Floated in may '08 at a share price of 525p. Shares in issue Dec '08 717,160,000.
Based in Mexico & listed on the LSE FTSE 250 index. (FTSE100 March '09)
Miner of Gold, silver, Zinc & Lead in Mexico
Produces approx 3m Oz silver, 280k Oz gold, 20k tons Zinc, 17k tons lead p.a.(2008)
Fresnillo has three producing mines, all of them in Mexico - Fresnillo, Ci�nega and Herradura; two advanced development projects - Fresnillo II, Soledad & Dipolos; and three exploration prospects - San Juan, San Julian, Orysivo, as well as a number of other long term exploration prospects and, in total, has mining concessions covering approximately 1.3 million hectares in Mexico.
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Thanks Harry, the RBC note reflects and adds to my basic reseach. My longer term turned out to be only half a morning, got out with a 10% loss but only had a few. If this hangs around the 1100p mark for a few days, I will probably have another go at a longer term holding. H

Going Ex Divi paying a rather nice 27.8p, but with commodities not flavour of the month the SP recovery time is uncertain. Anyone going for the Divi here at all?

SP up straight away. Would have been a very short term profitable trade.. Oh well.

Fresnillo plc ("Fresnillo" or the "Company") announces that it has agreed to issue 19,633,430 new ordinary shares of US$0.50 each (the "Placing Shares") representing approximately 2.74 per cent. of the number of existing shares of the Company (the "Placing") to funds and accounts managed by First Eagle Investment Management LLC (the "Placees") who are existing shareholders in the Company.

The Placing will ensure that Fresnillo plc is compliant with changes to the Ground Rules of the FTSE UK Index Series that require constituents to maintain a minimum free float of 25% or more.

The proceeds of the Placing will be used for general corporate purposes and the Company's working capital needs.

The Placees have agreed to subscribe for the Placing Shares at a price of £11.30 per Placing Share, a 1.99% discount to the closing price at Friday 26th of April.

Up another couple of %

I think Fres has a lot more chance of recovery than POG. Although the chart still looks pretty poor, relatively it has outperformed POG over the past year and has a 4% yield. Have added a little more to my modest position in Fres. Still nowhere clear that a bottom is in, waiting for gold to get to around $1150 before adding again.

Interims out today. http://www.moneyam.com/action/news/showArticle?id=4645582

RBC note today on the expected extra tax to be levied:
"Negative outcome relative to our expectation – We had previously expected a 5% EBITDA based royalty with a small per hectare fee for explorers. The proposed tax appears to be a 0.5% revenue based royalty and a 7.5% EBITDA royalty. In aggregate we believe that this will likely be equivalent to a 4.5% to 5% revenue based royalty based on Fresnillo’s cost structure. The government may also introduce a 10% tax on the distribution of profits to shareholders outside of Mexico. Fresnillo’s management have indicated that they believe that the tax is likely to be finalized by the end of October in time for inclusion in the country’s 2014 budget. The proposed legislation would need to pass through both the Chamber of Deputies and Senate. At present most of the major parties in Mexico appear to support the new royalty aside from the right of centre National Action Party, (PAN).
The impact of the new royalty system would be negative for FRES and we have adjusted our numbers to reflect its likely impact. Our NAV has declined from 978p to 907p and we have also pulled back our 2014E and 2015E EPS to 70cps and 87cps cps from 75cps and 93cps respectively. We retain our Sector Perform rating but pull back our target price from 1300p to 1200p on unchanged multiples of 1.5x P/NAV and 14.0x P/CF, on our 2014 estimates. Fresnillo has historically traded at a premium to other peer silver producers reflecting a significant growth profile and a history of operating outperformance. Over the short term the shares could benefit from the results of the GDX reweighting, which should be announced on Friday 13th September."

Big faller here.

500p support.

Still no support.

Another new low.

StockMarketWire.com
Fresnillo's pre-tax profits tumbled by 64.4% in the year to the end of December to $418.7m.

Fresnillo says its results were hit by a combination of lower precious metals prices, the lower gold production which arose from the legal dispute surrounding explosives permits at the Minera Penmont operations, and the non-cash loss generated by the Silverstream revaluation.

It says that as a result, revenues fell by 25.1% to $1,615.2m and earnings before interest, tax, depreciation and amortisation fell by 44.5% to $729.8m. Chief executive Octavio Alvídrez said: "Fresnillo continued to deliver on its strategic priorities in 2013, despite a challenging external environment for the mining industry and disrupted operations at Minera Penmont. We achieved silver production that was ahead of our targets and made significant progress on a number of our development projects, with the dynamic leaching plant at Herradura being concluded and construction continuing at Saucito II and San Julian.

"Gold production declined as a result of the legal proceedings which halted operations at Soledad-Dipolos and, triggered the suspension of the use of explosives at Herradura. This, combined with lower precious metals prices, impacted our financial results. Nevertheless, our cost reduction initiatives, extensive exploration efforts and focus on operational excellence means we remain well placed to continue to create value for our stakeholders through the cycle as evidenced by today's recommendation of the special dividend. We look forward to making further progress towards our long-term goals in 2014."

Cazenove note today:
"P&L below forecast: reported revenue of $1,615m was 1% below JPMe due to higher than expected TC/RCs. EBITDA of $730m came in 7% below JPMe due to higher than expected costs, primarily at Herradura due to the disruption caused by the suspension of its explosives permit. Working down the P&L, higher than expected D&A and tax expenses were offset by lower than expected minority interests and SilverStream revaluation effects, leaving reported EPS of 32.9 UScps, 8% below JPMe and 9% below company-compiled consensus. Underlying EPS of 38.1 UScps, excluding SilverStream, was, however, 19% below JPMe and 21% below consensus.
Cashflow performance solid: operating cashflow of $452m (including net interest) came in 13% below of our forecast, but was offset by lower than anticipated capex of $572m vs JPMe of $688m, implying better than expected free cash flow of c. -$120.0m vs JPMe of -$179.2m. Net cash of $415.5m was therefore higher than our $356.7m forecast, supporting FRES’ decision to pay a surprise $50.1m special dividend in addition to the $165m extraordinary dividend paid on 11th November and the interim dividend of $36.1m, and bringing the total DPS paid in respect of 2013 to 35.1 UScps vs JPMe 27.3 UScps.
Project update: the high-returning $235m Saucito II project “advanced rapidly as a result of efficient execution and infrastructure synergies”, with FRES now guiding to construction completion by end 2014 vs mid-2015 previously. However, start-up of the San Julian project has been delayed by ~12 months from Q4 2014 to H2 2015 as the company now plans to build a reservoir to complement ground water supplies. The total capex for the project has also increased marginally to $515m vs $500m previously.
Outlook: 2014 production guidance of 43Moz silver (including SilverStream) and 450koz gold is unchanged vs the targets given at Q4 production results, with last week’s receipt of a new explosives permit at Herradura allowing the company to re-confirm its targets. No specific has been set at $225m (JPMe $222m) including $30m capitalized exploration expenditures, while capex guidance has been set at $642m, including capitalized exploration, vs JPMe of $816m, reflecting the deferral of the San Julian development. Operating cost targets have been given with the company expecting “continued cost pressures, mainly in energy, operating materials and labour” offset by ongoing cost control initiatives."

Silver price seems to be now be recovering. Gold price is stable / slow.

FRES could now be on recovery path with explosives available and if mines at high production again.

I am in FRES at 803p and very hopeful of easy pickings - does anyone have comments ?

Credit Suisse note:
"We believe Fresnillo went through a rough patch on its operations during the last twelve months mainly in the back adjusting ore grades and Penmont flaws, but we expect it to recover. We think that ore grades will stabilize in current levels, and expect Herradura to be fully reestablished on 2H14. What could drive our view to a more positive stance? Higher grades in Fresnillo, or an acceleration of the Centauro Deep project. How would we become more cautious? Deteriorating ore grades, and a delay in projects.
After a strong investment cycle, Fresnillo is getting to the sweet spot of growth delivery, we estimate the surge of cash flows by 2016. We believe that there will be a significant improvement in operations, mainly coming from Saucito II cumulative production. This mine is a rising star, and has become the key of Fresnillo's growth story, we expect it to contribute 52% of silver production in 2014.
We are upgrading Fresnillo to Neutral, with a TP of GBp 900 and 4% downside. We think that the storm is over, though still, the company is trading at a 35% 2014 EV/Ebitda premium to peers, and 1.2x NPV."

IC SAY BUY

From I C today;

Weak gold price hits Fresnillo
Production outages and the sharp fall-away in precious metals prices from April 2013 onwards made for unflattering half-year comparatives for Fresnillo (FRES). But the Mexican miner still declared a special dividend and signalled it was on track to meet full-year guidance.
Operating profits halved to $183m (£108m), while cash flows were down by a third to $337m – which is still pretty healthy by most standards. The profit drop was partly due to temporary disruptions at the Herradura mine after the government imposed a ban on the use of explosives. This ban has now been lifted, and gold production at Herradura was up by a third in the second quarter compared with the first. But the disruption meant that Fresnillo’s total gold output fell by 18.9 per cent to 191,317 ounces.
The good news is half-year silver output was marginally higher, at 21.3m ounces, while costs shrank thanks to lower exploration charges. Two major expansion projects – Saucito II and San Julian – remain on track and on budget.
However, Fresnillo is a commodity play, so double-digit falls in average prices for silver and gold were always going to have an overriding impact on these results. In the event, the fall in net earnings was less severe than that in underlying profits due to the revaluation of the miner’s Silverstream complex.
UBS anticipates 2014 EPS of 31¢, rising to 36¢ in 2015.
B We anticipate a stronger second half in terms of production, but full-year comparatives will still look anaemic. Fresnillo’s habit of returning capital to shareholders means we still like its shares despite a lofty multiple. MR
Buy

FRES

As per remarks on the chart......

Starting to tuck more of these away.

Yes, it's a bit of a long term investment and am still trying to get my head around the likely direction of the price of silver. I assume that once QE starts and interest rates start to climb then gold will drift off, but no idea about silver. Tempted to do likewise and buy for the long term.

http://www.kitco.com/LFgif/ag0365nys.gif