First Quantum Minerals Ltd records low First Quarter Revenues in 2023

First Quantum Minerals Ltd records low First Quarter Revenues in 2023

 

By Kalata News

 

LUSAKA – First Quantum Minerals Ltd has recorded a 70% gross profit reduction in the first quarter of 2023 compared to the first quarter of the previous year.

FQM’s gross profit was recorded at $280 million compared to gross profit of $908 million in 2022.

According to the Condensed Interim Financial Statement for quarter 1 ended March 2023, FQM also experienced an increased cost of production of about 104% during the same period, with their major product being copper.

The company has 8 operational projects that include two projects in Zambia namely; Kansanshi Mining with ownership of 80% and Trident Limited at 100% ownership.

It has 4 subsidiaries with 2 in Zambia and one Minera Panamá S.A in Panama and another FQM Trading AG in Switzerland.

 

Explains FQM, “These condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting (“IAS 34”). Accordingly, certain disclosures included in the annual financial statements prepared in accordance with International Financial Reporting Standards (“IFRSs”) as issued by the International Accounting Standards Board have been condensed or omitted.”

 

First Quantum Minerals Ltd. (“First Quantum”, “FQM” or the “Company”) was incorporated under the Company Act (British Columbia) on December 21, 1983, under the name of Xenium Resources Ltd.

 

A tax expense of $25 million was recorded for three months ended March 31, 2023, (three months ended March 31, 2022: $155 million tax expense) reflecting statutory tax rates. The statutory tax rates for the Company’s operations range from 20% to 30%.

 

The Company’s operations are subject to seasonal aspects, in particular the rainy season in Zambia. The rainy season in Zambia generally starts in November and continues through April, with the heaviest rainfall normally experienced in the months of January, February and March. As a result of the rainy season, mine pit access and the ability to mine ore is lower in the first quarter of the year than other quarters and the cost of mining is higher.

 

The Company has committed to $413 million (December 31, 2022: $426 million) in capital expenditures, principally related to major expansionary projects.

 

Due to the size, complexity and nature of the Company’s operations, various legal and tax matters are outstanding from time to time. The Company is routinely subject to audit by tax authorities in the countries in which it operates and has received a number of tax assessments in various locations, including Zambia, which are currently at various stages of progress with the relevant authorities. The outcome of these audits and assessments are uncertain however the Company is confident of its position on the various matters under review.

 

The Company is an international mining company which has grown through a combination of exploring, developing, operating, and acquiring mining projects or companies with interests in mining activities. The Company produces copper in concentrate, copper anode, copper cathode, nickel, gold, zinc, silver, cobalt, acid and pyrite. The Company’s principal activities include mineral exploration, mine engineering and construction, and development and mining operations. A summary of its interests in and the locations of, the Company’s operating projects and its development and exploration projects as at December 31, 2022 are set out below.

 

“These consolidated interim financial statements have been prepared on a going concern basis. In making the assessment that the Company is a going concern, management has taken into account all available information about the future, which is at least, but is not limited to, twelve months from March 31, 2023. Expected credit losses on financial assets remain immaterial at March 31, 2023,” says the Company’s first quarter report.