In morning trade the OZ Minerals Limited (ASX: OZL) share price has drifted lower following the release of its first quarter update.
At the time of writing the copper miner’s shares are down 0.5% to $10.55.
What happened in the first quarter?
In the first quarter OZ Minerals produced 27,442 tonnes of copper across its operations. This puts the company on course to achieve its full year production guidance of 97,000 tonnes to 109,000 tonnes.
The company’s gold production was also strong, with 34,648 ounces produced during the quarter. This also puts the company’s gold operations on course to achieve guidance of between 118,000 to 131,000 ounces.
This was all achieved at an all-in sustaining cost of 104 U.S. cents per pound, which compares favourably to its full year guidance of 110-120 U.S. cents per pound.
Managing director and CEO, Andrew Cole, was pleased with the company’s start to the year.
He said: “The year has started strongly. Carrapateena underground development has now reached first ore, Prominent Hill is on track for annual guidance and we have continued to progress our growing pipeline of projects and studies.”
Before adding: “Underground development at Carrapateena remains critical path and we are continuing to see development rates increase as additional work areas come on-line. The minerals processing plant and non-processing infrastructure construction have all continued on schedule and the project is on track for commissioning in Q4.”
Should you invest?
I thought this was a strong quarter from OZ Minerals and goes some way to justifying its strong share price gain in 2019. Prior to today the OZ Minerals share price was up just under 23% since the start of the year.
If you’re confident with copper and gold prices over the medium term then I would suggest you consider an investment in its shares. But if you’re uncertain but still want exposure to the resources sector, then diversified miners such as BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO) might be better options.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.