financial highlights
In 2018, we continued to drive efficiencies at our operations; this enabled us to exceed the midpoint of our copper production guidance while delivering zinc and precious metals production within our guidance ranges. Despite a downward trend in copper prices over the year, we were still able to generate positive free cash flow. Our financial performance for the year included:
- Delivered revenue of $1.47 billion, $70.1 million higher than 2017
- Generated cash from operating activities of $479.6 million
- Decreased net debt to $465.5 million, including cash and cash equivalents of $515.5 million
- Delivered consolidated cash cost of $0.94 per pound copper and all-in sustaining cash cost of $1.52 per pound
Key Accomplishments
In 2018, Hudbay acquired the Ann Mason project and consolidated the mineral rights around our Constancia property. Over the long term, we expect these acquisitions – and final approval to develop our Rosemont copper project in Arizona – will make a positive contribution to our development pipeline and be accretive to long-term value. More significantly, during the year we leveraged our skills as mine operators to enhance the value and potential of our existing assets. Among our operating highlights:
- Across the Company, produced 154,550 tonnes of copper in concentrate, 115,588 tonnes of zinc in concentrate and 176,375 ounces of precious metal in concentrate
- Exceeded the midpoint of our 2018 copper production guidance by 14% (on a consolidated basis)
- At Constancia, achieved record mill throughput, record copper recoveries and record molybdenum production in 2018
- Updated our reserve and resource estimates at Lalor, including a 65% increase in gold reserves
2018 summary
Operations summary
| For the years ended December 31 | 2018 | 2017 |
|---|---|---|
| Production (contained metal in concentrate)* | ||
| Copper (000 tonnes) | 154.5 | 159.2 |
| Zinc (000 tonnes) | 115.6 | 135.2 |
| Gold (000 ounces) | 119.9 | 108.6 |
| Silver (000 ounces) | 3,954.4 | 3,487.3 |
* Metal reported in concentrate is prior to refining losses or deductions associated with smelter contract terms.
Financial summary
| Financial condition (in $000s) | Dec. 31, 2018 | Dec. 31, 2017 (Restated) |
|---|---|---|
| Cash and cash equivalents | $515,497 | $356,499 |
| Working capital | 445,228 | 251,388 |
| Total assets | 4,685,635 | 4,728,016 |
| Total long-term debt | 981,030 | 979,575 |
| Equity | 2,178,856 | 2,112,345 |
| Financial performance (in $000s, except per share and cash cost amounts) |
Dec. 31, 2018 | Dec. 31, 2017 (Restated) |
|---|---|---|
| Revenue | $1,472,366 | $1,402,339 |
| Profit before tax | 170,837 | 172,911 |
| Basic and diluted earnings (loss) per share1 | 0.33 | 0.57 |
| Profit (loss) | 85,416 | 139,692 |
| Operating cash flows before change in non-cash working capital | 493,471 | 530,561 |
| Production | ||
| Contained metal in concentrate2 | ||
| Copper (tonnes) | 154,550 | 159,192 |
| Gold (ounces) | 119,882 | 108,593 |
| Silver (ounces) | 3,954,469 | 3,487,258 |
| Zinc (tonnes) | 115,588 | 135,156 |
| Metal sold | ||
| Payable in metal in concentrate2 | ||
| Copper (tonnes) | 147,923 | 148,655 |
| Gold (ounces) | 113,097 | 109,770 |
| Silver (ounces) | 3,372,353 | 3,060,269 |
| Refined zinc (tonnes) | 115,723 | 116,377 |
1 Attributable to owners of the Company.
2 Metal reported in concentrate is prior to deductions associated with smelter contract terms.