UPDATE 1-Poland’s KGHM targets lower output after record 2015 loss (Reuters U.S. – March 17, 2016)


Europe’s second biggest copper producer, Poland’s state-run KGHM, signalled on Thursday plans to cut its copper output this year after writedowns pushed its 2015 net loss higher than expected.

The miner posted a record loss of 5.01 billion zlotys ($1.3 billion) at the group level and 2.8 billion loss for the parent company, from which KGHM pays dividends. Analysts had expected losses of 4.81 billion and 2.29 billion respectively.

Earlier this year, the company reported writedowns of $1.3 billion on its foreign assetsdue to falling metal prices, with the largest drag coming from its main overseas mine Sierra Gorda in Chile.

KGHM, which underwent a management reshuffle this year, expects 2016 copper prices to fall further and average $5,000 per tonne compared with $5,495 last year, and expects its full-year output to fall 9 percent to 525,400 tonnes.

The company, which is also the world’s largest silver miner, had planned to almost double its copper output to more than 1 million tonnes a year by 2020, but signalled a revision of its plans and its foreign assets after worries about Chinese demand battered metals prices.

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