(Adds shares, CEO comments, details)
By Sanjeeban Sarkar
Feb 28 Precious metal miner Fresnillo Plc
reported on Tuesday a more than six-fold jump in its
profit for the year, boosted by higher production and metal
prices and a weak Mexican Peso, but warned that market
conditions could be volatile.
The company, which produces silver and gold from six mines
in Mexico, reported profit of $425.0 million for the year ended
Dec. 31, compared with $69.4 million reported a year earlier.
Total revenue rose 31.9 percent to $1.91 billion.
Fresnillo shares eased 2 percent in morning trading on the
London Stock Exchange, largely in line with a wider fall in
The company's results were boosted almost equally by
stronger production and cost-control, as they were by an
increase in metal prices and depreciation of the peso, Chief
Executive Octavio Alvídrez told reporters on a call.
"My enthusiasm for improved market conditions is somewhat
tempered by their current unpredictability," he added.
Gold prices have risen as investors seek shelter
from political shocks, while spot silver is forecast to
post its strongest year since 2014, supported by stronger
industrial demand and its attraction as a haven from risk.
Meanwhile, the peso has hit record lows, pressured by
concerns over a potential trade war between the United States
and Mexico under U.S. President Donald Trump.
The currency's slide has boosted revenues for miners, who
incur most of their costs in pesos, while earning in dollars.
Some analysts say the worst may be over for peso, but the
currency is expected to remain weak throughout this year, a
Reuters poll showed this month.
As miners across the board resume handsome dividends,
Fresnillo set a final dividend of 21.5 cents per share, compared
with 3.35 cents a year earlier.
The company said its full-year silver production rose 7.1
percent to 50.3 million ounces, while gold production for the
year was up 22.8 percent to 935,513 ounces. Capital expenditure
for the year was $434.1 million, 8.6 percent lower than 2015 and
(Reporting by Sanjeeban Sarkar in Bengaluru and Barbara Lewis
in London; Editing by Amrutha Gayathri)