Compania de Minas Buenaventura is a Peruvian mining company (that is both based in and does all its business in Peru). Its numerous mines across the country hold reserves of gold, silver, copper, lead, zinc and molybdenum. Gold generates the largest share of revenue (44% in 2009) followed by silver (29%), zinc (15%), lead (7%) and copper (5%). Because of recent economic and market trends Buenaventura shifted its focus away from hedging and futures contracts so that it is able to take advantage of rising market prices (began that strategy in 2008, many of the contracts were annulled in 2008 so the company's net earnings have gradually improved since then). The company also generates its own power at hydroelectric plants (some have diesel generators as backup if water is scarce).Gold Fields in the Chucapaca area of Southern Peru released data indicating significant reserves of gold, silver and copper (5.6 million ounces of gold of which 2.9 million belongs to Buenaventura). In total 83.7 MT (tons) of mineral containing ore was discovered 1.9 g per ton gold, 8.2 g per ton silver and 0.09% copper.
At the beginning of 2010 53.7% of its shares were held by foreigners the rest by investors from Peru (ADR's make up roughly half of all shares (50.6% common shares, there were 25.6% more shares of the company traded in 2009 than in 2008).
In 2009 gold production (at all the mines it has an interest in, includes shares not held by it) totalled 1.322 million ounces most of which came from Yanacocha (898 thousand ounces) about 12 times less than silver (16.757 million ounces 63% of which came from one of the eleven mines (Uchucchacua) and 31.8% from 3 others (spread evenly between Yanacocha, El Brocal and Julcani). El Brocal was responsible for 75.6% of zinc production (has 84.6% of Buenaventura's zine reserves, 8 other mines also have zinc). Cerro Verde produced 83.1% of copper while El Brocal and Uchucchacua combined contributed 82.6% of lead (the company total was 23 million concentrate tons (abbreviated DST).
The largest gold producing mine Yanacocha (44% owned by Buenaventura) is on track to produce 1.5 million ounces in 2010 and scheduled to do the same in 2011.
Seven of the mines in operation (December 2010) are underground mines (four of the seven only contain silver and gold) the other four are open pit (two of the open pit mines are minority stakes including the gold silver Yanacocha property (46.65%) and the copper, molybdenum Cerro Verde (19.26%).
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Ebitda, operating income and net income outpaced revenue in terms of growth between 2008 and 2009 (287.2% for ebitda and 198.3% for net income compared to 16.9% for revenue). Gold production is scheduled to rise 9% in 2011 after the opening of two new mines which could have an even larger impact on earnings since gold prices are at record highs. The company's cash to debt ratio reached a three year high in June 2010 (15.86 at the half in 2010 compared to 3.11 six months earlier and 1.7 at the end of 2008) though cash fell 38.08% to $444 million hoh. Capital expenditure was $196 million for the first six months of 2010, 59% of it going to Conhua and El Brocal.
Although total assets have continued to rise steadily in recent years (2007-2011) current assets have been up and down reaching a high of $937.8 in 2009 and a low of $774.5 million in September 2010. A lot of that has to do with lower cash on hand and currency effects caused by changes in the value of the Nuevo Sol which was stable at around 3 to 1 USD in 2007 to mid to late 2009 when it began a relatively sharp decline (2.98 in August 2009 to 2.85 in November 2009 to 2.78 in June 2010 and staying at that level until October 2010 when it reached 2.727 and stayed at that level).
|Long term debt||229.105||150.555||164.86||121.307||(26.42)%|