• Revenue: $4.1 billion for the full year, including $695 million from discontinued operations.
• Adjusted EBITDA: $1.7 billion for the year, including $426 million in the fourth quarter.
• Free Cash Flow: $873 million for the year.
• Net Debt: Just over $1.3 billion, excluding capital leases.
• Copper Production: Record 369,072 tonnes for the year.
• Zinc Production: Record 191,704 tonnes for the year.
• Gold Production: 158,000 ounces for the year.
• Cash Costs: Candelaria at $1.73 per pound, Caserones at $2.51 per pound, Chapada at $1.58 per pound.
• Capital Expenditures: Sustaining CapEx of $704 million for the year.
• Dividends and Buybacks: $227 million returned through dividends and buybacks.
• Share Buyback: 3.3 million shares purchased under NCIB program in December.
• Ownership Increase: Caserones ownership increased from 51% to 70%.
• Major Acquisition: Acquisition of Filo Corp. valued at $3 billion.
• Asset Sale: Sale of Neves-Corvo and Zinkgruvan for up to $1.52 billion.

• Warning! GuruFocus has detected 7 Warning Signs with LUNMF.

Release Date: February 20, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Lundin Mining Corp (LUNMF) achieved record copper and zinc production in 2024, with copper production reaching 369,072 tonnes and zinc production at 191,704 tonnes.
• The company increased its ownership in the Caserones mine from 51% to 70%, adding approximately 24,000 tonnes of annualized attributable copper production.
• Lundin Mining Corp (LUNMF) formed a joint venture with BHP called Vicuna Corp, positioning the company as a top-tier copper producer.
• The sale of Neves-Corvo and Zinkgruvan to Boliden for up to $1.52 billion is expected to streamline the company's portfolio and strengthen its balance sheet.
• The company generated adjusted EBITDA of $1.7 billion and free cash flow from operations of $873 million in 2024.

Negative Points

• Copper sales volumes were negatively impacted by weather-related delays, resulting in approximately 20,000 tonnes of copper concentrate being recognized as revenue in Q1 2025 instead of Q4 2024.
• Pricing adjustments on prior period sales negatively impacted revenues by $46 million in the fourth quarter.
• The company faced non-cash tax impairments totaling $545 million, affecting earnings during the quarter.
• The fall of ground at the Eagle mine in the second quarter impacted nickel production, although it has been remediated.
• The company is in a moderate net debt position of just over $1.3 billion, although this is expected to improve with the sale of European assets.

Q & A Highlights

Q: Are you considering a potential positive development of Jose Maria and Filo to accelerate growth opportunities? A: Jack Lundin, President and CEO, stated that they are focusing on a phased development plan. The key milestone is to update the resource on Jose Maria and introduce a maiden resource for the sulfide component of the Filo del Sol deposit. These resource estimates will form the basis for an integrated project, envisioned to be developed in phases.

Q: With large capital commitments ahead, will you continue with share buybacks or preserve cash to improve balance sheet flexibility? A: Jack Lundin emphasized their commitment to returning capital to shareholders, noting that they believe the company is trading at a discount. They will remain opportunistic with share buybacks and have declared a Q4 dividend, balancing growth opportunities with shareholder returns.

Q: What is the scope of Phase One for the Vicuna district with the joint venture now closed? A: Jack Lundin explained that Phase One will likely resemble the previous standalone plan for Jose Maria, with a focus on large-scale mining operations that allow for rapid expansion. The integrated project will be designed to facilitate a quick increase in throughput and overall size.

Q: Can you clarify the timeline and capital requirements for the Argentina development under the Rig Bill? A: Jack Lundin clarified that they have until July 2026 to sign up for the Rig Bill, which requires spending 40% of the initial capital within the first two years of starting the investment. This equates to $800 million of a $2 billion project, which they are confident in achieving given the project's magnitude.

Q: How will the cash flow from the European assets be reflected in financial statements until the deal closes? A: Teitur Poulsen, CFO, explained that from September 1, 2024, the economic handover of these assets to Boliden means any cash generation or funding is for Boliden's account. The firm consideration is $1.37 billion, with a 5% interest earned from September 1 until closing, contributing to a net debt-free position on a pro forma basis.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.