Antofagasta PLC ANTO 3rd Quarter Results

  Antofagasta PLC (ANTO) - 3rd Quarter Results

RNS Number : 1600R
Antofagasta PLC
15 November 2012




For immediate release



Cleveland
House
  Telephone: + 44 20
7808 0988

33 King Street

 Fax: + 44 20 7930 7578

LondonEmail:
 info@antofagasta.co.uk

SW1Y 6RJ

United Kingdom



        Unaudited Results for the Nine Months ended 30 September 2012



London, 15 November 2012





Highlights



                 Nine months ended Nine months ended
                      30 September      30 September        Full year
                              2012              2011 Change      2011
                             US$'m             US$'m      %     US$'m
Group turnover             4,852.4           4,172.9  16.3%   6,076.0
Group EBITDA               2,832.3           2,505.5  13.0%   3,660.5



  Revenue

  Group  revenue  in   the  nine   months  ended  30   September  2012   was 
  US$4,852.4million compared with US$4,172.9 million in the same period  in 
  2011, mainly  reflecting increased  copper, gold  and molybdenum  volumes, 
  partly offset by a decrease in the average realised copper and  molybdenum 
  prices.

  The volume of copper produced in  the nine months ended 30 September  2012 
  was 515,800 tonnes, a 13.7% increase on the 453,500 tonnes produced in the
  nine months  ended 30  September 2011.  This was  mainly due  to  steadily 
  increasing  throughput  levels  at   Esperanza  following  the  start   of 
  operations there  in 2011.  Sales  volumes in  the  nine months  ended  30 
  September 2012 were 495,000 tonnes (nine months ended 30 September 2011  - 
  433,100). The difference  with production volumes  mainly reflects  timing 
  differences due to shipping and loading schedules.

  Gold production volumes were 213,500 ounces and sales volumes were 202,600
  ounces (nine  months  ended 30  September  2011 -  production  volumes  of 
  125,000 ounces and sales  volumes of 106,400  ounces) also reflecting  the 
  higher throughput at Esperanza.

  Molybdenum production volumes  were 9,500  tonnes and  sales volumes  were 
  9,800 tonnes (nine  months ended  30 September 2011  - production  volumes 
  were 7,300  tonnes and  sales volumes  were 7,200  tonnes) reflecting  the 
  particularly high molybdenum  grade at  Los Pelambres  during the  current 
  period.

The realised copper  price in the  period was 374.1  cents per pound  compared 
with the realised  price of  378.0 cents  in the  first nine  months of  2011. 
London Metal Exchange  ("LME") copper  prices averaged 361.2  cents per  pound 
during the period compared with 419.8 cents per pound in the nine months ended
30 September 2011. However, the improvement in the copper price during January
2012 compared with the final months of 2011 as well as positive mark-to-market
adjustments at  the end  of September  2012 resulted  in positive  provisional 
pricing adjustments in the current period.  Conversely, the sharp fall in  the 
copper price in  September 2011 resulted  in significant negative  provisional 
pricing  adjustments   in  the   comparative  period.   Commodity   derivative 
instruments did not have a significant overall impact on the Group's  revenues 
in the nine months to  30 September 2012, with  net realised losses of  US$1.3 
million. In the first nine  months of 2011 a net  loss of US$15.3 million  was 
recognised within revenue in respect of commodity derivatives, relating almost
entirely to Michilla.

Market molybdenum prices averaged US$13.3 per pound in the nine month  period, 
a decrease from  the average price  of US$16.2  per pound in  the nine  months 
ended 30 September 2011.  The realised molybdenum price  of US$12.3 per  pound 
for the period  was lower than  the average market  price as a  result of  the 
decreasing price during  the period,  which resulted  in negative  provisional 
pricing adjustments.

Market gold prices averaged US$1,651.3 per ounce in the nine month period,  an 
increase from the  average price of  US$1,534.4 per ounce  in the nine  months 
ended 30 September 2011.  The realised gold price  of US$1,668.4 for the  nine 
month period was marginally above the market price for the period.

The transport division's  sales were US$143.2  million in the  period, a  7.9% 
improvement compared with  the same period  in 2011 as  a result of  increased 
tariffs through indexation. The water division's sales were US$98.3 million, a
15.9% increase compared with the same period in 2011 as a result of  increased 
volumes and tariffs.

Further details of production and sales volumes and realised prices by  mining 
operation are given in Note 2, and an analysis of revenue by business  segment 
is given in Note 3. Further details of the operating performance of each  mine 
and the rail and water  division are also given  in the Group's third  quarter 
production report released on 31 October 2012.



EBITDA



Group EBITDA  in  the nine  months  ended  30 September  2012  was  US$2,832.3 
million, compared with US$2,505.5  million in the nine  three months of  2011. 
The increased  revenues  discussed  above  were  partly  offset  by  increased 
operating costs. Excluding by-product credits  (which are reported as part  of 
revenue) and  tolling  charges  for  concentrates  (which  are  deducted  from 
revenue), weighted average cash  costs for the  Group (comprising on-site  and 
shipping costs in the case of Los  Pelambres and Esperanza, and cash costs  in 
the case of the other two operations) increased slightly from 142.5 cents  per 
pound in the nine months ended 30  September 2011 to 146.4 cents per pound  in 
the first nine  months of 2012.  Net cash costs  including by-product  credits 
(which are reported as  part of revenue) were  99.0 cents per pound,  compared 
with 103.7 cents per pound in the  first nine months of 2011, with the  higher 
gold sales volumes offsetting the  increased operating costs. Further  details 
of the  cash  costs of  each  mine are  given  in the  Group's  third  quarter 
production report released on 31 October 2012.



Further details of cash costs by mining operation are given in Note 2, and  an 
analysis of  EBITDA  by business  segment  is given  in  Note 3.  Details  of 
commodity derivative  instruments are  given in  Note 5.  As explained  above, 
further details of  the operating performance  of each mine  and the rail  and 
water division are also given in the Group's third quarter production report.



Cash and Borrowings



At 30  September  2012  the  Group  had  cash,  cash  equivalents  and  liquid 
investments of US$3,876.8  million (31  December 2011  - US$3,280.0  million). 
Excluding the  minority  share in  each  partly-owned operation,  the  Group's 
attributable share of total cash  and cash equivalents was US$3,508.9  million 
(31 December  2011  -  US$3,041.1  million).  Total  Group  borrowings  at  30 
September  2012  were  US$1,911.8  million  (31  December  2011  -  US$2,140.3 
million). Of this, US$1,306.2 million (31 December 2011 - US$1,456.3  million) 
is proportionally  attributable  to the  Group  after excluding  the  minority 
shareholdings in partly-owned operations.



Taxation



As explained in  Note 7  to the  2012 Half  Yearly Financial  Report dated  29 
August 2012, the Chilean Congress was studying a bill to increase the rate  of 
first category (i.e.  corporation) tax  to 20%, compared  with the  previously 
announced rates of 18.5% for 2012 and 17% from 2013. This change was  enacted 
on  27  September   2012,  and   as  previously  expected   will  be   applied 
retrospectively from 1  January 2012. Accordingly,  the rate of  20% will  be 
applied in the Group's  results for the  tax expense and  deferred tax in  the 
full financial year compared with the rate  of 18.5% which was applied in  the 
half year. As well  as now calculating the  annual corporation tax charge  for 
2012 based on the new 20% rate, there will also be a further one-off impact in
the 2012 results as a consequence  of re-calculating the opening deferred  tax 
balances at the 20% rate. Previously these balances had mainly been calculated
based on the 17% rate which had been expected to apply from 2013 onwards.  The 
impact of  this one-off  adjustment in  respect of  the opening  deferred  tax 
balances on the  2012 full  year results  is expected to  be a  tax charge  of 
approximately US$70 million.



There are no changes to the rates applicable to the mining tax (royalty) or to
withholding taxes, details of  which are also  set out in Note  7 to the  Half 
Yearly Financial Report.

Basis of Information



The Group  revenue  and  EBITDA  figures included  in  this  release  for  the 
nine-month period ended 30 September 2012 are presented on a basis  consistent 
with the  accounting policies  used  in the  Group's  2011 Annual  Report  and 
Financial Statements  under International  Financial Reporting  Standards  and 
Interpretations ("IFRS").



The Group's four  mining companies,  Los Pelambres, Esperanza,  El Tesoro  and 
Michilla will also file quarterly financial statements under a consistent IFRS
basis for  the nine-month  period ended  30 September  2012 with  the  Chilean 
securities regulator,  the  Superintendencia de  Valores  y Seguros  de  Chile 
("SVS").







Enquiries
  London                                                            Santiago

                                                                          

  Investor relations - Antofagasta plc             Antofagasta Minerals S.A.

Tel: +44 20 7808 0988                                     Tel: +562 798 7000

www.antofagasta.co.uk                                                        

                                                           Alejandro Rivera -
                                                          arivera@aminerals.cl
Hussein Barma - hbarma@antofagasta.co.uk
                                                                             
Philip Holden - pholden@antofagasta.co.uk
                                                                             

                                                                             
Media enquiries - Bankside Consultants

Tel: +44 20 7367 8871



Simon Rothschild -
simon.rothschild@bankside.com



  Notes

      1. General information and accounting policies

These unaudited third quarter results are for the nine-month period ending  30 
September 2012.  The  Group  revenue and  EBITDA  information,  including  all 
comparatives, have been prepared on the  basis of the accounting policies  set 
out in the Group's statutory accounts for the year to 31 December 2011 and  in 
accordance with  applicable International  Financial Reporting  Standards  and 
Interpretations (IFRS) which have been endorsed by the European Union.

While the revenue and EBITDA information contained in this nine month  results 
announcement has been computed in accordance with IFRS, this announcement does
not  itself  contain  sufficient  information   to  comply  with  IFRS.   The 
information included in this announcement for the nine month periods ending 30
September 2011 and 30 September 2012 is unaudited.

The information contained in this announcement for the year ended 31  December 
2011 does not constitute statutory accounts. A copy of the statutory accounts
for that year has been delivered to the Registrar of Companies. The  auditors' 
report on these accounts was unqualified and did not contain statements  under 
section 498(2)  (regarding  adequacy of  accounting  records and  returns)  or 
section 498(3) (regarding provision of necessary information and explanations)
of the Companies Act 2006. The comparative information contained in Note 2  of 
this announcement is  not derived  from the  statutory accounts  for the  year 
ended 31 December 2011 and is accordingly not covered by the auditors' report.

2. Production and Sales Statistics

(See notes following Note 2(b).)

(a) Production and sales volumes for copper, gold, molybdenum and
silver

                          Production                         Sales
                                                       Nine       Nine
               Nine months Nine months               months     months
                     ended       ended                ended      ended
                        30          30                   30         30    Full
                 September   September Full year  September  September    year
                      2012        2011      2011       2012       2011    2011
Copper ('000
tonnes)
Los Pelambres        296.0       297.4     411.8      288.2      286.9   415.5
Esperanza            113.7        54.4      90.1      104.8       44.8    86.3
El Tesoro             78.2        69.7      97.1       74.5       68.8    96.0
Michilla              27.8        32.0      41.6       27.5       32.6    42.2
Group total          515.8       453.5     640.5      495.0      433.1   640.0
Gold ('000
ounces)
Los Pelambres         38.8        26.8      39.8       38.8       26.8    39.8
Esperanza            174.6        98.2     157.1      163.8       79.6   153.4
                     213.5       125.0     196.8      202.6      106.4   193.2
Molybdenum
('000 tonnes)
Los Pelambres          9.5         7.3       9.9        9.8        7.2     9.4
Silver ('000
ounces)
Los Pelambres      1,479.6     1,213.3   1,774.3    1,479.6    1,213.3 1,774.3
Esperanza            917.8       385.7     724.3      822.8      385.7   724.3
                   2,397.4     1,599.0   2,498.6    2,302.4    1,599.0 2,498.6





(b) Cash costs per pound of copper produced and realised prices for
copper, gold, molybdenum and silver sold

                          Cash cost                        Realised prices
             Nine months Nine months             Nine months Nine months
                   ended       ended                   ended       ended
                      30          30                      30          30
               September   September   Full year   September   September   Full year
                    2012        2011        2011        2012        2011        2011
                      US          US          US          US          US          US
             cents/pound cents/pound cents/pound cents/pound cents/pound cents/pound
Copper
Los
Pelambres           81.2        77.8        78.3       375.5       373.8       371.1
Esperanza           54.2        99.0        83.2       374.7       350.4       354.7
El Tesoro          155.2       175.6       171.6       367.2       407.5       391.2
Michilla           314.6       196.7       213.3       375.7       390.1       381.6
Group
weighted
average (net
of
by-products)        99.0       103.7       101.9       374.1       378.0       372.6
Group
weighted
average
(before
deducting
by-products)       159.5       156.8       155.2
Group
weighted
average
(before
deducting
by-products
and
excluding
tolling
charges from
concentrate)       146.4       142.5       141.5
Cash costs
at Los
Pelambres
comprise:
On-site and
shipping
cost               121.3       110.7       110.0
Tolling
charges for
concentrates        15.9        19.0        18.0
Cash costs
before
deducting
by-product
credits            137.2       129.7       128.0
By-product
credits
(principally
molybdenum)       (56.1)      (51.9)      (49.7)
Cash costs
(net of
by-product
credits)            81.2        77.8        78.3
Cash costs
at Esperanza
comprise:
On-site and
shipping
cost               164.7       241.7       219.4
Tolling
charges for
concentrates        17.7        15.4        15.5
Cash costs
before
deducting
by-product
credits            182.4       257.1       234.9
By-product
credits
(principally
gold)            (128.1)     (158.1)     (151.7)
Cash costs
(net of
by-product
credits)            54.2        99.0        83.2
Copper LME
average
price (US
cents/pound)                                           361.2       419.8       399.7
Gold
(US$/ounce)
Los
Pelambres                                            1,634.0     1,552.2     1,610.6
Esperanza                                            1,676.5     1,619.4     1,643.4
Weighted
average                                              1,668.4     1,602.5     1,636.6
Gold average
market price                                         1,651.3     1,534.4     1,572.4
Molybdenum
(US$/pound)
Los
Pelambres                                               12.3        15.7        15.1
Molybdenum
average
market price                                            13.3        16.2        15.5
Silver
(US$/ounce)
Los
Pelambres                                               29.9        37.5        35.9
Esperanza                                               30.0        37.9        35.2
Weighted
average                                                 29.9        37.6        35.7
Silver
average
market price                                            30.6        36.2        35.1



Notes to the production and sales statistics



(i) The production  and sales figures  represent the total  amounts 
produced and sold  at each mine,  not the Group's  attributable share of  each 
mine. The Group owns 60% of Los Pelambres, 70% of Esperanza, 70% of El Tesoro
and 74.2% of Michilla.



(ii) Los Pelambres produces  copper and molybdenum concentrates  and 
Esperanza produces  copper  concentrate. The  figures  for Los  Pelambres  and 
Esperanza are expressed in  terms of payable  metal contained in  concentrate. 
Los Pelambres  and  Esperanza  are  also credited  for  the  gold  and  silver 
contained in  the copper  concentrate sold.  El Tesoro  and Michilla  produce 
cathodes with no by-products.



(iii) Cash costs are a measure of the cost of operational  production 
expressed in terms of cents per  pound of payable copper produced. Cash  costs 
are  stated  net  of  by-product  credits  and  include  tolling  charges  for 
concentrates at Los Pelambres and Esperanza. Cash costs exclude  depreciation, 
financial income and expenses,  hedging gains and  losses, exchange gains  and 
losses and corporation tax for all four operations By-product calculations  do 
not take into account mark-to-market gains for molybdenum at the beginning  or 
end of each period.



(iv) Realised copper prices are determined by comparing revenue  from 
copper sales (grossing  up for  tolling charges for  concentrates) with  sales 
volumes for  each  mine in  the  period.  Realised molybdenum  prices  at  Los 
Pelambres are calculated on  a similar basis.  Realised prices reflect  gains 
and losses on commodity derivatives, which are included within revenue.



(v) The totals in the tables  above may include some small  apparent 
differences as the specific individual figures have not been rounded.



(vi) The  production  information in  Note  2(a) and  the  cash  cost 
information in Note 2(b) is derived from the Group's production report for the
third quarter of 2012, published on 31 October 2012.



3. Revenue and EBITDA analysed by business segment



                             Revenue                        EBITDA
                                                       Nine       Nine
                 Nine months Nine months             months     months
                       ended       ended              ended      ended
                          30          30    Full         30         30    Full
                   September   September    year  September  September    year
                        2012        2011    2011       2012       2011    2011
                       US$'m       US$'m   US$'m      US$'m      US$'m   US$'m
Los Pelambres        2,655.6     2,582.2 3,676.6    1,872.9    1,853.4 2,641.9
Esperanza            1,124.2       474.4   922.9      734.1      239.4   518.9
El Tesoro              603.3       618.2   827.8      345.6      348.3   463.6
Michilla               227.8       280.3   355.0       38.7      137.3   156.7
Exploration               -          -      -    (205.8)    (138.8) (215.4)
Corporate and
other items               -          -      -     (72.9)     (45.8)  (55.3)
Mining               4,610.9     3,955.4 5,782.3    2,712.6    2,393.8 3,510.4
Railway and
other transport
services               143.2       132.7   178.8       58.5       58.1    76.0
Water concession        98.3        84.8   114.9       61.2       53.6    74.1
Group revenue
and EBITDA           4,852.4     4,172.9 6,076.0    2,832.3    2,505.5 3,660.5



Revenue by product:

                                Nine months ended Nine months ended
                                     30 September      30 September Full year
                                             2012              2011      2011
                                            US$'m             US$'m     US$'m
Copper
- Los Pelambres                         2,299.4           2,260.2   3,255.9
- Esperanza                               826.1             331.5     646,4
- El Tesoro                               603.3             618.2     827.8
- Michilla                                227.8             280.3     355.0
Gold
- Los Pelambres                            63.2              41.5      63.9
- Esperanza                               273.8             128.5     251.3
Molybdenum
- Los Pelambres                           249.2             235.8     293.8
Silver
- Los Pelambres                            43.8              45.0      63.0
- Esperanza                                24.3              14.4      25.2
Total Mining                              4,610.9           3,955.4   5,782.3
Railway and transport services              143.2             132.7     178.8
Water concession                             98.3              84.8     114.9
                                          4,852.4           4,172.9   6,076.0



Notes to revenue and EBITDA by business segment



(i)   Revenue   from    Esperanza   is   statedafter    eliminating 
inter-segmental sales to El Tesoro of US$2.1 million. Revenue from the Railway
and other transport services is statedafter eliminating inter-segmental sales
to the mining division of US$5.2 million (nine months ended 30 September  2011 
-  US$11.8million).  Revenue  from  the  Water  concession  is  stated  after 
eliminating inter-segmental  sales to  the  mining division  ofUS$5.1  million 
(nine months ended 30 September 2011  - US$5.5 million) and after  eliminating 
sales to the Railway and  othertransport services division of US$0.2  million 
(nine months ended 30 September 2011 - US$0.2 million).



(ii)  Revenue  includes  the  effect  of  both  final  pricing   and 
mark-to-market  adjustments  to  provisionally  priced  sales  of  copper  and 
molybdenum  concentrates  and  copper  cathodes.  Further  details  of   such 
adjustments are given in Note 4.



(iii) Revenue includes  a realised loss  on commodity derivatives  at 
Los Pelambres of US$5.9 million (nine  months ended 30 September 2011-  nil). 
At Michilla for the nine months ended  30 September 2012 there was a  realised 
gain of US$4.4 million  (nine months ended 30  September 2011- loss  ofUS$15.6 
million). At El Tesoro for the nine months ended 30 September 2012 there was a
realised gain of US$0.2  million (nine months ended  30 September 2011-  gain 
ofUS$0.3 million). Further details are given in Note 5.



(iv) EBITDA is calculated  by adding back depreciation,  amortisation 
and disposals of plant, property and  equipment and any impairment charges  to 
operating profit from subsidiaries.



4. Embedded derivatives - provisionally priced sales



Copper and  molybdenum concentrate  sale agreements  and copper  cathode  sale 
agreements generally provide for provisional pricing  of sales at the time  of 
shipment, with final pricing being based  on the monthly average London  Metal 
Exchange copper price or monthly average molybdenum price for specified future
periods. This normally ranges  from one to five  months after shipment to  the 
customer.

Under IFRS, both gains and losses from the marking-to-market of open sales are
recognised through adjustments to revenue in the income statement and to trade
debtors in the balance sheet. The Group determines mark-to-market prices using
forward prices  at each  period  end for  copper concentrate  (including  gold 
content) and cathode sales, and period-end month average prices for molybdenum
concentrate sales due to the absence of a futures market for that commodity.



The mark-to-market adjustments  at the end  of each period  and the effect  on 
revenue in the income statement for each period are as follows:



                                                   Balance sheet -
                                         net mark to market effect on debtors
                                          At 30.09.12 At 30.09.11 At 31.12.11
                                                US$'m       US$'m       US$'m
Los Pelambres - copper concentrate               73.0     (230.1)      (18.0)
Los Pelambres - molybdenum concentrate          (1.6)       (1.0)       (0.1)
Esperanza - copper concentrate                   28.3      (56.7)         4.3
Esperanza - gold in concentrate                   1.9           -       (1.6)
El Tesoro - copper cathodes                       1.1       (5.0)       (0.2)
Michilla - copper cathodes                      (0.2)       (3.7)       (0.2)
                                                102.5     (296.5)      (15.8)



For the period ended 30 September 2012

                                             Nine months ended
                                             30 September 2012
                       Los                   El                  Los                     Los
                 Pelambres   Esperanza   Tesoro Michilla   Pelambres   Esperanza   Pelambres
                    Copper      Copper   Copper   Copper     Gold in     Gold in  Molybdenum
               concentrate concentrate cathodes cathodes concentrate concentrate concentrate
                     US$'m       US$'m    US$'m    US$'m       US$'m       US$'m       US$'m
Provisionally
invoiced gross
sales              2,282.5       835.0    603.8    223.9        64.4       269.5       289.3
Effects of
pricing
adjustments to
previous
period
invoices
Reversal of
mark-to-market
adjustments at
the end of the
previous
period                18.0       (4.3)      0.2      0.2          -         1.6         0.1
Settlement of
sales invoiced
in the
previous
period                75.8        29.5      4.0      1.3         0.1         1.5         1.3
Total effect
of adjustments
to previous
period
invoices in
the current
period                93.8        25.2      4.2      1.5         0.1         3.1         1.4
Effects of
pricing
adjustments to
current period
invoices
Settlement of
sales invoiced
in the
previous
period              (57.2)      (22.7)    (6.0)    (1.8)       (1.1)         0.1      (24.4)
Mark-to-market
adjustments at
the end of the
current period        73.0        28.3      1.1    (0.2)          -         1.9       (1.6)
Total effect
of adjustments
to current
period
invoices              15.8         5.6    (4.9)    (2.0)       (1.1)         2.0      (26.0)
Total pricing
adjustments          109.6        30.8    (0.7)    (0.5)       (1.0)         5.1      (24.6)
Realised
(losses)/gains
on commodity
derivatives          (5.9)          -      0.2      4.4          -          -          -
Revenue before
deducting
tolling
charges            2,386.2       865.8    603.3    227.8        63.4       274.6       264.7
Tolling
charges             (86.8)      (39.7)       -       -       (0.2)       (0.8)      (15.5)
Revenue net of
tolling
charges            2,299.4       826.1    603.3    227.8        63.2       273.8       249.2



For the period ended 30 September 2011

                                             Nine months ended
                                             30 September 2011
                       Los                   El                  Los                     Los
                 Pelambres   Esperanza   Tesoro Michilla   Pelambres   Esperanza   Pelambres
                    Copper      Copper   Copper   Copper     Gold in     Gold in  Molybdenum
               concentrate concentrate cathodes cathodes concentrate concentrate concentrate
                     US$'m       US$'m    US$'m    US$'m       US$'m       US$'m       US$'m
Provisionally
invoiced gross
sales              2,667.2       411.2    629.5    306.6        41.4       125.4       266.0
Effects of
pricing
adjustments to
previous
period
invoices
Reversal of
mark-to-market
adjustments at
the end of the
previous
period             (124.3)          -    (4.1)    (1.4)          -          -       (0.3)
Settlement of
sales invoiced
in the
previous
period               116.2          -      3.5      1.0       (0.5)          -         0.3
Total effect
of adjustments
to previous
period
invoices in
the current
period               (8.1)          -    (0.6)    (0.4)       (0.5)          -           -
Effects of
pricing
adjustments to
current period
invoices
Settlement of
sales invoiced
in the current
period              (64.7)       (8.4)    (6.0)    (6.6)         0.7         3.5      (17.3)
Mark-to-market
adjustments at
the end of the
current period     (230.1)      (56.7)    (5.0)    (3.7)          -          -       (1.0)
Total effect
of adjustments
to current
period
invoices           (294.8)      (65.1)   (11.0)   (10.3)         0.7         3.5      (18.3)
Total pricing
adjustments        (302.9)      (65.1)   (11.6)   (10.7)         0.2         3.5      (18.3)
Realised
gain/(losses)
on commodity
derivatives             -          -      0.3   (15.6)          -          -          -
Revenue before
deducting
tolling
charges            2,364.3       346.1    618.2    280.3        41.6       128.9       247.7
Tolling
charges            (104.1)      (14.6)       -       -       (0.1)       (0.4)      (11.9)
Revenue net of
tolling
charges            2,260.2       331.5    618.2    280.3        41.5       128.5       235.8





For the period ended 31 December 2011

                                                Year ended
                                             31 December 2011
                                             El
                       Los                                       Los                     Los
                 Pelambres   Esperanza   Tesoro Michilla   Pelambres   Esperanza   Pelambres
                    Copper      Copper   Copper   Copper     Gold in     Gold in  Molybdenum
               concentrate concentrate cathodes cathodes concentrate concentrate concentrate
                     US$'m      US$'m    US$'m    US$'m      US$'m      US$'m      US$'m
Provisionally
invoiced gross
sales              3,620.7       721.5    836.6    379.8        64.2       248.6       337.4
Effects of
pricing
adjustments to
previous
period
invoices
Reversal of
mark-to-market
adjustments at
the end of the
previous
period             (124.3)          -    (4.1)    (1.4)          -          -       (0.3)
Settlement of
molybdenum
sales invoiced
in the
previous
period               116.2          -      3.5      1.0       (0.5)          -         0.3
Total effect
of adjustments
to previous
period
invoices in
the current
period               (8.1)          -    (0.6)    (0.4)       (0.5)          -           -
Effects of
pricing
adjustments to
current period
invoices
Settlement of
molybdenum
sales invoiced
in the current
period             (194.9)      (51.0)    (8.5)    (8.6)         0.4         5.1      (25.9)
Mark-to-market
adjustments at
the end of the
current period      (18.0)         4.3    (0.2)    (0.2)          -       (1.6)       (0.1)
Total effect
of adjustments
to current
period
invoices           (212.9)      (46.7)    (8.7)    (8.8)         0.4         3.5      (26.0)
Total pricing
adjustments        (221.0)      (46.7)    (9.3)    (9.2)       (0.1)         3.5      (26.0)
Realised
gains/(losses)
on commodity
derivatives             -          -      0.5   (15.6)          -          -          -
Revenue before
deducting
tolling
charges            3,399.7       674.8    827.8    355.0        64.1       252.1       311.4
Tolling
charges            (143.8)      (28.4)       -       -       (0.2)       (0.8)      (17.6)
Revenue net of
tolling
charges            3,255.9       646.4    827.8    355.0        63.9       251.3       293.8





Copper concentrate



The typical period  for which sales  of copper concentrate  remain open  until 
settlement occurs  is a  range  of approximately  three  to five  months  from 
shipment date.



At 30 September 2012 sales totalling 182,200 tonnes remained open as to  price 
(Los Pelambres - 128,700 tonnes, Esperanza  - 53,500 tonnes), with an  average 
mark-to-market price  of  372.4  cents  per pound  compared  with  an  average 
provisional invoice price of 347.2 cents per pound. At 30 September 2011 sales
totalling 142,100 tonnes remained  open as to price  (Los Pelambres -  115,700 
tonnes, Esperanza - 26,400  tonnes), with an  average mark-to-market price  of 
318.3 cents per pound  compared with an average  provisional invoice price  of 
409.8 cents per  pound. At  31 December  2011 sales  totalling 201,600  tonnes 
remained open as to price (Los Pelambres - 157,500 tonnes, Esperanza -  44,100 
tonnes), with  an  average  mark-to-market  price of  344.7  cents  per  pound 
compared with an average provisional invoice price of 347.8 cents per pound.





Copper cathodes



The typical  period for  which  sales of  copper  cathodes remain  open  until 
settlement occurs is approximately one month from shipment date.



At 30 September 2012, sales totalling  9,700 tonnes remained open as to  price 
(El Tesoro  -  7,000  tonnes,  Michilla  -  2,700  tonnes),  with  an  average 
mark-to-market price  of  372.5  cents  per pound  compared  with  an  average 
provisional invoice price  of 368.3  cents per  pound. At  30 September  2011, 
sales totalling 10,800  tonnes remained open  as to price  (El Tesoro -  6,900 
tonnes, Michilla  - 3,900  tonnes), with  an average  mark-to-market price  of 
317.7 cents per pound  compared with an average  provisional invoice price  of 
355.2 cents per  pound. At  31 December  2011, sales  totalling 12,600  tonnes 
remained open as to price (El Tesoro - 9,400 tonnes, Michilla - 3,200 tonnes),
with an average mark-to-market price of 344.5 cents per pound compared with an
average provisional invoice price of 345.9 cents per pound.



Gold in concentrate



The typical  period for  which sales  of gold  in concentrate  remain open  is 
approximately one month from shipment date.



At 30 September 2012, sales totalling 23,700 ounces remained open as to price,
with an average mark-to-market price of

US$1,771.2 per ounce compared with an average provisional invoice price of
US$1,692.5 per ounce. At 30 September 2011, no sales remained open as to
price. At 31 December 2011, sales totalling 15,300 ounces remained open as to
price, with an average mark-to-market price of US$1,536.0 per ounce compared
with an average provisional invoice price of US$1,638.6 per ounce.



Molybdenum concentrate



The typical period for which sales of molybdenum remain open is  approximately 
two months from shipment date.



At 30 September 2012 sales totalling  1,700 tonnes remained open as to  price, 
with an average  mark-to-market price of  US$11.8 per pound  compared with  an 
average provisional invoice price of US$12.2 per pound. At 30 September  2011 
sales totalling  1,400 tonnes  remained  open as  to  price, with  an  average 
mark-to-market price of US$14.5 per pound compared with an average provisional
invoice price of US$14.8 per pound. At 31 December 2011 sales totalling 1,100
tonnes remained open  as to  price, with  an average  mark-to-market price  of 
US$13.4 per  pound  compared with  an  average provisional  invoice  price  of 
US$13.4 per pound.



5. Derivative Financial Instruments

The Group periodically  uses derivative  financial instruments  to reduce  its 
exposure to commodity  price, foreign exchange  and interest rate  movements. 
The Group does  not use  such derivative instruments  for speculative  trading 
purposes.

The Group has  applied the hedge  accounting provisions of  IAS 39  "Financial 
Instruments: Recognition and Measurement".  The effective portion of  changes 
in the fair value of derivative financial instruments that are designated  and 
effective as hedges  of future  cash flows  have been  recognised directly  in 
equity, with such amounts subsequently  recognised in the income statement  in 
the period  when the  hedged item  affects profit  or loss.  Any  ineffective 
portion is recognised immediately in profit or loss. Realised gains and losses
on commodity  derivatives recognised  in  profit or  loss have  been  recorded 
within revenue.  The  time value  element  of changes  in  the fair  value  of 
derivative options is excluded from  the designated hedging relationship,  and 
is therefore recognised directly in profit or loss within other finance  items 
for those derivatives where hedge accounting has not been applied.. When hedge
accounting has been  applied the  realised gains  and losses  on exchange  and 
interest derivatives are  recognised within other  finance items and  interest 
expense respectively.





(a) Mark-to-market adjustments and income statement impact



The balance sheet mark-to-market adjustments in respect of derivatives at  the 
end of each  period, and the  total effect  on the income  statement for  each 
period, are as follows:



For the period ended 30 September 2012

                                                                           Total balance
                                                                         sheet impact of
                                                            Impact on     mark-to-market
             Income statement impact for nine months      reserves at     adjustments at
                         ended 30.09.12                      30.09.12           30.09.12
                  Realised         Losses   Total net  (Losses)/gains      Net financial
            (losses)/gains resulting from (loss)/gain  resulting from  (liability)/asset
                           mark-to-market              mark-to-market
                           adjustments on              adjustments on
                                  hedging                     hedging
                              instruments                 instruments
                     US$'m          US$'m       US$'m           US$'m              US$'m
Commodity
Derivatives
Los                  (5.9)                      (5.9)               -                  -
Pelambres
El Tesoro              0.2             -         0.2           (1.6)              (1.1)
Michilla               4.4         (10.3)       (5.9)          (23.3)               24.8
Exchange
Derivatives
Michilla             (0.3)             -       (0.3)            16.2                8.4
Interest
Derivatives
Esperanza           (11.0)             -      (11.0)             7.3             (19.7)
                    (12.6)         (10.3)      (22.9)           (1.4)               12.4



For the period ended 30 September 2011

                                                                           Total balance
                                                                         sheet impact of
                                                            Impact on     mark-to-market
             Income statement impact for nine months      reserves at     adjustments at
                         ended 30.09.11                      30.09.11           30.09.11
                  Realised          Gains   Total net  Gains/(losses)      Net financial
            gains/(losses) resulting from gain/(loss)  resulting from  asset/(liability)
                           mark-to-market              mark-to-market
                           adjustments on              adjustments on
                                  hedging                     hedging
                              instruments                 instruments
                     US$'m          US$'m       US$'m           US$'m              US$'m
Commodity
Derivatives
El Tesoro              0.3             -         0.3             1.9                0.6
Michilla            (15.6)           52.5        36.9           113.1               88.7
Exchange
Derivatives
Michilla                -             -          -           (9.5)              (9.5)
Esperanza              1.1             -         1.1           (1.8)                 -
Corporate            (2.0)             -       (2.0)              -                 -
and other
items
Railway and
other                (2.4)              -       (2.4)              -                  -
transport
services
Interest
Derivatives
Esperanza           (16.2)             -     (16.2)             3.6             (31.9)
                    (34.8)           52.5        17.7           107.3               47.9



For the year ended 31 December 2011

                                                                           Total balance
                                                                         sheet impact of
                                                            Impact on     mark-to-market
             Income statement impact for year ended       reserves at     adjustments at
                            31.12.11                         31.12.11           31.12.11
                  Realised          Gains   Total net  Gains/(losses)      Net financial
            gains/(losses) resulting from gain/(loss)  resulting from  asset/(liability)
                           mark-to-market              mark-to-market
                           adjustments on              adjustments on
                                  hedging                     hedging
                              instruments                 instruments
                     US$'m          US$'m       US$'m           US$'m              US$'m
Commodity
Derivatives
El Tesoro              0.5             -         0.5             1.8                0.5
Michilla            (15.6)           49.1        33.5            86.4               58.4
Exchange
Derivatives
Michilla                 -             -           -           (7.8)              (7.8)
Esperanza              1.1             -         1.1           (1.8)                  -
Corporate            (2.0)              -       (2.0)              -                 -
and other
items
Railway and          (2.4)              -       (2.4)              -                 -
other
transport
services
Interest
Derivatives
Esperanza           (22.4)             -      (22.4)             8.4             (27.0)
                    (40.8)           49.1         8.3            87.0               24.1





The gains/(losses) recognised in reserves are disclosed before non-controlling
interests and tax.



The  net  financial  asset/(liability)   resulting  from  the  balance   sheet 
mark-to-market adjustments are analysed as follows:



                        At 30.09.12 At 30.09.11 At 31.12.11
                              US$'m       US$'m       US$'m
Analysed between:
Current assets                 22.2        20.4        11.4
Non-current assets             11.0        68.9        47.6
Current liabilities           (7.8)      (19.4)      (16.9)
Non-current liabilities      (13.0)      (22.0)      (18.0)
                               12.4        47.9        24.1



(b) Outstanding derivative financial instruments

(i) Commodity derivatives

The Group periodically uses  commodity derivatives to  manage its exposure  to 
commodity price fluctuations.

Min/max instruments

         At 30.09.12              For instruments held at 30.09.12
              Copper          Weighted average Covering a Weighted
          production   remaining period from 1  period up  average    Weighted
              hedged              October 2012        to:    floor average cap
          000 tonnes                    Months            US cents    US cents
Michilla      65,325                      16.9   31-12-14    350.3       461.9



Between 1 October 2012 and 31  October 2012 no additional min/max  instruments 
were entered into and 2,775 tonnes of min/max instruments matured. As a result
up to 31 October 2012:

(i) 33,300 tonnes  of 2012  Group copper  production had  been hedged  with 
min-max options of which  27,750 tonnes matured by  31 October 2012 and  5,550 
tonnes remain outstanding and will mature by the end of the year.

(ii) 33,000 tonnes  of 2013  Group copper  production has  been hedged  with 
min-max options.

(iii) 24,000 tonnes  of 2014  Group copper  production has  been hedged  with 
min-max options.



Futures - arbitrage

The Group  also has  futures for  copper production,  to buy  and sell  copper 
production with the  effect of swapping  COMEX prices for  LME prices  without 
eliminating underlying market price exposure.

                At 30.09.12          For instruments held at 30.09.12
                                  Weighted average
          Copper production  remaining period from    Covering a      Weighted
                     hedged         1 October 2012 period up to: average price
                 000 tonnes                 Months                    US cents
El Tesoro            11,800                    8.8      31-01-14         368.6



(ii) Exchange derivatives

The Group  periodically  uses  foreign  exchange  derivatives  to  reduce  its 
exposure to fluctuations in the exchange rates influencing operating costs and
the fair value of non-US dollar denominated assets or liabilities.



Cross currency swaps

The Group has used cross currency swaps to swap Chilean pesos for US dollars.

                At 30.09.12          For instruments held at 30.09.12
         Principal value of        Weighted average
             cross currency   remaining period from    Covering a     Weighted
                 swaps held          1 October 2012 period up to: average rate
                      US$'m                  Months                    Ch$/US$
Michilla               87.6                     5.5      16-09-13        533.2



(iii) Interest derivatives

The Group periodically  uses interest  derivatives to reduce  its exposure  to 
interest rate movements.

- Interest rate swaps

The Group has used interest rate swaps to swap the floating rate interest
relating to the Esperanza financing for fixed rate interest. At 30 September
2012 the Group had entered into the contracts outlined below.



            Maturity date Maximum notional amount Weighted Average Fixed Rate
                                            US$'m                           %
Esperanza        15.08.18                   395.2                       3.372



















                     This information is provided by RNS
           The company news service from the London Stock Exchange

END


QRTLLFLDLVLSLIF -0- Nov/15/2012 07:00 GMT