Why Is Antofagasta Plc Up Today?

Antofagasta Plc (LSE:ANTO) shares rose 3.23% to 3,353.0p today, extending interest in one of the London market's most focused copper producers.

The gain follows a first half in which higher copper prices drove sharp increases in revenue, EBITDA and pre-tax profit, even as volumes were lower and the company trimmed its production outlook for the year.

Today's move reflects the balance between those two forces: a copper price that is boosting Earnings and the delivery of major expansion projects in Chile that are designed to lift output in the years ahead. This article looks at the latest results, Capital returns, growth plans and risks.

About Antofagasta Plc

Antofagasta Plc is a Chile-focused Mining group, best known for producing copper. Its principal operations are Los Pelambres and Centinela, with by-product output of molybdenum, gold and silver.

Iván Arriagada serves as Chief Executive.

Its shares trade on the London Stock Exchange under LSE:ANTO, giving investors direct exposure to copper, a metal that is central to electrification, power grids and renewable energy.

Key Reasons Behind Today's Uptick

Today's 3.23% rise comes against a backdrop of materially higher earnings. The average realised copper price in the first half of 2026 was $6.19 per pound, 36% higher than a year earlier.

Mining shares are closely tied to metals prices and to sentiment towards global industrial demand. When copper firms, producers with high Operating Leverage tend to see the largest swings in profit and share price.

Investors are also looking beyond the temporary operating disruption at Los Pelambres towards the expansion projects due to complete commissioning in 2027, which is why LSE:ANTO remains a closely watched name among FTSE 100 miners.

H1 2026 Financial Performance

In the six months to 30 June 2026, Antofagasta reported Revenue of $4,479.0m, up 18% from $3,799.4m. EBITDA rose 27% to $2,840.5m, with the EBITDA Margin improving to 63.4% from 58.8%.

Profit before tax rose 72% to $1,995.8m. Profit attributable to owners was $847.3m, compared with $521.6m a year earlier, and Earnings Per Share were 85.9 cents against 52.9 cents.

Cash flow from operations increased 53% to $2,772.9m, showing that the profit improvement translated into cash.

The scale of the earnings increase relative to the rise in revenue is typical of a mining Business with high operating leverage. When prices rise and a large part of the cost base is fixed, a bigger share of each extra dollar of revenue reaches profit.

Production and Cost Picture

Copper production in the first half was 285,000 tonnes, down 9% year-on-year, mainly because of lower output at Los Pelambres and Centinela.

Cash costs before by-product credits were $2.85 per pound, 23% higher than a year earlier, while net cash costs after by-product credits fell 8% to $1.22 per pound as by-product revenues rose.

For 2026 the company guides to cash costs of $2.40 to $2.60 per pound before by-product credits and $1.15 to $1.35 per pound after them.

Production Guidance Reduced

Antofagasta now expects 2026 copper production of 625,000 to 655,000 tonnes, down from the previous range of 650,000 to 700,000 tonnes.

The change follows a temporary shutdown at Los Pelambres caused by unusually adverse weather conditions. Operations have resumed, but inspections found that some pipeline platforms and water management systems require repairs.

Full-year Capital Expenditure guidance was unchanged at $3.4bn, excluding Zaldívar.

Los Pelambres and Centinela Expansion Projects

Los Pelambres delivered first-half EBITDA of $1,401.0m, up 30%, from 133,800 tonnes of copper production, 7% lower. Two major infrastructure projects there are due in 2027: a desalination plant expansion to 800 litres per second, costing approximately $1bn with $0.6bn spent, and a concentrate pipeline and El Mauro enclosures project of approximately $1bn with $0.5bn spent.

A further Development Options Project of approximately $2bn remains under study.

At Centinela, the Second Concentrator Project has a total cost of $4.4bn, with $3.3bn spent to date. Construction and commissioning are due to complete in 2027, with ramp-up beginning at the end of 2027. The project is expected to add 170,000 tonnes of copper-equivalent production, and together with the Los Pelambres work is expected to lift group production by about 30%.

Dividend and Capital Returns

The board declared an interim Dividend of 30.1 cents per share, equal to $296.7m and a payout of 35% of underlying earnings. The dividend was paid on 30 September 2026 to shareholders on the register at 4 September 2026.

The payout reflects the company's approach of returning a share of earnings while keeping enough capital to fund its large growth programme. Investors should note that dividends from mining companies vary with Commodity prices and capital needs.

The 81% increase in the interim dividend, from a lower base, shows how quickly distributions can respond to a higher copper price. It also leaves the board with room to keep investing in capacity while still rewarding shareholders.

Balance Sheet and Net Debt

Net Debt rose to $3,966.1m at 30 June 2026 from $2,749.5m at the end of 2025. The increase reflects heavy capital expenditure, dividends and the recognition of Centinela's new water infrastructure as a lease.

The ratio of net debt to EBITDA was 0.68x, up from 0.53x at the end of 2025. That remains a modest level of leverage for a miner, but it is rising during the peak spending period for the expansion projects.

Tax and Royalty Backdrop

The group recorded an income tax charge of $718.6m in the first half, an effective tax rate of 36.0%. The Chilean corporate tax rate is 27%, and a mining royalty tax charge of $230.5m added 11.5 percentage points to the rate.

A proposed Chilean reform would gradually cut the corporate tax rate from 27% to 23% over three years. It has been proposed but not yet enacted, so it remains an item to monitor.

Growth Catalysts

The main catalyst is the delivery of the Centinela Second Concentrator and the Los Pelambres water and pipeline projects, which should raise volumes from 2027 and dilute unit costs over time.

A sustained copper price supported by electrification, data-centre power Demand and grid Investment would also help earnings. Progress on the Development Options Project could add further long-term optionality.

Sector and Economic Exposure

Antofagasta's results are driven by the copper price, Chilean operating conditions, energy and water costs and the global industrial cycle, including demand from China.

Because all of its producing Assets are in Chile, the group is also exposed to local policy, taxation, weather events and water availability. The recent disruption at Los Pelambres illustrates how operating conditions can affect volumes.

Risks to Consider

Risks include a fall in copper prices, further operational disruption, cost inflation, delays or overruns on major projects and changes to Chilean tax or royalty rules.

Higher net debt during the investment phase also reduces financial flexibility if conditions weaken. Investors should weigh these factors against the potential benefits of the expansion programme.

Water Supply is another consideration. Both main operations rely on desalination and water management infrastructure, which is why the water projects at Los Pelambres and Centinela form such a large part of the capital programme. Delays or cost increases there could affect timing of the production uplift. Weather events, as seen this year, can also interrupt output at short notice.

Conclusion

Antofagasta Plc (LSE:ANTO) shares rose 3.23% to 3,353.0p today, supported by a first half in which revenue rose 18%, EBITDA rose 27% and the Interim Dividend was set at 30.1 cents.

Offsetting that, copper production fell 9% and guidance was reduced to 625,000 to 655,000 tonnes. For those following LSE:ANTO, the story now turns to execution on the 2027 project milestones, the copper price and Chile's tax policy.