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Oz Minerals share price higher after quarterly results

The Oz Minerals Ltd (ASX: OZL) share price has risen 1.5% higher in early trade despite the company reporting lower third-quarter production results.

What did Oz Minerals announce?

Contained copper produced totalled 24,663 tonnes, representing a 13.54% decline from the June quarter.

Oz Minerals’ contained gold produced did climb 12.09% to 30,346 tonnes in a positive boost for the group.

The company’s all-in sustaining cost (AISC) edged higher to US128 cents per pound (c/lb), up from 120 c/lb in Q2 2019.

The Oz Minerals share price will be one to watch given its copper and gold production has historically climbed higher in Q3 2019.

The company’s cash position was boosted $9 million higher as working capital expenditure fell from the June quarter.

What’s the outlook like for Oz Minerals?

Growth in capital expenditure is expected to reduce the company’s cash balance as we enter the final quarter of the year.

Oz Minerals’ also flagged a lower ore inventory balance as it processes Prominent Hill open pit ore stockpiles through to mid-2023.

Prominent Hill AISC edged higher from US108 c/lb to US117 c/lb largely due to increased paste filling and lower grade copper processing.

However, Oz Minerals’ expects AISC to be towards the bottom of its US 110c – US 120c per pound for the full-year.

Positively, the company noted copper and gold production remain on-track for annual guidance levels.

The company’s Explorer Challenge target drilling is set to commence in early Q4 2019 with hopes of further strong results.

How has the Oz Minerals share price performed?

The Oz Minerals share price opened at $9.75 per share this morning, having climbed 10.89% higher since January.

That represents nearly half of the capital gains posted by the S&P/ASX200 Index (INDEXASX: XJO) performance over the same period.

The Oz Minerals share price has also been volatile in 2019, climbing as high as $11.04 in April 2019.

Given a yield of 2.40% per annum, I think BHP Group Ltd (ASX: BHP) could be a better mining sector buy in 2020.

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Motley Fool contributor Kenneth Hall 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.

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