Copper Bull Market
Copper inventories are about 200 000 metric tons, about the same when Copper prices peaked to $4.58/lbs in January 2011
Copper prices still about 20% down from peak
Demand for Copper still rising with EV and Renewables in the West and China; and electrification and construction in the developing world
When economy gets out of recession, demand expected to rise
Supply still low → Possible supply gap
Financial Analysis
866 mm lbs of Copper sold in 4Q20 and 3202 mm lbs for FY20 at $2.95 with cost of $1.88 (cash cost of $1.48)
Revenues of $4.5 billion vs $3.8 billion for 3Q20. FY20 revenues of $14.2 billion vs $14.4 billion in FY19
Net income of $0.7 billion vs $0.3 billion for 3Q20. FY20 net income of $0.6 billion vs $0.2 billion net loss in FY19
$9.7 billion in debt with no payment due in 2021 and 71% of it due after 2025
$3.7 billion in cash
Shift towards more gold production in comparison to Copper
Shift from North American mines to South American and Indonesian mines which are more profitable
FY20 Cash cost per lbs in Indonesia $0.43 vs $1.81 in North America
25% of sales from Indonesia in FY20, expected to be 34% in FY21
Currency and political risks
Read the full analysis here: https://ishfaaqpeerally.teachable.com/courses/662813/lectures/30002285