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Atalaya Mining PLC on Wednesday posted a drop in interim profit as operating costs rose.
Shares were down 6.7% at 266.00 pence each on Wednesday afternoon in London.
For the six months that ended on June 30, the Cyprus-based copper producer posted a 8.8% drop in revenue to €197.7 million from €197.1 million a year earlier.
Pretax profit decreased by 60% to €34.2 million from €85.3 million, as operating costs surged by 42% to €138.3 million from €97.7 million a year earlier.
Atalaya said the increase in operating costs was as a result of huge rises in ‘key input costs such as electricity, diesel, explosives, steel and lime’.
The company said earnings before interest, tax, depreciation and amortisation fell to €41.4 million from €99.4 million a year earlier, driven by the ‘combination of lower revenues and higher operating costs compared with the periods in 2021’, Atalaya explained.
Chief Executive Officer Alberto Lavandeira said: ‘As a result of the ongoing conflict in Ukraine and the inflationary environment globally, our costs have increased materially since last year and it is likely that current conditions will persist for some time.’
Atalaya Mining declared an interim dividend of $0.036 per share, equivalent to about 3 pence per share.
Turning to production, the company mined 7.5 million tonnes of ore in the first half of 2022, compared to 6.6 million tonnes a year ago.
The company said it expects copper production to be 52,000 - 54,000 tonnes in 2022, with full year copper grade and copper recoveries anticipated to average 0.40% and 85%-87% respectively.
Lavandeira added: ‘Positively, the plant demonstrated strong performance in Q2, processing around 4.0 million tonnes of ore and yielding good recoveries despite lower grades. We expect strong throughput to continue for the remainder of the year.’
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