Kaz Minerals first-half profit up, Bozshakol project on track

For the six months to the end of June, the copper miner said core profit rose to $115m from $88m in the same period last year. Pre-tax profit surged to $91m fro $2m last year.

Although revenue fell to $302m from $341m, cost of sales declined to $170m from $282m and administrative expenses dropped to $51m from $71m.

The copper company said its Bozshakol clay plant was ramping up, with over 60% of ore throughput capacity achieved in August to date.

Group copper cathode equivalent production increased 43% in the first half to 52.6 kt.

The group narrowed its full-year production guidance for copper and gold, but lifted the target for silver. Group copper guidance narrowed to 135-145 kt and gold to 95-115 koz, but silver was upped to 2,500-2,750 koz.

Chief executive Oleg Novachuk said: "We have continued to deliver on our strategy of high growth, low-cost copper in the first half of 2016 with production increasing by 43%, including the first significant contributions from Bozshakol and Aktogay.

“We have also been able to further reduce our operating costs with 34% lower gross cash costs in the East Region and Bozymchak supporting an improved EBITDA despite weaker commodity prices. Our growth is set to accelerate as Bozshakol continues its ramp up in the second half of the year followed by the commissioning of Aktogay sulphide in the first half of 2017."

RBC Capital Markets said the results were “solid”. It noted that reported EBITDA of $115m was 15% above consensus of $100m and towards the top end of the broad Bloomberg consensus range of $71m to $121m.

At 0937 BST, Kaz shares were up 11% to 182.10p.