Antofagasta: Copper's red-hot year

Chilean miner Antofagasta posted a 52% jump in annual core profit on Tuesday, aided by record copper prices that made up for a modest drop in output, and said its increased capital spending would boost production in the medium term.

For Antofagasta, 2025 was a reminder of how powerful the copper cycle can be. The London-listed Chilean miner delivered record operating earnings as buoyant metal prices more than compensated for slightly lower output.

EBITDA climbed to $5.2019 billion, up 52% from $3.4268 billion in 2024, while revenue rose 30% to $8.6203 billion . Just as striking was profitability: the EBITDA margin widened to 60.3%, from 51.8% a year earlier - a level that places Antofagasta among the more profitable large pure-play copper producers.

The lift came largely from price. The company's average realised copper price rose to $4.93 per pound, up 18.1% on the year . In a market increasingly animated by talk of electrification, data centres and grid expansion, copper has regained its reputation as the metal with a PhD in economics.

There was also help from by-products. Higher output and prices for gold and molybdenum trimmed the effective cost of producing copper. Net cash costs fell to $1.19/lb, while cash costs before by-product credits were $2.38/lb . In other words, the company was producing copper more cheaply just as it was selling it for more.

Yet the operational picture was not uniformly rosy. Copper production slipped 2% to 653,700 tonnes , reflecting lower grades and maintenance at some sites, partly offset by stronger concentrate output at Centinela.

Long-standing goal of expanding Centinela

If 2025 was about price, the next few years are about volume. Antofagasta is in the midst of one of the heaviest investment phases in its history, funnelling cash into projects designed to expand output and protect its cost position.

Capital expenditure surged to $3.6845 billion in 2025 (cash basis), up from $2.4149 billion in 2024 . Management says the group has now passed peak construction spending on its current slate of projects and remains on track to deliver 30% production growth over the medium term .

At the centre of that ambition is the Centinela Second Concentrator Project, a brownfield expansion with total capex of $4.4 billion. It is intended to add 170,000 tonnes of copper-equivalent production and shift Centinela further down the global cost curve . The company left its 2026 production guidance unchanged at 650,000–700,000 tonnes , suggesting that the real step-up will come once construction is complete.

Dividends, debt, and what the ratios say

The investment drive has been accompanied by rising borrowings - but not, yet, by financial strain.

Net debt rose to $2.7495 billion at the end of 2025 (from $1.6291 billion a year earlier), yet net debt to EBITDA remained a modest 0.53 times . For a capital-intensive miner in expansion mode, that is conservative. The group also held $4.9099 billion in cash, cash equivalents and liquid investments at year-end .

Shareholders, meanwhile, are not being asked to wait. The board proposed a final dividend of 48.0 cents per share, bringing the full-year payout to 64.6 cents, equivalent to 50% of underlying earnings . Underlying earnings per share reached 129.3 cents, more than double the previous year's 62.8 cents .

Taken together, the numbers sketch a company enjoying the sweet spot of the cycle: high prices, widening margins and manageable leverage. The valuation question for investors is less about today's earnings - flattered as they are by copper at nearly $5 per pound - than about durability. How much of 2025's profit surge is structural, and how much merely cyclical?