Fresnillo Reports Strong 2024 Results with Doubled EBITDA and Increased Revenue
Why we think this is good
Fresnillo's 2024 financial results show significant improvements across key metrics. The company more than doubled its EBITDA to US$1,547.3 million, while adjusted revenue increased by 26.9% to US$3,639.9 million. Profit before income tax saw a substantial rise from US$114.0 million in 2023 to US$743.9 million in 2024. The company's cash position strengthened considerably, with cash and other liquid funds increasing to US$1,297.8 million from US$534.6 million. Operating cash flow also showed impressive growth, rising to US$1,299.8 million from US$425.9 million. These improvements were supported by higher precious metal prices and operational efficiencies. However, it's important to note that the company faces some risks, including high customer concentration with 99.6% of revenue derived from customers in Mexico, and exposure to commodity price fluctuations. The current valuation appears somewhat high with a PE ratio of around 39.5, but this may be justified by the strong growth and positive outlook for precious metals prices.
Key Points
- Adjusted revenue increased 26.9% to US$3,639.9 million
- EBITDA more than doubled to US$1,547.3 million
- Profit before income tax rose to US$743.9 million from US$114.0 million
- Cash and other liquid funds increased to US$1,297.8 million
- Net cash position of US$458.3 million as of 31 December 2024
- Operating cash flow increased to US$1,299.8 million from US$425.9 million
- Final ordinary dividend of 26.1 US cents per share declared
- One-off special dividend of 41.8 US cents per share announced
- Silver production in line with guidance, gold production slightly ahead
- Continued focus on operational improvements and cost efficiencies
Summary
Fresnillo plc delivered strong financial results for 2024, with adjusted revenue up 26.9% to US$3,639.9 million and EBITDA more than doubling to US$1,547.3 million. The company's performance was driven by higher precious metal prices and operational efficiencies. Profit before income tax surged to US$743.9 million from US$114.0 million in 2023. The company's cash position strengthened significantly, with cash and other liquid funds increasing to US$1,297.8 million from US$534.6 million. Fresnillo maintained its strong financial position with a net cash of US$458.3 million. The company faces some challenges, including high customer concentration and exposure to commodity price fluctuations. Looking ahead, Fresnillo remains focused on operational improvements, cost efficiencies, and ongoing exploration activities to replenish reserves. The company's outlook appears positive, supported by favorable precious metals prices.