MMX returns to blue.
Mining company manages to reverse losses and hopes to secure funding for the Serra Azul project.
247_Family pride. That must have been the comment of businessman Eike Batista regarding MMX's positive results in the first quarter of this year. The mining company is part of the EBX Group, which is also involved in the oil, logistics, port, and other sectors. In the first three months of the year, MMX earned R$ 64 million, reversing the loss of R$ 76 million in the same period last year. All the company's numbers erase the poor performance recorded 12 months ago. The EBITDA (earnings before interest, taxes, depreciation, and amortization), for example, of R$ 40 million in the quarter reverses the negative R$ 23 million EBITDA of the previous year. And the gross revenue of R$ 195 million is 86% higher than in 2010.
One of the main factors contributing to the positive result was the increase in iron ore prices. In the coming months, the price is expected to continue rising, which should benefit MMX and other mining companies. There is an expectation that the price per ton will reach US$100 by the end of this year. For the second half of the year, the company hopes to secure financing to begin operations at the Serra Azul mines, located in the iron ore quadrangle of Minas Gerais.
Investors reacted positively to the results, and MMX's stock traded up approximately 0,5% throughout Wednesday's session. However, year-to-date, the stock has accumulated a decline of 18,5%.