Compania De Minas Buenaventura S.A.A Announces First Quarter 2003 Results.Business Editors LIMA Lima, city, Peru Lima (lē`mə, Span. lē`mä), city (1990 metropolitan area est. pop. 6,400,000), W Peru, capital and largest city of Peru. Its port is Callao. , Peru--(BUSINESS WIRE)--April 25, 2003 Compania de Minas Minas may refer to:
 `rä), city (1993 pop. 194,727), W Colombia, a port on the Pacific Ocean. .A.A. "Buenaventura"
(NYSE NYSESee: New York Stock Exchange : BVN BVN Basketball Verband Nordwestschweiz (basketball association, Switzerland) BVN Bolsa de Valores Nacional, SA (Guatemala) BvN Birkhoff-Von Neumann Decomposition BVN Bureau Voucher Number BVN Broadband Virtual Network / Lima Stock Exchange Lima Stock Exchange Peru's major securities market. : BUE BUE Buenos Aires, Argentina (Airport Code) BUE British University In Egypt (El Sherouk, Egypt) BUE Built Up Edge (type of defect in machining) .LM), Peru's largest publicly traded precious metals Precious Metals Valuable metals such as gold, iridium, palladium, platinum, and silver. Notes: Investing in precious metals can be done either by purchasing the physical asset, or by purchasing futures contracts for the particular metal. mining company, announced net income of S/.186.3 million or US$53.6 million for the three-month period ended March 31, 2003. This represents an increase of 313% over the net income of S/.45.1 million in the corresponding quarter of 2002. The Company's operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. was S/.52.4 million or US$15.1 million during the first quarter of 2003, representing a 126% increase when compared to the S/.23.2 million recorded in the corresponding quarter of 2002. Buenaventura's EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become in the first quarter of 2003 was US$78.2 million, which represents an 85% increase when compared to the EBITDA of US$42.3 million in the same quarter of 2002. Sales During the first quarter of 2003, Buenaventura reported total sales of S/.153.7 million, compared to S/.126.1 million during the same period of 2002. The higher sales revenue this quarter was due mainly to a 22% increase in the volume of gold sold, as shown below, and a 22% increase in gold price (US$349.81 in the first quarter of 2003, compared to US$287.89 in the first quarter of 2002).
Sales content for the three-month period ended March 31,
--------------------------------------------------------
2002 2003
------------ ------------
Gold 62,734 oz 76,668 oz
Silver 3,112,469 oz 2,062,064 oz
Lead 5,234 MT 4,566 MT
Zinc 11,340 MT 13,603 MT
Operations In the first quarter of 2003, Orcopampa increased its gold production by 18.4% (43,621 ounces of gold for the first quarter of 2003 and 36,856 ounces of gold in the first quarter of 2002) and reduced its cash cost by 7% (US$159.29/oz of gold in the first quarter of 2003, compared to US$170.51/oz of gold recorded in same quarter of 2002). Uchuchacua decreased its production by 3% (2,368,140 ounces of silver in the first quarter of 2003, compared to 2,431,242 ounces in the same period of 2002). The cash operating cost at Uchucchacua during the first quarter of 2003 was US$3.10 per ounce ounce, in zoology ounce, in zoology: see leopard. ounce, unit of measurement ounce: see English units of measurement. of silver, compared to US$2.71 in the same period of 2002, this increase is mainly due to higher, labor and supply costs to prepare future areas of production and lower by-product by·prod·uct or by-prod·uct n. 1. Something produced in the making of something else. 2. A secondary result; a side effect. by-product Noun 1. credits. Antapite produced 17,927 ounces of gold during the first quarter of 2003 at a cash operating cost of US$163.33/oz (7,850.72 ounces of gold production in the same period of 2002 at a cash operating cost of US$148.52). We have to mention that Antapite's treatment plant expansion is in process and the mine is expanding its preparation to increase production from April onward on·ward adj. Moving or tending forward. adv. also on·wards In a direction or toward a position that is ahead in space or time; forward. . Buenaventura's total production, which includes 100% of its operating units operating unit A type of operating company that engages in transactions with outsiders and that is owned by another business. For example, in 1995 the stockholders of Capital Cities/ABC approved a $19 billion merger with the Walt Disney Company, whereupon , 78.06% of the production of the Ishihuinca and Antapite mines, 32.42% of the production of El Brocal, and 100.0% of the production of Cedimin, was:
1Q 2002 1Q 2003 Var %
------------ ------------ ------------
Gold 58,830 oz 67,654 oz 15.0 %
Silver 3,064,133 oz 2,911,776 oz ( 5.0 %)
Zinc 8,612 MT 6,361 MT (26.0 %)
Lead 3,316 MT 3,438 MT 4.0 %
Earnings Earnings per ADS for the three-month period ended March 31, 2003 were US$0.84, compared to US$0.20 during the corresponding 2002 period. As it has been disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). , the company adjusted its financial statements to conform to Verb 1. conform to - satisfy a condition or restriction; "Does this paper meet the requirements for the degree?" fit, meet coordinate - be co-ordinated; "These activities coordinate well" the NIC (1) (Network Interface Card) See network adapter. See also InterNIC. (2) (New Internet Computer) An earlier Linux-based computer from The New Internet Computer Company (NICC), Palo Alto, CA. 39, equivalent to FAS 133, to report derivative derivative: see calculus. derivative In mathematics, a fundamental concept of differential calculus representing the instantaneous rate of change of a function. results, and due to this, US$0.41/ADS of the above mentioned earnings per ADS correspond to derivatives derivatives In finance, contracts whose value is derived from another asset, which can include stocks, bonds, currencies, interest rates, commodities, and related indexes. Purchasers of derivatives are essentially wagering on the future performance of that asset. . Non-consolidated affiliates Buenaventura's income from non-consolidated affiliates, attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk mainly to Yanacocha Yanacocha is a gold mine in northern Peru, considered one of the biggest and most profitable in the world producing over US$7 billion worth of gold to date. The 251-square kilometer open pit mine is situated about 30 kilometers (14km straight line) north of Cajamarca, in high , was S/.64.9 million or US$18.7 million during the first quarter of 2003, compared to S/.30.4 million in the corresponding period in 2002. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. mining plans, Yanacocha's production increased 36% to 639,359 ounces of gold (279,080 ounces being Buenaventura equity ounces) in the first quarter of 2003, from 471,467 ounces of gold (205,795 ounces being Buenaventura equity ounces) in the same period of 2002. The cash cost was US$134/oz, in the first quarter of 2003, compared to US$146/oz. in the first quarter of 2002. In the first quarter of 2003, Yanacocha changed accounting principles related to FAS 143 (Reclamation Reclamation A claim for the right to return or the right to demand the return of a security that has been previously accepted as a result of bad delivery or other irregularities in the delivery and settlement process. Cost). The cumulative effect of the change was US$36.4 million in expenses in this period (US$15.9 million Buenaventura's share). Buenaventura is Peru's largest precious metals mining company and a major holder of mining rights in Peru. The Company focuses on exploration and production through its wholly-owned mines, as well as through its participation in joint exploration projects. Buenaventura currently operates four mines in Peru, has controlling interests controlling interest The ownership of a quantity of outstanding corporate stock sufficient to control the actions of the firm. Controlling interest often involves ownership of significantly less than 51% of a firm's outstanding stock because many owners fail in two mining companies, which own two mines in Peru, and has minority interests in several other mining companies in Peru. The Company has a significant ownership interest in Minera Minera (Welsh: Mwynglawdd) is a small village in the county borough of Wrexham in north-east Wales. It borders Coedpoeth to the east and Bwlchgwyn to the west. Yanacocha S.A., Latin Lat·in n. 1. a. The Indo-European language of the ancient Latins and Romans and the most important cultural language of western Europe until the end of the 17th century. b. America's largest producer of gold. Buenaventura is listed on the Lima Stock Exchange and the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. . Exchange rate as of March 31, 2003: S/.3.475/US$1.00
Compania de Minas Buenaventura S.A.A. and subsidiaries
Consolidated Balance Sheets
As of December 31, 2002 (audited) and March 31, 2003 (unaudited)
2002 2003 2003
S/(000) S/(000) US$(000)
16 Assets
17 Current assets
Cash and cash equivalents 90,642 109,361 31,471
Trade and other accounts
receivable, net 85,932 79,330 22,829
Accounts receivable from
affiliates 30,661 30,338 8,730
Inventories, net 74,408 80,423 23,143
Current portion of prepaid taxes
and expenses 30,860 36,308 10,448
----------- ----------- -----------
18 Total current assets 312,503 335,760 96,621
Long - term account receivable 8,969 9,456 2,721
Prepaid taxes and expenses 13,233 9,500 2,734
Investments in shares 1,184,448 1,237,043 355,984
Property, plant and equipment,
net 369,352 368,313 105,989
Development costs and mineral
lands, net 148,194 151,002 43,454
Mining concessions, net 173,768 169,627 48,814
----------- ----------- -----------
19 Total assets 2,210,467 2,280,701 656,317
----------- ----------- -----------
20 Liabilities and shareholders' equity, net
21 Current liabilities
Bank loans 43,826 35,205 10,131
Trade accounts payable 36,344 27,953 8,044
Accounts payable to affiliates 22 22 6
Dividends payable 1,343 43,394 12,488
Other current liabilities 62,285 58,941 16,961
Current portion of long-term
debt 17,192 18,643 5,365
----------- ----------- -----------
22 Total current
liabilities 161,012 184,158 52,995
24 Derivative instruments - 335,552 96,562
25 Deferred income tax and
workers' profit sharing 17,464 16,948 4,877
Long-term debt 113,331 105,223 30,280
----------- ----------- -----------
26 Total liabilities 291,807 641,881 184,714
----------- ----------- -----------
27 Minority interest 45,986 65,623 18,884
----------- ----------- -----------
28 Shareholders' equity,
net
Capital stock 610,735 610,735 175,751
Investment shares 1,652 1,652 475
Additional paid-in capital 545,266 545,266 156,911
Legal reserve 77,042 95,416 27,458
Retained earnings 646,313 335,579 96,570
Cumulative translation
adjustment 6,961 (16,192) (4,660)
Unrealized gain on investments
carried at fair value - 16,036 4,615
Treasury shares (15,295) (15,295) (4,401)
----------- ----------- -----------
29 Total shareholders'
equity 1,872,674 1,573,197 452,719
----------- ----------- -----------
Total liabilities and
shareholders' equity, net 2,210,467 2,280,701 656,317
----------- ----------- -----------
Compania de Minas Buenaventura S.A.A. and subsidiaries
Consolidated Statements of Income (unaudited)
For the three-months periods ended March 31, 2002 and 2003
2002 2003 2003
S/(000) S/(000) US$(000)
31 Operating revenues
Net sales 126,082 153,738 44,241
Royalty income 15,325 24,196 6,963
----------- ----------- -----------
32 Total revenues 141,407 177,934 51,204
----------- ----------- -----------
Costs of operation
Operating costs 69,940 67,532 19,434
Depreciation 8,965 8,308 2,391
Exploration and development
costs in operational mining
sites 12,104 14,821 4,265
----------- ----------- -----------
Total costs of operation 91,009 90,661 26,090
----------- ----------- -----------
Gross margin 50,398 87,273 25,114
----------- ----------- -----------
33 Operating expenses
General and administrative 15,038 16,757 4,822
Sales 5,522 4,906 1,412
Exploration costs in non-
operational mining areas 3,692 8,667 2,494
Royalties 2,990 4,575 1,317
----------- ----------- -----------
34 Total operating expenses 27,242 34,905 10,045
----------- ----------- -----------
35 Operating income 23,156 52,368 15,069
----------- ----------- -----------
Other income (expenses)
Gain from change in the fair
value of derivative instruments - 91,620 26,365
Share in affiliated companies,
net 30,399 64,907 18,678
Realized gain (loss) in
derivative instruments 15,566 (1,288) (371)
Interest income 2,289 1,186 341
Gain from exposure to inflation 175 856 246
Interest expense (4,107) (2,310) (665)
Amortization of mining
concessions (4,120) (3,975) (1,144)
Loss from sale of subsidiary's
shares (6,680) - -
Other, net (3,849) 2,662 766
----------- ----------- -----------
Total other income, net 29,673 153,658 44,216
----------- ----------- -----------
Income before income tax and
minority interest 52,829 206,026 59,285
Income tax (5,772) (6,441) (1,854)
----------- ----------- -----------
Income before minority interest 47,057 199,585 57,431
Minority interest (1,923) (13,330) (3,836)
----------- ----------- -----------
36 Net income 45,134 186,255 53,595
----------- ----------- -----------
Basic and diluted earnings per
share, stated in Peruvian
Nuevos Soles and U.S. dollars 0.35 1.46 0.42
----------- ----------- -----------
Weighted average number of
shares outstanding 127,225,692 127,225,692 127,225,692
----------- ----------- -----------
Compania de Minas Buenaventura S.A.A. and subsidiaries
Consolidated Statements of Cash Flows (unaudited)
For the three-months periods ended March 31, 2002 and 2003
2002 2003 2003
S/(000) S/(000) US$(000)
Operating activities
Collection from customers 117,130 176,414 50,767
Collection of royalties 15,886 24,083 6,930
Collection of interest 2,275 2,440 702
Payments to suppliers and third
parties (46,289) (76,052) (21,885)
Payments to employees (30,491) (32,094) (9,236)
Payments of exploration
expenditures (11,517) (19,135) (5,506)
Payments of income tax (3,615) (10,835) (3,118)
Payments of royalties (3,467) (6,366) (1,832)
Payments of interest (3,527) (3,824) (1,100)
----------- ----------- -----------
37 Net cash provided by
operating activities 36,385 54,631 15,722
----------- ----------- -----------
38 Investing activities
Purchase of plant and equipment (18,628) (10,816) (3,112)
Proceeds from (payments by)
derivative instruments 15,566 (1,288) (371)
Proceeds from sale of plant and
equipment 2,055 392 113
Development expenditures (9,782) (7,422) (2,136)
Purchase of investments in
shares, net (3,865) (1,500) (432)
----------- ----------- -----------
39 Net cash used in
investing activities (14,654) (20,634) (5,938)
----------- ----------- -----------
Net cash used in financing
activities (825) (15,278) (4,397)
----------- ----------- -----------
Net increase in cash during the
year 20,906 18,719 5,387
Cash at beginning of year 86,317 90,642 26,084
----------- ----------- -----------
40 Cash at year-end 107,223 109,361 31,471
2002 2003 2003
S/(000) S/(000) US$(000)
Reconciliation of net income to
net cash provided by operating
activities
Net income 45,134 186,255 53,595
Add (deduct)
Gain from change in the fair
value of derivative instruments - (91,620) (26,365)
Share in affiliated companies,
net of dividends received (30,399) (64,907) (18,678)
Minority interest 1,923 13,330 3,836
Depreciation 9,087 8,791 2,530
Amortization of mining
concessions 4,120 3,975 1,144
Amortization of development
costs in operative mining sites 4,279 3,870 1,114
Net cost of retired plant and
equipment - 1,357 391
Gain from exposure to inflation (175) (856) (246)
Deferred income tax 2,157 (516) (148)
Loss on sale of plant and
equipment 4,332 37 11
Loss on sale of investments in
shares 6,680 - -
41 Net changes in assets and
liabilities accounts
Decrease (increase) of operating
assets -
Trade and other accounts
receivable (24,507) 8,237 2,371
Inventories 6,246 (3,594) (1,034)
Prepaid taxes and expenses 7,724 (1,715) (493)
Decrease of operating
liabilities -
Trade and other accounts
payable (216) (8,013) (2,306)
----------- ----------- -----------
42 Net cash provided by
operating activities 36,385 54,631 15,722
----------- ----------- -----------
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