Antofagasta PLC (LSE:ANTO) lowered its copper production forecast for 2026 to between 625,000 and 655,000 tonnes, down from a previous estimate of 650,000 to 700,000 tonnes. The revision follows severe weather that prompted a shutdown at the Los Pelambres mine, leading the Chilean government to declare a state of catastrophe in the Coquimbo region. Mining operations have resumed, but inspections revealed the need for repairs to certain pipeline platforms and water management systems.
Key Details
Despite the production downgrade, Antofagasta reported strong financial results for the first half of 2026. Revenue increased by 18% year-on-year to $4.48 billion, while earnings before interest, tax, depreciation, and amortization (EBITDA) rose 27% to $2.84 billion. Profit before tax surged 72% to $2 billion, supported by higher copper prices, which averaged $6.19 per pound during the period. The company declared an interim dividend of 30.1 cents per share, an increase of 81% from the previous year.
Background
Antofagasta's copper production for the first half of 2026 was 285,000 tonnes, down 9% from the same period last year. However, net cash costs fell 8% to $1.22 per pound, aided by stronger by-product credits and effective cost controls. Chief executive Iván Arriagada noted that the company’s focus on productivity and cash cost discipline contributed to the improved earnings, while maintaining a balance sheet capable of supporting growth plans. The company expects production to increase sequentially in the latter half of 2026 as operations stabilize.
The downgrade in production forecasts could impact copper prices, particularly as the market adjusts to the anticipated supply constraints. Investors will closely monitor how these developments affect Antofagasta's share performance and the broader copper market. Watch for updates on the company's production recovery and any further impacts from weather conditions in Chile.
Based on reporting by: proactiveinvestors.co.uk