Boliden (BOL) Q2 2024 earnings summary

Executive summary

• Q2 2024 results were driven by a SEK 2.4 billion insurance income from the Rönnskär fire and the decision to reopen Tara mine, alongside improved base and precious metal prices, though lower treatment charges and premiums were a headwind.

• Smelters had a strong production quarter with well-executed maintenance shutdowns, while Aitik faced low mill volumes due to ramp-up and equipment issues; Garpenberg achieved record throughput.

• Tara mine is being reopened with a reduced workforce and new union agreement, with onboarding and retraining in Q3 and full production expected from Q1 2025.

• Key projects, including Odda expansion, Aitik dam reinforcement, Kristineberg extension, and Rönnskär electrolysis plant, are progressing on schedule and budget.

• Sales increased to SEK 22,748 million year-over-year, with higher metal prices but lower smelting fees and premiums.

Financial highlights

• Operating profit excluding process inventory revaluation was SEK 4 billion, including SEK 2 billion in one-offs (insurance and Tara restructuring); including process inventory, profit was SEK 4.8 billion.

• Net profit reached SEK 3,610 million, with earnings per share at SEK 13.20.

• Revenues rose to SEK 22,748 million, up from SEK 18,442 million in Q2 2023.

• CapEx for the quarter was SEK 3.7 billion, in line with guidance; free cash flow was SEK 401 million, supported by SEK 600 million in insurance proceeds.

• Net debt increased to SEK 14.4 billion, mainly due to dividend payments.

Outlook and guidance

• CapEx guidance for 2024 remains at SEK 15.5 billion; most planned maintenance is complete.

• Smelters' planned maintenance impact: SEK -400 million for the full year, SEK -50 million in Q3, SEK 0 million in Q4.

• Tara mine is expected to incur an operating loss of EUR -25 million per quarter in H2 2024, with breakeven expected in Q1 2025.

• No changes to grade guidance; Aitik is expected to reach 45 million tons throughput from 2025 as ramp-up and project competition ease.