Kghm Polska Miedz S.a. · GPW:KGH
Kghm Polska Miedz — Q1 2025 Earnings Presentation
49 slides from Kghm Polska Miedz's earnings presentation, May 16, 2025
Slide 1: Results of the KGHM Group for the First Quarter of 2025
RESULTS OF THE KGHM GROUP FOR THE FIRST QUARTER OF 2025 Lubin, 16 May 2025
Slide 2: Agenda
Agenda 1. Key issues and execution of main targets 2. Macroeconomic environment 3. Production results of the KGHM Group by segment 4. Advancement of development initiatives 5. Financial results of the KGHM Group 6. Sustainable development – commitments and initiatives of KGHM Polska Miedź S.A.
Slide 3: Key Issues and Execution of Main Targets
KEY ISSUES AND EXECUTION OF MAIN TARGETS
Slide 4: Key macroeconomic factors
Key macroeconomic factors Copper price1) Exchange rate Copper price1) +11% [USD/t] +11% [USD/PLN] [PLN/t] -/- 37 286 33 683 9 340 8 438 3.99 3.99 Q1 2024 Q1 2025 Q1 2024 Q1 2025 Silver price +37% Silver price +37% [USD/oz t] [PLN/oz t] 31.88 127.27 23.34 93.14 Q1 2024 Q1 2025 Q1 2024 Q1 2025 Q1 2024
Slide 5: Basic results indicators in the KGHM Group and in KGHM Polska Miedź S.A.
Basic results indicators in the KGHM Group and in KGHM Polska Miedź S.A. KGHM Group +8% +60% -22% Revenues Adjusted EBITDA Profit for the period [PLN mn] [PLN mn] [PLN mn] 8 315 8 942 2 489 1 551 424 330 Q1 2024 Q1 2025 Q1 2024 Q1 2025 Q1 2024 Q1 2025 KGHM Polska Miedź S.A. +4% +40% -67% Revenues Ad
Slide 6: Key production indicators
Key production indicators Q1 2025 -6% Q1/Q1 169 Payable copper production [kt] by the KGHM Group lower by 6% (Q1/Q1) ▪ KGHM Polska Miedź S.A. – decrease due to Payable copper Payable copper production +22% Q1/Q1 execution of planned maintenance on smelter production Sierra Gorda S.C.M.1) [kt] infras
Slide 7: Metals production
Metals production KGHM Group Silver production +2% Q1/Q1 [t] Payable copper -6% Q1/Q1 316 321 production [kt] 179 169 16 Q1 2024 Q1 2025 14 17 TPM production1) 21 [koz t] +2% Q1/Q1 From purchased 51 44 41 42 metal- bearing materials 146 134 From own 95 90 concentrate Q1 2024 Q1 2025 Molybdenum produ
Slide 8: KGHM Group production and sales in Q1 2025
KGHM Group production and sales in Q1 2025 2025 Execution of annual targets Budget Production Copper in concentrate [kt] 99.4 392.3 KGHM Polska Miedź S.A. Silver in concentrate [t] 329 1 278 Electrolytic copper, total [kt] 134.0 567.1 Electrolytic copper from own concentrate [kt] 90.3 375.4 Silver i
Slide 9: Advancement of key strategic performance indicators in Q1 25
Advancement of key strategic performance indicators in Q1 2025 Domestic copper production Recycling of scrap Energy produced 134 kt 46 kt (dry weight) 25.12% of consumption (197.7 GWh) ~560 kt ~600 kt min. 50% of consumption ~124 kt of copper scrap ~350 kt of copper scrap 22% of consumption of elect
Slide 10: Macroeconomic Environment
POLSKA MIEDZ MACROECONOMIC ENVIRONMENT
Slide 11: Macroeconomic environment: commodities and currencies prices
Macroeconomic environment Commodities and currencies prices [USD/t] [PLN/t] In the first quarter of 2025 the copper market exhibited a high level of volatility, exceeding 10 000 USD per tonne in intraday trading, caused among others by speculations regarding the potential introduction of tariffs Sou
Slide 12: Precious metals prices in Q1 2025
Precious metals prices in Q1 2025 The global wave of uncertainty on financial markets raised the price of gold to hitherto unseen heights. In the shadow of geopolitical tensions and market uncertainty, the start Uncertainty as to the further directions of economic policy in the of 2025 brought a str
Slide 13: The copper market remains under the strong influence of tariffs
The copper market remains under the strong influence of actual and promised tariffs The global economic outlook is also weighed down by a highly volatile information flow The increase in the COMEX premium vs the LME, resulting from the desire to … which led to a rarely-seen rise in exports from Chin
Slide 14: Improvement in manager sentiment, rising PMI
The first quarter of 2025 brought visible improvement to manager sentiment, which is reflected in rising PMI, both in the Eurozone as well as in the USA. Jan-23 Feb-23 Mar-23 Apr-23 May-23 Jun-23 Jul-23 Aug-23 Sep-23 Oct-23 Nov-23 Dec-23 Jan-24 Feb-24 Mar-24 Apr-24 May-24 Jun-24 Jul-24 Aug-24 Sep-24
Slide 15: IMF World Economic Outlook – April 2025
IMF World Economic Outlook – April 2025 Forecasts (F) real GDP growth – International Monetary Fund - World Economic Outlook Update April 2025 in comparison to January 2025; 15 for Chile April 2025 in comparison to October 2024.
Slide 16: Production Results of the KGHM Group by Segment
PRODUCTION RESULTS OF THE KGHM GROUP BY SEGMENT
Slide 17: Production results
Production results KGHM Polska Miedź S.A. Ore Extraction Production of copper Electrolytic copper Metallic silver [mn t dry weight] in concentrate [kt] production [kt] production [t] -2.5% Q1/Q1 -3.0% Q1/Q1 -8,2% Q1/Q1 +1.9% Q1/Q1 146 134 7.9 7.7 102.5 51 44 310 316 99.4 From 51.0 50.4 purchased met
Slide 18: Production results: Sierra Gorda S.C.M.
Production results Sierra Gorda S.C.M.1) Payable copper production Silver production -14% Q1/Q1 [kt] [t] +22% Q1/Q1 5.8 5.0 20.8 Q1 2024 Q1 2025 17.0 TPM production +8% Q1/Q1 [koz t] 6.5 7.0 Q1 2024 Q1 2025 Q1 2024 Q1 2025 Molybdenum production -/- Q1/Q1 [mn lbs] ▪ The higher payable copper producti
Slide 19: Production results: KGHM INTERNATIONAL LTD.
Production results KGHM INTERNATIONAL LTD. Payable copper production [kt] Silver production -75% Q1/Q1 ▪ Silver: lower silver production by the Sudbury Basin mainly [t] -10% Q1/Q1 0.4 due to lack of production from March 2025 as a result 16.0 0.1 of the disposal of a portion of 14.4 the assets Q1 20
Slide 20: Advancement of Development Initiatives
ADVANCEMENT OF DEVELOPMENT INITIATIVES
Slide 21: A rationale and responsible investment program
A rationale and responsible investment program Capital expenditures by KGHM Polska Miedź S.A. in Q1 2025 CAPEX execution in Q1 2025, incl. borrowings By category By area Replacement Mining Maintenance Metallurgy Development (incl. R&D) Other activities Leasing Adaptation projects IFRS 16 Development
Slide 22: CAPEX execution in key investments
CAPEX execution in key investments Outfitting of the mines ▪ Conveyor belts – work continued on construction and extension of conveyor belts (25 conveyor belts under construction; completed – 2.24 km) ▪ Outfitting and infrastructure of regions/sections – work continued (the largest expenditures were
Slide 23: Role of shafts in maintaining output in Poland
Role of shafts in maintaining output in Poland Deposit access program in KGHM’s concessioned areas Share of production from GGP in total production Bytom in Poland Odrzański Ore extraction dry weight from GGP [kt] +6% Q1/Q4 +12% Q1/Q1 1 629 1 730 1 540 1 730 22.3% 22.5% 19.5% 22.5% Q4 2024 Q1 2025 Q
Slide 24: CAPEX execution in key investments
CAPEX execution in key investments 1) excluding Leasing per IFRS 16, plus borrowing costs and R&D Investments related to IAS - metallurgical plants and concentrators ▪ Significant maintenance at the Głogów and Legnica metallurgical plants – incl. maintenance on convertors and electrolizers. ▪ Concen
Slide 25: Financial Results of the Group
FINANCIAL RESULTS OF THE GROUP
Slide 26: Financial indicators of the KGHM Group
Financial indicators of the KGHM Group Q1 2025 Group revenues Operating costs KGHM Group adjusted EBITDA1) [mn PLN] [mn PLN] [mn PLN] +8% Q1/Q1 +1% Q1/Q1 +60% Q1/Q1 7 729 7 814 2 489 Depreciation/ amortisation 593 696 102 672 8 942 8 315 1 551 76 462 332 7 136 7 118 247 1 253 896 Q1 2024 Q1 2025 Q1
Slide 27: Group sales revenue
Group sales revenue Q1 2025 Revenues from contracts with customers Revenues from contracts with customers [PLN mn] [PLN mn] +8% Q1/Q1 +8% Q1/Q1 8 942 8 315 510 511 895 525 +1 018 +6 8 942 8 315 -3 -144 -250 7 279 7 537 Revenues for Change in sales Change in prices Change in Adjustments of Other Reve
Slide 28: Registration of HMG-S and HMG-B copper cathode brands on CME
Registration of HMG-S and HMG-B copper cathode brands on the CME Group Inc. exchange The registration of copper cathodes on metals exchanges is equivalent to a confirmation of their high quality in accordance with existing global standards, as well as stability in their production volumes. Currently
Slide 29: Expenses by nature
Expenses by nature KGHM Group Expenses by nature [PLN mn] 8 666 +9% Q1/Q1 7 986 8 750 8 666 1 060 8 408 Minerals extraction tax 7 986 8 098 805 Minerals extraction tax 2 050 Purchased metal- 1 940 bearing materials 5 556 +6% Q1/Q1 Purchased metal- 5 241 328 Expenses by nature bearing materials Other
Slide 30: C1 unit cost
C1 unit cost 1) KGHM Group C1 – KGHM Group C1 – KGHM Polska Miedź S.A. [USD/lb] [USD/lb] +5% Q1/Q1 KGHM Polska Miedź S.A. – an increase in C1 -7% Q1/Q1 by 5% mainly due to a higher minerals 3.15 extraction tax charge by 34%. C1 cost 3.01 incl. the minerals extraction tax excluding the minerals extra
Slide 31: Financial results
Financial results 330 KGHM Group Consolidated net profit in Q1 2025 Profit for the period [PLN mn] A decrease in Group profit by PLN 94 milion, mainly due to exchange differences despite higher EBITDA [PLN mn] + 598 424 + 98 + 76 330 - 654 - 87 - 125 Profit for Change in Exchange differences Gain on
Slide 32: Cash flow
Cash flow KGHM Group [PLN mn] +1 403 + 97 + 23 869 715 -1 319 - 50 Cash as at Net cash generated Net cash used in Proceeds Interest paid Other Cash as at 1 January 2025 from operating investing activities from/repayments of 31 March 2025 activities borrowings and debt instruments 32
Slide 33: Net debt of the KGHM Group
Net debt of the KGHM Group As at the end of Q1 2025 Main factors affecting net debt in 2025 Net debt / adjusted EBITDA 1.4 0.7 0.9 0.8 0.7 Increases in debt ▪ Cash expenditures on property, plant and equipment 31-03-2024 30-06-2024 30-09-2024 31-12-2024 31-03-2025 (PLN 1 488 mn) ▪ The minerals extra
Slide 34: Operating results
Operating results KGHM Group Change in adjusted EBITDA1) +60% Q1/Q1 Adjusted EBITDA [PLN mn] [PLN mn] 2 489 2 489 +215 +340 +26 102 1 551 +357 672 1 551 76 462 332 Q1 2024 KGHM Polska KGHM Sierra Other segments Q1 2025 247 Miedź S.A. INTERNATIONAL Gorda LTD. S.C.M. 1 253 896 An increase in adjusted
Slide 35: The financial situation of the KGHM Group remains stable and safe
The financial situation of the KGHM Group remains stable and safe 2025 Budget Total unit production cost of electrolytic copper from own concentrate 29.5 36.0 of KGHM Polska Miedź S.A.1) [k PLN/t] 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 110% Investments Capital expenditures 601 3 800 KGHM Polska
Slide 36: Sales revenue
Sales revenue KGHM Polska Miedź S.A. Revenues from contracts with customers Higher revenues from contracts with customers by PLN 258 million (+4%) in the [PLN mn] first quarter of 2025 compared to 2024, mainly due to more favourable prices of +4% Q1/Q1 basic products, with a lower sales volume 7 279
Slide 37: Expenses by nature
Expenses by nature KGHM Polska Miedź S.A. The reduction in costs by nature compared to the corresponding prior-year period was mainly related to the increase in the minerals extraction tax charge, the consumption of purchased metal- Expenses by nature bearing materials and labour costs [PLN mn] 7 02
Slide 38: EBITDA and profit for the period
EBITDA and profit for the period KGHM Polska Miedź S.A. Adjusted EBITDA Profit for the period EBITDA and standalone profit for the [PLN mn] +40% Q1/Q1 [PLN mn] -67% Q1/Q1 period EBITDA +PLN 357 million: 1 253 Revenues higher by PLN 258 million (mainly due to more favourable prices with 896 387 a
Slide 39: Profit for the period
Profit for the period KGHM Polska Miedź S.A. Profit for the period [PLN mn] +357 387 -295 127 -183 -87 -43 -9 Profit for Change in Exchange Fair value Impact of derivatives and Income tax Other Profit for Q1 2024 EBITDA differences gains/losses on hedging transactions Q1 2025 financial assets measur
Slide 40: Market risk management
Market risk management Hedged position on the copper, silver and currency markets (as of 31 March 2025) Copper Hedgedzabezpieczająca position – open- as at 31 December 2024 Pozycja otwarta na 31.12.2024 [kt] At the end of the first quarter of 2025, the Parent 9.45 Pozycja Hedgedzabezpieczająca wdroż
Slide 41: Other segments, including domestic companies
Other segments, including domestic companies Basic measures of results – prior to consolidation adjustments Revenues [PLN mn] +11% Q1/Q1 Adjusted EBITDA [PLN mn] +34% Q1/Q1 Profit/loss for the period [PLN mn] 680 699 2 648 102 2 288 76 25 Q1 2024 Q1 2025 Q1 2024 Q1 2025 -10 Revenues from external cu
Slide 42: Sustainable Development – Commitments and Initiatives of KGHM Polska Miedź S.A.
SUSTAINABLE DEVELOPMENT – COMMITMENTS AND INITIATIVES OF KGHM POLSKA MIEDŹ S.A.
Slide 43: Actions by KGHM's employee volunteers
Actions by KGHM’s employee volunteers approx. 1300 hours dedicated to advancing volunteer projects 269 employee volunteers took part in actions 47 volunteer actions Thematic actions 8 actions in the area of 0 actions in the area of 0 actions in the area of science and education ecology the arts and
Slide 44: Climate neutrality by 2050
Climate neutrality by 2050 Achieving climate neutrality by 2050 is the overriding goal of the Climate Policy of KGHM Polska Miedź S.A. Intermediate goal – the reduction of total Scope 1 and Scope 2 emissions by 2030 by 30%1) Emissions reduction by 30% Climate neutrality 2030 versus the base year 202
Slide 45: By 2030 the increase in share of RES will lead to a substantial reduction in CO2 emissions
By 2030 the increase in share of RES will lead to a substantial reduction in CO2 emissions Own sources of electricity generation in KGHM Polska Miedź S.A. 2020 - base year (105 MW): 2030 - goal: Market Own Market sources Natural gas 98% Own sources Natural gas, RES, 76% and RES Recovery* 24% Recover
Slide 46: Energy Development Program, including RES
Energy Development Program, including RES Selected important Events in Q1 2025 Ensuring energy security in KGHM ▪ The Natural Gas-Steam (CCGT) blocks of the Head Office ensured M&A Development of wind energy energy security for the Core Production Business as regards the supply of power to the Polko
Slide 47: Cautionary Statement
Cautionary Statement This presentation was prepared by KGHM Polska Miedź S.A. (KGHM). The presentation is strictly of an informational nature and should not be construed as containing investment advice. The users of this presentation are solely responsible for their own analysis and assessment of th
Slide 48: Intellectual Property Rights
Intellectual Property Rights All rights reserved. All content on this presentation of the KGHM are protected by copyright and other protective laws. The presentation and the trademarks, service marks and logos on the presentation are owned by or licensed to KGHM, and are subject to copyright, tradem
Slide 49: Results of the KGHM Group for the First Quarter of 2025
RESULTS OF THE KGHM GROUP FOR THE FIRST QUARTER OF 2025 Lubin, 16 May 2025