Buenaventura Profit Misses Estimates on Lower Output

Cia. de Minas Buenaventura SA, Peru’s biggest precious-metals producer, said fourth-quarter profit dropped 39 percent, missing analysts’ estimates.

Net income fell to $139.1 million, or 54 cents a share, from $227.9 million, or 90 cents, a year earlier, Lima-based Buenaventura said today in an e-mailed statement. Analysts expected profit of 67 cents a share excluding one-time items, the average of four estimates compiled by Bloomberg.

Buenaventura’s stakes in Newmont Mining Corp. (NEM)’s Yanacocha gold mine and Freeport-McMoRan Copper & Gold Inc. (FCX)’s Cerro Verde copper mine contributed less to the company’s earnings on lower sales volume and rising expenses, said Inteligo SAB analyst Lali Merino, who doesn’t own Buenaventura shares and rates the stock a hold.

“Their subsidiaries accounted for substantially less revenue this quarter,” Merino said in a telephone interview from Lima before the report was released. “Metals prices weren’t a factor.”

New York-traded copper and silver futures rose 5 percent and 1 percent, respectively, while gold gained 2 percent in the period.

Newmont’s Yanacocha mine, in which Buenaventura holds a 44 percent stake, contributed $32.4 million, down 63 percent from a year earlier. Income from Buenaventura’s 18 percent stake in Cerro Verde (CVERDEC1) fell 28 percent to $28.6 million.

Falling Production

Revenue rose 5 percent to $424.2 million. Gold production fell 22 percent to 211,448 ounces, while zinc doubled and lead climbed 68 percent, Buenaventura said. Silver output rose 12 percent to 4.59 million ounces.

Expenses rose 32 percent to $21.6 million.

Gold futures for April delivery fell 1.1 percent to settle at settle at $1,578.10 an ounce today on the Comex in New York. Silver declined 1.9 percent to $28.395.

The report was released after the close of regular trading today. Buenaventura’s American depositary receipts, each representing one ordinary share, dropped 24 cents, or 0.9 percent, to close at $25.62 in New York. The ADRs have dropped 28.7 percent this year.

(Buenaventura is scheduled to have its quarterly conference call tomorrow at 10 a.m. New York time. To call from outside the U.S.: 1-334-323-7224, Code: 15403. For U.S. participants: 1-800-311-9404.)

To contact the reporter on this story: Alex Emery in Lima at aemery1@bloomberg.net

To contact the editor responsible for this story: James Attwood at jattwood3@bloomberg.net

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