Antofagasta Plc

Antofagasta Plc is a senior copper producer headquartered in London, United Kingdom, operating primarily in South America. The company's portfolio consists of 7 projects, comprising 4 operating mines, 2 advanced exploration, and 1 suspended project. Key assets include Antucoya, Centinela, Los Pelambres, and Zaldívar. The business model centers on operating long-life mines with significant by-product streams, supported by an integrated transport division that provides rail and road cargo services to both internal operations and third-party customers. Processing capabilities encompass milling and flotation for sulphide ores and a solvent extraction and electrowinning (SX-EW) process for oxide ores. The operational approach emphasizes a focus on well-established jurisdictions to enable significant, long-term investment with confidence. A key competitive advantage is the ability to leverage a strong balance sheet and innovative financing solutions to fund organic growth projects. The enterprise maintains a conservative approach to its capital allocation framework, which enables the delivery of both growth investments and shareholder returns throughout economic cycles. This strategy has supported an industry-leading EBITDA margin among its pure-play peers. The company's operational footprint is managed through a portfolio of 4 distinct mining operations and a transport division with an extensive rail network.

Strategic direction is guided by 5 pillars: safety and sustainability, people and culture, competitiveness, innovation, and growth. The growth strategy prioritizes organic, brownfield projects within existing sites to add value with reduced risk, cost, and time to delivery, with a medium-term ambition to increase production by over 30%. A core component is the Competitiveness Programme, which has delivered over $1 billion in savings and productivity improvements since its inception, helping to control costs amidst industry-wide inflation. The innovation strategy focuses on developing proprietary technologies, such as a patented primary sulphide leaching process, alongside deploying automation and advanced analytics to increase production and cut costs. The capital allocation framework ensures a disciplined approach, prioritizing sustaining capital and committed dividends (minimum 35% of underlying earnings) before funding growth projects or excess shareholder returns. This framework is designed to maintain a strong balance sheet while executing an industry-leading organic growth program.

The board is composed of 11 non-executive directors, 6 of whom are independent. Governance is structured through 5 committees: Nomination and Governance, Audit and Risk, Sustainability and Stakeholder Management, Projects, and Remuneration and Talent Management. The CEO is not a member of the board, a structure that reflects local practice and enhances independent oversight from the non-executive directors. The Chairman is not independent and has served on the board since 1990, a tenure the board considers beneficial due to his extensive experience and position as a representative of the controlling shareholder. To ensure robust governance, the Senior Independent Director actively engages with shareholders and proxy advisors on governance matters and leads the annual review of the Chairman's performance. The board's effectiveness is assessed annually, with an external evaluation conducted at least every 3 years. The executive committee, chaired by the CEO, is responsible for implementing strategy and managing day-to-day operations.

The sustainability strategy is integral to the business model, with a central goal of achieving carbon neutrality by 2050. The company has set a target to reduce absolute Scope 1 and 2 emissions by 50% by 2035 (from a 2020 baseline) and Scope 3 emissions by 10% by 2030. Key decarbonization initiatives include sourcing 100% of electricity for mining operations from renewable sources since 2022, trialing trolley-assist technology for haul trucks, and deploying South America's first hydrogen-powered locomotive in its transport division. Water management is a critical focus, with an aspiration for 90% of water use to come from sea water or recirculated sources, supported by significant investment in desalination capacity. The organization is committed to creating a balanced workforce, aiming for 30% female representation by the end of 2025, and has implemented a 'Suppliers for a Better Future Programme' to enhance sustainability practices across its value chain. All operating mines have received external accreditation for responsible production practices.

The corporate structure is characterized by a controlling shareholder, the E. Abaroa Foundation, which holds an interest of approximately 65% through its controlled entities. The Group operates a 50% joint venture, for which it serves as the operator, in partnership with Barrick Gold Corporation. In 2024, the company consolidated its investment in Compañía de Minas Buenaventura S.A.A., holding approximately 19% of its outstanding shares and securing 2 board seats, thereby accounting for it as an associate. An innovative financing package was secured for a major growth project, comprising a $2.5 billion project finance facility with a 12-year term and a 4-year drawdown period. This arrangement was complemented by an agreement to transfer existing water supply infrastructure and its planned expansion to an international consortium, a move designed to reduce the project's capital intensity. The company also issued a $750 million 10-year corporate bond in 2024 for general corporate purposes.