HudBay Minerals Inc (HBM.TO) Q1 2026 Earnings Call Transcript
Bullish Industrial Materials 9.91B Canada
Next Earnings
2026-05-11
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Hudbay delivered record 2025 financials, secured Mitsubishi funding for Copper World, initiated a dividend increase, and outlined a disciplined 2026 plan with further deleveraging and growth capex.
⭐ Key Highlights
Record 2025 performance
Hudbay achieved record annual revenue > $2 billion, adjusted EBITDA > $1 billion, and free cash flow > $380 million.
Strong per-cycle production across assets
Copper and gold production met or exceeded guidance for 11th straight year (copper and gold).
Copper World partnership and funding
Mitsubishi joint venture solidified for Copper World, enabling funding and de-risking with a path to sanction in 2026.
Dividend and balance-sheet transformation
First-ever dividend increase to $0.01 per share quarterly, alongside debt reduction and improved liquidity (net debt/EBITDA 0.4x; Copper World closing boosted liquidity).
2026 strategic plan and guidance
New capital-allocation framework, continued deleveraging, and 2026 targets including higher copper production and modest gold declines due to Pampacancha depletion; updated 3-year outlook to be released with March reserve/resource update.
✔Positive Signals
- Record annual revenues (> $2B) and adjusted EBITDA (> $1B) in 2025
- First-ever quarterly dividend increase to $0.01 per share
- Significant free cash flow generation and strong deleveraging progress
- Mitsubishi-led Copper World joint venture improves funding and reduces future equity contributions
- Enhanced capital-allocation framework enabling return of capital and growth investments
✖Negative Signals
- Permitting delays for Maria Reyna and Caballito in Peru amid election-year uncertainties
- BC SAG mill maintenance risk and potential throughput impact in 2026
- Manitoba disruptions from wildfire evacuations and power outages impacting near-term production
- Short-term copper production mix shifts and schedule risk around Pampacancha depletion
- Ongoing project execution risks and timelines for copper-related brownfield/greenfield expansions
📊Financial Results
- Q4 2025 revenues $733 million (record for the quarter)
- Q4 2025 adjusted EBITDA $386 million (record for the quarter)
- Q4 2025 net earnings $128 million or $0.32 per share; adjusted EPS $0.22
- Q4 2025 cash costs at consolidated level negative $0.63 per pound; sustaining cash cost $0.94 per pound
- Full-year 2025 free cash flow $388 million; total debt reduced by $185 million since end-2024; end-year liquidity $994 million; net debt/EBITDA 0.4x; post-C Copper World close liquidity > $1.4B
🔮Future Guidance
- 2026 copper production guidance: 124,000 tonnes (midpoint); gold: 244,500 ounces
- Consolidated 2026 cash costs: negative $0.30 to negative $0.10 per pound; sustaining cash costs $1.70–$2.10 per pound
- Manitoba gold cash costs $500–$800 per ounce; BC copper cash costs $1.50–$2.50 per pound; Peru copper cash costs $1.70–$2.10 per pound
- Growth capex in 2026 includes Copper World growth, New Ingerbelle, and Snow Lake initiatives; total 2026 sustaining capex ~ $435 million; growth capex ~ $140 million (excluding Copper World JV spending)
- Copper World capex guidance of $135 million in 2026 (pre-FID spend); sanction decision expected in 2026; Mitsubishi funding to cover post-FID spend and progression
💡Interesting Insights
- Capital allocation now balances crowding-in growth with dividends; Mitsubishi funding structurally de-risks Copper World and may accelerate other greenfield/brownfield opportunities
Detailed Analysis
AI-generated summary of HudBay Minerals Inc earnings call transcript.
Hudbay closed 2025 with record revenues, EBITDA and free cash flow, supported by strongest operational performance across Peru, Manitoba and British Columbia, despite wildfire, social unrest and outages. The company secured Mitsubishi as a long-term partner for Copper World, enabling a clearer path to sanction in 2026 and improved financial flexibility. A new capital-allocation framework accompanies the first quarterly dividend increase, reflecting balance-sheet strength and a focus on high-return brownfield/growth opportunities. 2026 guidance calls for modest copper production growth, a gold decline due to Pampacancha depletion, ongoing cost discipline, and continued deleveraging, with a reserve/resource update and a 3-year outlook due in late March. The narrative centers on sustaining margins, advancing Copper World and New Ingerbelle, expanding Snow Lake/Ops, and reinvesting for high-return, long-term value while returning cash to shareholders.
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