S&P/ASX 200 Index (ASX: XJO) mining stock Sandfire Resources Ltd (ASX: SFR) is under selling pressure today.
Sandfire Resources shares closed yesterday trading for $8.82. That saw the stock up 37.8% in 12 months.
But investors are favouring their sell buttons today, with Sandfire shares currently changing hands for $8.60, down 2.5%.
For some context, the ASX 200 is down 0.5% at this same time.
Today's underperformance comes following the release of Sandfire's full year financial results (FY 2024).
Here are the highlights.
Sandfire share price slides amid ongoing losses
- Sales revenue of $935 million, up 16% from FY 2023
- Profit before tax and net finance expense of $53 million, up from a $5 million loss the prior year
- Loss after tax of $19 million, a 66% decrease from losses posted in FY 2023
- Underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) of $362 million, up 40% year on year
- Underlying earnings loss of $5.5 million, an 88% decrease on the FY 2023 losses
What else happened with the ASX 200 mining stock in FY 2024?
The ASX 200 mining stock, primarily focused on copper, reported a 47% increase in FY 2024 Copper Equivalent (CuEq) production from continuing operations to 133.5kt. Although this did come in 1.1% below Sandfire's full-year copper production guidance
Underlying operating costs from continuing operations of $501 million, however, beat guidance by 3.8%.
Sandfire said the "near faultless ramp-up" of its Motheo Copper Mine, located in Botswana, underpinned a return to profitability in the June half-year.
The ASX 200 mining stock expects Motheo's underlying operating (unit) cost to remain unchanged at $42 per tonne of ore processed.
As for Sandfire's MATSA mining operations in Spain, underlying operating (unit) costs are expected to remain below the initial FY 2024 guidance at $75 per tonne of ore processed.
FY 2024 also saw Sandfire reduce its net debt by $34 million to $396 million as at 30 June. The company cited the establishment of a $200 million corporate revolver facility for significantly improving its financial flexibility.
The board opted not to declare a dividend. Sandfire last paid a dividend in March 2022.
What did management say?
Commenting on the results that have yet to boost the ASX 200 mining stock today, Sandfire CEO Brendan Harris said, "The transformation of our business continued to gather momentum in the last 12 months."
Harris added:
Collectively, the successful ramp-up of Motheo, record underground performance at MATSA and strong cost control more broadly, underpinned a 16% increase in sales revenue to $935 million and a 40% increase in underlying EBITDA to $362 million.
This included a return to profitability in the second half and a reduction in our net debt to $396 million at year end.
What's next for the ASX 200 mining stock?
Looking at what might impact the ASX 200 mining stock in the year ahead, Sandfire expects Motheo to increase copper equivalent production by 31% in FY 2025 and generate strong free cash flow.
And the miner expects copper demand to grow.
"As the most efficient conductor of electricity, we believe demand for copper will only grow as the world responds to the impacts of climate change," Harris said.
Sandfire forecasts Copper Equivalent production to increase by 13% in FY 2025 and to "progressively return the company's balance sheet to a net cash position".
Sandfire share price snapshot
With today's intraday fall in the Sandfire share price factored in, the ASX 200 mining stock remains up 34.5% over 12 months.
