Buenaventura Mining CO (BVN) Q2 FY26 earnings call: guidance and Q&A

How are mining and processing performing relative to the block model at San Gabriel, and what further steps are needed to optimize throughput and recoveries to reach steady state?

Underground mining is on plan, with new fleets coming. Processing faces challenges with press filters for tailings (requiring structural reinforcement, $5M-$10M CapEx) and gold recoveries (due to organic matter/sulfides, requiring new reagents and a $15M flotation circuit by end of 2027). Target 70% recovery by end of 2026, 85% by end of 2027.

“We are already in the cut [indiscernible] field. We are already in the first undercut beneath the original mining layer with cemented backfill. So we are doing okay according to the plan. We are ramping up production.”

asked by Tanya Jakusconek · answered by Juan Ortiz Zevallos

Beyond diesel prices and royalties, are there other inflationary pressures on labor, consumables, or supply chain affecting costs?

No major inflation effects are foreseen. Diesel prices could impact OpEx by 5% to 7%. Workers' profit sharing is slightly increasing costs, but energy, reagents, and other consumables are stable.

“We don't see or we don't foresee at this point in time any major inflation effects. As we were speaking last quarter, the impact of higher diesel prices had an effect of around 5% in our OpEx, probably having diesel at the same levels as the last quarter, the impact could be around 5% to 7%.”

asked by Tanya Jakusconek · answered by Daniel Dominguez Vera

What are the updated expectations for Cerro Verde dividends for 2026 and 2027, given strong performance?

For FY26, $274 million has been received YTD, with an additional $50 million to $100 million expected, totaling $350 million to $380 million. For FY27, a similar level of around $300 million is expected, depending on copper prices.

“So in total, we should be receiving between $350 million, $380 million of total dividends for this year. Probably Yes, depending on the price, could be $50 million or $80 million less.”

asked by Tanya Jakusconek · answered by Daniel Dominguez Vera

What are the CapEx and OpEx implications of the initiatives to address San Gabriel's challenges, and what are the overall CapEx expectations for this year and next?

Total CapEx for FY26 is expected to be around $500 million, with $200M-$220M spent in H1. San Gabriel-specific CapEx for the rest of the year is around $60 million, including $5M-$10M for tailings filter reinforcement and $15M for a future flotation circuit. OpEx impact from these initiatives is not material, maybe $1-$2 per ton for the flotation circuit.

“the total CapEx we expect to spend this year is around $500 million. We already have expended in the first half around $200 million, $220 million. All the investment we have to do in San Gabriel and El Brocal and all our flagships are according to what we expected in the guidelines.”

asked by Carlos De Alba · answered by Leandro Raggio

What is the expected copper production for Cerro Verde this year and next, and will Buenaventura's percentage of production change?

Cerro Verde produced 187,000 tons of fine copper in H1 2026. Full-year 2026 production is expected to be around 370,000 to 380,000 tons. Buenaventura's share (40,000 tons of concentrate) will not change.

“the production of the 6 months of 2026 is about 187,000 tons of fine copper, 187,000. Probably it's a very steady operation, probably we can expect the same production for the remaining 6 months of 2026. So it's going to be around 370,000, 380,000 tons of copper for 2026.”

asked by Carlos De Alba · answered by Juan Ortiz Zevallos

How will the approved 20% increase in Yumpag's throughput impact silver production and the cost structure?

The 20% throughput increase (from 1,000 tpd to 1,200 tpd) is expected to lead to a 10% increase in silver production for H2 FY26. This, combined with connecting to the national electrical grid by Q4 FY26, will result in a 15% to 17% reduction in operating costs compared to H1 FY26.

“We expect that 10% increase of what we were thinking at the beginning of the year. The effect is going to be a cost reduction in the order of 15% to 17% lower than the operating cost of the initial -- the first half of the year.”

asked by Cesar Perez-Novoa · answered by Leandro Raggio

Given high copper prices and strong cash flow, is there scope to accelerate the development timeline for the Trapiche copper greenfield project?

The opportunity to exploit primary sulfides at Trapiche is becoming more realistic due to higher copper prices. The company will spend the next 1.5 years assessing the business case, reducing project risks (access roads, power lines, licenses), and conducting deeper asset consumption analysis.

“due to the increase in copper prices, the opportunity of exploiting the primaries, which is -- which are currently open underneath the secondary sulfides, it becomes -- it's getting closer to a reality. So we are going to be spending the next year, 1.5 years in understanding if it's a business.”

asked by Cesar Perez-Novoa · answered by Renzo Macher

Has El Nino had any operational impact to date, and what are the concerns and mitigation plans for future effects?

No damage to date. The company has identified risks, established committees at each mine, and authorized an additional $12 million in CapEx for 2026 for prevention. This includes increased pumping capacity, water treatment, and reinforcement of critical structures to prepare for heavy rainfall expected in the next rainy season starting December 2026.

“So far, we haven't had any damage like probably you heard the news about the damage for heavy rainfalls in Chile. We don't have that in Peru. But we are preparing for probably a strong rainfall in the next rainy season starting in December 2026.”

asked by Cesar Perez-Novoa · answered by Juan Ortiz Zevallos