest received   1,165    3,333    2,141    5,378 
Payments to suppliers and third-parties   (238,889)   (239,961)   (497,017)   (395,179)
Payments to employees   (14,551)   (23,031)   (84,634)   (121,827)
Payment of income tax   (30,910)   (54,343)   (54,988)   (75,819)
Payment of royalties   (8,708)   (10,377)   (17,494)   (20,060)
Payment of interest   (8,193)   (523)   (8,415)   (765)
                     
Net cash and cash equivalents provided by operating activities   84,796    4,921    154,939    140,910 
                     
Investment activities                    
Income from sales of mining concessions, property, plant and equipment   3,015    -    3,015    - 
Additions of mining concessions, development costs, property, plant and equipment   (147,223)   (92,211)   (233,264)   (168,682)
Payments for purchase of investment shares and contibution to associates   -    (13,047)   (3,685)   (17,789)
Associates loan income   14,964    -    14,964    - 
Decrease (increase) in time-deposits   772    (750)   -    6,846 
                     
Net cash and cash equivalents used in investment activities   (128,472)   (106,008)   (218,970)   (179,625)
                     
Financing activities                    
Dividends payments   (76,269)   (101,779)   (76,269)   (101,779)
Dividends payments to non-controlling interest   (3,133)   (4,957)   (6,573)   (34,179)
Decrease in financial obligations   (45)   (1,020)   (101)   (1,020)
Purchase of treasury shares   (462)   -    (462)   - 
Increase in financial obligations   60,000    4,192    60,000    14,287 
                     
Net cash and cash equivalents used in financing activities   (19,909)   (103,564)   (23,405)   (122,691)
                     
Net decrease in cash and cash equivalents during the period   (63,585)   (204,651)   (87,436)   (161,406)
Cash and cash equivalents at the beginning of the period   162,861    514,092    186,712    470,847 
                     
Cash and cash equivalents at period-end   99,276    309,441    99,276    309,441 

 

 
 

 

Compañía de Minas Buenaventura S.A.A.

Second Quarter and Six-Month 2013 Results

Page 14 of 14

 

   For the three-month period
ended June 30,		   For the six-month period
ended June 30,		 
   2013   2012   2013   2012 
   US$(000)   US$(000)   US$(000)   US$(000) 
Reconciliation of net profit to cash and cash equivalents provided by operating activities                    
                     
Net profit attributable to owners of the parent   18,953    153,224    121,630    361,319 
                     
Add (less)                    
Depreciation and amortization   38,036    24,022    85,670    51,795 
Deferred income tax   1,479    (729)   11,760    13,145 
Net income attributable to minority interest   1,906    17,913    10,162    31,833 
Provision for estimated fair value of embedded derivatives related to concentrate sales and adjustments on open liquidations   26,746    9,156    31,055    (10,193)
Accretion expense of provision for closure of mining and exploration units   5,255    1,363    6,148    2,417 
Loss (gain) from currency exchange differences   6,715    496    6,603    781 
Share in the results of associates, net of dividends received in cash   (41,742)   (117,588)   (125,910)   (251,373)
Income from sales of mining concessions, property, plant and equipment   (3,015)   -    (3,015)   - 
Provisions   (16,507)   (20,856)   (13,032)   (13,542)
                     
Net changes in operating assets and liabilities                    
                     
Decrease (increase) in operating assets                    
Trade and other accounts receivable, net   33,565    (36,371)   88,471    (13,063)
Income tax credit   (8,221)   (5,122)   (11,867)   (4,677)
Inventory, net   22,462    1,722    22,304    (15,376)
Prepaid expenses   3,586    (20,558)   (1,908)   (5,235)
                     
Increase (decrease) in operating liabilities                    
Trade and other accounts payable   15,954    (22,797)   (17,681)   7,803 
Provisions   (20,068)   46,181    (51,324)   13,114 
Income tax payable   (308)   (25,135)   (4,127)   (27,838)
                     
Net cash and cash equivalents provided by operating activities   84,796    4,921    154,939    140,910 

 

 
 

 

Signature

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Compañía de Minas Buenaventura S.A.A.  
   
/s/ CARLOS E. GALVEZ PINILLOS  
   
Carlos E. Gálvez Pinillos  
   
Chief Financial Officer  

 

Date: July 30, 2013