Industrias Peñoles (PE&OLES) Q3 2024 earnings summary

Executive summary

• Net sales rose 15% year-over-year in 3Q'24 to $1,732.2M, driven by higher metal prices despite lower volumes for some products.

• Operating profit reached $349.8M, a significant turnaround from a $57.1M loss in 3Q'23, reflecting improved margins and cost controls.

• EBITDA surged to $569.9M in 3Q'24 from $118.8M in 3Q'23, supported by favorable pricing and lower production costs.

• After-tax income attributable to controlling interest was $40.1M, up from $15.6M in 3Q'23.

• Metal prices rose significantly year-over-year: gold (+28.3%), silver (+24.7%), zinc (+14.4%), copper (+10.2%), while lead declined (-5.8%).

Financial highlights

• Gross profit increased to $523.4M in 3Q'24, up from $128.1M in 3Q'23, as cost of sales fell 12.4%.

• YTD net sales reached $4,763.1M, up 6.9% from the prior year.

• Net cash from operating activities YTD was $907.8M, a 292% increase year-over-year.

• Cash and equivalents stood at $1.5B, with financial debt at $2.8B as of September 2024.

• Net income attributable to controlling interest was US$40.1 million, up 156.3% year-over-year.

Outlook and guidance

• Management continues to focus on cost control, operational efficiency, and product mix optimization.

• Ongoing strategies to reduce less profitable chemical by-products and channel capacity to higher-margin products.

• Exploration advanced in five priority projects across Mexico, Chile, and Peru, with over 32,800 meters drilled.

• Brownfield and greenfield exploration continues, with promising results near Tizapa and ongoing international projects.