Lundin cuts Caserones copper outlook a second time

Lundin Mining (TSX: LUN; Nasdaq Stockholm: LUMI) has cut 2026 copper production guidance at its Caserones mine in Chile for a second time this year, to 105,000 to 115,000 tonnes from 120,000 to 130,000 tonnes, after snowmelt slowed haulage and limited the volume of ore delivered to the mill.

The company first lowered the Caserones target on August 18, to 120,000 to 130,000 tonnes from an original 130,000 to 140,000 tonnes, after severe winter storms. Group copper guidance is now 285,000 to 310,000 tonnes, from 300,000 to 325,000 tonnes. Gold guidance of 134,000 to 149,000 ounces and consolidated cash-cost guidance of $1.95 to $2.15 a pound were left unchanged, as was Caserones cash-cost guidance of $2.15 to $2.35 a pound. The group reduction matches the 15,000-tonne cut at both ends of the Caserones range.

Prolonged power outages in July and August halted operations at Caserones for about 30 days, including the time needed to thaw flotation banks and turn over the mills, and each restart was followed by a progressive ramp-up. The impact has continued into the fourth quarter as snowmelt reduced haulage rates.

"Importantly, these are deferred tonnes rather than lost production, and we expect to see a recovery in operational performance through 2027," president and chief executive Jack Lundin said in the company's statement.

The mine produced 15,015 tonnes of copper in the third quarter, against 35,270 tonnes a year earlier. Group output was 62,610 tonnes, down from 84,999 tonnes, at a consolidated cash cost of $2.01 a pound, inside the unchanged full-year range of $1.95 to $2.15. Gold production was 36,763 ounces.

Revenue was $1,109.2 million, with a realized copper price of $6.85 a pound that the company said was a record and a realized gold price of $4,321 an ounce. Adjusted earnings were $276.5 million, or $0.32 a share, compared with net earnings attributable to shareholders of $228.9 million, or $0.27 a share. The adjusted figure beat the $0.30-a-share average of six analysts surveyed by Zacks Investment Research, the Associated Press reported. Adjusted EBITDA was $647.7 million. Those results came despite the sharp third-quarter drop in Caserones throughput. Lundin held net cash of $237 million at September 30 and about $200 million as of November 4.

Lundin released the results after the close on Wednesday. Its shares last closed at C$31.67 in Toronto, up 5.9% on the day and before the guidance cut was published. Toronto trading had not opened on Thursday morning as this was written.

The company cut its 2026 capital expenditure guidance to $980 million from $1.03 billion.

At Candelaria in Chile, copper production was 34,954 tonnes in the third quarter, up from 30,928 tonnes in the second quarter. Chapada in Brazil produced 12,641 tonnes of copper and 16,921 ounces of gold, its highest quarterly totals of the year, the company said.

At the Vicuña project, a 50/50 joint operation with BHP (NYSE, LON, ASX: BHP) on the Argentina-Chile border, Lundin said it secured the Vicuña Provincial Agreement with the government of San Juan and received approval from Argentina's National Gas and Electricity Regulatory Entity to build a high-voltage power line. The company said its technical team is advancing all aspects of the project to target a sanction decision as early as the end of this year.

(With files from the Associated Press)