Earnings Call: Q4 2025

Jan 23, 2026

Earnings release

Summary

Copper output rose 27% to 507,000 tonnes in 2025, alongside record results at key assets. 2026 guidance reflects growth at Kinsevere and Khoemacau, while operations remain focused on safety, reliability, and cost control.

Hello everyone, and thank you for joining MMG's 2025 fourth quarter production report teleconference. Before we begin, I would like to remind you that today's discussion may include forward-looking statements and other information intended exclusively for participating investors. The materials provided, including any audio or written transcripts of this call, are for reference purposes only. MMG has not authorized any third party to reproduce, distribute, or disseminate the contents of this meeting. Neither the company nor its affiliates accept any responsibility or liability for any use, distribution, or reliance on all or any part of this remark made during today's discussion. Please be advised that financial markets inherently involve risks. Investment decisions should be made with careful and prudent judgment. We strongly encourage all investors to conduct their own independent analysis and due diligence before acting on any information shared during this call. Joining us today from MMG's management team are Mr. Zhao Jing Ivo, Chief Executive Officer and Executive Director. Mr. Qian Song, Chief Financial Officer. Mr. Wang Nan, Chief Operating Officer. Ms. Sandra Xiangjun Guan, Interim Executive General Manager, Commercial and Development. Mr. Xia Weiquan, President Africa, and Mr. Chen Xuesong, President Las Bambas. I will now hand over to Mr. Zhao Jing Ivo to take you through MMG's operational performance for the fourth quarter and the full year 2025. After the presentation, we will also open the line for questions. Thank you. Okay, thank you, and welcome to MMG fourth quarter production report teleconference. I am very pleased to share an update on MMG's operational performance. Safety is MMG's first value. As always, that means to begin with our safety performance. In 2025, our safety performance was generally in line with the previous year. The total recordable injury frequency was 2.06, and the significant events with energy exchange frequency rate was 0.80 per million hours worked. However, we observed an increase in safety performance indicators during the fourth quarter. This reminds us of the importance of staying focused on the safety of all employees and contractors. Moving forward, we will continue to strengthen proactive field task observations, ensure the effective implementation of critical controls, and enhance contractor safety management. Now, let us turn to our production results. 2025 was a year of strong operational performance for MMG with record and near-record results across our key assets. Total copper production for the year reached 507,000 tons. A 27% increase over 2024, and a clear milestone beyond the half million ton threshold. This result reflects our strategic focus on copper with our three copper mines, particularly our flagship asset at Las Bambas, making a key contribution. Total zinc production reached 230,000 tons, up 6% year-on-year, with Dugald River delivering its highest annual production on record. By-product precious metals also performing strongly. Gold production reached 118,000 ounces, up 22% year-on-year. And silver production reached 10.6 million ounces, up 17% year-on-year. These by-products are important contributors to MMG's revenue and help to support our financial performance, particularly during periods of strong precious metals market conditions. Next, I will go through our performance by business segment. First, the corporate portfolio. Las Bambas achieved a historic operational breakthrough in 2025, with annual copper production exceeding 410,000 tons. This represents a 27% year-on-year increase, solidifying its position as one of the world's top 10 copper mines. This result was above the upper end of guidance and was the second highest annual production since the mine began operation. This outstanding performance was driven by improved operating efficiency and stable mining operations at both Ferrobamba Pit and Chalcobamba Pit. Notably, in 2025, Las Bambas set new records for ore mines, ore mills, and recovery rates. On cost, thanks to by-product credits from stronger precious metals prices, the full year average C1 cost was $1.12 per pound of copper, better than our guidance range. On community relations, Las Bambas made positive progress by working closely with local communities and the Peruvian government. Through the Corazón de Las Bambas program, we helped the local communities set up a business in transportation, infrastructure, agriculture, and catering services. These businesses provide services to the mine and create stable income for local residents. We also invested in local education infrastructure through Peru's Works for Taxes program. This allows taxes to be used for community development more quickly and efficiently. These efforts have helped build a strong and stable relationship with the government and communities, supporting the mine's nearly three years of stable operation. For 2026, the Las Bambas production guidance is 380,000 to 400,000 tons of copper in copper concentrate. We expect average C1 costs to be in the range of US$1.20 to US$1.40 per pound. If precious metals prices stay strong, actual C1 costs may be lower. With its C1 cash cost position in the lowest third of global copper mines, Las Bambas enjoys a robust cost advantage. In the context of current strong copper prices, this offers considerable profit resilience and reinforces the stability of our business. Now, Kinsevere. In 2025, Kinsevere focused on ramping up its expansion project. It produced about 53,000 tons of copper cathode, up 18% year-on-year. The full-year average C1 cost was US$3.12 per pound. This year, Kinsevere's focus will be addressing challenges, including improving power supply stability, stabilizing production, optimizing the concentrator and roaster, and fixing bottlenecks in the hydrometallurgical process. For 2026, Kinsevere copper production guidance is 64,000 to 75,000 tons, with C1 cost guidance of US$2.50 to US$2.90 per pound. Now, Khoemacau. In 2025, Khoemacau produced about 42,000 tons of copper in copper concentrate. During the third quarter, a change in mining contractors caused a short-term impact on mining volumes. However, by the fourth quarter, operations recovered, and mining expanded into the higher-grade Zone 5 North area. This supported higher head grades and improved recovery rates. Supported by stronger silver prices and lower ore development costs, full-year C1 costs were $1.97 per pound, better than the guidance range. For 2026, as mining moves into higher-grade ore in Zone 5 North, and with progress in mine development and the Phase 2 project, copper production is expected to increase. Production guidance is 48,000 to 53,000 tons in copper concentrate, with C1 cost guidance of $2 to $2.30 per pound. If silver prices stay strong, actual C1 costs may be further improved. I'd also like to share an update on Khoemacau's expansion plan. Khoemacau is a new mine that MMG acquired in March 2024. It has attractive resource potential and a clear expansion plan. in December 2025, the board approved a feasibility study for the Phase 2 expansion. This is an important part of our global mining strategy in Africa. After completion, annual production capacity is expected to increase to 130,000 tons of copper in copper concentrate, with annual silver production exceeding 4 million ounces. Early works have already started, including camp construction, land acquisition, recruitment, and procurement of long-lead items. Mine construction is planned to commence this year, with first copper concentrate expected in the first half of 2028. After commissioning, Khoemacau's average C1 costs are expected to drop to below $1.60 per pound, which will significantly improve the mine's profitability and strengthen MMG's position in the global copper supply market. In addition, ongoing exploration at Khoemacau has identified more expansion potential. Annual capacity could increase to 200,000 tons of copper in copper concentrate in the future. We plan to start a pre-feasibility study for the next phase of expansion this year. To our zinc portfolio. Dugald River delivered record annual results, with zinc production reaching 183,000 tons. This result exceeds the prior year by 12% year-on-year and finished at the upper end of guidance, solidifying its position among the world's top 10 zinc mines. For the first time, annual ore processed exceeded 2 million tons, with plant recovery rates staying stable at around 90%. These strong results were driven by a focus on operational efficiency and technical optimization, which helped the site recover quickly and perform well after unplanned weather impacts in the first quarter. On cost, the full-year average of C1 cost was 65 US cents per pound of zinc, better than the previous guidance range. This was mainly due to higher by-product credits from stronger silver prices, lower treatment charges, high production levels, and the favorable exchange rates. Looking ahead to 2026, we anticipate potential constraints as demand softens, alongside season weather challenges in the first half. Our focus will be on enhanced planning and operational execution to maintain resilience through this period. Zinc production for the year is expected to be between 170,000 and 180,000 tonnes, with C1 cost guidance of 80 US cents to 95 US cents per pound. Again, if silver prices remain high, C1 costs may be further improved. Rosebery also delivered a steady performance in 2025, with good execution of the mine plan. Full year zinc production was approximately 49,000 tonnes, while zinc equivalent production reached 140,000 tonnes. This highlights the value of Rosebery's polymetallic ore body and its effective approach to optimizing by-product value. On cost, supported by strong operating efficiency, high by-product volumes, and favorable precious metal prices, full year C1 costs were negative 94 US cents per pound of zinc, significantly lower than the previous guidance range. Looking ahead, annual zinc production is expected to be between 45,000 and 55,000 tonnes. Based on 2025 realized product prices, zinc equivalent production is expected to be 125,000 to 140,000 tonnes. C1 cost guidance is negative 60 US cents to negative 10 US cents per pound. If precious metal prices remain strong, Rosebery C1 costs could improve further. Finally, I'd like to share an update on our recent senior management appointments. In December, Mr. Chen Xuesong was appointed as President Las Bambas, and Mr. Xia Weiquan as President, Africa Operations. These appointments aim to extend operating responsibilities to the asset level, strengthen front-line leadership in safety, production, and cost optimization. Both Mr. Chen and Mr. Xia are on the line today and available to answer any questions about our asset operations. To wrap up, MMG delivered a strong performance in 2025, unlocking production potential while achieving steady progress on key growth projects. Looking ahead to 2026, we will remain focused on safety, stability, and efficiency to support production reliability. At the same time, we'll keep advancing key growth projects like the Toka Rama Phase 2 expansion to strengthen MMG's long-term value and resilience as a copper-focused, diversified miner. On behalf of MMG, I would like to sincerely thank all investors and stakeholders for your support. We are committed to creating sustainable value for all shareholders. That concludes my remarks. I will now hand the call back to the moderator. Thank you. Thank you. Ladies and gentlemen, we will now poll for questions. If you would like to register for a question, please press star one on your telephone. Thank you. Once again, ladies and gentlemen, that is star one to register for a question. Thank you. Once again, ladies and gentlemen, that is star one to register for a question. Thank you. Once again, that is star one to register for a question. Thank you. There are no questions on the line. This concludes our Q&A session. I will now hand the call back to Mr. Zhao for closing remarks. Thank you. Okay. Thank you all for taking the time to join this teleconference. If you have any further questions, please contact our investor relations team. See you next time. Thank you.