Rising metal prices imply direct impact on profit margins: AMAK CEO

 Geoffrey Day, CEO of Al Masane Al Kobra Mining (AMAK)

The increase in copper, zinc, and gold prices had a direct impact on Al Masane Al Kobra Mining Co.’s (AMAK) profit margins, as production costs are divided into fixed and variable components with fixed costs making up roughly half of total production expenses at current output levels, said CEO Geoffrey Day.

In an interview with Argaam, Day discussed the company’s first-quarter results. He explained that the strong rise in profits was driven by a pick-up in zinc sales volumes, along with higher realized prices for copper, zinc, gold, and silver. This was paired with the reduction in treatment charges for base metals, which led to an SAR 85 million (63%) hike in the three-month revenues.

Day highlighted that AMAK’s gross profit margin rose to 38% in Q1 2025, from 26% in the same period of 2024. He added that lower selling and marketing expenses—largely due to reduced shipping costs per ton—also played a role in improving the company’s first-quarter financial performance.

Regarding revenue distribution in Q1 2025, gold accounted for 36.9%, copper 31.4%, zinc 31.3%, and silver 0.4%, according to the top executive.

No significant changes are projected in the quarterly production results for Q2 2025, Day stated, noting that prevailing global commodity prices will continue to influence AMAK’s financial performance.

As for sales volumes, he confirmed that the Q1 2025 production data will be published later for all investors and shareholders through the company’s website, in accordance with AMAK’s disclosure policy.

AMAK plans to launch a series of webinars to formally and regularly present its financial and production results. These sessions will also include forward-looking guidance and operational cost details, pending board approval, the CEO added.