Antofagasta, the Chilean copper miner, has cut its full-year production guidance to 625,000-655,000 tonnes from 650,000-700,000 tonnes after weather-related disruptions at its Los Pelambres mine, a risk Deutsche Bank analyst Liam Fitzpatrick said he had flagged following a soft start to the first half.
Deutsche Bank has downgraded Antofagasta to Sell from its prior rating, cutting the price target to 3,400p from an unspecified prior level, implying downside from the last close of 3,756p.
The bank said first-half earnings (EBITDA) of $2.8bn came in broadly in line with company-compiled consensus, while earnings per share of $0.86 beat expectations.
Net debt of $3.9bn ran higher than forecast, which Fitzpatrick attributed largely to Centinela's new water infrastructure being recognised as a lease now that the asset is operational.
The board declared a dividend per share of $0.30, in keeping with the company's policy of paying out 35% of earnings.
Los Pelambres has since resumed operations, with mining and processing rates climbing back as site conditions improve, the note said.
