Aura Minerals Inc (ORAAF) Q2 2024 Earnings Call Highlights: Strong Production Growth Amid ...

GuruFocus News
4 min read

In This Article:

  • Production: 64.3 gold equivalent ounces, a 33% increase compared to last year.

  • EBITDA: $56 million for Q2, totaling close to $110 million for the first semester.

  • Net Revenue: $134 million for Q2, exceeding $0.5 billion over the last 12 months.

  • Net Income: $26 million loss for Q2, impacted by noncash and nonrecurring losses.

  • All-in Sustaining Cash Costs: Slight increase of $41 compared to the first part of 2024.

  • Dividends and Share Buybacks: $25 million in dividends and $4 million in share buybacks, totaling an 8.8% yield over the last 12 months.

  • Net Debt: $142 million at the end of Q2, with a net debt over EBITDA ratio of 0.8 times.

  • Cash Position: $190 million at the end of Q2.

Release Date: August 06, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Aura Minerals Inc (ORAAF) reported a strong quarter in terms of results and cash generation, despite it being the weakest quarter of the year due to mine sequencing.

  • The company achieved a 33% increase in production compared to the same quarter last year, with expectations of stronger production in the second half of the year.

  • Aura Minerals Inc (ORAAF) reported a strong EBITDA of $56 million for the quarter, contributing to a total of nearly $110 million for the first half of the year.

  • The company paid close to $25 million in dividends and $4 million in share buybacks, providing an 8.8% yield to shareholders, one of the highest in the gold sector.

  • Aura Minerals Inc (ORAAF) is progressing well with the Borborema project, which is 40% complete and on schedule and budget, with expectations to start ramp-up by Q1 next year.

Negative Points

  • The company experienced a slight increase in all-in sustaining cash costs due to lower grades and contractor changes, impacting the quarter's financials.

  • Aura Minerals Inc (ORAAF) reported a $26 million net income loss for the quarter, primarily due to non-recurring accounting events and exchange rate impacts.

  • Production in Apoena and Almas was affected by lower grades and contractor changes, leading to a decrease in production compared to internal projections.

  • The company faced non-cash losses related to gold derivatives and FX impacts due to rising gold prices and currency fluctuations.

  • Despite strong operational performance, the companys net debt increased to $142 million due to ongoing investments in the Borborema project and shareholder returns.

Q & A Highlights

Q: Can we expect strong operating rates in Minosa and Aranzazu to continue, and what are the drivers for better performance in Apoena and Almas in Q3? A: Rodrigo Barbosa, President and CEO, stated that Minosa and Aranzazu should maintain strong production levels, with some quarter-to-quarter volatility. For Apoena and Almas, improvements are expected in Q3 due to higher grades and lower strip ratios in Apoena, and normalized operating rates with a new contractor in Almas.

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