Compañía de Minas Buenaventura S.A.A. (BVN): history, ownership, mission, how it works & makes money

A Brief History of Compañía de Minas Buenaventura S.A.A.

Compañía de Minas Buenaventura S.A.A. (NYSE: BVN), established in 1953, is Peru's largest publicly traded precious metals mining company. As of 2024, the company has undergone significant developments and financial transformations, particularly in its operational efficiency and production capacities.

Recent Financial Performance

In the third quarter of 2024 (3Q24), Buenaventura reported a substantial increase in its financial metrics compared to the same period in the previous year (3Q23). Key financial highlights include:

For the nine-month period ending September 30, 2024 (9M24), the company also reported significant growth, with net sales reaching US$ 855.0 million, up 50% from US$ 570.0 million in 9M23.

Production Overview

Buenaventura's operational performance in 3Q24 showed remarkable growth in several key production areas:

Capital Expenditures and Investments

Buenaventura's capital expenditures (CAPEX) for 3Q24 totaled US$ 98.0 million, compared to US$ 59.8 million for the same period in 2023. Notable allocations included:

Market Position and Outlook

As of September 30, 2024, Buenaventura maintained a cash position of US$ 457.9 million with a net debt of US$ 224.7 million, resulting in a leverage ratio of 0.50x. The company’s credit rating was upgraded by Moody’s to B1 with a positive outlook, reflecting improved operational efficiencies and strong cash flow generation.

Overall, the company has positioned itself favorably within the mining sector, with increasing production levels and financial performance that underline its resilience and growth potential in the precious metals market.

A Who Owns Compañía de Minas Buenaventura S.A.A. (BVN)

Ownership Structure

As of 2024, Compañía de Minas Buenaventura S.A.A. (BVN) has a diverse ownership structure primarily consisting of institutional investors and individual shareholders. The largest shareholders include:

Share Performance

In 2024, the stock performance of Compañía de Minas Buenaventura has shown significant fluctuations. The closing stock price as of December 31, 2024, was approximately $9.50 per share, reflecting a year-to-date increase of 25% compared to the closing price at the end of 2023.

Financial Overview

Buenaventura reported substantial growth in its financial performance for the third quarter of 2024:

Production Statistics

Buenaventura's production metrics for the third quarter of 2024 are as follows:

Strategic Partnerships

Buenaventura holds significant interests in various mining projects and partnerships, including:

• Cerro Verde: 19.58% ownership
• El Brocal: 61.43% ownership
• Coimolache: 40.09% ownership

Recent Transactions

In August 2024, Buenaventura completed the sale of its Chaupiloma Royalty Company to Franco-Nevada for US$ 210 million, enhancing its liquidity position.

Market Capitalization

As of December 2024, the market capitalization of Compañía de Minas Buenaventura is approximately $2.4 billion, reflecting a strong position within the mining sector.

Compañía de Minas Buenaventura S.A.A. (BVN) Mission Statement

Company Overview

Compañía de Minas Buenaventura S.A.A. is the largest publicly-traded precious metals mining company in Peru, known for its commitment to sustainable mining practices and significant contributions to the local economy.

Mission Statement

The mission of Compañía de Minas Buenaventura S.A.A. is to create value for its stakeholders through responsible mining practices, focusing on safety, environmental stewardship, and community engagement, while maximizing the potential of its mineral resources.

Financial Performance Overview

As of the third quarter of 2024, Buenaventura reported significant financial improvements compared to the same period in 2023. The following table summarizes key financial metrics:

Production Highlights

Buenaventura's production metrics for the third quarter of 2024 demonstrated significant year-over-year growth, particularly in silver, lead, and zinc production:

Strategic Initiatives

Buenaventura's strategic focus includes enhancing production efficiency, reducing costs, and improving sustainability practices. The company’s capital expenditures for the third quarter of 2024 totaled US$ 98.0 million, with significant allocations to the San Gabriel Project (US$ 76.8 million).

Community Engagement

Buenaventura emphasizes its commitment to community engagement, ensuring that mining operations contribute positively to local economies and support social development initiatives.

Conclusion

The mission of Compañía de Minas Buenaventura S.A.A. is driven by a robust commitment to responsible mining, financial performance, and community development, positioning the company as a leader in the precious metals mining sector in Peru.

How Compañía de Minas Buenaventura S.A.A. (BVN) Works

Company Overview

Compañía de Minas Buenaventura S.A.A. (BVN) is Peru's largest publicly traded precious metals mining company. The company focuses on the exploration, extraction, and processing of precious metals, primarily gold and silver, along with base metals like copper, zinc, and lead.

Financial Performance

As of the third quarter of 2024, Buenaventura reported significant financial improvements. Key financial metrics include:

Production Statistics

Buenaventura's production metrics for the third quarter of 2024 indicate significant increases in silver, lead, and zinc production, while gold and copper production showed mixed results:

Key Operational Highlights

In the third quarter of 2024, Buenaventura achieved notable operational milestones:

• EBITDA from direct operations increased to US$ 132.4 million, a 149% increase YoY.
• Average gold price realized was US$ 2,514/oz, up 31% from US$ 1,921/oz in 3Q23.
• Average silver price realized was US$ 29.92/oz, a 17% increase YoY.
• Completed the sale of the Chaupiloma Royalty Company for US$ 210 million.
• Capital expenditures (CAPEX) for the quarter totaled US$ 98.0 million, with US$ 76.8 million allocated to the San Gabriel Project.

Production Costs

Cost applicable to sales (CAS) for various metals showed increases due to changes in production levels and ore grades:

Debt and Cash Position

As of September 30, 2024, Buenaventura's financial health is reflected in its cash and debt metrics:

• Cash Position: US$ 457.9 million
• Net Debt: US$ 224.7 million
• Leverage Ratio: 0.50x

Credit Rating

Buenaventura's credit rating was upgraded to B1 with a positive outlook by Moody’s, reflecting operational improvements and efficient liquidity management.

How Compañía de Minas Buenaventura S.A.A. (BVN) Makes Money

Revenue Generation from Mining Operations

Compañía de Minas Buenaventura S.A.A. (BVN) generates revenue primarily through the extraction and sale of precious metals, including gold, silver, lead, zinc, and copper. In the third quarter of 2024, BVN reported total revenues of US$ 331.1 million, marking a 57% increase compared to US$ 211.3 million in the same quarter of 2023. For the first nine months of 2024, total revenues reached US$ 855.0 million, a 50% increase from US$ 570.0 million in 2023.

Production and Sales Volumes

In 3Q24, BVN's production figures showcased significant increases across several metals:

• Gold production reached 35,345 ounces, a 6% increase from 33,265 ounces in 3Q23.
• Silver production surged to 3,875,123 ounces, up 122% from 1,743,629 ounces in the prior year.
• Zinc production nearly doubled to 5,995 MT, representing a 98% increase year-on-year.
• Lead production increased by 251% to 4,455 MT.

Price Realizations

The average realized prices for BVN's metals in 3Q24 were as follows:

• Gold: US$ 2,514 per ounce, a 31% increase from US$ 1,921 in 3Q23.
• Silver: US$ 29.92 per ounce, up 17% from US$ 25.67.
• Zinc: US$ 2,883 per MT, reflecting a 64% increase from US$ 1,762.
• Lead: US$ 2,082 per MT, a decrease of 6% from US$ 2,225.

Strategic Asset Sales

BVN executed a notable strategic move by selling its Chaupiloma Royalty Company to Franco-Nevada for US$ 210 million during 3Q24. This sale significantly impacted the company's financial position, contributing to a net income of US$ 236.9 million for the quarter.

Capital Expenditures and Investments

In 3Q24, BVN's capital expenditures totaled US$ 98.0 million, with major allocations as follows:

• US$ 76.8 million for the San Gabriel Project.
• US$ 8.3 million for the Trapiche Project.
• US$ 12.9 million in sustaining capital expenditures.

Financial Position

As of September 30, 2024, BVN's cash position was US$ 457.9 million, while net debt stood at US$ 224.7 million, resulting in a leverage ratio of 0.50x.

Share in Associated Companies

BVN's share in associated companies yielded US$ 48.7 million in 3Q24, compared to US$ 46.4 million in 3Q23. The breakdown is as follows:

• Cerro Verde: US$ 49.8 million
• Coimolache: -US$ 0.7 million
• Other minor: -US$ 0.4 million

Article updated on 8 Nov 2024

Resources:

• Compañía de Minas Buenaventura S.A.A. (BVN) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Compañía de Minas Buenaventura S.A.A. (BVN)' financial performance, including balance sheets, income statements, and cash flow statements.
• SEC Filings – View Compañía de Minas Buenaventura S.A.A. (BVN)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.