Fresnillo share price: 3 things to watch out for in its half-year results
The precious metals mining company saw its share price tumble more than 10% over the last five days of trading after it slashed its production guidance last week, ahead of its half-year results.
Fresnillo saw its share price fall more than 10% over the last five trading sessions after the company cut its production guidance last week.
Investors will be particularly interested in how its production guidance downgrade will impact the mining company’s bottom line when it unveils its half-year results on Wednesday next week.
Fresnillo opts to cut full-year production guidance
2019 remains a challenging year for most mining companies with the sector encumbered by a myriad of headwinds, leading many to take a particularly cautious stance.
As such, the Mexican-based mining company opted to slash its full-year production guidance last week, driven by lower-than-expected ore grades and ore throughput at its Fresnillo mine and a delay in the construction of a leaching pad at Herradura.
2019 silver production guidance was decreased from 58-61 moz to 55-58 moz, driven mainly by lower ore grades and ore throughput at the Fresnillo mine.
Meanwhile, gold production guidance of 910-930 koz gold is decreased to 880-910 koz mainly driven by the delay in the construction of a leaching pad at Herradura and lower ore processed at the DLP.
Fresnillo pledges stronger performance in H2
Despite the setback, production levels at Fresnillo have continued to recover towards target levels since the first quarter as the company begins to see the positive impact of operational measures and investments it has made into infrastructure, equipment and infill drilling.
‘We will continue to work hard to ensure the improvements we have seen this quarter are maintained in the second half of the year,’ Fresnillo CEO Octavio Alvídrez said.
Practise trading Fresnillo and other mining stocks with an IG demo account.
Development projects in the pipeline
Construction of the Juanicipio project commenced immediately following the management’s approval in April 2019, with good progress made on engineering and early stage construction works in accordance with Fresnillo’s plans.
The project is expected to be concluded by late 2020.
Meanwhile, construction of the Pyrites plant (phase II) in the Fresnillo district remains on track and on budget, with commissioning expected in the second half of 2020.
Fresnillo flotation plant optimisation to cope with higher content of lead and zinc is progressing according to plan and is expected to be concluded on time by 2H20, the company said.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. Please see important Research Disclaimer.
Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
European Central Bank meeting
Learn about how the ECB meeting affects interest rates and price stability ahead of the next announcement.
- How might the next meeting affect the markets?
- What are the key rate decisions to watch?
- Why is the Governing Council announcement important for traders?
Live prices on most popular markets
- Forex
- Shares
- Indices
See more forex live prices
See more shares live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
See more indices live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.
