KGHM predicts 15% reduction in profits for 2013

KGHM Polska Miedz is expecting profits of 3.2 billion zloty ($1.02 billion), down 15% from last year, the company said on Friday February 15.

Polish copper and silver producer KGHM Polska Miedz has predicted profits of 3.2 billion zloty ($1.02 billion) for 2013, down 15% from 2012, the company said on Friday February 15.

The company ascribed the profit decrease to an expected appreciation of the dollar against the zloty and a three-month hiatus in production at KGHM’s Glogów smelter.

It also cited added costs due to the implementation of Poland’s minerals extraction tax, which came into effect on April 18 2012.

KGHM expected to produce 425,000 tonnes of copper concentrate and 548,000 tonnes of cathode this year, compared with 562,000 tonnes in 2012, it said.

It anticipated that 146,600 tonnes of copper cathode – or 30.4% of its total output – would be produced from third-party copper-bearing materials during the year, compared with 147,300 tonnes in 2012, it said.

Predicted silver production stood at 1,075 tonnes, compared with 1,098 tonnes in 2012.

KGHM started the year with two significant deals announced in January.

It signed a contract for the supply of cathodes with German semi-finished copper producer MKM Mansfelder Kupfer und Messing, with an estimated contract value of 1.52 billion zloty. The overall estimated value of contracts signed between the companies equals 3.50 billion zloty.

It also signed a contract with cable manufacturer Prysmian Metals for the sale of copper wire rod in 2013-14, with an estimated value of up to 2.86 billion zloty.

Tom Brooks

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