LONDON -- Hochschild Mining (LSE: HOC.L) announced a 43% fall in profit this morning, with adjusted EBITDA -- its preferred measurement for profitability -- reported as $168.4 million in its first-half results, compared to $297.1 million at the same stage last year.
However, the silver lining is that it beat its own half-time forecast of $157 million and, as a result, shares opened up 10.50 pence higher (446.50 pence) than when the market closed yesterday (436.00 pence). Though they had fallen slightly to 439.30 pence at the time of writing, it remains a sign that investors were not dispirited by the interim report.
Like others in its sector, the mid-cap precious-metals miner has been affected by lower commodity prices, as revenue fell to $354.5 million, down from $496.8 million at half-time in 2011.
Executive Chairman Eduardo Hochschild pointed to continued progress at the Inmaculada and Crespo advanced projects, as he said:
The first half of 2012 provided the Company with tougher challenges than last year, although I am pleased to report that we have delivered on our production targets and that we are on track to meet our full-year target. Despite an anticipated fall in financial results, the Company remains in a strong financial position and therefore the Board is maintaining the interim dividend at $0.03 per share.
I am delighted that we were able to publish our feasibility studies for the Inmaculada and Crespo projects in January, laying the foundations for the next phase of our growth which is expected to deliver a 50% increase in production. Both projects have made good progress in the early stages of their development in the first half of the year. In addition, our ambitious exploration campaign continues to bear fruit with further additions to the pipeline and the ongoing drilling campaign well under way across our portfolio.
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