Record gold output, but Hudbay posts loss in Q1

Operations at Constancia copper mine. (Image courtesy of Hudbay Minerals.)

Hudbay Minerals (TSX: HBM; NYSE: HBM) released its first quarter results today with record gold production of 35,500 oz. during that time. Consolidated copper production was 24,553 tonnes at a ‘sustaining cash cost’ of $2.16 per lb.

Despite strong metal prices, revenue fell to $313.6 million for the period, compared to $322,3 million for the last quarter of 2020, and $245.1 million in the year earlier quarter. The company recorded a net loss of $60.1 million or $0.23 per share.

Nonetheless, president and CEO Peter Kukielski remained upbeat saying, “Our operations remain on track to achieve full year production and unit cost guidance following a strong quarter of production at the Manitoba business unit and lower first quarter production in Peru as a result of planned mill maintenance. We are very pleased to have commenced production at Pampacancha and we look forward to our first gold pour at the New Britannia mill, which remains on schedule for the third quarter.”

Non-cash working capital increased due to higher realized metals prices to $90.7 million in the first quarter from $86.1 million in the preceding quarter.

Hudbay has several growth projects in the pipeline. As mentioned earlier, the Pampacancha copper mine, a satellite deposit at the Constancia mine in Peru, has begun production. The New Britannia gold mine in Manitoba will be back in production early in the third quarter, with the copper flotation plant to be commissioned by year end.

The preliminary economic assessment for the Mason project in Nevada outlines an average copper production of 140,000 tonnes in each of the first 10 years of operation. The Copper World property is being actively explored and the Rosemont project is at the permitting-development stage; both are copper projects in Arizona.

(This article first appeared in the Canadian Mining Journal)