Mexican precious metals miner Fresnillo has hailed a strong year despite profits falling by more than half.
Adjusted revenue for the firm rose to $2.86bn (£2.2bn) from $2.5bn (£2bn) the year prior but pre-tax profit fell 54.1 per cent to $114m (£89.8m), driven by the “unhelpful” peso-dollar rate as a result of an improving Mexican economy.
The average spot Mexican peso/US dollar exchange rate appreciated by 11.7 per cent in 2023, which the group said resulted in an impairment of $113.3m on the group’s costs denominated in Mexican pesos.
Basic and diluted earning per share, meanwhile, fell 14.1 per cent to 31 cents (24p) from 37 (0.29) cents in 2022.
The company’s cost inflation was 3.9 per cent in 2023 and led to across-the-board hikes in the cost of labour, materials and equipment.
The board declared a final dividend of 4.2 cents (3.3p) a share which when combined with the interim payout of 1.4 cents a share (1.1p) makes 5.6 cents (4.4p) per share for the full year – a 66 per cent drop on the 22 return.
Precious metal production across the group rose almost entirely across the group.
Total silver production was 56.3 million ounces (moz), up by 4.7 per cent from 53.7 moz in 2022, while gold production fell to 610,000 ounces (koz), a reduction of 4.0 per cent from 635.9 koz in the previous year.
Attributable by-product lead and zinc production increased 9.2 per cent and 8.6 per cent to 57,833 tonnes and 107,705 tonnes respectively.
Chief executive Octavio Alvidrez said: “Fresnillo delivered a sound operating performance in 2023 despite a number of headwinds, a testament to the strength and efforts of our teams.”
“At the same time, we focused on increasing productivity and raising development rates while advancing our pipeline of future projects and we continued to identify and implement cost reduction measures, as well as improve efficiency across all of our mines.”
On the London Stock Exchange this morning, Fresnillo’s share price rose by more than three per cent, by around 11.30.
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