Despite a 20% fall in copper prices, the Company delivered US$1.075 billion in pre-tax profit (before extraordinary items)
Santiago, 24 March 2016.- Codelco CEO, Nelson Pizarro, reported a record copper production of 1.732 million tonnes from its own mines in 2015. This record production is up 3.6% from 2014 and it is one of the highest in company history, despite extreme weather events in northern Chile, the negative impact of a contractor strike and, particularly, lower ore grades (down 19% since 2004, when Codelco had a similar production).
Pizarro added that, despite an increasingly complex global market outlook, both copper and molybdenum prices were down 20% and 41%, respectively, Codelco delivered US$1.075 billion in pre-tax profits before extraordinary items to the Chilean State. This significant result was achieved thanks to a robust cost reduction plan, saving US$1.203 billion, equivalent to 120% of the total target.
In fact, direct costs (C1) fell 8% to US$139.7 c/lb from US$150.4 c/lb in 2014. As a result, the Company moved from third to second cost quartile in the industry, i.e., 50% of the most competitive mining companies.
The CEO also stated that this cost reduction plan maintained Codelco's Mining Ebitda margin at 37%, another significant figure amidst falling copper and molybdenum prices.
Pizarro explained that Codelco's investment plan continued to make progress thanks to a US$ 600 million capitalisation during this period and a successful issuance of USD 2 billion in bonds.
Similar to other companies in the industry, Codelco reported impairments of USD 2.431 billion in 2015 and, after adjusting extraordinary items, a net loss of US$1.492 billion. The CEO explained that this adjustment only has an accounting impact, but it does not affect the amount Codelco delivers to the State nor its investment plan.
CODELCO KEY FIGURES 2015