Hudbay Minerals Inc.(HBM,HBM.TO) reported Wednesday a profit in its second quarter, compared to prior year's loss, with growth in revenues. Further, the firm reaffirmed its fiscal 2025 production guidance.
Separately, Hudbay Minerals announced a $600 million joint venture transaction with Japanese conglomerate Mitsubishi Corp. (MBC.L,MSBHY.PK) for a 30 percent minority interest in Copper World LLC, which owns the fully-permitted Copper World project in Arizona.
In the pre-market activity, Hudbay Minerals shares were climbing around 14.6 percent to trade at $11.28.
Mitsubishi has agreed to acquire a 30 percent interest in Hudbay unit Copper World, for an initial cash contribution of $600 million.
The joint venture will be structured as a new limited liability corporation, Copper World LLC. Under the JV Transaction, the initial contribution of $600 million will consist of $420 million upon closing and a $180 million matching contribution payable no later than 18 months following closing.
Hudbay will retain 100 percent of its existing U.S. federal net operating losses of approximately $275 million and Arizona state losses of $210 million.
The JV Transaction is expected to close in late 2025 or early 2026, subject to the satisfaction of customary closing conditions.
Mitsubishi will also fund its pro-rata 30 percent share of future equity capital contributions.
The company noted that Copper World will support the U.S. Government's foreign investment and national security objectives with a projected direct $1.5 billion investment into the U.S. critical minerals supply chain.
The fully permitted initial phase of the Copper World project is located on private land owned by Hudbay. The mine is expected to produce 85,000 tonnes of copper per year over an initial 20-year mine life.
During the three-year construction period, Copper World is expected to create more than 1,000 jobs annually.
Mitsubishi will be contributing 30 percent of the ongoing costs beginning August 31, 2025 and will participate in the funding of the DFS as well as the final project design, project financing, and project construction for Copper World.
Regarding the second quarter results, Hudbay Minerals noted that net earnings attributable to owners was $117.7 million or $0.30 per share, compared to prior year's loss of $16.5 million, or $0.04 per share.
Adjusted earnings attributable to owners was $75.5 million or $0.19 per share, compared to $0.2 million or breakeven per share last year.
Revenue for the quarter grew to $536.4 million from $425.5 million last year.
In the second quarter, consolidated copper production was 29,956 tonnes and consolidated gold production was 56,271 ounces.
Further, the company continues to expect fiscal 2025 consolidated production of 117,000 to 149,000 tonnes of copper and 247,500 to 308,000 ounces of gold.
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