KGHM Q3 profit drops

WSE-listed copper and silver giant KGHM posted a PLN 604 million net profit in Q2, down by 63 percent y/y. Revenues amounted to PLN 4.77 billion, up from PLN 4.68 billion last year. EBITDA grew by 29.8 percent to PLN 1.41 billion. “"Despite the relatively small increase in revenue due to the need to build product stocks in order to meet our contractual obligations in the last quarter of this year, we clearly see an increase in profitability of our key business segments, partly as a result of a further improvement in the market environment that translates into copper prices. On the other hand, our efforts in ordering the situation of foreign assets, particularly the Sierra Gorda mine,” said company’s CEO Radosław Domagalski-Łabędzki. At the same time, KGHM has cut its 2017 CAPEX to PLN 510 million, from the previous PLN 1.02 billion. “Thanks to better than budgeted financial results of KGHM International and Sierra Gorda, KGHM estimates that capital outlays of the parent company won't exceed PLN 510 million this year assuming current macroeconomic situation holds, in particular, copper prices,” KGHM explained in its report.