Nexa sells Chapi mine to Quilla, receives cash & milestone payments

From Zacks Investment Research: 2024-12-24 16:06:21

Nexa Resources S.A. has sold its stake in Minera Pampa de Cobre S.A.C., transferring its rights and interests in the Chapi copper mine to Quilla Resources Peru S.A.C. This move aligns with NEXA’s ongoing portfolio optimization strategy to focus on productive mines. Nexa received $1 million in cash from Quilla and will receive more milestone-driven payments. Nexa Resources is a large-scale, low-cost, integrated zinc producer investing in greenfield projects. In 2022, NEXA decided not to progress on the Pukaqaqa and Shalipavco projects. The company recently sold the Morro Agudo Complex in Brazil. Nexa Resources’ shares have gained 17.9% in the past year. Some better-ranked stocks in the basic materials space are Carpenter Technology Corporation, New Gold, and Fortuna Mining Corp. Carpenter Technology has an average trailing four-quarter earnings surprise of 14.1% and shares have gained 138% in the last year. New Gold has an average trailing four-quarter earnings surprise of 37.50% and shares have gained 65% in the past year. Fortuna Mining’s shares gained 10% in the last year.

NEXA to Receive Milestone-Driven Payments for Chapi
Nexa Resources received $1 million in cash from Quilla. It will receive another $4 million after the commencement of commercial production. The company will also receive contingent payments totaling up to $11 million if the average copper price exceeds certain thresholds and the mine achieves certain production milestones, and an NSR royalty on minerals produced from the Chapi mine.

NEXA’s Ongoing Efforts to Drive Growth
Nexa Resources is a large-scale, low-cost, integrated zinc producer with more than six decades of experience in developing and operating mining and smelting assets in Latin America. It currently owns and operates five long-life mines, three located in the central Andes region of Peru and two in Brazil. Nexa Resources also owns and operates three smelters.

NEXA’s Zacks Rank & Stocks to Consider
Nexa Resources currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks from the basic materials space are Carpenter Technology Corporation (CRS), New Gold (NGD), and Fortuna Mining Corp. (FSM). CRS currently sports a Zacks Rank #1 (Strong Buy) and NGD and FSM carry a Zacks Rank #2 (Buy). Carpenter Technology has an average trailing four-quarter earnings surprise of 14.1%. New Gold has an average trailing four-quarter earnings surprise of 37.50%. The Zacks Consensus Estimate for Fortuna Mining’s 2024 bottom line indicates year-over-year growth of 118%. The company has a trailing four-quarter earnings surprise of 53.6%, on average.



Read more at Zacks Investment Research: NEXA Completes Sale of Chapi Mine to Enhance Cash Flow & Returns – December 24, 2024