Compañía de Minas Buenaventura - Q4 2025
February 27, 2026
Transcript
Operator (participant)
Good morning, ladies and gentlemen. Welcome to the Compañía de Minas Buenaventura 4th Quarter 2025 Earnings Results Conference Call. At this time, all participants are in listen-only mode, and please note that this call is being recorded. I would now like to introduce you to your host for today's call, Mr. Sebastian Valencia, Head of Investor Relations. Mr. Valencia, you may begin.
Sebastián Valencia (Head of Investor Relations)
Good morning, everyone, and thank you for joining us today to discuss our fourth quarter 2025 results. Today's discussion will be led by Mr. Leandro García, Chief Executive Officer. Also joining our call today and available for your questions are Mr. Daniel Domínguez, Chief Financial Officer, Mr. Juan Carlos Ortiz, Vice President of Operations, Mr. Aldo Masa, Vice President of Business Development and Commercial, Mr. Alejandro Hermoza, Vice President of Sustainability, Mr. Renzo Macher, Vice President of Projects, Mr. Juan Carlos Salazar, Vice President of Geology and Explorations, Mr. Roque Benavides, Chairman, and Mr. Raúl Benavides, Director. Before I hand the call over, let me first touch on a few items. On Buenaventura's website, you will find our press release that was posted yesterday after the market closed. Please note that today's remarks include forward-looking statements that are based on management current views and assumptions.
While management believes that these assumptions, expectations, and projections are reasonable in view of the current available information, we are cautioned not to place under reliance on these forward-looking statements. I encourage you to read the full disclosure concerning forward-looking statements within the earnings result that was issued on February 26, 2026. Let me now turn the call to Mr. Leandro García.
Leandro García (CEO)
Thank you, Sebastián. Good morning, thank you for joining us today to discuss the quarterly results of the company at the year-end. On slide two is our cautionary statement, important information that I encourage you to read. Today, we will talk about our 2025 performance, our main achievements, and our priorities for the future. After the presentation, we will be available for our Q&A session, where our team will be happy to answer your questions. The next slide, I will start by providing a summary of our strong results for the year. Copper production in the full year of 2025 reached 52.4 thousand tons, down 8% year-over-year. This was mainly because the company processed the stockpiles with higher precious metal content, following a sharp increase in precious metal. This was in El Brocal.
Silver production reached 15.6 million ounces, 1% higher compared to the 15.5 million ounces produced during the same period last year, in line with our annual expectations. Gold production was 121,000 ounces, down 18% year on year, mainly due to lower output at Orcopampa and Tambomayo, consistent with the 2025 planned mining sequence. EBITDA from our direct operations in full year of 2025 was $112 million, which represents an 88% increase compared to the $431.5 million in 2024. Net income for the full year was $830 million, compared to $460 million in 2024, which include $157.3 million from the sale of Chaupiloma.
The year ended with a cash position of $530 million and total debt of $710 million, resulting in a leverage ratio of 0.22x. Moving on to San Gabriel. As of now, San Gabriel has reached 99% overall progress. CapEx for the project in the fourth quarter of 2025 was $153 million, primarily allocated to the completion of the processing plant construction. After the quarter ended on January 29, 2026, Buenaventura received $98 million in dividends from its stake in Cerro Verde. Finally, the board approved a dividend of $0.9904 per share. With this approval, total dividends declared over the past 12 months reached $1.135 per share at ADS. Moving forward to our 2025 guidance.
Regarding gold production, our primary focus is in San Gabriel, which is expected to become our main gold-producing asset in the coming years, playing a key role in our long-term growth strategy. We anticipate a stable copper and silver production at both El Brocal and Uchucchacua Yumpag, maintaining consistent output levels. For 2025, we expect total CapEx of between $385 million and $415 million. Around $200 million-$220 million with sustaining CapEx, mainly focused on mine development, tailings, and ventilation outbreaks at El Brocal, Uchucchacua, and Yumpag, as well as readiness and wrap-up works at San Gabriel. Growth CapEx for 2026 is expected to be between $185 million and $195 million, mainly focused on the completing of San Gabriel and advancing Trapiche and Algarrobo.
Moving on the cost applicable to sales trend, copper cash increased in the fourth quarter of 2025, mainly due to higher personnel costs, driven by improved profitability, increased cement consumption, and foreign exchange impacts at El Brocal. Silver cash increased due to higher commercial deductions on Yumpag, non-payable value, and escalators. Additionally, there were increased ore throughput, partially offsetting lower grades at Uchucchacua and Julcani. Gold cash has increased due to lower throughput, reducing the scale efficiency at Orcopampa and Tambomayo. On the next slide, we will present free cash flow generation. The fourth quarter cash position increased during the quarter, mainly driven by net cash inflows from operating activities. Moving on to slide six, I would like to highlight a key milestone achieved last December. We produced our first gold bar at San Gabriel, and we have received the initial operating permit.
The water license is expected in the coming weeks. For 2026, our production guidance is between 48,000 gold ounces and 55,000 gold ounces. There are still some pending milestones to achieve full potential. These include the expansion of tailings drying areas and upgrades on the ventilation system. We expect to complete this milestone, enable a stable 2,000 tons per day throughput in the third quarter of 2026 and continued ramp-up. San Gabriel's cumulative progress has reached 99% overall completion by fourth quarter of 2025, primarily driven by finishing the engineering and procurement, as well as the construction at 98% of advance. On the next slide, we are showing the processing plant's progress, the primary crusher mechanical works at 100%. The SAG and Ball mechanical works are at 100% also.
Finally, the sealed tanks mechanic works are ended with a 100% achievement. Moving on, we can see the progress of the main components of the plant. Moving on to slide nine, we are showing the progress made at the filter tailings plant, which is now complete. To conclude the presentation, I would like to share a few final thoughts. Consistent copper and silver output, supported by steady operations at El Brocal, Uchucchacua, and Yumpag, ensuring operational reliability. Solid performance from affiliate companies, Coimolache, is operating at full capacity, which, while Cerro Verde distribute $98 million in dividends attributable to Buenaventura's stake. San Gabriel has entered in its transition phase, moving from project execution to ramp-up during the first half of 2026, positioning the operation to achieve a stable 2,000 tons per day throughput in the third quarter of 2026.
A supportive environment allows us to step up exploration investment to reinforce our reserves and resources base, while advancing progressive closures to enhance efficiency. A strong cash flow generation, a solid balance sheet, and a disciplined capital allocation enable us to return value to shareholders, reaffirming our commitment to investor returns. Thank you for your attention, and I will call back to the operator to open the line for questions. Operator, please go ahead.
Operator (participant)
Thank you. We will now begin the question-and-answer session. To ask a question, dial in by phone and press star, then one on your telephone keypad. Make sure your mute function is turned off, and if you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. The first question comes from Carlos de Alba with Morgan Stanley. Sir, your line is live. Please proceed with your questions.
Carlos de Alba (Managing Director and Senior Equity Research Analyst)
Yeah. Good morning, everyone. Thank you. First one is maybe on CapEx. Leandro, your significant increase on CapEx versus what expectations are in the sell side consensus, and also, and probably more intriguing versus what you guys told us just a few months ago in your Investor Day. Maybe can you please provide some detail as to what happened in those last months, that led the company to significantly revise all the CapEx? I have a couple of other questions.
Leandro García (CEO)
Thank you, Carlo, for your question. Mainly, primarily in San Gabriel, the pending works are related to earthworks and continue to the ramp up of the project. Maybe Renzo can explain the pending issues to be resolved and have the production steady.
Renzo Macher (VP of Projects)
Yeah, sure. Hi, everyone, hi. Yes, effectively, we have some remaining works on earthworks, especially after the rainy season, where we're kind of all the water systems and the roads are starting to be tested with rain. There are some minor slope semi-failures that we need to cover and fix, and some channels to redirect water that are gonna need additional care. We need to continue with the grouting for the tape, for the water dam, for the last part of the grouting. That's, that plus closing some contracts for some additional quantities and material in the plant that is already finished.
Carlos de Alba (Managing Director and Senior Equity Research Analyst)
All these failures just eventuated or the company discovered them as the ramp up started?
Renzo Macher (VP of Projects)
Well, kind of when we finish the earthworks, it is still untested. We are currently in the middle of the rainy season, so you're still, you keep finding things that can be improved or things that need some extra work to be finished. If there are certain roads are not working as expected, and we need to do alternative routes, and some areas can be accessed with that, but anything major.
Carlos de Alba (Managing Director and Senior Equity Research Analyst)
Okay. All right, thank you. On San Gabriel, thank you for the color on the ramp up. Just maybe what is behind the lower guidance for production this year? Similar, I guess, to CapEx, a little bit of a surprise or a surprise, given that just a few months ago, you guided to a higher number.
Leandro García (CEO)
Yes, Carlos. As we anticipate, we were, we continue working in the ramp up and putting all the things away and in order to reach by phases the production of the design plant, no? We are going to reach the 3,000 tons per day next year. We are making all the efforts to reach as soon as possible, but we foresee a production of 2,000 tons per day all this year. Actually, the ventilation, we have to improve the ventilation for in order to work on the high-grade areas. We are, we have a little flexibility of the higher-grade areas, so we are planning to work in only three galleries.
Well, maybe Juan Carlos can give the exact explanation of the components of our production.
Juan Carlos Ortiz (VP of Operations)
Yes, Leandro, thank you. Well, number one, as you mentioned, Leandro, is the all the components that are still pending for construction and permitting. We will finalize the construction and get the permit granted, the final operational permits, by the second quarter of this year. At that time, we will have all the area for drying the tailings and for compaction of the tailings inside the reservoir all set up. We have partial permits already set up for commissioning. We have to have the definitive permit by the second quarter of this year. In addition to that, the mine, it's rescheduling the production plan because after the accident that we have late December last year, we need to redesign the ventilation system.
We need to triple the amount of air, fresh air, that we need to push into the galleries in order to dilute all the gases that we have underground. In order to that, we are bringing more ventilator, more fans, more electrical devices in order to power these equipments. The consequence of that also, in order to have a higher control of the ventilation and the risk linked to gases and steam underground, is that we are losing part of the flexibility that we expected to have in 2026. The flexibility in order to mine high-grade areas in six different levels, now we're gonna be restricted to mine only in three levels. By throughput, it will be the same. By the gold grade, it will be lower. We are not mining high-grade areas.
We are gonna be restricted to three levels, which we need to mine the high grade and the average grade to complete the throughput that we compromise with the processing plant. The main reason, therefore, is the lower grade that we are mining in the, this initial year, 2026.
Carlos de Alba (Managing Director and Senior Equity Research Analyst)
Thank you, Juan Carlos, sorry. Then maybe, one more. With a very significant increase in gold and silver prices, in others as well, is the company-
...foreseeing any changes in the mining plan, that was presented late last year, and maybe the guidance will change? Can you offer some color there?
Leandro García (CEO)
Yeah. No, well, we have reviewed the mining plans of all our operations. Well, the only change we have foresee, realized is the San Gabriel, right? In Copper, we still with the same objective. Silver also.
Carlos de Alba (Managing Director and Senior Equity Research Analyst)
Thank you. I'll get back on the queue. Thank you.
Operator (participant)
The next question is from Tanya Jakusconek with Scotiabank. Please go ahead.
Tanya Jakusconek (Equity Analyst)
Great, good morning, everybody. Thank you for taking my questions. Just if I could finish off on San Gabriel. I just want to make sure I understand, just off the growth capital of $185-$195, how much of that is San Gabriel, and what is going to the earthworks and what's going to ventilation?
Leandro García (CEO)
Thank you, Tanya. Thank you for your question. maybe Renzo, you have the figures there?
Renzo Macher (VP of Projects)
Yes. Hi, thanks for the question, Tanya. Yeah, from that, in San Gabriel is going to be like $160 million. That includes the closing of all the contracts that we have. That's probably half of that, and the other half is additional work in the earthworks. I think the ventilation is more in the, in the sustaining CapEx.
Tanya Jakusconek (Equity Analyst)
Okay, so you've put it there. Okay. Understood. Maybe if I could just get Daniel Domínguez to just give me some more guidance. I found the exploration in G&A was lower than I expected in Q4. Can you give me some guidance on G&A for 2026 exploration and dividends from Yanacocha, including the dividend payout, whether you're reviewing that with your board meeting in March?
Daniel Domínguez (CFO)
Thank you for the question Tanya. Expect for the entire 2026 will be around $60 million-$70 million, which is similar to what we reported in year 2025. This increase, compared to previous years, is because the workers' participations in profits, number one, and number two, due to the stronger Peruvian currency. For explorations, we have the explorations in the mining sites, in the operating sites, which will be around $60 million-$70 million. We have increased our budget in explorations because we are focusing on more labors in San Gabriel, in El Brocal and Uchucchacua
Also in the non-operating sites, we'll be disbursing some cash for the other projects that we have, greenfield projects. This will be around $20 million-$30 million. Our total budget for explorations is between $90 million-$100 million, compared to the $70 million that we have been disbursing in the past. Finally, for dividends, what we expect to receive from Cerro Verde this year is around $200 million, a little bit higher than what we received in year 2025.
What we, decided at the board meeting yesterday, that was that we were going to pay, for this time, as the prices are, going well and our, CapEx for San Gabriel has, basically been completed, we will pay 40% of the net income of the previous year, from 2025. Remember that our dividend policy is not less than 20% of the net income of the year. We have, increased that to 40%, and we will continue evaluating in the future, depending on the, on the prices and also with our, CapEx program.
Tanya Jakusconek (Equity Analyst)
Okay, thank you for that. Just maybe my last question comes on permits and just on Coimolache sulfides. Are we still looking for that study to come out in Q1 on the Coimolache sulfides? You know, I think it was H1, the conceptual study on the project. On the permitting side, just on San Gabriel, I know we're waiting for this water permit. What's taking so long? Asset sales, if I could, where is that going on some of your asset sales, and are we hoping to get those done this year?
Leandro García (CEO)
Thank you, Tanya. In the, for the first question, the Coimolache, we are just ending the study. We have to discuss internally with Southern and Espro, which are the following steps we need. We should inform to the market sure in the first half of this year. What are the following positive news for the project? We continue working on that, but we have to well, put it on the in the in the board of and get the approval to continue. In terms of what's the following, the San Gabriel?
Tanya Jakusconek (Equity Analyst)
San Gabriel, yeah.
Leandro García (CEO)
Yes. The authority has already visited us. We are just waiting for the permit to be signed. We expect in the following couple of weeks, we hope to receive, to be granted of this permit. What the last question about was?
Tanya Jakusconek (Equity Analyst)
Asset sales. Yeah.
Leandro García (CEO)
Well-
Aldo Masa (VP of Business Development and Commercial)
The asset sales.
Leandro García (CEO)
The asset sale. Yes. Sorry. We continue evaluating this asset. We are in the last part of taking a decision, and as soon as we arrive to a conclusion, we will inform it to the market.
Tanya Jakusconek (Equity Analyst)
Okay, we're still planning.
Leandro García (CEO)
Maybe, Aldo?
Aldo Masa (VP of Business Development and Commercial)
Yes, yes. Tanya, yes, we will make a huge analysis about the asset sales. We haven't made a decision yet, you know, if we are going to sell or not. You have to take into consideration that this increase in precious metals prices, really, you have to think a lot, if you want to sell or not an asset right now, no? We are still analyzing, and we will take a decision very soon.
Tanya Jakusconek (Equity Analyst)
Okay. Okay, thank you.
Operator (participant)
The next question is from Cesar Perez Novoa with BTG Pactual. Please go ahead.
Cesar Perez Novoa (Analyst)
Yes, good morning, gentlemen. My question relates to Yumpag and Uchucchacua. Could you comment on why cost applicable to sales rose 16% in the quarter? I believe you attribute this to larger throughput of low-grade mineral, but also there is some commercial deductions. You also mentioned increased non-payable value. Can you please explain this, what it is? My second and final question would be regarding guidance. Thank you for G&A and exploration data, but it would be really useful if you could complement this, if possible, with revenues and EBITDA for 2026. Thank you.
Leandro García (CEO)
Thank you, Cesar. Happy to count on your questions.
Aldo Masa (VP of Business Development and Commercial)
Maybe, Leandro, I will explain a little bit about these, the reductions in Yumpag.
Leandro García (CEO)
The escalation. Yes, of course. Go ahead.
Aldo Masa (VP of Business Development and Commercial)
Yes. We, Cesar, thank you very much for your question. We have two main reasons that here. The first one is when you sell silver concentrates with less than 2,500 grams, usually the payable for that concentrate is between 60% and 70%. When you sell silver concentrate with higher than 2,500 grams, the payable is between 90% and 95%. In the last quarter, we produced more silver concentrate with lower grade, that's why the reduction is a lot more. The other reason is the escalators. We have escalators clauses in our contracts. Due to a sharp increase in the price of silver, right now, these escalators are applying to the contracts.
What does it mean? If the upper range of the escalator is $50 per ounces, and the price of silver is $100, apply a percentage of the price. you understand?
Cesar Perez Novoa (Analyst)
Yes, I do. All right. Okay, those would be the two main reasons.
Aldo Masa (VP of Business Development and Commercial)
These are.
Cesar Perez Novoa (Analyst)
Thank you.
Aldo Masa (VP of Business Development and Commercial)
- two reasons why the cost is high.
Leandro García (CEO)
That, that resolves, answers your question, Cesar?
Cesar Perez Novoa (Analyst)
Yes, and the, if possibly, you could provide some guidance for EBITDA or revenues.
Leandro García (CEO)
Daniel, please.
Daniel Domínguez (CFO)
Hello, Cesar. Thanks for your question. If we consider prices at levels of $4,500 for gold, $70 for silver, and $12,000 for copper, we should be in the range of revenues at $1.8 billion-$2 billion. This includes close to $100 million of sales from the concentrate that we buy from Cerro Verde, from Freeport. The EBITDA that we expect for the total year will be around $800 million-$1 billion.
Cesar Perez Novoa (Analyst)
All right, Daniel. Thank you very much.
Operator (participant)
The next question is from Fernando Gil with Intesa Sanpaolo. Please go ahead.
Fernando Gil (Research Analyst)
Hi, thank you for taking my questions. Just a quick question regarding the investor day targets. I remember you announced that three mines are under permanent strategic review, Orcopampa, Tambomayo, or Julcani. Could you tell us, what is the current status of these mines? Are you studying to do some action separately or together? Has there been any process, formal process for any kind of sale? Yeah, that would be it. Thank you very much.
Leandro García (CEO)
Thank you, Fernando, for your question. Well, we already began that process and analyzing the feasibility of selling this unit, this mine. However, as Aldo explained it minutes before, with the increasing price in metal in prices of gold and silver, we are reanalyzing the possibility. We are, we have been continue advancing on this process.
We are close to make a final decision. If there are, will be sold apart each by each unit, as separate or as a whole, we were open to all the possibilities. By now, the higher possibility, the best alternative is if we sell it, to sell it separately.
Fernando Gil (Research Analyst)
Okay, thank you.
Operator (participant)
Again, if you have a question, please press star then one. The next question is a follow-up from Carlos de Alba with Morgan Stanley. Please go ahead.
Carlos de Alba (Managing Director and Senior Equity Research Analyst)
Yeah, thank you. just on the dividends, like, the $0.99 per share approved by the board, when do you expect to pay that? Also, the $200 million in expected dividends from Cerro Verde, when do you expect you will get that money?
Leandro García (CEO)
Yes, for, this proposal of dividends has to be approved by the, in the shareholder meeting, no? Daniel, please go ahead.
Daniel Domínguez (CFO)
Yes, Carlos. The dividend payment should be for April, the second quarter of this year. Regarding Cerro Verde dividends, we have already received in January, $100 million from Cerro Verde. We expect $50 million by July and another $50 million by the fourth quarter of this year.
Carlos de Alba (Managing Director and Senior Equity Research Analyst)
That's 150, I thought you said 200.
Daniel Domínguez (CFO)
Yes, $100 in January.
Carlos de Alba (Managing Director and Senior Equity Research Analyst)
Yeah.
Daniel Domínguez (CFO)
$50 million in July, and in the fourth quarter, another $50 million.
Carlos de Alba (Managing Director and Senior Equity Research Analyst)
Yeah. Sorry. Okay, got it. Thank you!
Operator (participant)
Ladies and gentlemen, with that, we will be concluding today's audio question and answer session. I would like to turn the floor back over to Sebastián Valencia, Head of Investor Relations, for any webcast questions.
Sebastián Valencia (Head of Investor Relations)
Thanks, operator. At this time, there are no further questions. I would like to turn the call over to Leandro García.
Leandro García (CEO)
Thank you, Sebastian. Well, before we conclude today's conference call, I would like to thank you for the time and effort dedicated in joining us today. Your participation and input are greatly appreciated. Thank you again, and have a wonderful day.
Operator (participant)
Ladies and gentlemen, that concludes Buenaventura's Fourth Quarter 2025 Earnings Results Conference call. We would like to thank you again for your participation. You may now disconnect.