Compañía de Minas Buenaventura S.A.A. (NYSE:BVN) is among the 11 Best Silver Mining Stocks to Buy According to Hedge Funds. Compañía de Minas Buenaventura S.A.A. (NYSE:BVN) reported strong second-quarter 2025 results, with EBITDA from direct operations jumping to $130.1 million from $107.2 million in the second quarter of 2024. Net income also went up to $98.2 million from $74.4 million in the previous year. EBITDA was $256.4 million and net income was $245.2 million for the first half of 2025, both of whi ...

Financial Data and Key Metrics Changes - EBITDA for Q2 2025 was $130 million, up from $107 million in Q2 2024, indicating a year-over-year increase of approximately 21.5% [6] - Net income for Q2 2025 reached $91 million, compared to $71 million in Q2 2024, reflecting a year-over-year increase of about 28.2% [7] - Cash position at the end of Q2 2025 was $589 million, with total debt of $860 million, resulting in a leverage ratio of 0.56 times [9] Business Line Data and Key Metrics Changes - Silver production in Q2 2025 was 3.6 million ounces, down 11% from 4 million ounces in Q2 2024, primarily due to lower production at Jumpac, Tambomayo, and Huican [7] - Copper production increased by 28% year-over-year, attributed to halted operations at El Brocal in 2024 affecting copper ore processing [7] - Gold production decreased to 27,345 ounces from 33,119 ounces in Q2 2024, mainly due to reduced output at Tambomayo and Orcopampa, partially offset by increases at La Sanja and El Brocal [8] Market Data and Key Metrics Changes - The company initiated the sale of part of the Cerro Verde copper concentrate, selling approximately 20,000 metric tons by the end of Q2 2025, with a total of 40,000 metric tons expected for the full year [8] - Cerro Verde announced a new dividend distribution of $59 million on July 24, corresponding to Buenaventura's equity share, contributing to a total of $108 million in dividends [9] Company Strategy and Development Direction - The company is committed to stable and continuous production of flagship assets, with ongoing optimization efforts to increase throughput [14] - Continuous exploration is emphasized as part of the company's strategy to extend the life of its mining assets [15] - The San Gabriel project achieved 88% overall completion by Q2 2025, with expectations to commence ramp-up in Q3 2025 and produce the first gold bar in Q4 2025, subject to timely permit approvals [12][15] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in obtaining necessary permits for the San Gabriel project, with no anticipated risks regarding the permit for production commencement [20] - The company plans to maintain financial stability and has redeemed the remaining 2026 notes, indicating a focus on managing debt levels [15] - The ramp-up of production at San Gabriel is expected to take all of 2026, with stabilization projected between 100,000 and 120,000 ounces [22] Other Important Information - Total CapEx for Q2 2025 was $107 million, with $82 million allocated to the San Gabriel project [9] - The all-in sustaining costs for copper increased by 63% year-over-year, primarily driven by lower byproduct credits [10] Q&A Session Summary Question: Can you provide more details on the pending permits for San Gabriel? - Management indicated that they have invited authorities to visit the plant in September and do not foresee risks in obtaining the necessary permits [20] Question: What is the expected CapEx for the second half of 2025? - Total CapEx for San Gabriel is expected to remain between $720 million and $750 million, with approximately $130 million to $160 million disbursed in the second half of 2025 [22][23] Question: What is the status of silver production at Uchucchacua? - Management noted a decrease in silver grades due to a shift towards polymetallic stops, with plans to monitor and potentially resume mining in the bottom part of the mine by Q4 2025 [36][37] Question: How is the commercialization of Cerro Verde concentrate impacting overall costs? - The company has started selling 40,000 tons of copper concentrates from Cerro Verde, which is expected to improve terms and overall margins [42][43] Question: What is the timeline for the Trepiche project? - The environmental impact study is on track for approval by the end of the year, with the feasibility study expected to be completed by mid-2026 [55][57] Question: What is the definition of commercial production for San Gabriel? - Commercial production is defined as producing two gold bars over 20 continuous days at 65% capacity [64][70]

Financial Data and Key Metrics Changes - EBITDA for Q2 2025 was $130 million, up from $107 million in Q2 2024, reflecting a strong performance [7] - Net income increased to $91 million in Q2 2025 from $71 million in Q2 2024 [8] - Total CapEx for the quarter was $107 million, with $82 million allocated to the San Gabriel project [9] - Cash position at the end of the quarter was $589 million, with total debt of $860 million, resulting in a leverage ratio of 0.56 times [9] Business Line Data and Key Metrics Changes - Silver production decreased by 11% year-over-year to 3.6 million ounces, primarily due to lower output at Jumpac, Tambomayo, and Huican [8] - Copper production increased by 28% year-over-year, attributed to halted operations at El Brocal in 2024 [8] - Gold production fell to 27,345 ounces from 33,119 ounces in the same quarter last year, mainly due to decreased output at Tambomayo and Orcopampa [8] Market Data and Key Metrics Changes - The company initiated the sale of part of the Cerro Verde copper concentrate, selling approximately 20,000 metric tons by the end of the quarter, with a total of 40,000 metric tons expected for the full year 2025 [8] - Cerro Verde announced a new dividend distribution of $59 million, corresponding to Buenaventura's equity share, to be distributed in August [9] Company Strategy and Development Direction - The company is committed to stable and continuous production of flagship assets and is focused on optimizing throughput [15] - Continuous exploration efforts are emphasized to extend the life of mining assets [15] - The San Gabriel project is on track with 88% overall completion, with expectations to produce the first gold bar in Q4 2025, subject to timely permit approvals [13][16] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in obtaining necessary permits for the San Gabriel project, indicating no significant risks [19] - The company plans to maintain financial stability and has redeemed the remaining 2026 notes [16] - The ramp-up of production at San Gabriel is expected to take all of 2026, with stabilization anticipated thereafter [21] Other Important Information - The all-in sustaining costs for copper increased by 63% year-over-year, primarily due to lower byproduct credits [11] - The company received $49 million in dividends from Cerro Verde, which contributed to operating cash flow [12] Q&A Session Summary Question: Can you provide more details on the pending permits for San Gabriel? - Management indicated that they have invited authorities to visit the plant in September and do not foresee risks in obtaining the necessary permits [19] Question: What is the expected CapEx for the second half of 2025? - Total CapEx for San Gabriel is expected to remain between $720 million and $750 million, with approximately $130 million to $160 million disbursed in the second half of 2025 [20][22] Question: When do you expect to reach full production capacity at San Gabriel? - The ramp-up will take all of 2026, with expectations to stabilize production between 100,000 and 120,000 ounces [21] Question: How is Uchucchacua performing regarding silver grades and costs? - Management noted a decrease in silver grades due to a shift towards polymetallic stops, with expectations to stabilize in Q3 [32][35] Question: What is the strategy for El Brocal moving forward? - The company plans to prioritize mining blocks with higher gold and silver content while maintaining a target copper production of 1.45% [38] Question: Can you clarify the commercialization of Cerro Verde concentrate? - The company has sold 20,000 tons of copper concentrate in the first half and plans to sell another 20,000 tons in the second half, with margins expected around $1.2 million for each 10,000 tons [48][50] Question: What is the status of the Trepiche project? - The environmental impact study is on track for approval by the end of the year, with the feasibility study expected to be completed in Q3 2026 [55] Question: What is the definition of commercial production for San Gabriel? - Commercial production is defined as producing two gold bars over 20 continuous days at 65% capacity [64][68]

Note: (1) Consolidated figures includes 100% BVN, 100% La Zanja and 100% El Brocal. (2) Net Income attributable to owners of the parent. 3 2Q25 Earnings Results Conference Call Cautionary Statement This presentation contains certain information that may constitute forward-looking information under applicable U.S. securities legislation, including but not limited to information about costs applicable to sales, general and administrative expenses; production volumes; current expectations on the timing, extent ...

Core Insights - Buenaventura Mining (BVN) reported its second-quarter 2025 production and sales figures from its operating mines, highlighting mixed performance across different sites [1] Group 1: Mine Performances - Gold production at the Orcopampa mine decreased by 30.2% year-over-year to 12,270 ounces, with sales of 12,158 ounces; the company expects 2025 production to be between 48,000 and 52,000 ounces [3][11] - El Brocal mine produced 5,581 ounces of gold, a 40.2% increase year-over-year, and silver production rose by 25% to 390,486 ounces; copper production was 13,079 MT, down 1% year-over-year [4][11] - Tambomayo's gold production fell 66.6% to 2,985 ounces, and silver production dropped 49.7% to 191,181 ounces due to processing delays; the company maintained 2025 production expectations for gold at 12,000-15,500 ounces and silver at 1.2-1.5 million ounces [6][7][11] - Coimolache mine saw a significant increase in gold production, rising 77.9% to 13,149 ounces, with sales of 13,440 ounces; production guidance for 2025 remains at 50,000-55,000 ounces [8][11] - Julcani mine's silver production decreased by 32.3% year-over-year to 299,697 ounces, with sales of 282,420 ounces; the expected silver production for 2025 is between 1.5 and 1.8 million ounces [9] Group 2: Sales and Guidance - In Q2 2025, Buenaventura sold 3,244 ounces of gold, 309,222 ounces of silver, and 12,439 MT of copper from the El Brocal mine; the company expects gold production from El Brocal to be between 18,000 and 20,000 ounces and silver production at 1.4-1.6 million ounces for 2025 [5] - The company maintained its overall production guidance for 2025, with expectations for gold production across its mines to remain stable despite the mixed results in Q2 [11] Group 3: Stock Performance - Buenaventura's stock has gained 5% over the past year, compared to the industry's growth of 10.7% [10]

Group 1 - Compañía de Minas Buenaventura S.A.A. (NYSE: BVN) has been monitored for over 20 years, with previous hesitations primarily due to doubts regarding the value proposition of gold [1] - The company operates in a diverse range of industries, including mining, and has been analyzed through various economic crises and market conditions [1] Group 2 - The analyst has a long position in ORAAF shares, indicating a positive outlook on the company's performance [2] - The article reflects the author's personal opinions and does not represent any business relationship with the companies mentioned [2]

Financial Performance - The company's net income for 1Q25 was US$140 million, compared to US$61 million in 1Q24[4] - The company's cash position is US$648 million and debt is US$862 million, with a leverage ratio of 046x[4] - The company received US$49 million in dividends from Cerro Verde[6] - 1Q25 EBITDA was US$126 million with a 41% margin, compared to US$95 million with a 38% margin in 1Q24[4] Production - Copper production was 122 kton in 1Q25, a 20% increase compared to 102 kton in 1Q24[8] - Gold production was 365 kOz in 1Q25, a 24% decrease compared to 478 kOz in 1Q24[8] - Silver production was 31 Moz in 1Q25, a 21% decrease compared to 37 Moz in 1Q24[8] Costs - Copper All-in Sustaining Cost decreased 83% from 1Q24 to 1Q25[12] San Gabriel Project - The San Gabriel project is 79% complete as of 1Q25[6, 19, 20, 22] - Total CAPEX for San Gabriel as of 1Q25 is US$505 million[17] - The CAPEX for FY25 has been revised to US$220-250 million[17] - The company anticipates the first gold bar from San Gabriel in 4Q25[17, 18, 29] Reserves - Consolidated reserves have been updated as of 2024, with increases of 482 kOz for gold, 61 Moz for silver, and 253 kton for copper compared to 2023[9, 10]

Financial Data and Key Metrics Changes - The company's EBITDA from direct operations for Q1 2025 was $126 million, up from $95 million in Q1 2024, reflecting an EBITDA margin increase to 41% from 38% year-over-year [8] - Net income for Q1 2025 was $140 million, compared to $61 million in the same period last year [8] - The cash position at the end of the year was $648 million, with total debt at $862 million, resulting in a net leverage ratio of 0.46 times [9] Business Line Data and Key Metrics Changes - Silver production increased by 20% year-over-year to 3.7 million ounces, with 2.2 million ounces coming from Jumpak [11] - Copper production decreased by 21% year-over-year, primarily due to the processing of remaining inventories from the El Brocal pen pit [11] - Gold production was 27,980 ounces, down from 36,593 ounces in Q1 2024, mainly due to decreased output at Tambomayo and Orcopampa [11] Market Data and Key Metrics Changes - The all-in sustaining cost for Q1 2025 decreased by 83% compared to the same period last year, driven by lower commercial deductions and higher by-product rates [12] - Cash costs applicable to sales for copper increased year-over-year due to lower by-product credit contributions at El Brocal [13] Company Strategy and Development Direction - The company is focused on reserve growth, EBITDA maximization, and cost efficiency at flagship mines, with a strong pipeline of projects [17] - The San Gabriel project is on track, with 79% overall completion and expected to produce its first gold bar in Q4 2025, pending necessary permits [15][17] Management's Comments on Operating Environment and Future Outlook - Management highlighted that the CapEx for San Gabriel is expected to be between $720 million and $750 million, with an internal rate of return around 12% to 13% [22][23] - The company anticipates an increase in overall CapEx for 2025 to a range of $400 million to $420 million due to adjustments in the San Gabriel project [38] Other Important Information - The company received $49 million in dividends related to its stake in Cerro Verde [10] - The exploration budget for 2025 is projected to be around $40 million to $45 million for operating units and $20 million for non-operating areas [32] Q&A Session Summary Question: Clarification on San Gabriel CapEx and expected returns - Management clarified that the CapEx increase in 2025 is due to geotechnical and hydraulic issues, with expected returns maintaining profitability at $1,600 per ounce [22][23] Question: Exploration budget and administrative expenses - The exploration budget is set at $40 million to $45 million for operating units, with administrative expenses expected to be around $60 million to $65 million for the year [32][33] Question: Updates on underground operations and training - The company is on track with training underground miners and has 60,000 tons of ore on the surface, with development proceeding as planned [50][51] Question: Status of permits and construction at Comalache - Construction permits were granted in March, and construction began in April, with expectations to start piling fresh ore by August [55]

Financial Data and Key Metrics Changes - The company's EBITDA from direct operations for Q1 2025 was $126 million, up from $95 million in Q1 2024, reflecting an EBITDA margin increase to 41% from 38% year-over-year [7] - Net income for Q1 2025 was $140 million, compared to $61 million in the same period last year [7] - The cash position at the end of the quarter was $648 million, with total debt of $862 million, resulting in a net leverage ratio of 0.46 times [8] Business Line Data and Key Metrics Changes - Silver production increased by 20% year-over-year to 3.7 million ounces, with 2.2 million ounces coming from Jumpak [9] - Copper production decreased by 21% year-over-year, primarily due to the processing of remaining inventories from the El Brocado pen pit [9] - Gold production fell to 27,980 ounces from 36,593 ounces in Q1 2024, mainly due to decreased output at Tambomayo and Orcopampa [9] Market Data and Key Metrics Changes - The all-in sustaining cost for Q1 2025 decreased by 83% compared to the same period last year, driven by lower commercial deductions and higher by-product rates [11] - Cash costs applicable to sales for copper and silver increased year-over-year, while gold cash costs rose primarily due to lower volumes and grades at Tambomayo and Orcopampa [12] Company Strategy and Development Direction - The company is focused on reserve growth, EBITDA maximization, and cost efficiency at flagship mines, with a strong pipeline of projects [16] - The San Gabriel project is on track, with 79% overall completion and expected to produce its first gold bar in Q4 2025, pending necessary permits [14][16] Management's Comments on Operating Environment and Future Outlook - Management highlighted the importance of the San Gabriel project and its expected profitability, maintaining an internal rate of return (IRR) of around 12% to 13% [20][21] - The company anticipates an increase in capital expenditures for 2025, now expected to be between $400 million and $420 million, due to additional costs associated with San Gabriel [34] Other Important Information - The company received $49 million in dividends related to its stake in Cerro Verde [8] - Exploration expenses for 2025 are projected to be around $40 million to $45 million for operating units and $20 million for non-operating areas [28] Q&A Session Summary Question: Clarification on San Gabriel CapEx and expected returns - Management confirmed that the CapEx increase in 2025 is due to geotechnical and hydraulic issues, with total CapEx for the project now estimated between $720 million and $750 million, maintaining profitability at $1,600 gold prices [20][21] Question: Exploration budget and administrative expenses - The exploration budget for operating units is expected to be $40 million to $45 million for the year, with administrative expenses projected at $60 million to $65 million due to higher worker participation from increased profits [28][29] Question: Update on underground operations and training - The company is on track with underground training and development, with 60,000 tons of ore material on the surface and plans to hire new crews by July [45][46] Question: Status of permits and construction at Comalache - Construction permits were granted in March, and construction began in April, with expectations to start piling fresh ore by August [51]

Market Prices - The morning fixing price for gold on the London Bullion Market was US$2,611 per ounce on December 31, 2024, and US$3,120 per ounce on March 31, 2025[51]. - The afternoon fixing spot price of silver on the London market was US$28.91 per ounce on December 31, 2024, and US$34.06 per ounce on March 31, 2025[51]. - The London Metal Exchange Spot Price for copper was US$8,706 per tonne on December 31, 2024, and US$9,673 per tonne on March 31, 2025[51]. - A continued decline in market prices of gold, silver, and copper could adversely impact revenues, net income, and cash flows[53]. Operating Costs and Profitability - Increased operating costs, including higher equipment, energy, and production costs, could adversely affect profitability and results of operations[68]. - The company no longer engages in hedging activities for gold and silver prices, exposing it fully to market price fluctuations[51]. Mineral Reserves and Exploration - The company may face challenges in replenishing mineral reserves due to the speculative nature of exploration and potential changes in economic feasibility[64]. - The estimates of proven and probable reserves are subject to uncertainties, and actual recovery may vary from estimates[72]. Tax Liabilities - The tax claim for the years 2007, 2008, 2009, and 2010 initially amounted to 373.3 million soles (approximately US$99.0 million), escalating to 2,107.5 million soles (approximately US$559.0 million) due to penalties and fees[78]. - The total amount paid for the disputed tax assessment related to fiscal years 2007 and 2008 was S/1,584,227,000 (equivalent to US$420,219,000), while for fiscal year 2009 it was S/193,398,000 (equivalent to US$51,299,000), and for fiscal year 2010 it was S/356,691,000 (equivalent to US$94,613,000)[80]. - As of 2023, the probability of recovering a portion of the payments made under protest to the Tax Administration related to fiscal years 2009 and 2010 was assessed to be less than 50%, leading to a recognized liability of S/420,231,000 (equivalent to US$111,823,000)[82]. Labor Relations - Unions represented approximately 17.6% of the company's and its subsidiaries' employees as of December 31, 2024, indicating potential risks related to labor disputes[88]. Partnerships and Interests - The company holds a 19.58% partnership interest in Cerro Verde and has no longer any interest in Yanacocha, having sold its stake to Newmont on February 8, 2022[96]. Credit Ratings - The company is rated "BB" by Fitch, "Ba3" by Moody's Investors Service, and "BB-" by S&P Global Ratings, which could impact borrowing costs if ratings are downgraded[102]. Political and Social Risks - The company has faced local political protests and social risks that could disrupt operations and affect future mining projects[89]. - The political and social situation in Peru directly impacts the company's operations, with significant unrest leading to violence and vandalism affecting mining facilities[121]. - Over 60 Peruvians died during three months of violence in early 2023, impacting public and private institutions, including critical mining infrastructure[122]. Legal and Compliance Risks - Legal proceedings against SUNAT could have a material adverse effect on the company's business, with ongoing appeals in Peruvian courts[85]. - The company is subject to evolving anti-bribery and anti-corruption laws in Peru, which may not be as stringent as those in other jurisdictions, necessitating ongoing compliance efforts[110]. Community Relations - The company has implemented extensive community relations practices to manage social issues that may arise at its operations[101]. Geotechnical and Environmental Risks - Geotechnical challenges could adversely impact production and profitability, with potential risks from severe weather and hydrological conditions[91]. - The company owns 15 tailings dams, including 1 under construction, 5 active, and 9 inactive, which could present stability risks, especially related to liquefaction[104]. - The company maintains strict operational controls on critical components to mitigate risks associated with tailings dam failures, which could lead to severe damages and loss of life[106]. Cybersecurity Risks - Cyber incidents, including deliberate attacks, have been increasing, posing risks to the company's information technology systems and potentially disrupting operations[107]. - A cyber-attack could cause temporary interruptions in production and expose the company to liabilities if sensitive personal information is compromised[108]. Shareholder Rights and Corporate Governance - As of March 31, 2025, the Benavides Family holds approximately 35% of the company's outstanding share capital, potentially limiting other shareholders' influence[129]. - Shareholders' rights under Peruvian law are less defined compared to those in the U.S., which may complicate enforcement of their rights[132]. - The company is subject to less stringent disclosure requirements than U.S. companies, potentially resulting in less information available to investors[134]. - Holders of ADSs may be unable to exercise preemptive rights and accretion rights for Common Shares unless specific conditions are met[136]. - A capital increase requires approval from holders of at least 40% of Common Shares at a properly called meeting[136]. - U.S. Holders of ADSs may face limitations in exercising rights unless a registration statement under the Securities Act is effective[136]. - Any rights offering could have a dilutive effect on shareholders who do not exercise their rights[136]. - The Depositary has discretion to sell preemptive rights or accretion rights for holders of ADSs and distribute net proceeds[136]. - If the Depositary cannot make rights available, they may allow the rights to lapse[136].