November 08, 2006
Hochschild Gives A South American Boost To Londons Mining Sector


Quite a feather in Londons cap to have Hochschild Mining taking a full listing. At first glance Toronto or New York might have seemed a more logical destination, but the Sabanes-Oxley Act has meant that compliance requirements in North America have reached stratospheric levels and London looked more attractive, though a full listing on the LSE is certainly no walkover. Geographically, also, it has advantages as both JP Morgan Cazenove and Goldman Sachs International, the joint sponsors, joint global co-ordinators and joint bookrunners for the IPO are both based in London, as are Canaccord Adams the co-lead manager and Nomura International, the co-manager. The shares were placed at 350 p each to raise around 270 million from institutional investors in the UK, Europe, the US and Canada. On this basis its market capitalisation is just over 1 billion which takes it straight to 99th position in the FTSE 250 Index and makes it worthy of consideration by all types of investors.

The history of this Peruvian mining company is fascinating as it comprises the mining operations of the Hochschild Group which was founded in Chile in 1911 by Mauricio Hochschild. After World War 1 it expanded into Bolivia where the target was tin and it did not start its Peruvian operations until 1925. Even then it stuck to metal trading and beneficiation until the 1940s and during the 2nd World War the Group was a key supplier of tin and other metals to the allied forces. The next major advance came in the 1960s when the Arcata mine was developed in Peru and it is still in production today. Over the next ten years or so more mines were opened in Brazil, Peru and Chile such as the well known Mantos Blancos copper mine in Chile.

It is here that the history gets a bit complicated as in November 1984 Anglo American bought the South African mining operations of Hochschild Group and immediately sold the Peruvian operations to Luis Hochschild who is clearly a descendant of the founder, though the exact relationship is not clear. Anyway it is his son Eduardo who is now executive chairman of the company, having started as a safety assistant at Arcata in 1987 and working his way up to be boss of the company 12 years later. At the executive level he is supported by Roberto Danino as deputy chairman and Alberto Beeck which is director of strategy and corporate development.

The operations sold back to Luis became the basis of Hochschild Mining which then launched an aggressive expansion campaign in Peru as well as in Mexico, Argentina and Chile. In order to spread the financial risk joint ventures were agreed with other local and overseas mining partners to develop the San Jose, Pallacanta, Mina Moris and San Felipe projects. Hochschild Mining is now the fourth largest silver producer in the world with an output of around 10.5 million ounces plus just under 250,000 ounces of gold in 2005. In that year its cash costs of production amounted to US$2.65/oz for silver and US$169/oz for gold which puts it in the first quartile of the 2005 global cost curve for both metals.

Its specialisation is in epithermal vein deposits and it currently has three underground mines Arcata, Ares and Salene - in production in southern Peru. Next up are two advanced and two early stage development projects in Argentina, Mexico and Peru and then a swathe of prospects at various stages. The overall strategy is to bring a sequence of these projects into production and the aim is to push towards annual production of 50 million silver equivalent ounces, or 830,000 gold equivalent ounces if preferred, by 2011. This is quite an uplift from the 2005 figures, but Hochschild is not the sort of company which would risk undershooting a declared target, so it may err on the conservative side.





Powered by IST's

217 - Billy Liar Tribute Act!!!!! LOL!!!!!

He just can't help it. They say compulsive liars actually start believing their own lies.

BB heres a cheaper alternative for Doodlebug 3 1/4....... he he pissing myself.

Signal Update Our system’s recommendation today is to STAY IN CASH. The previous SELL signal was issued on 21/01/2015, 2 days ago, when the stock price was 125.9250. Since then HOC.L has fallen by -17.61%.Market Outlook The bears still have the upper hand in the market. A more cautious attitude may be required, but there is no definite sign to urge you into action and to disturb your comfort of being on the sidelines.

British Bulls

.

drip, drip,drip

Fallen back sharply since it's recent 130p ish high, whilst it was a good call by gf originally, the window of opportunity was minute.
2517

I topped up my holding a couple of days ago.

22 Jan 2016
Numis today upgrades its investment rating on Hochschild Mining PLC (LON:HOC) to buy (from hold) and cut its price target to 50p (from 80p).

given that precious metals are generally regarded as a safe haven in times of volatile markets, i'm surprised you chaps have neglected this one

Time to buy gold and silver.

The share is on a downtrend since late August last year on reaching 315p
With time could change but after 2 heavy days of rising last week, today is very weak again
Will need to break over 250p on the next 2 month to change direction after holding over the 50MA

15 minutes delayed

Moving higher in the last few days.

Would have been a good purchase early Jan.

Anyone know why the sp has fallen since early 2011? Rising well now.

Results not good an a large drop this morning after yesterday's one
Wonder if ready for a bounce and take a punt.
180p good be a very good price but shorter time frame 238p would be right, but maybe only coming donw to 245p soon

There is weakness after 12.02 UT
order book DEPTH at 40 v 69

now looking for an intraday double bottom ?
264.50p was the price erlier

the intraday low has gone to 262.80p, and the order book is still very weak or much weaker yet

DEPTH at 34 v 74

still on new lows earlier 255p

silver chart