RNS Number : 2678A
23 May 2023
21 Upper Brook Street
London W1K 7PY
23 May 2023
Fresnillo plc - AGM Statement
Fresnillo plc will hold its Annual General Meeting today.
Chairman Mr Alejandro Baillères will make the following
"I am once again honoured to be presenting to you today in my
second AGM as your Chairman.
Our Purpose is to contribute to the wellbeing of people through
the sustainable mining of silver and gold. We remained committed to
that Purpose in 2022, putting our people and our communities at the
heart of everything we do.
I am pleased to say we delivered a resilient operating
performance in the year, with our people rising to meet a number of
external challenges while delivering on our production
Silver production was broadly comparable to the prior year,
while gold production was lower. Both of these results were in line
with our expectations. We have started 2023 well and we are
confident in delivering on our guidance for the year.
Our financial results were impacted by industry pressures
including volatile precious metal prices and higher cost inflation,
along with the effects of the Labour Reform in Mexico.
We reported adjusted revenue of $2.6 billion, down 8.8%
primarily due to the lower volumes of gold sold and the decrease in
silver price, while Gross Profit also fell, reflecting lower prices
and higher costs.
In line with our dividend policy, we declared an interim
dividend of 3.40 US cents per share, with a final dividend of 13.30
US cents per share, bringing the total for the year to 16.70 US
cents per share, totaling over $123 million.
We have adapted to the considerable challenges resulting from
the Labour Reform, which required us to internalise, recruit and
re-train a substantial proportion of our workforce. We also
invested substantially into new equipment to address capacity
constraints. Although this has been disruptive, the actions we took
have proven effective and our mines are now fully staffed. We
believe these changes will lead to a more cohesive and resilient
workforce in the longer term.
The residual impact of the pandemic also caused a number of
delays impacting our ability to complete tie-ins to the electricity
grid of both our new Juanicipio mine and the Pyrites Plant at the
We were pleased to complete the tie-in of Juanicipio late last
year, while we expect to complete the same process at the Pyrites
Plant this quarter.
Juanicipio is an outstanding asset and is set to play an
increasingly important role in our overall production profile as we
ramp the mine up to capacity over the coming weeks.
In these difficult times, your Board has been a huge asset to
Fresnillo and I thank them for their support.
In addition to the oversight of our handling of the pandemic,
Labour Reform and delays to the commissioning process, your Board
continues to push hard on important matters including our Diversity
Programme and Sustainability strategy. Increasing the participation
of women in our business is a key priority. The 'Women for Women
Mentoring Programme' is now in place, and we are actively
developing leadership and support networks. In 2020 we pledged to
increase the overall representation of women in our workforce from
10% to 12% by 2025 and I am pleased to say we have already exceeded
that target. We have further to go, particularly in increasing the
number of women in more senior roles, but I am confident we have a
robust framework in place to facilitate this transition.
On Sustainability we persist in our effort to improve safety and
your Board has continued to develop a programme for monitoring and
responding to the potential risks of tailings dams, as well as to
climate-related risks and opportunities and our Task Force on
Climate-related Financial Disclosures obligations. We remain fully
committed to decreasing carbon emissions and setting Science-Based
Targets in the future, subject to Mexican energy policy. Our target
is for wind power to provide 75% of our electricity by 2030 and we
will continue to engage with the relevant Government authorities to
help us deliver on that target.
Looking forward, we see a very busy and exciting year ahead. We
will remain faithful to our strategy that has served us well. This
means maximising the potential of our existing operations and
delivering growth through development projects - all while
advancing and enhancing the sustainability of our operations.
We continue to see opportunity for growth in our current
portfolio, highlighted by the expected tie-in and commissioning of
the Pyrites Plant at the Fresnillo mine and the continued ramp up
of our new Juanicipio mine. Additionally, we are making good
progress on advanced and priority early-stage projects in Mexico,
Peru and Chile.
Above all however is our commitment to our Purpose that directs
all our actions and ensures that we contribute to the wellbeing of
all our stakeholders. 2023 will be a year not without its
challenges. Like all companies we remain cautious about the outlook
for the global economy, as well as mindful of the continued
pressure of inflation, supply chain constraints, the tight labour
market and other factors which will have an impact on our business.
More recently for example, we have seen reform to the Mining Law in
Mexico, though our preliminary analysis indicates there is no
material impact for Fresnillo.
I am, however, confident that we will maintain the steady
progress of the last 12 months. As always, I would like to close by
thanking all our people for their commitment and hard work during
the year and our shareholders for their support."
For further information, please visit our website
www.fresnilloplc.com or contact:
FRESNILLO PLC Tel: +44 (0)20 7399 2470
Gabriela Mayor, Head of Investor
Mexico City Office Tel: +52 55 52 79 3206
Ana Belem Zárate
POWERSCOURT Tel: +44 (0)7793 858 211
ABOUT FRESNILLO PLC
Fresnillo plc is the world's largest primary silver producer and
Mexico's largest gold producer, listed on the London and Mexican
Stock Exchanges under the symbol FRES.
Fresnillo plc has eight operating mines, all of them in Mexico -
Fresnillo, Saucito, Juanicipio, Ciénega, Herradura,
Soledad-Dipolos1, Noche Buena and San Julián (Veins and
Disseminated Ore Body), one development project - the Pyrites Plant
at Fresnillo, which has been completed and is awaiting tie-in of
the plant to the national electricity grid, and four advanced
exploration projects - Orisyvo, Rodeo, Guanajuato and Tajitos as
well as a number of other long term exploration prospects.
Fresnillo plc has mining concessions and exploration projects in
Mexico, Peru and Chile.
Fresnillo plc has a strong and long tradition of exploring,
mining, a proven track record of mine development, reserve
replacement, and production costs in the lowest quartile of the
cost curve for silver.
Fresnillo plc's goal is to maintain the Group's position as the
world's largest primary silver company and Mexico's largest gold
(1) Operations at Soledad-Dipolos are currently suspended.
Information contained in this announcement may include
'forward-looking statements'. All statements other than statements
of historical facts included herein, including, without limitation,
those regarding the Fresnillo Group's intentions, beliefs or
current expectations concerning, amongst other things, the
Fresnillo Group's results of operations, financial position,
liquidity, prospects, growth, strategies and the silver and gold
industries are forward-looking statements. Such forward-looking
statements involve risk and uncertainty because they relate to
future events and circumstances. Forward-looking statements are not
guarantees of future performance and the actual results of the
Fresnillo Group's operations, financial position and liquidity, and
the development of the markets and the industry in which the
Fresnillo Group operates, may differ materially from those
described in, or suggested by, the forward-looking statements
contained in this document. In addition, even if the results of
operations, financial position and liquidity, and the development
of the markets and the industry in which the Fresnillo Group
operates are consistent with the forward-looking statements
contained in this document, those results or developments may not
be indicative of results or developments in subsequent periods. A
number of factors could cause results and developments to differ
materially from those expressed or implied by the forward-looking
statements including, without limitation, general economic and
business conditions, industry trends, competition, commodity
prices, changes in regulation, currency fluctuations (including the
US dollar and Mexican Peso exchanges rates), the Fresnillo Group's
ability to recover its reserves or develop new reserves, including
its ability to convert its resources into reserves and its mineral
potential into resources or reserves, changes in its business
strategy and political and economic uncertainty.
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(END) Dow Jones Newswires
May 23, 2023 02:00 ET (06:00 GMT)
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