FORM 6-K

 

SECURITIES AND EXCHANGE COMMISSION

 

Washington, D.C. 20549

 

Report of Foreign Issuer

 

Pursuant to Rule 13a-16 or 15d-16 of the

 

Securities Exchange Act of 1934

 

For the month of October 2016

 

BUENAVENTURA MINING COMPANY INC.

 

(Translation of Registrant's Name into English)

 

CARLOS VILLARAN 790

 

SANTA CATALINA, LIMA 13, PERU

 

(Address of Principal Executive Offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F x Form 40-F ¨

 

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

 

Yes ¨  No x

 

 If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-________________.

 

 

 

 

 

 

 

 

 

 

Buenaventura Announces Third Quarter and

Nine-Month 2016 Results

 

Lima, Peru, October 27, 2016 – Compañia de Minas Buenaventura S.A.A. (“Buenaventura” or “the Company”) (NYSE: BVN; Lima Stock Exchange: BUE.LM), Peru’s largest publicly-traded precious metals mining company, announced today results for the third quarter (3Q16) and nine-month (9M16) periods ended September 30, 2016. All figures have been prepared in accordance with IFRS (International Financial Reporting Standards) on a non GAAP basis and are stated in U.S. dollars (US$).

 

Third Quarter 2016 Highlights:

 

· In 3Q16, EBITDA from direct operations was US$83.3 million compared to US$5.6 million reported in 3Q15. Adjusted EBITDA (including associated companies) increased 99% (US$ 134.6 million in 3Q16 compared to the US$ 67.6 million in 3Q15).

 

· All in Sustaining Cost (AISC*) decreased 51% in 3Q16 (US$ 570/oz) compared to 3Q15 (US$ 1,171/oz).

 

· At El Brocal, we expect an improvement in 4Q16 due to i) higher ore treated, ii) higher zinc grade and better commercial terms.

 

· Net income in 3Q16 was negative US$ 24.7 mainly due to El Brocal and Yanacocha results.

 

· Production from direct operations in 3Q16 was 93k gold ounces and 5.8 million silver ounces, higher compared to 89k gold ounces and 5.6 million silver ounces in 3Q15.

 

· The Tambomayo project remains in-line with schedule and budget. Total project progress is at 96%. Production ramp up is expected to begin in December 2016.

 

· Buenaventura´s Net debt/EBITDA ratio has been reduced to 2x. By the end of the year, we expect a ratio of 1.6x-1.9x.

 

· Dividend payment to be resumed (US$ 0.030 per share/ADS).

 

Financial Highlights (in millions of US$, except EPS figures) :

 

  3Q16 3Q15 Var% 9M16 9M15 Var%
Total Revenues 269.0 211.0 28% 781.7 694.4 13%
Operating Profit 34.7 -54.2 N.A. 107.4 -93.5 N.A.
EBITDA Direct Operations 83.3 5.6 1391% 252.9 80.2 215%
Adjusted EBITDA (Inc Associates) 134.6 67.6 99% 468.5 303.8 54%
Net Income -24.7 -23.2 6% 82.4 -24.7 N.A.
EPS** -0.10 -0.09 6% 0.32 -0.10 N.A.

 

(*) See Appendix 5

(**) as of September 30, 2016 Buenaventura had 253,986,867 outstanding shares.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  2 of 23

 

Operating Revenues

 

During 3Q16, net sales were US$263.1 million, a 30% increase compared to the US$202.3 million reported in 3Q15. This result was mainly explained by an increase in all metal prices as well as higher volume sales of copper, zinc and lead.

 

Royalty income decreased 32% from US$8.7 million in 3Q15 to US$5.9 million in 3Q16 as a result of lower revenues at Yanacocha.

 

Operating Highlights 3Q16 3Q15 Var% 9M16 6M15 Var%

Net Sales

(in millions of US$)

263.1 202.3 30% 763.2 669.2 14%
Average Realized Gold Price (US$/oz) (1) (2) 1,334 1,103 21% 1,275 1,169 9%
Average Realized Gold Price (US$/oz) inc. Affiliates (3) 1,338 1,112 20% 1,267 1,172 8%
Average Realized Silver Price (US$/oz) (1) (2) 20.83 14.50 44% 17.60 15.34 15%
Average Realized Lead Price (US$/MT) (1) (2) 1,950 1,593 22% 1,839 1,734 6%

Average Realized

Zinc Price (US$/MT) (1) (2)

2,460 1,775 39% 2,092 1,998 5%
Average Realized Copper Price (US$/MT) (1) (2) 4,820 3,723 29% 4,666 4,599 1%
             
Volume Sold 3Q16 3Q15 Var% 9M16 6M15 Var%
Gold Oz Direct Operations (1) 94,539 91,370 3% 268,280 271,479 -1%
Gold Oz inc Associated Companies (3) 173,291 217,320 -20% 520,267 618,138 -16%
Silver Oz (1) 4,975,143 4,801,621 4% 15,924,538 14,239,819 12%
Lead MT (1) 7,138 6,409 11% 21,374 22,086 -3%
Zinc MT (1) 15,040 12,543 20% 42,866 39,442 9%
Copper MT (1) 11,225 7,456 51% 32,895 19,917 65%

 

(1) Buenaventura’s Direct Operations includes 100% of Buenaventura’s operating units, 100% of La Zanja and 100% of El Brocal
(2) The realized price considers the adjustments of quotational periods
(3) Considers 100% of Buenaventura’s operating units, 100% of La Zanja, 100% of El Brocal, 40.95% of Coimolache and 43.65% of Yanacocha

 

For 9M16, net sales increased 14%, from US$669.2 million in 9M15 to US$763.2 million in 9M16. Royalty income for 9M16 was US$18.5 million, lower than US$25.2 million during 9M15.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  3 of 23

 

Production and Operating Costs

 

In 3Q16, Buenaventura’s gold equity production from direct operations was 4% higher compared to the figure reported in 3Q15 (92,571 gold ounces in 3Q16 vs 88,669 gold ounces in 3Q15). Gold production including associated companies in 3Q16 was 156,905 ounces, 19% lower than the amount reported in the same period 2015. This decline is explained by a decrease in production from Yanacocha. Silver equity production from direct operations increased 5%, mainly due to higher production at the Uchucchacua mine and the Mallay mine.

 

Equity Production 3Q16 3Q15 Var% 9M16 9M15 Var%
Gold Oz Direct Operations (1) 92,571 88,669 4% 257,280 254,195 1%
Gold Oz including Associated Companies 156,905 194,500 -19% 468,222 562,553 -17%
Silver Oz Direct Operations (1) 5,840,913 5,583,565 5% 17,575,037 15,232,580 15%
Silver Oz including Associated Companies 6,099,334 5,716,336 7% 18,290,013 15,624,885 17%
Lead MT 7,087 6,542 8% 21,135 19,697 7%
Zinc MT 13,175 10,047 31% 35,819 31,502 14%
Copper MT Direct Operations (1) 7,608 5,187 47% 20,978 12,640 66%
Copper MT including Associated Companies 31,128 16,115 93% 93,361 42,275 121%
             
Consolidated Production 3Q16 3Q15 Var% 9M16 9M15 Var%
Gold Oz (2) 96,271 92,870 4% 269,563 267,080 1%
Silver Oz (2) 5,980,514 5,854,489 2% 18,024,485 16,248,238 11%
Lead MT (2) 8,156 7,957 3% 24,676 25,148 -2%
Zinc MT (2) 18,527 15,407 20% 51,179 48,209 6%
Copper MT (2) 12,362 9,525 30% 35,531 23,156 53%
(1) Buenaventura’s Direct Operations includes 100% of Buenaventura’s operating units, 53.06% of La Zanja and 61.32% of El Brocal
(2) Considers 100% of Buenaventura’s operating units, 100% of La Zanja and 100% of El Brocal

 

Orcopampa (100% owned by Buenaventura)

 

Production
    3Q16 3Q15 Var % 9M16 9M15 Var %
Gold Oz 53,167 54,035 -2% 145,129 156,023 -7%
Silver Oz 179,210 146,930 22% 492,810 392,541 26%
               
Cost Applicable to Sales
    3Q16 3Q15 Var % 9M16 9M15 Var %
Gold US$/Oz 660 636 4% 682 676 1%

 

Gold production at Orcopampa decreased 2% in 3Q16 (compared to 3Q15) mainly due to lower ore grade (see Appendix 2). Cost Applicable to Sales (CAS) in 3Q16 (660 US$/Oz) increased 4% compared to 3Q15 (636 US$/Oz), mainly due to higher exploration expenses in order to increase resources at the Pucara and the Lucia area.

 

Gold production guidance for 2016 is 190k – 200k ounces.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  4 of 23

 

Uchucchacua (100% owned by Buenaventura)

 

Production
    3Q16 3Q15 Var% 9M16 9M15 Var%
Silver Oz 4,086,850 3,775,051 8% 12,170,024 9,801,413 24%
Zinc MT 1,950 1,293 51% 5,566 4,090 36%
Lead MT 2,772 2,340 18% 7,869 5,869 34%
               
Cost Applicable to Sales
    3Q16 3Q15 Var% 9M16 9M15 Var%
Silver US$/Oz 11.06 13.56 -18% 10.84 14.47 -25%

 

Silver production in 3Q16 increased 8% compared to 3Q15, due to higher volumes of ore treated and higher ore grade (see Appendix 2). Cost Applicable to Sales (CAS) in 3Q16 decreased 18% compared to 3Q15, an improvement primarily explained by i) Increasing efficiencies as a result of massive mining using the bench & fill method and ii) lower reagent prices and consumption.

 

Silver production guidance for 2016 is 15.5 million – 16.5 million ounces.

 

Mallay (100% owned by Buenaventura)

 

Production
    3Q16 3Q15 Var% 9M16 9M15 Var%
Silver Oz 412,526 323,095 28% 1,252,490 928,126 35%
Zinc MT 2,740 2,445 12% 8,137 6,765 20%
Lead MT 1,965 1,925 2% 5,907 5,353 10%
Gold Oz 420 259 62% 1,460 396 268%
               
Cost Applicable to Sales
    3Q16 3Q15 Var% 9M16 9M15 Var%
Silver US$/Oz 13.05 13.99 -7% 12.55 13.96 -10%

 

Silver production in 3Q16 increased 28% compared to 3Q15, mainly due to increased amounts ore treated (see Appendix 2). Cost Applicable to Sales (CAS) in 3Q16 was 7% lower compared to 3Q15 mainly due to more volume sold.

 

Silver production guidance for 2016 is 1.5 million – 1.9 million ounces.

 

Julcani (100% owned by Buenaventura)

 

Production
    3Q16 3Q15 Var% 9M16 9M15 Var%
Silver Oz 782,813 794,810 -2% 2,473,802 2,397,790 3%
               
Cost Applicable to Sales
    3Q16 3Q15 Var% 9M16 9M15 Var%
Silver US$/Oz 11.86 12.94 -8% 11.32 12.70 -11%

 

Silver production in 3Q16 is in line with the figure reported in 3Q15. Cost Applicable to Sales (CAS) in 3Q16 was 8% lower than 3Q15, an improvement primarily mainly explained by higher volume sold and lower commercial deductions.

 

Silver production guidance for 2016 is 3.0 million – 3.4 million ounces.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  5 of 23

 

La Zanja (53.06% owned by Buenaventura)

 

Production
    3Q16 3Q15 Var % 9M16 9M15 Var %
Gold Oz 37,407 35,653 5% 106,984 103,362 4%
Silver Oz 50,309 78,844 -36% 159,012 241,969 -34%
               
Cost Applicable to Sales
    3Q16 3Q15 Var % 9M16 9M15 Var %
Gold US$/Oz 641 906 -29% 568 838 -32%

 

Gold production in 3Q16 increased 5% compared to 3Q15. CAS in 3Q16 decreased 29% compared to 3Q15, an improvement primarily due to i) lower headcount generated by new synergies with Tantahuatay mine, ii) lower reagent and explosives prices and consumption, and iii) lower contractor expenses resulting from more favorable prices.

 

Gold production guidance for 2016 is 130k – 140k ounces.

 

Tantahuatay (40.10% owned by Buenaventura)

 

Production
    3Q16 3Q15 Var % 9M16 9M15 Var %
Gold Oz 39,595 34,739 14% 110,890 97,085 14%
Silver Oz 162,983 259,433 -37% 587,551 598,392 -2%
               
Cost Applicable to Sales
    3Q16 3Q15 Var % 9M16 9M15 Var %
Gold US$/Oz 527 484 9% 476 542 -12%

 

Gold production in 3Q16 increased 14% compared to the figure reported in 3Q15. CAS in 3Q16 increased 9% compared to 3Q15 mainly due to an inventory write-down and higher exploration expenses.

 

Gold production guidance for 2016 is 145k – 155k ounces

 

El Brocal (61.32%* owned by Buenaventura)

 

Production
    3Q16 3Q15 Var % 9M16 9M15 Var %
Copper MT 12,291 9,446 30% 35,312 22,895 54%
Zinc MT 13,836 11,670 19% 37,477 37,353 0%
Silver Oz 468,806 735,760 -36% 1,476,348 2,486,399 -41%
               
Cost Applicable to Sales
    3Q16 3Q15 Var % 9M16 9M15 Var %
Copper US$/Lb 2.17 2.34 -7% 2.18 2.39 -9%
Zinc US$/Lb 0.92 0.83 12% 0.80 0.75 7%

 

During 3Q16, copper production increased 30% compared to 3Q15, due to a higher ore volume treated and ore grade. Moreover, in 3Q16 zinc production increased 19% as a result of higher ore treated.

 

(*) Since August 2016, the new ownership of El Brocal is 61.32%.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  6 of 23

 

In 3Q16, zinc Cost Applicable to sales (CAS) increased 12% compared to 3Q15 mainly due to lower ore grade and lower silver by-product contribution. Copper CAS in 3Q16 decreased 7% compared to 3Q15 mainly due higher ore grade and lower commercial deductions per ton resulting from the renegotiation of commercial contracts.

 

Zinc production guidance for 2016 is 55k – 65k MT, while copper production guidance for 2016 is 40k – 50k MT.

 

General and Administrative Expenses

 

General and administrative expenses in 3Q16 were US$16.9 million, 15% lower compared to the US$19.8 million in 3Q15. For 9M16, the expense was US$58.0 million (US$58.8 million in 9M15).

 

Exploration in Non-Operating Areas

 

Exploration costs in non-operating areas during 3Q16 were US$6.4 million compared with US$5.3 million in 3Q15. During the period, Buenaventura’s main exploration efforts were focused on the Tambomayo project (US$1.75 million), the San Gabriel project (US$1.21 million) and Marcapunta Norte (US$0.32 million). For 9M16, the expense was US$14.8 million (US$25.7 million in 9M15).

 

Share in Associated Companies

 

During 3Q16, Buenaventura’s share in associated companies was negative US$11.9 million, compared to US$13.4 million reported in 3Q15, composed by:

 

Share in the Result of Associates

(in millions of US$)

3Q16 3Q15 Var % 9M16 9M15 Var %
Cerro Verde 9.5 1.3 621% 44.3 10.1 339%
Coimolache 4.9 4.1 20% 17.0 9.1 87%
Yanacocha -26.2 8.0 N.A. -24.1 42.4 N.A.
Total -11.9 13.4 N.A. 37.2 61.6 -40%

 

YANACOCHA

At Yanacocha (43.65% owned by Buenaventura), during 3Q16, gold production was 147,386 ounces, 39% lower than 3Q15 production (242,454 ounces). For 9M16, gold production was 483,258 ounces, 32% lower than 706,433 ounces in 9M15.

 

Gold production guidance at Yanacocha for 2016 is 630k – 660k ounces.

 

In 3Q16, Yanacocha reported a net loss of US$60.1 million compared to a net income of US$18.2 million reported in 3Q15. CAS in 3Q16 was US$1,040/oz, 65% higher than the US$630/oz reported in 3Q15 mainly due to: i) an inventory write-down of US$49.4 million in 3Q16 (US$19.9 million in 3Q15), and ii) lower volume sold (145,582 gold ounces in 3Q16 vs 257,606 gold ounces in 3Q15).

 

Advancing Yanacocha sulfides through Chaquicocha exploration drilling.

 

Capital expenditures at Yanacocha were US$26.7 million in 3Q16, while for 9M16 was US$62.7 million.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  7 of 23

 

CERRO VERDE

 

At Cerro Verde (19.58% owned by Buenaventura), during 3Q16 copper production was 120,124 MT (23,520 MT attributable to Buenaventura), a 115% increase compared to 3Q15 (55,811 MT and 10,928 MT attributable to Buenaventura). For 9M16, copper production was 369,681 MT (72,384 MT attributable to Buenaventura).

 

During 3Q16, Cerro Verde reported a net income of US$48.3 million compared to net income of US$6.7 million in 3Q15. This increase was primarily due to: i) a lower cash cost, and ii) higher volumes sold. For 9M16, net income was US$226.0 million (compared to US$46.5 million in 9M15).

 

Copper production guidance at Cerro Verde for 2016 is 500k MT – 550k MT.

 

COIMOLACHE (Tantahuatay operation)

 

At Coimolache (40.10% owned by Buenaventura), attributable contribution to net income in 3Q16 was US$4.9 million (US$4.1 million in 3Q15). For 9M16, the contribution was US$17.0 million, compared to US$9.1 million reported in 9M15.

 

Project Development and Exploration

 

The Tambomayo Project (100% ownership)

· Proyect is on schedule and within budget
· Total CAPEX: US$ 340 M
· Overall project progress is at 96% (As of September 2016)
o Exploration and mine development are completed (100% of progress).
o The construction progress of the facilities is at 93%.
· The following facilities have been completed and already commissioned:
o Tailings dam
o Water dam
o Power line and substations
o Access road
o Crusher and stockpile area

 

The San Gabriel Project (100% ownership)

· Environmental Impact Assessment (EIA) of the project´s construction is expected to be approved in December 2016.
· Objectives for 4Q16:
o Drilling program: 3,000 meters in order to confirm resources and certainty
o Complete Metallurgical studies to be completed in order to improve recovery

 

Other

 

During the October 27, 2016 meeting, the Board of Directors meeting passed the following resolution:

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  8 of 23

 

· Declaration of cash dividend of US$ 0.030 per share or ADS, payable on November 30, 2016

 

* * *

 

Company Description

Compañía de Minas Buenaventura S.A.A. is Peru’s largest, publicly traded, precious metals company and a major holder of mining rights in Peru. The Company is engaged in the mining, processing, development and exploration of gold and silver and other metals via wholly owned mines as well as through its participation in joint exploration projects.

 

Buenaventura currently operates several mines in Peru (Orcopampa*, Uchucchacua*, Mallay*, Julcani*, El Brocal, La Zanja and Coimolache and is developing the Tambomayo project.

 

The Company owns 43.65% of Minera Yanacocha S.R.L (a partnership with Newmont Mining Corporation), an important precious metal producer; 19.58% of Sociedad Minera Cerro Verde, an important Peruvian copper producer.

 

For a printed version of the Company’s 2015 Form 20-F, please contact the investor relations contacts on page 1 of this report, or download the PDF format file from the Company’s web site at www.buenaventura.com.

 

(*) Operations wholly owned by Buenaventura

 

Note on Forward-Looking Statements

This press release may contain forward-looking information (as defined in the U.S. Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties, including those concerning the Company’s, Yanacocha’s and Cerro Verde’s costs and expenses, results of exploration, the continued improving efficiency of operations, prevailing market prices of gold, silver, copper and other metals mined, the success of joint ventures, estimates of future explorations, development and production, subsidiaries’ plans for capital expenditures, estimates of reserves and Peruvian political, economic, social and legal developments. These forward-looking statements reflect the Company’s view with respect to the Company’s, Yanacocha’s and Cerro Verde’s future financial performance. Actual results could differ materially from those projected in the forward-looking statements as a result of a variety of factors discussed elsewhere in this Press Release.

 

**Tables to follow**

APPENDIX 1

 

Equity Participation in

Subsidiaries and Associates (as of September 30, 2016)

  BVN Operating
  Equity % Mines / Business
El Molle Verde S.A.C* 100.00 Trapiche project
Minera La Zanja S.A* 53.06 La Zanja
Sociedad Minera El Brocal S.A.A* 61.32 Colquijirca and Marcapunta
Compañía Minera Coimolache S.A ** 40.10 Tantahuatay
Minera Yanacocha S.R.L ** 43.65 Yanacocha
Sociedad Minera Cerro Verde S.A.A ** 19.58 Cerro Verde
Processadora Industrial Rio Seco S.A* 100.00 Rio Seco chemical plant
Consorcio Energético de Huancavelica S.A* 100.00 Energy – Huanza Hydroelectrical plant
Buenaventura Ingenieros S.A* 100.00 Engineering Consultant

 

(*)Consolidates

(**) Equity Accounting

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  9 of 23

 

APPENDIX 2

 

    GOLD PRODUCTION
    3Q16 3Q15 % 9M16 9M15 %
Mining Unit Operating Results Underground
Orcopampa Ore Milled  DMT 121,714 114,509 6% 350,643 337,344 4%
  Ore Grade OZ/MT 0.42 0.49 -14% 0.42 0.48 -11%
  Recovery Rate % 97.0% 95.2% 2% 96.0% 95.8% 0%
  Ounces Produced* 53,167 54,035 -2% 145,129 156,023 -7%
Mining Unit Operating Results Open Pit
La Zanja Ounces Produced 37,407 35,653 5% 106,984 103,362 4%
Tantahuatay Ounces Produced 39,595 34,739 14% 110,890 97,085 14%
               
    SILVER PRODUCTION
    3Q16 3Q15 % 9M16 9M15 %
Mining Unit Operating Results Underground
Uchucchacua Ore Milled  DMT 320,838 310,733 3% 943,460 803,255 17%
  Ore Grade OZ/MT 15.15 14.56 4% 15.37 14.57 6%
  Recovery Rate % 84.1% 83.5% 1% 83.9% 83.8% 0%
  Ounces Produced 4,086,850 3,775,051 8% 12,170,024 9,801,413 24%
Julcani Ore Milled  DMT 42,647 44,937 -5% 131,425 132,924 -1%
  Ore Grade OZ/MT 18.96 18.51 2% 19.60 18.93 4%
  Recovery Rate % 96.8% 95.5% 1% 96.1% 95.3% 1%
  Ounces Produced 782,813 794,810 -2% 2,473,802 2,397,790 3%
Mallay Ore Milled  DMT 51,463 41,888 23% 152,422 115,312 32%
  Ore Grade OZ/MT 8.39 8.31 1% 8.77 8.57 2%
  Recovery Rate % 93.3% 92.8% 1% 93.7% 94.0% 0%
  Ounces Produced 412,526 323,095 28% 1,252,490 928,126 35%
Mining Unit Operating Results Open Pit
Colquijirca Ounces Produced 277,255 517,648 -46% 937,547 1,781,192 -47%
               
    ZINC PRODUCTION
    3Q16 3Q15 % 9M16 9M15 %
Mining Unit Operating Results Underground
Uchucchacua Ore Milled  DMT 320,838 310,733 3% 943,460 803,256 17%
  Ore Grade % 1.16% 1.03% 13% 1.15% 1.05% 10%
  Recovery Rate % 52.45% 40.5% 29% 51.0% 48.2% 6%
  MT Produced 1,950 1,294 51% 5,566 4,091 36%
Mallay Ore Milled  DMT 51,463 41,888 23% 152,422 115,312 32%
  Ore Grade % 5.93% 6.6% -11% 6.05% 6.64% -9%
  Recovery Rate % 88.5% 87.8% 1% 87.9% 88.5% -1%
  MT Produced 2,740 2,445 12% 8,137 6,765 20%
Mining Unit Operating Results Open Pit
Colquijirca MT Produced 13,836 11,670 19% 37,477 37,353 0%

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  10 of 23

 

APPENDIX 3: EBITDA Reconciliation (in thousand US$)

 

  3Q16 3Q15 9M16 9M15
Net Income -28,366 -39,006 81,355 -60,248
Add / Substract: 111,685 44,596 171,593 140,429
Provision for income tax, net 31,129 -14,297 37,625 -3,934
Share in associated companies by the equity method, net 11,850 -13,381 -37,222 -61,621
Interest income -1,749 -827 -6,061 -2,441
Interest expense 10,911 6,934 26,585 21,078
Loss on currency exchange difference 4,233 3,936 -1,255 7,517
Long Term Compensation provision 336 -12 926 123
Depreciation and Amortization 45,361 59,564 138,041 169,078
Workers´ participation provision 2,878 246 6,572 629
Impairment of long-term lived assets 0 0 0 3,803
Loss from discontinued operations 6,736 2,433 6,382 6,197
EBITDA Buenaventura Direct Operations 83,319 5,590 252,948 80,181
EBITDA Yanacocha (43.65%) -2,817 40,736 42,808 153,251
EBITDA Cerro Verde (19.58%) 41,603 11,906 136,151 44,764
EBITDA Coimolache (40.10%) 12,515 9,402 36,567 25,605
Adjusted EBITDA (Including Associated companies) 134,620 67,634 468,475 303,801

 

Note:

EBITDA (Buenaventura Direct Operations) consists of earnings before net interest, taxes, depreciation and amortization, share in associated companies, net, loss on currency exchange difference, other, net, provision for workers’ profit sharing and provision for long-term officers’ compensation.

 

EBITDA (including associated companies) consists of EBITDA (Buenaventura Direct Operations), plus (1) Buenaventura’s equity share of EBITDA (Yanacocha) (2) Buenaventura’s equity share of EBITDA (Cerro Verde), plus (3) Buenaventura’s equity share of EBITDA (Coimolache). All EBITDA mentioned were similarly calculated using financial information provided to Buenaventura by the associated companies.

 

Buenaventura presents EBITDA (Buenaventura Direct Operations) and EBITDA (including affiliates) to provide further information with respect to its operating performance and the operating performance of its equity investees, the affiliates. EBITDA (Buenaventura Direct Operations) and EBITDA (including affiliates) are not a measure of financial performance under IFRS, and may not be comparable to similarly titled measures of other companies. You should not consider EBITDA (Buenaventura Direct Operations) and EBITDA (including affiliates) as alternatives to operating income or net income determined in accordance with IFRS, as an indicator of Buenaventura’s, affiliates operating performance, or as an alternative to cash flows from operating activities, determined in accordance with IFRS, as an indicator of cash flows or as a measure of liquidity.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  11 of 23

 

APPENDIX 4: COST APPLICABLE TO SALES RECONCILIATION

 

Reconciliation of Costs Applicable to Sales and Cost Applicable to Sales per Unit Sold

 

Cost applicable to sales consists of cost of sales, excluding depreciation and amortization, plus selling expenses. Cost applicable to sales per unit sold for each mine consists of cost applicable to sales for a particular metal produced at a given mine divided by the volume of such metal produced at such mine in the specified period. We note that cost applicable to sales is not directly comparable to the cash operating cost figures disclosed in previously furnished earnings releases.

 

Cost applicable to sales and Cost applicable to sales per unit of mineral sold are not measures of financial performance under IFRS, and may not be comparable to similarly titled measures of other companies. We consider Cost applicable to sales and Cost applicable to sales per unit of mineral sold to be key measures in managing and evaluating our operating performance. These measures are widely reported in the precious metals industry as a benchmark for performance, but do not have standardized meanings. You should not consider Cost applicable to sales or Cost applicable to sales per unit of mineral sold as alternatives to cost of sales determined in accordance with IFRS, as indicators of our operating performance. Cost applicable to sales and Cost applicable to sales per unit of mineral sold are calculated without adjusting for by-product revenue amounts.

 

The tables below set forth (i) a reconciliation of consolidated Cost of sales, excluding depreciation and amortization to consolidated Cost applicable to sales, (ii) reconciliations of the components of Cost applicable to sales (by mine and mineral) to the corresponding consolidated line items set forth on our consolidated statements of profit or loss for the three and nine months ended September 30, 2015 and 2016, and (iii) reconciliations of Cost of sales, excluding depreciation and amortization to Cost applicable to sales for each of our mining units.  The amounts set forth in Cost applicable to sales and Cost applicable to sales per unit sold for each mine and mineral indicated in the tables below can be reconciled to the amounts set forth on our consolidated statements of profit or loss for the three and nine months ended September 30, 2015 and 2016 by reference to the reconciliations of Cost of sales, excluding depreciation and amortization (by mine and mineral), Selling Expenses (by mine and metal) expenses and Exploration in units in operations (by mine and mineral) to consolidated Cost of sales, excluding depreciation and amortization, consolidated Selling Expenses and consolidated Exploration in units in operations expenses, respectively, set forth below.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  12 of 23

 

Set forth below is a reconciliation of consolidated Cost of sales, excluding depreciation and amortization, to consolidated Cost applicable to sales:

 

  For the 3 months ended Sep 30   For the 9 months ended Sep 30
  2016   2015   2016   2015
  (in thousands of US$)        
Consolidated Cost of sales excluding depreciation and amortization 129,752   145,921   371,545   427,228
Add:              
Consolidated Exploration in units in operation 24,985   20,990   66,206   66,008
Consolidated Commercial deductions 57,590   45,094   171,306   135,147
Consolidated Selling expenses 5,531   4,655   15,646   12,701
Consolidated Cost applicable to sales 217,858   216,660   624,703   641,084

 

Set forth below is a reconciliation of Cost of sales, excluding depreciation and amortization (by mine and mineral) to consolidated Cost of sales:

 

  For the 3 months ended Sep 30   For the 9 months ended Sep 30
  2016   2015   2016   2015
Cost of sales by mine and mineral (in thousands of US$)
Julcani, Gold 9   6   15   40
Julcani, Silver 5,460   3,709   14,545   16,398
Julcani, Lead 464   282   1,345   1,420
Julcani, Copper 9   41   57   189
Mallay, Gold 103   58   454   54
Mallay, Silver 2,476   1,950   7,157   5,784
Mallay, Lead 1,120   1,313   3,620   3,848
Mallay, Zinc 1,883   1,588   5,289   4,933
Orcopampa, Gold 24,293   24,290   66,824   78,317
Orcopampa, Silver 1,136   813   3,173   2,636
Orcopampa, Copper 33   0   42   0
Uchucchacua, Gold 20   16   68   18
Uchucchacua, Silver 20,552   28,758   66,971   78,965
Uchucchacua, Lead 1,185   1,748   3,855   4,653
Uchucchacua, Zinc 990   825   2,946   3,837
La Zanja, Gold 22,964   32,256   64,726   86,549
La Zanja, Silver 369   940   1,208   2,826
El Brocal, Gold 1,600   1,370   5,370   2,542
El Brocal, Silver 2,513   3,861   7,645   14,007
El Brocal, Lead 2,299   2,566   6,718   9,693
El Brocal, Zinc 12,747   11,403   30,718   31,404
El Brocal, Copper 24,852   17,878   70,449   46,358
Non Mining Units 2,675   10,252   8,351   32,757
Consolidated Cost of sales, excluding depreciation and amortization 129,752   145,921   371,545   427,228

 

Set forth below is a reconciliation of Exploration expenses in units in operation (by mine and mineral) to consolidated Exploration expenses in mining units:

 

  For the 3 months ended Sep 30   For the 9 months ended Sep 30
  2016   2015   2016   2015
Exploration expenses in units in operation by mine and mineral (in thousands of US$)
Julcani, Gold 4   4   7   22
Julcani, Silver 2,503   2,582   7,321   8,944
Julcani, Lead 213   196   677   775
Julcani, Copper 4   29   29   103
Mallay, Gold 33   21   157   20
Mallay, Silver 800   699   2,475   2,178
Mallay, Lead 362   470   1,252   1,449
Mallay, Zinc 609   569   1,829   1,857
Orcopampa, Gold 11,680   9,364   29,259   30,664
Orcopampa, Silver 546   313   1,389   1,032
Orcopampa, Copper 16   0   18   0
Uchucchacua, Gold 7   3   20   4
Uchucchacua, Silver 7,336   6,177   19,671   17,087
Uchucchacua, Lead 423   375   1,132   1,007
Uchucchacua, Zinc 353   177   865   830
La Zanja, Gold 94   10   101   35
La Zanja, Silver 2   0   2   1
El Brocal, Gold 0   0   0   0
El Brocal, Silver 0   0   0   0
El Brocal, Lead 0   0   0   0
El Brocal, Zinc 0   0   0   0
El Brocal, Copper 0   0   0   0
Non Mining Units 0   0   0   0
Consolidated Exploration expenses in units in operation 24,985   20,990   66,206   66,008

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  13 of 23

 

Set forth below is a reconciliation of Commercial Deductions in units in operation (by mine and mineral) to consolidated Commercial deductions:

 

  For the 3 months ended Sep 30   For the 9 months ended Sep 30
  2016   2015   2016   2015
Commercial Deductions in units in operation by mine and mineral (in thousands of US$)
Julcani, Gold 2   2   3   11
Julcani, Silver 1,022   1,241   3,892   5,251
Julcani, Lead 87   95   362   447
Julcani, Copper 1   16   20   64
Mallay, Gold 42   29   166   29
Mallay, Silver 1,319   1,083   3,578   2,883
Mallay, Lead 572   732   1,803   1,920
Mallay, Zinc 1,538   1,062   4,210   3,155
Orcopampa, Gold 183   81   331   200
Orcopampa, Silver 66   0   82   0
Orcopampa, Copper 8   0   9   0
Uchucchacua, Gold 8   5   27   5
Uchucchacua, Silver 8,686   9,094   28,325   25,236
Uchucchacua, Lead 491   565   1,620   1,486
Uchucchacua, Zinc 1,458   831   4,201   3,958
La Zanja, Gold 16   77   181   141
La Zanja, Silver 4   12   12   12
El Brocal, Gold 1,939   1,287   6,541   2,922
El Brocal, Silver 1,974   2,646   6,094   9,592
El Brocal, Lead 1,097   1,129   3,418   4,400
El Brocal, Zinc 9,794   5,631   23,747   17,719
El Brocal, Copper 27,281   19,477   82,682   55,717
Non Mining Units 0   0   0   0
Consolidated Commercial deductions in units in operation 57,590   45,094   171,306   135,147

 

Set forth below is a reconciliation of Selling expenses (by mine and mineral) to consolidated Selling expenses:

 

  For the 3 months ended Sep 30   For the 9 months ended Sep 30
  2016   2015   2016   2015
Selling expenses by mine and mineral (in thousands of US$)
Julcani, Gold 0   0   1   2
Julcani, Silver 168   197   554   781
Julcani, Lead 14   15   51   68
Julcani, Copper 0   2   2   9
Mallay, Gold 8   4   33   4
Mallay, Silver 185   147   523   418
Mallay, Lead 84   99   265   278
Mallay, Zinc 141   119   387   357
Orcopampa, Gold 249   192   569   634
Orcopampa, Silver 12   6   27   21
Orcopampa, Copper 0   0   0   0
Uchucchacua, Gold 1   0   3   0
Uchucchacua, Silver 1,014   816   3,036   2,166
Uchucchacua, Lead 58   50   175   128
Uchucchacua, Zinc 49   23   134   105
La Zanja, Gold 294   272   780   927
La Zanja, Silver 5   8   15   30
El Brocal, Gold 93   79   341   133
El Brocal, Silver 146   222   486   733
El Brocal, Lead 134   147   427   507
El Brocal, Zinc 742   654   1,952   1,642
El Brocal, Copper 1,447   1,026   4,476   2,424
Non Mining Units 686   576   1,411   1,334
Consolidated Selling expenses 5,531   4,655   15,646   12,701

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  14 of 23

 

  JULCANI
  3Q 2016 3Q 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 9 5,460 464 - 9 5,942 6 3,709 282 - 41 4,038
Add:                        
Exploration Expenses (US$000) 4 2,503 213 - 4 2,724 4 2,582 196 - 29 2,811
Commercial Deductions (US$000) 2 1,022 87 - 1 1,112 2 1,241 95 - 16 1,353
Selling Expenses (US$000) 0 168 14 - 0 183 0 197 15 - 2 215
Cost Applicable to Sales (US$000) 16 9,153 777 - 15 9,961 12 7,729 588 - 88 8,417
Divide:                        
Volume Sold 21 771,898 726 - 5 Not Applicable 12 597,425 405 - 19 Not Applicable
CAS 776 11.86 1,070 - 2,751 Not Applicable 993 12.94 1,451 - 4,722 Not Applicable
                         
  MALLAY
  3Q 2016 3Q 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 103 2,476 1,120 1,883 - 5,582 58 1,950 1,313 1,588 - 4,908
Add:                        
Exploration Expenses (US$000) 33 800 362 609 - 1,804 21 699 470 569 - 1,759
Commercial Deductions (US$000) 42 1,319 572 1,538 - 3,471 29 1,083 732 1,062 - 2,906
Selling Expenses (US$000) 8 185 84 141 - 418 4 147 99 119 - 369
Cost Applicable to Sales (US$000) 186 4,781 2,138 4,171 - 11,275 112 3,878 2,614 3,338 - 9,942
Divide:                        
Volume Sold 234 366,346 1,845 2,277 - Not Applicable 105 277,157 1,737 2,024 - Not Applicable
CAS 794 13.05 1,159 1,832 - Not Applicable 1,066.11 13.99 1,505 1,649 - Not Applicable
                         
  ORCOPAMPA
  3Q 2016 3Q 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 24,293 1,136 - - 33 25,461 24,290 813 - - - 25,102
Add:         -              
Exploration Expenses (US$000) 11,680 546 - - 16 12,242 9,364 313 - - - 9,678
Commercial Deductions (US$000) 183 66 - - 8 257 81 - - - - 81
Selling Expenses (US$000) 249 12 - - 0 261 192 6 - - - 198
Cost Applicable to Sales (US$000) 36,405 1,759 - - 57 38,221 33,926 1,133 - - - 35,059
Divide:                        
Volume Sold 55,191 182,484 - - 21 Not Applicable 53,376 136,573 - - - Not Applicable
CAS 660 9.64 - - 2,693 Not Applicable 636 8.29 - - - Not Applicable
                         
  UCHUCCHACUA
  3Q 2016 3Q 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 20 20,552 1,185 990 - 22,747 16 28,758 1,748 825 - 31,347
Add:                        
Exploration Expenses (US$000) 7 7,336 423 353 - 8,119 3 6,177 375 177 - 6,733
Commercial Deductions (US$000) 8 8,686 491 1,458 - 10,644 5 9,094 565 831 - 10,495
Selling Expenses (US$000) 1 1,014 58 49 - 1,122 0 816 50 23 - 889
Cost Applicable to Sales (US$000) 36 37,588 2,157 2,850 - 42,632 25 44,845 2,738 1,856 - 49,464
Divide:                        
Volume Sold 51 3,398,654 2,141 1,313 - Not Applicable 23 3,307,909 1,831 815 - Not Applicable
CAS 714 11.06 1,008 2,171 - No Applicable 1,047 13.56 1,496 2,277 - No Applicable
                         
  JULCANI
  9M 2016 9M 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 15 14,545 1,345 - 57 15,963 40 16,398 1,420 - 189 18,047
Add:                        
Exploration Expenses (US$000) 7 7,321 677 - 29 8,035 22 8,944 775 - 103 9,844
Commercial Deductions (US$000) 3 3,892 362 - 20 4,277 11 5,251 447 - 64 5,773
Selling Expenses (US$000) 1 554 51 - 2 608 2 781 68 - 9 860
Cost Applicable to Sales (US$000) 26 26,313 2,436 - 108 28,883 75 31,375 2,710 - 365 34,524
Divide:                        
Volume Sold 31 2,323,633 2,092 - 37 Not Applicable 76 2,471,004 1,804 - 77 No Aplicable
CAS 828 11.32 1,165 - 2,939 No Applicable 984 12.70 1,502 - 4,739 No Applicable
                         
  MALLAY
  9M 2016 9M 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 454 7,157 3,620 5,289 - 16,520 54 5,784 3,848 4,933 - 14,619
Add:                        
Exploration Expenses (US$000) 157 2,475 1,252 1,829 - 5,713 20 2,178 1,449 1,857 - 5,504
Commercial Deductions (US$000) 166 3,578 1,803 4,210 - 9,757 29 2,883 1,920 3,155 - 7,987
Selling Expenses (US$000) 33 523 265 387 - 1,208 4 418 278 357 - 1,057
Cost Applicable to Sales (US$000) 810 13,734 6,940 11,715 - 33,198 108 11,262 7,494 10,302 - 29,167
Divide:                        
Volume Sold 933 1,094,056 5,415 6,802 - Not Applicable 105 806,831 4,847 5,501 - Not Applicable
CAS 868 12.55 1,281 1,722 - No Applicable 1,029 13.96 1,546 1,873 - No Applicable
                         
  ORCOPAMPA
  9M 2016 9M 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 66,824 3,173 - - 42 70,039 78,317 2,636 - - - 80,953
Add:                        
Exploration Expenses (US$000) 29,259 1,389 - - 18 30,666 30,664 1,032 - - - 31,696
Commercial Deductions (US$000) 331 82 - - 9 423 200 0 - - - 200
Selling Expenses (US$000) 569 27 - - 0 596 634 21 - - - 655
Cost Applicable to Sales (US$000) 96,983 4,671 - - 70 101,724 109,815 3,689 - - - 113,504
Divide:                        
Volume Sold 142,272 524,582 - - 24 Not Applicable 162,333 415,757 - - - Not Applicable
CAS 682 8.90 - - 2,885 No Applicable 676 8.87 - - - No Applicable
                         
  UCHUCCHACUA
  9M 2016 9M 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 68 66,971 3,855 2,946 - 73,839 18 78,965 4,653 3,837 - 87,473
Add:                        
Exploration Expenses (US$000) 20 19,671 1,132 865 - 21,689 4 17,087 1,007 830 - 18,929
Commercial Deductions (US$000) 27 28,325 1,620 4,201 - 34,174 5 25,236 1,486 3,958 - 30,685
Selling Expenses (US$000) 3 3,036 175 134 - 3,347 0 2,166 128 105 - 2,399
Cost Applicable to Sales (US$000) 118 118,003 6,782 8,146 - 133,049 27 123,454 7,273 8,731 - 139,486
Divide:                        
Volume Sold 153 10,882,782 6,131 4,041 - Not Applicable 26 8,534,639 4,567 3,230 - Not Applicable
CAS 771 10.84 1,106 2,016 - No Applicable 1,058 14.47 1,593 2,703 - No Applicable

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  15 of 23

 

  LA ZANJA
  3Q 2016 3Q 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 22,964 369 - - - 23,333 32,256 940 - - - 33,196
Add:                        
Exploration Expenses (US$000) 94 2 - - - 96 10 0 - - - 10
Commercial Deductions (US$000) 16 4 - - - 21 77 12 - - - 90
Selling Expenses (US$000) 294 5 - - - 299 272 8 - - - 280
Cost Applicable to Sales (US$000) 23,369 380 - - - 23,749 32,615 961 - - - 33,576
Divide:                        
Volume Sold 36,472 40,097 - - - Not Applicable 35,995 79,267 - - - Not Applicable
CAS 641 9.47 - - - Not Applicable 906 12.12 - - - Not Applicable
                         
  BROCAL
  3Q 2016 3Q 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 1,600 2,513 2,299 12,747 24,852 44,012 1,370 3,861 2,566 11,403 17,878 37,077
Add:                        
Exploration Expenses (US$000) - - - - - - - - - - - -
Commercial Deductions (US$000) 1,939 1,974 1,097 9,794 27,281 42,085 1,287 2,646 1,129 5,631 19,477 30,169
Selling Expenses (US$000) 93 146 134 742 1,447 2,562 79 222 147 654 1,026 2,128
Cost Applicable to Sales (US$000) 3,632 4,634 3,530 23,283 53,580 88,659 2,735 6,729 3,842 17,688 38,380 69,374
Divide:                        
Volume Sold 2,570 215,665 2,426 11,450 11,199 Not Applicable 1,858 403,292 2,436 9,704 7,437 Not Applicable
CAS 1,413 21.49 1,455 2,033 4,785 Not Applicable 1,472 16.68 1,577 1,823 5,161 Not Applicable
                         
  NON MINING COMPANIES
  3Q 2016 3Q 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) - - - - - 2,675 - - - - - 10,252
Add:                        
Selling Expenses (US$000) - - - - - 686 - - - - - 576
Total (US$000) - - - - - 3,361 - - - - - 10,828
                         
  BUENAVENTURA CONSOLIDATED
  3Q 2016 3Q 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 48,989 32,507 5,067 15,620 24,894 129,752 57,995 40,031 5,908 13,816 17,919 145,921
Add:                        
Exploration Expenses (US$000) 11,819 11,187 997 962 20 24,985 9,402 9,771 1,042 746 29 20,990
Commercial Deductions (US$000) 2,190 13,072 2,248 12,790 27,291 57,590 1,480 14,077 2,521 7,524 19,492 45,094
Selling Expenses (US$000) 645 1,530 290 932 1,447 5,531 547 1,396 311 797 1,028 4,655
Cost Applicable to Sales (US$000) 63,644 58,295 8,603 30,304 53,651 217,858 69,424 65,274 9,782 22,883 38,468 216,660
Divide:                        
Volume Sold 94,539 4,975,143 7,138 15,040 11,225 Not Applicable 91,370 4,801,621 6,409 12,543 7,456 Not Applicable
CAS 673 11.72 1,205 2,015 4,780 Not Applicable 760 13.59 1,526 1,824 5,160 Not Applicable
                         
  COIMOLACHE
  3Q 2016 3Q 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 16,681 1,085 - - - 17,766 13,666 1,307 - - - 14,973
Add:                        
Exploration Expenses (US$000) 2,932 191 - - - 3,123 2,192 210 - - - 2,402
Commercial Deductions (US$000) 114 7 - - - 122 219 18 - - - 237
Selling Expenses (US$000) 240 16 - - - 256 207 20 - - - 227
Cost Applicable to Sales (US$000) 19,967 1,299 - - - 21,267 16,285 1,554 - - - 17,839
Divide:                        
Volume Sold 37,923 162,764 - - - Not Applicable 33,682 247,769 - - - Not Applicable
CAS 527 7.98 - - - Not Applicable 484 6.27 - - - Not Applicable
                         
  LA ZANJA
  9M 2016 9M 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 64,726 1,208 - - - 65,934 86,549 2,826 - - - 89,375
Add:                        
Exploration Expenses (US$000) 101 2 - - - 103 35 1 - - - 36
Commercial Deductions (US$000) 181 12 - - - 193 141 12 - - - 153
Selling Expenses (US$000) 780 15 - - - 795 927 30 - - - 957
Cost Applicable to Sales (US$000) 65,788 1,237 - - - 67,025 87,652 2,869 - - - 90,521
Divide:                        
Volume Sold 115,760 166,485 - - - Not Applicable 104,594 255,566 - - - Not Applicable
CAS 568 7.43 - - - No Applicable 838 11.23 - - - Not Applicable
                         
  BROCAL
  9M 2016 9M 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 5,370 7,645 6,718 30,718 70,449 120,899 2,542 14,007 9,693 31,404 46,358 104,004
Add:                        
Exploration Expenses (US$000) - - - - - - - - - - - -
Commercial Deductions (US$000) 6,541 6,094 3,418 23,747 82,682 122,482 2,922 9,592 4,400 17,719 55,717 90,349
Selling Expenses (US$000) 341 486 427 1,952 4,476 7,681 133 733 507 1,642 2,424 5,439
Cost Applicable to Sales (US$000) 12,252 14,224 10,563 56,417 157,607 251,062 5,597 24,331 14,600 50,765 104,499 199,792
Divide:                        
Volume Sold 9,131 933,000 7,736 32,023 32,834 Not Applicable 4,346 1,756,023 10,869 30,711 19,840 Not Applicable
CAS 1,342 15.25 1,365 1,762 4,800 No Applicable 1,288 13.86 1,343 1,653 5,267 Not Applicable
                         
  NON MINING COMPANIES
  9M 2016 9M 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) - - - - - 8,351 - - - - - 32,757
Add:                        
Selling Expenses (US$000) - - - - - 1,411 - - - - - 1,334
Total (US$000) - - - - - 9,762 - - - - - 34,091
                         
  BUENAVENTURA CONSOLIDATED
  9M 2016 9M 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 137,456 100,699 15,538 38,953 70,548 371,545 167,522 120,615 19,613 40,174 46,546 427,228
Add:                        
Exploration Expenses (US$000) 29,544 30,859 3,061 2,694 47 66,206 30,745 29,243 3,230 2,688 103 66,008
Commercial Deductions (US$000) 7,249 41,985 7,203 32,158 82,711 171,306 3,307 42,973 8,253 24,832 55,782 135,147
Selling Expenses (US$000) 1,727 4,640 917 2,472 4,478 15,646 1,700 4,149 980 2,104 2,433 12,701
Cost Applicable to Sales (US$000) 175,976 178,183 26,720 76,277 157,785 624,703 203,273 196,981 32,077 69,798 104,864 641,084
Divide:                        
Volume Sold 268,280 15,924,538 21,374 42,866 32,895 Not Applicable 271,479 14,239,819 22,086 39,442 19,917 Not Applicable
CAS 656 11.19 1,250 1,779 4,797 Not Applicable 749 13.83 1,452 1,770 5,265 Not Applicable
                         
  COIMOLACHE
  9M 2016 9M 2015
  GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL GOLD (OZ) SILVER (OZ) LEAD (MT) ZINC (MT) COPPER (MT) TOTAL
Cost of Sales (without D&A) (US$000) 43,048 3,192 - - - 46,240 39,023 3,212 - - - 42,235
Add:                        
Exploration Expenses (US$000) 6,878 510 - - - 7,388 11,015 907 - - - 11,922
Commercial Deductions (US$000) 434 40 - - - 474 509 40 - - - 549
Selling Expenses (US$000) 753 56 - - - 809 647 53 - - - 700
Cost Applicable to Sales (US$000) 51,114 3,798 - - - 54,911 51,194 4,212 - - - 55,406
Divide:                        
Volume Sold 107,327 592,768 - - - Not Applicable 94,428 579,275 - - - Not Applicable
CAS 476 6.41 - - - No Applicable 542 7.27 - - - Not Applicable

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  16 of 23

 

APPENDIX 5: ALL-IN SUSTAINING COST

 

All-in Sustaining Cost for 3Q16

 

    Buenaventura 1     La Zanja     Tantahuatay     Attributable 2  
    3Q16     3Q16     3Q16     3Q16  
Au Ounces Sold BVN     91,908                          
Au Ounces bought from La Zanja     -36,412                          
Au Ounces Sold Net     55,497       51,272       37,923       97,907  

 

      3Q16       3Q16       3Q16       3Q16  
Income Statement & Cash Flow     US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au  
                                                                 
Cost of Sales 3     67,151       1,210       23,180       452       17,766       468       86,573       884  
Exploration in Operating Units     24,889       448       875       17       3,122       82       26,605       272  
Royalties     6,143       111       0       0       0       0       6,143       63  
Comercial Deductions 4     15,484       279       803       16       122       3       15,959       163  
Selling Expenses     2,045       37       236       5       256       7       2,273       23  
Administrative Expenses 5     12,653       228       615       12       746       20       13,279       136  
Other Expenses     0       0       2,484       48       2,702       71       2,401       25  
Other Incomes     -2,993       -54       -5,589       -109       -3,072       -81       -7,190       -73  
Administrative charges     0       0       1,562       30       354       9       971       10  
Sustaining Capex 6     17,774       320       9,076       177       9,611       253       26,443       270  
                                                                 
By-product Credit     -115,724       -2,085       -1,015       -20       -3,373       -89       -117,615       -1,201  
                                                                 
All-in Sustaining Cost     27,422       494       32,227       629       28,234       745       55,842       570  

 

*All-in Sustaining Cost does not include: Depreciation and Amortization, Stoppage of mining units, Exploration in non-operating areas.

 

Notes:

1. Non-consolidated financial statements for Compañia De Minas Buenaventura S.A.A.

2. Considers 100% from Compañia De Minas Buenaventura S.A.A., 53.06% from La Zanja and 40.095% from Tantahuatay.

3. For Buenaventura does not consider purchase of concentrate from La Zanja.

4. For all metals produced.

5. For Buenaventura, does not consider management services charged to subsidiaries.

6. Sustaining Capex + Growth Capex equals Acquisitions of mining concessions, development costs, property, plant and equipment.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  17 of 23

  

All-in Sustaining Cost for 3Q15

 

    Buenaventura 1     La Zanja     Tantahuatay     Attributable Production 2  
    3Q15     3Q15     3Q15     3Q15  
Au Ounces Sold BVN     92,866                          
Au Ounces bought from La Zanja     -35,879                          
Au Ounces Sold Net     56,987       32,990       33,682       87,996  

 

      3Q15       3Q15       3Q15       3Q15  
Income Statement & Cash Flow     US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au  
                                                                 
Cost of Sales 3     76,109       1,336       29,950       908       14,973       445       98,004       1,114  
Exploration in Operating Units     20,982       368       137       4       2,402       71       22,018       250  
Royalties     5,302       93       0       0       0       0       5,302       60  
Comercial Deductions 4     14,852       261       855       26       237       7       15,401       175  
Selling Expenses     1,724       30       277       8       227       7       1,962       22  
Administrative Expenses 5     11,516       202       459       14       436       13       11,934       136  
Other Expenses     0       0       3,525       107       2,887       86       3,028       34  
Other Incomes     -965       -17       -6,704       -203       -3,422       -102       -5,894       -67  
Other administrative charges     0       0       3,031       92       233       7       1,702       19  
Sustaining Capex 6     12,643       222       12,488       379       17,092       507       26,122       297  
                                                                 
By-product Credit     -74,363       -1,305       -1,333       -40       -3,590       -107       -76,510       -869  
                                                                 
All-in Sustaining Cost     67,800       1,190       42,684       1,294       31,476       935       103,069       1,171  

 

*All-in Sustaining Cost does not include: Depreciation and Amortization, Stoppage of mining units, Exploration in non-operating areas.

 

Notes:

1. Non-consolidated financial statements for Compañia De Minas Buenaventura S.A.A.

2. Considers 100% from Compañia De Minas Buenaventura S.A.A., 53.06% from La Zanja and 40.095% from Tantahuatay.

3. For Buenaventura does not consider purchase of concentrate from La Zanja.

4. For all metals produced.

5. For Buenaventura, does not consider management services charged to subsidiaries. For La Zanja does not consider US$ 3.8 MM Impairment.

6. Sustaining Capex + Growth Capex equals Acquisitions of mining concessions, development costs, property, plant and equipment.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  18 of 23

   

All-in Sustaining Cost for 9M16

 

    Buenaventura 1     La Zanja     Tantahuatay     Attributable 2  
    9M16     9M16     9M16     9M16  
Au Ounces Sold BVN     258,386                          
Au Ounces bought from La Zanja     -114,997                          
Au Ounces Sold Net     143,389       107,702       107,327       243,568  

 

      9M16       9M16       9M16       9M16  
Income Statement & Cash Flow     US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au  
                                                                 
Cost of Sales 3     342,087       2,386       60,004       557       46,240       431       392,465       1,611  
Exploration in Operating Units     66,103       461       2,147       20       7,388       69       70,204       288  
Royalties     15,499       108       0       0       0       0       15,499       64  
Comercial Deductions 4     48,833       341       2,611       24       474       4       50,409       207  
Selling Expenses     10,738       75       732       7       809       8       11,450       47  
Administrative Expenses 5     38,122       266       1,641       15       1,799       17       39,714       163  
Other Expenses     0       0       6,578       61       4,840       45       5,431       22  
Other Incomes     -5,162       -36       -12,745       -118       -5,892       -55       -14,287       -59  
Administrative charges     0       0       1,959       18       858       8       1,383       6  
Sustaining Capex 6     33,852       236       11,897       110       18,483       172       47,575       195  
                                                                 
By-product Credit     -458,672       -3,199       -2,801       -26       -10,269       -96       -464,275       -1,906  
                                                                 
All-in Sustaining Cost     91,401       637       72,022       669       64,731       603       155,569       639  

 

*All-in Sustaining Cost does not include: Depreciation and Amortization, Stoppage of mining units, Exploration in non-operating areas.

 

Notes:

1. Non-consolidated financial statements for Compañia De Minas Buenaventura S.A.A.

2. Considers 100% from Compañia De Minas Buenaventura S.A.A., 53.06% from La Zanja and 40.095% from Tantahuatay.

3. For Buenaventura does not consider purchase of concentrate from La Zanja.

4. For all metals produced.

5. For Buenaventura, does not consider management services charged to subsidiaries.

6. Sustaining Capex + Growth Capex equals Acquisitions of mining concessions, development costs, property, plant and equipment.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  19 of 23

 

All-in Sustaining Cost for 9M15

 

    Buenaventura 1     La Zanja     Tantahuatay     Attributable Production 2  
    9M15     9M15     9M15     9M15  
Au Ounces Sold BVN     283,085                          
Au Ounces bought from La Zanja     -104,477                          
Au Ounces Sold Net     178,608       100,618       94,428       269,857  

 

      9M15       9M15       9M15       9M15  
Income Statement & Cash Flow     US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au       US$ 000'       US$/Oz Au  
                                                                 
Cost of Sales 3     228,941       1,282       87,133       866       42,235       447       292,108       1,082  
Exploration in Operating Units     66,056       370       8,446       84       11,922       126       75,318       279  
Royalties     16,902       95       0       0       0       0       16,902       63  
Comercial Deductions 4     44,711       250       2,494       25       549       6       46,254       171  
Selling Expenses     5,088       28       954       9       700       7       5,875       22  
Administrative Expenses 5     35,644       200       1,200       12       1,364       14       36,827       136  
Other Expenses     0       0       10,156       101       5,635       60       7,648       28  
Other Incomes     -3,983       -22       -16,039       -159       -7,022       -74       -15,308       -57  
Other administrative charges     0       0       5,472       54       126       1       2,954       11  
Sustaining Capex 6     22,652       127       26,024       259       32,644       346       49,549       184  
                                                                 
By-product Credit     -226,736       -1,269       -3,969       -39       -9,122       -97       -232,500       -862  
                                                                 
All-in Sustaining Cost     189,275       1,060       121,870       1,211       79,032       837       285,626       1,058  

 

*All-in Sustaining Cost does not include: Depreciation and Amortization, Stoppage of mining units, Exploration in non-operating areas.

 

Notes:

1. Non-consolidated financial statements for Compañia De Minas Buenaventura S.A.A.

2. Considers 100% from Compañia De Minas Buenaventura S.A.A., 53.06% from La Zanja and 40.095% from Tantahuatay.

3. For Buenaventura does not consider purchase of concentrate from La Zanja.

4. For all metals produced.

5. For Buenaventura, does not consider management services charged to subsidiaries. For La Zanja does not consider US$ 3.8 MM Impairment.

6. Sustaining Capex + Growth Capex equals Acquisitions of mining concessions, development costs, property, plant and equipment.

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  20 of 23

 

APPENDIX 6

 

Compañía de Minas Buenaventura S.A.A. and Subsidiaries

Consolidated Statement of Financial Position

As of September 30, 2016 and December 31, 2015

 

    2016     2015  
    US$(000)     US$(000)  
Assets                
Current assets                
Cash and cash equivalents     117,243       78,519  
Trade and other accounts receivable, net     286,035       219,862  
Inventory, net     139,127       101,473  
Income tax credit     17,607       45,919  
Prepaid expenses     6,860       8,231  
Total current assets     566,872       454,004  
Assets classified as held for sale     4,421       15,592  
      571,293       469,596  
                 
Non-current assets                
Trade and other accounts receivable, net     167,869       162,567  
Income tax credit     4,092       -  
Inventory, net     5,655       26,029  
Investment in associates     1,941,603       2,043,983  
Mining concessions, development costs, property, plant and equipment, net     1,854,681       1,747,624  
Investment properties, net     10,293       10,719  
Deferred income tax asset, net     30,653       41,574  
Prepaid expenses     30,647       29,235  
Other assets     17,814       15,854  
Total non-current assets     4,063,307       4,077,585  
                 
Total assets     4,634,600       4,547,181  
                 
                 
Liabilities and shareholders’ equity                
Current liabilities                
Bank loans     54,547       285,302  
Trade and other accounts payable     240,000       247,114  
Provisions     60,805       49,829  
Income tax payable     4,516       2,444  
Embedded derivatives for concentrate sales, net     4,153       1,694  
Hedge derivative financial instruments     219       10,643  
Financial obligations     38,945       33,394  
Total current liabilities     403,185       630,420  
                 
Liabilities directly associated with assets classified as held for sale     8,768       20,611  
      411,953       651,031  
                 
Non-current liabilities                
Trade and other accounts payable     17,266       15,057  
Provisions     144,752       141,885  
Financial obligations     561,712       320,316  
Contingent consideration liability     20,524       16,994  
Deferred income tax liability, net     10,206       12,662  
Total non-current liabilities     754,460       506,914  
                 
Total liabilities     1,166,413       1,157,945  
                 
Shareholders’ equity                
Capital stock     750,497       750,497  
Investment shares     791       1,396  
Additional paid-in capital     218,450       219,055  
Legal reserve     162,744       162,714  
Other reserves     269       269  
Retained earnings     2,103,608       2,024,895  
Other reserves of equity     (313 )     2,240  
Shareholders’ equity, net attributable to owners of the parent     3,236,046       3,161,066  
Non-controlling interest     232,141       228,170  
Total shareholders’ equity     3,468,187       3,389,236  
                 
Total liabilities and shareholders’ equity     4,634,600       4,547,181  

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  21 of 23

 

Compañía de Minas Buenaventura S.A.A. and Subsidiaries

Consolidated Statement of profit or loss

For the three-month and nine-month periods ended September 30, 2016 and 2015

 

    For the three-month period
ended September 30, 		    For the nine-month period
ended September 30, 		 
    2016     2015     2016     2015  
    US$(000)     US$(000)     US$(000)     US$(000)  
Continuing operations                                
Operating income                                
Net sales of goods     257,484       191,869       746,310       626,503  
Net sales of services     5,598       10,391       16,859       42,698  
Royalty income     5,947       8,720       18,493       25,200  
Total operating income     269,029       210,980       781,662       694,401  
                                 
Operating costs                                
Cost of sales of goods, excluding depreciation and amortization     (127,210 )     (130,505 )     (363,194 )     (380,910 )
Cost of services, excluding depreciation and amortization     (2,542 )     (15,416 )     (8,351 )     (46,318 )
Depreciation and amortization     (45,361 )     (59,564 )     (138,041 )     (169,078 )
Exploration in operating units     (24,985 )     (20,990 )     (66,206 )     (66,008 )
Mining royalties     (7,332 )     (6,937 )     (20,375 )     (21,844 )
Total operating costs     (207,430 )     (233,412 )     (596,167 )     (684,158 )
                                 
Gross profit     61,599       (22,432 )     185,495       10,243  
                                 
Operating expenses, net                                
Administrative expenses     (16,879 )     (19,838 )     (58,048 )     (58,806 )
Exploration in non-operating areas     (6,355 )     (5,259 )     (14,824 )     (25,660 )
Selling expenses     (5,531 )     (4,655 )     (15,646 )     (12,701 )
Reversal (expense) for provision for contingencies     (331 )     201       (129 )     (280 )
Provision for impairment of long–lived assets     -       -       -       (3,803 )
Other, net     2,241       (2,225 )     10,561       (2,445 )
Total operating expenses, net     (26,855 )     (31,776 )     (78,086 )     (103,695 )
                                 
Operating profit (loss)     34,744       (54,208 )     107,409       (93,452 )
                                 
Other income (expense), net                                
Share in results of associates under equity method     (11,850 )     13,381       37,222       61,621  
Financial income     1,749       827       6,061       2,441  
Net gain (loss) from currency exchange difference     (4,233 )     (3,936 )     1,255       (7,517 )
Financial costs     (10,911 )     (6,934 )     (26,585 )     (21,078 )
Total other income (expense), net     (25,245 )     3,338       17,953       35,467  
                                 
Profit (loss) before income tax     9,499       (50,870 )     125,362       (57,985 )
Current income tax     (14,054 )     (3,176 )     (32,359 )     (10,556 )
Deferred income tax     (17,075 )     17,473       (5,266 )     14,490  
                                 
Profit (loss) from continuing operations     (21,630 )     (36,573 )     87,737       (54,051 )
                                 
Discontinued operations                                
Profit (loss) from discontinued operations     (6,736 )     (2,433 )     (6,382 )     (6,197 )
Net profit     (28,366 )     (39,006 )     81,355       (60,248 )
                                 
Attributable to:                                
Owners of the parent     (24,651 )     (23,229 )     82,372       (24,656 )
Non-controlling interest     (3,715 )     (15,777 )     (1,017 )     (35,592 )
      (28,366 )     (39,006 )     81,355       (60,248 )
                               
Basic and diluted profit (loss) per share attributable to equity holders of the parent, stated in U.S. dollars     (0.10 )     (0.09 )     0.32       (0.10 )
                               
Profit (loss) for continuing operations, basic and diluted per share attributable to equity holders of the parent, expressed in U.S. dollars     (0.07 )     (0.08 )     0.35       (0.07 )
                               
Weighted average number of shares outstanding (common and investment), in units     253,715,190       253,715,190       253,715,190       253,715,190  

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  22 of 23

 

Compañía de Minas Buenaventura S.A.A. and Subsidiaries

Consolidated Statements of cash Flows

For the three-month and nine-month periods ended September 30, 2016 and 2015

 

    For the three-month period ended
September 30, 		    For the nine-month period ended
September 30, 		 
    2016     2015     2016     2015  
    US$(000)     US$(000)     US$(000)     US$(000)  
                         
Operating activities                                
Proceeds from sales     262,108       239,513       677,953       721,967  
Proceeds from dividends     3,142       1,816       139,926       4,775  
Value Added Tax recovered     34,850       21,911       105,722       74,784  
Royalty received     5,947       7,151       27,005       28,966  
Interest received     52       700       1,766       2,497  
Payments to suppliers and third-parties     (190,615 )     (192,714 )     (523,634 )     (553,471 )
Payments to employees     (36,065 )     (40,892 )     (105,219 )     (127,920 )
Payments of interest     (1,068 )     (7,684 )     (18,941 )     (17,283 )
Payment of income taxes     (2,705 )     (6,125 )     (14,166 )     (17,387 )
Payments of mining royalties     (6,053 )     (5,525 )     (15,409 )     (17,407 )
                                 
Net cash and cash equivalents provided by operating activities     69,593       18,151       275,003       99,521  
                                 
Investing activities                                
Proceeds from sales of mining concessions, property, plant and equipment     3,352       569       5,651       2,589  
Proceeds from loan to third parties     -       141       -       141  
Acquisitions of mining concessions, development costs, property, plant and equipment     (118,296 )     (84,895 )     (239,664 )     (166,527 )
Loans granted to associates     -       (20,800 )     -       (20,800 )
Opening of time deposits     -       (7,350 )     -       (7,350 )
                                 
Net cash and cash equivalents used in investing activities     (114,944 )     (112,335 )     (234,013 )     (191,947 )
                                 
Financing activities                                
Proceeds from bank loans     -       150,000       175,851       240,000  
Payments of bank loans     (3,760 )     (50,000 )     (415,760 )     (90,000 )
Proceeds from financial obligations     210       -       275,210       10,000  
Payments of financial obligations     (8,297 )     (20,784 )     (25,180 )     (29,870 )
Dividends paid to non-controlling interest     (1,649 )     (2,140 )     (5,709 )     (8,048 )
Acquisition of non-controlling interest     (4,152 )     -       (5,459 )     -  
Increase of restricted bank accounts     (2,023 )     -       (4,011 )     -  
Repurchase of treasury shares     (1,210 )     -       (1,210 )     -  
Payments of dividends     -       (70 )     (9 )     (70 )
                                 
Net cash and cash equivalents provided by (used in) financing activities     (20,881 )     77,006       (6,277 )     122,012  
                                 
Net increase (decrease) in cash and cash equivalents during the period     (66,232 )     (17,178 )     34,713       29,586  
Cash and cash equivalents at the beginning of the period     179,464       125,276       78,519       78,512  
                                 
Cash and cash equivalents at period-end     113,232       108,098       113,232       108,098  
                                 
                                 
Unrealized gain (loss) for changes in the fair value of hedge financial instruments     827       (154 )     (2,911 )     (2,495 )
Changes in the asset for closure of mining units     -       12,272       8,433       53,988  

 

 

  Compañía de Minas Buenaventura S.A.A.
Third Quarter and Nine-Month 2016 Results
Page  23 of 23

 

    For the three-month period ended
September 30, 		    For the nine-month period ended
September 30, 		 
    2016     2015     2016     2015  
    US$(000)     US$(000)     US$(000)     US$(000)  
                         
Reconciliation of net profit to cash and cash equivalents provided by operating activities                                
                                 
Net profit (loss) attributable to owners of the parent     (24,651 )     (23,229 )     82,372       (24,656 )
                                 
Plus (less):                                
Depreciation and amortization     45,361       61,377       138,041       179,185  
Net loss (gain) on sales of mining concessions, property, plant and equipment     -       10,667       2,072       13,620  
Accretion expense of provision for closure of mining units and exploration projects     1,112       96       2,810       2,931  
Loss (income) attributable to non-controlling interest     (3,715 )     (15,777 )     (1,017 )     (35,592 )
Net share in results of associates     11,850       (13,381 )     (37,222 )     (61,621 )
Provision for estimated fair value of embedded derivatives related to concentrate     20,651       (5,752 )     (9,298 )     (6,347 )
sales and adjustments on open liquidations                                
Deferred income tax expense (income)     17,075       (17,473 )     5,266       (14,490 )
Reversal (provision) for impairment loss of inventories     (291 )     8,928       (9,145 )     13,710  
Net loss (gain) from currency exchange difference     4,233       3,945       (1,255 )     7,525  
Provision for impairment of long–lived assets     -       -       -       3,803  
Other net     (765 )     (513 )     (1,352 )     3,326  
                                 
Net changes in operating assets and liabilities:                                
Decrease (increase) in operating assets -                                
Trade and other accounts receivable     (32,057 )     22,496       (68,235 )     51,970  
Inventories     (8,598 )     (12,810 )     (6,777 )     11,656  
Income tax credit     6,219       5,570       24,220       5,390  
Prepaid expenses     3,809       4,543       (3,115 )     7,242  
Increase (decrease) in operating liabilities -                                
Trade and other accounts payable     38,245       (17,892 )     21,908       (35,210 )
Provisions     (12,621 )     5,845       (4,196 )     (26,749 )
Income tax payable     594       (305 )     -       (947 )
Proceeds from dividends     3,142       1,816       139,926       4,775  
                                 
Net cash and cash equivalents provided by operating activities     69,593       18,151       275,003       99,521  

 

 

 

 

Signature

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Compañía de Minas Buenaventura S.A.A.

 

 

/s/ CARLOS E. GALVEZ PINILLOS

 

Carlos E. Gálvez Pinillos

 

Chief Financial Officer

 

 

 

Date: October 28, 2016

 

 

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