Company: Nexa Resources
Symbol: NEXA
Description: They are age-scale, low-cost integrated zinc producer with over 60 years of experience developing and operating mining assets in Latin America.
Shares: 31 million
Price Range: $18.00-$21.00
Trade Date: 10/27
Underwriter(s): JP Morgan, BMO Capital Markets, Morgan Stanley, Credit Suisse, BofA Merrill Lynch, Citigroup, Scotiabank, Bradesco BBI, Credicorp Capital
Co-Manager(s): ABN AMRO, Banco do Brasil Securities, Macquarie Capital, MUFG, National Bank of Canada Financial Markets, RBC Capital Markets
Terms Added: 10-10-17
Business: They operate and own five long-life underground mines, three located in the Central Andes of Peru and two located in the state of Minas Gerais in Brazil. Their operations are large-scale, modern, mechanized underground and open pit mines. Two of their mines, Cerro Lindo in Peru and Vazante in Brazil, are among the 12 largest zinc mines in the world, and, combined with their other mining operations, place Nexa Resources among the top five producers of mined zinc globally in 2016, according to Wood Mackenzie. In addition to zinc, which accounted for 64.0% of their mined metal production in 2016 measured on a zinc equivalent basis, they produce substantial amounts of copper, lead, silver and gold as byproducts, which reduce their overall cost to produce mined zinc.
FINANCIALS:
Their net revenues were $2.12 billion, $1.82 billion, and $1.91 billion and their profit (loss) was ($27.1 million), ($139.9 million), and $110.5 million in 2014, 2015, and 2016, respectively. In the first half of 2017, their net revenues increased 25.9% to $1.09 billion, while their profit decreased 56.6% to $60.3 million, compared to the same period in the previous year. The decreased profit in the first half of 2017 reflects a $35.4 loss in foreign exchange net losses, compared to a $133.8 million gain in the first half of 2016.
Dividend: They intend to make annual distributions on their common shares. The amount of distributions will be subject to the requirements of Luxembourg law and the approval of our board of directors or our shareholders, as applicable, and will depend on a number of factors, including, but not limited to, their cash balance, cash flow, earnings, capital investment plans, expected future cash flows from operations and their strategic plans, as well as legal requirements and other factors they may deem relevant at the time. As of the date of this prospectus, there are no contractual restrictions on their ability to make distributions to their shareholders. Subject to these considerations, they intend to distribute each year amounts equal to at least 2.0% of our average market capitalization for the previous fiscal year.
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