Nexa Resources (NEXA) Q3 2024 earnings summary

Executive summary

• Net revenues reached $709 million in Q3 2024, up 9% year-over-year, driven by higher prices and improved demand in home markets.

• Adjusted EBITDA rose 111% year-over-year to $183 million, with a margin of 26%, reflecting strong operational performance and cost discipline.

• Net income reached $6 million in Q3 2024, reversing prior losses, as portfolio optimization and asset sales enhanced financial flexibility.

• Net leverage ratio improved to 2.2x from 2.7x in Q2, supported by higher EBITDA and reduced net debt.

• Portfolio optimization advanced with the sale of non-core assets, including Chapi and Pukaqaqa, aligning with efficient capital allocation.

Financial highlights

• Q3 2024 consolidated net revenues were $709 million, up 9% year-over-year, but down 4% sequentially.

• Adjusted EBITDA was $183 million, 111% higher year-over-year, with a margin of 25.8%-26%.

• Net income was $6 million in Q3 2024, compared to a net loss in prior quarters; adjusted net income was $22 million.

• Free cash flow generation in Q3 was $51 million; available liquidity at quarter-end was $845 million.

• Capex for the first nine months totaled $191 million, mostly for sustaining activities; 2024 Capex guidance reduced to $300 million.

Outlook and guidance

• On track to meet full-year 2024 guidance for production and costs; mining cash cost guidance for 2024 reduced by 64% from previous guidance.

• Expect further improvements in Aripuanã with the addition of a fourth tailings filter in 2025, supporting higher production.

• Guidance for exploration and project evaluation maintained at $72 million for 2024.

• Commodity price assumptions for 2024 revised upward for zinc, copper, silver, and gold.

• Focus remains on growth projects, cost optimization, and maintaining conservative leverage ratios.