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LUXEMBOURG / ACCESSWIRE / July 28, 2022 / Nexa Resources S.A. ("Nexa Resources", "Nexa", or "Company") announces today its results for the three and six months ended June 30, 2022.
CEO Message - Ignacio Rosado
"We delivered strong results across the Company and recorded the highest quarterly Adjusted EBITDA in our history. We would like to thank our teams for the hard work in safely improving our performance and mitigating inflationary cost pressure and supply chain constraints. We are fine-tuning our operating strategy to improve our value propositions to remain competitive through the commodities' cycle.
We have seen increased volatility in the capital markets, as well as growing concerns about a global recession, which has put downward pressure on commodity prices. In the short- to mid-term, we expect this scenario will persist, as well as the risks associated with the Russia-Ukraine war, supply chain disruptions, and potential new waves and/or variants of COVID. At Nexa, we will continue to focus on the well-being of our employees and host communities, cost controls, efficiency, and cash flow generation, while delivering sustainable results.
During my first six months as CEO and amid the many challenges, I have been most impressed by the willingness of our people to continually embrace change. In this context, we are revisiting both our growth strategy and our organizational structure to prepare Nexa for a changing world, focusing on a collaborative culture to continue building shared value for our stakeholders. We are also working in our ESG strategy to reflect our public commitment to sustainability and long-term value creation.
Finally, we are pleased to report that Aripuanã is ramping up as expected, and we have already produced our first copper concentrate batch. Initial results from exploration activities also indicate that we should be able to add new resources during the year."
(1) Refer to "Use of Non-IFRS Financial Measures" for further information. Adjusted EBITDA, adjusted net income (loss) and adjusted EPS exclude the non-cash impact related to the offtake agreement. Please refer to the adjusted EBITDA reconciliation and "Offtake agreement" on pages 15 and 38 of this earnings release. For details on segment definition and accounting policy, please refer to explanatory note 2 - "Information by business segment" in the Condensed Consolidated Financial Statements ended on June 30, 2022.
(2) Working capital in 2Q22 had a negative impact of US$23 million, totaling a negative variation of US$179 million in 1H22. Working capital in 2Q21 had a negative impact of US$35 million, totaling a negative variation of US$22 million in 1H21.
(3) Cash, cash equivalents and financial investments.
Production, Sales and Cash Cost Guidance
Cash cost (1) net of by-product (US$/lb)
(1) 2022 C1 Weighted Cash cost net of by-products credits is measured with respect to zinc sold per mine.
Cash cost (2) net of by-product (US$/lb)
(2) 2022 C1 Weighted Cash cost net of by-products credits is measured with respect to zinc sold per smelter.
(1) Including Vazante LOM extension. Greenfield project portfolio is under review.
(2) Investments in tailing dams are included in sustaining expenses.
(4) The amounts are mainly related to capitalization of interest net of advanced payments for imported materials.
Exploration & Project Evaluation and Other Expenses Guidance
For a full version of this document, please go to our Investor Relations webpage at: http://ir.nexaresources.com
Nexa is a large-scale, low-cost integrated zinc producer with over 60 years of experience developing and operating mining and smelting assets in Latin America. Nexa currently owns and operates five long-life underground mines - three located in the Central Andes of Peru and two located in the state of Minas Gerais in Brazil - and is developing the Aripuanã Project as its sixth underground mine in Mato Grosso, Brazil. Nexa also currently owns and operates three smelters, two located in Brazil and one in Peru, Cajamarquilla, which is the largest smelter in the Americas. Nexa was among the top five producers of mined zinc globally in 2021 and also one of the top five metallic zinc producers worldwide in 2021, according to Wood Mackenzie.
Nexa Resources - Investor Relations | Roberta Varella | [email protected]
[1] Our cash cost net of by-products credits is measured with respect to zinc sold.
[2] Adjusted EBITDA excludes the non-cash impact related to the offtake agreement - US$28 million in 2Q22 and US$(19) million in 1Q22.
[3] For further information please access https://www.spglobal.com/spdji/en/documents/methodologies/methodology-sp-bvl-peru-indices.pdf.
SOURCE: Nexa Resources S.A.
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