By Samuel Indyk
Investing.com – Shares in Fresnillo (LON:FRES) were trading higher on Tuesday after the company said profit and revenue increased on the back of improved production and higher metals prices.
In the first half of the year, attributable silver production increased 2.7% versus H1 2020 to 27.5 moz. Attributable gold production was up 12.3% in the same period to 428.4 koz.
Adjusted revenues increased 37.1% to $1.543 billion with 75.8% of that attributed to higher metals prices and 24.2% due to increased volumes.
This helped the company report a 118% increase in operating profit to $471.9 million.
“I am pleased to report a strong financial result in the first half,” said Fresnillo Chief Executive Officer Octavio Alvídrez. “The combination of improved production performance and higher precious metals prices has seen a sharp increase in profitability during the period.”
Following the strong financial performance, the group announced it had approved an interim dividend of $0.099 cents per share, totalling $73.0 million versus $16.9 million in the same period last year.
The company added it remains on track to meet its 2021 full-year guidance of 53.5-59.5 moz of silver (including silverstream) and 675-725 koz of gold.
Fresnillo said that Mexico’s new law restricting the ability to subcontract labour is not expected to materially impact second half production, but they are assessing any potential impact.
At 10:34BST, shares in Fresnillo were trading higher by 2.1% at 839.8 pence per share.