Antofagasta: profit up 62% on record margin, but the stock already trades at nearly 30x earnings

Antofagasta reported results for the first half of 2026, ended 30 June. Revenue rose 17.9% year on year to USD 4,479.0 million, EBITDA – by 23.3% to USD 2,630.0 million, and net profit – by 62.4% to USD 847.3 million. The EBITDA margin reached 58.7% versus 56.1% a year earlier, and the net margin – 18.9% versus 13.7%. At the same time, the stock trades at 29.8 times trailing twelve-month earnings, which limits its appeal at the current price.

Key takeaways

— Revenue added 17.9% in the half-year, but profit growth was almost four times faster at 62.4%

— EBITDA margin rose to 58.7% from 56.1%, the best level in recent years

— Net profit rose to USD 847.3 million, but the 3.1x gap to EBITDA is explained by depreciation and taxes

— Operating cash flow was USD 2,772.9 million, 3.3 times net profit

— Net debt turned into a net cash position of USD 1,194.8 million as of 30 June 2026

— Trailing twelve-month dividend yield is only 1.55%, below the key rate

— Valuation at 29.8 P/E LTM and 8.6 EV/EBITDA LTM leaves no room for error

Attractiveness

Key figures, USD bn

Revenue added 17.9% in the half-year, but profit growth was almost four times faster at 62.4%

Revenue for the first half of 2026 was USD 4,479.0 million, up 17.9% year on year. The main contribution came from copper mining: the company does not disclose quarterly dynamics, but rising metal prices and higher production volumes drove this increase. For comparison, trailing twelve-month revenue was USD 9,300.0 million, confirming the resilience of the business.

Net profit rose 62.4% to USD 847.3 million. This outperformance is explained by operating leverage: with revenue up 17.9%, costs grew more slowly, expanding the margin. In addition, lower net financial expenses due to the shift to a net cash position added to profit.

Profit growth nearly four times faster than revenue is not a one-off effect but a consequence of the high-margin nature of the business. However, copper prices are volatile, and the current profit level may prove to be a peak.

EBITDA margin rose to 58.7% from 56.1%, the best level in recent years

EBITDA for the first half of 2026 was USD 2,630.0 million, up 23.3% year on year. The EBITDA margin reached 58.7% versus 56.1% in the same period last year. This is the highest margin level in several years, reflecting favourable copper price conditions.

The 2.6 percentage point margin expansion came with revenue up 17.9% and EBITDA up 23.3%. The main driver was copper prices rising faster than extraction costs. The company does not disclose cost line details, but such a gap indicates strong operating leverage.

The net margin also rose – to 18.9% from 13.7% a year earlier. This means the company not only improved operational efficiency but also reduced debt burden, which lowered interest expenses.

Net profit rose to USD 847.3 million, but the 3.1x gap to EBITDA is explained by depreciation and taxes

Net profit for the first half of 2026 was USD 847.3 million, up 62.4% year on year. At the same time, EBITDA was USD 2,630.0 million, meaning net profit was only 32% of EBITDA. Such a gap is typical for the mining industry due to high depreciation and taxes.

Operating profit was USD 1,896.5 million, or 72% of EBITDA. The difference between operating and net profit is financial expenses and taxes. The reduction of net debt to a negative value (net cash position) led to lower interest expenses, which supported net profit.

Net profit growth of 62.4% significantly outpaces revenue growth, driven by operating and financial leverage. However, the sustainability of this growth depends on maintaining high copper prices.

Operating cash flow was USD 2,772.9 million, 3.3 times net profit

Operating cash flow for the first half of 2026 reached USD 2,772.9 million, 3.3 times net profit. This significant gap is explained by high depreciation, which is a non-cash expense, as well as possible changes in working capital.

Over the trailing twelve months, operating cash flow was USD 4,032.5 million. This means that in the second half of 2025, the flow was significantly lower than in the first half of 2026. The company does not disclose details, but such growth may be related to improved settlement terms with customers.

Free cash flow is not disclosed, but given capital expenditures, which are typically significant in mining, it can be assumed to remain positive. This allows financing dividends and reducing debt.

Net debt turned into a net cash position of USD 1,194.8 million as of 30 June 2026

As of 30 June 2026, the company's net debt turned negative and stood at minus USD 1,194.8 million, meaning a net cash position. This is a significant improvement compared to 31 December 2025, when net debt was USD 4.2 billion. The change over the half-year was minus USD 5.4 billion.

The net debt to EBITDA LTM ratio is minus 0.19. This means the company has a substantial margin of safety and can withstand periods of low copper prices without financial problems. A negative ratio indicates that cash and equivalents exceed debt obligations.

The debt reduction was achieved through strong operating cash flow, which allowed financing current operations and repaying part of the obligations. This improves the company's credit quality and reduces risks for shareholders.

Trailing twelve-month dividend yield is only 1.55%, below the key rate

The trailing twelve-month dividend yield is 1.55%. This is a modest level, especially considering that the key rate in Russia is significantly higher. For a mining company with high margins and a net cash position, such a yield looks low.

The company does not disclose the dividend for the first half of 2026, but historically Antofagasta pays dividends twice a year. If current profit and the payout ratio are maintained, the dividend for 2026 could be higher than for 2025. However, our estimate is based on the assumption of stable copper prices.

The main risk to the dividend is a fall in copper prices, which could reduce profit and, consequently, payouts. In addition, the company may allocate part of the funds to capital expenditures or acquisitions, which would also limit dividends.

Valuation at 29.8 P/E LTM and 8.6 EV/EBITDA LTM leaves no room for error

Antofagasta shares trade at a P/E LTM of 29.8 and EV/EBITDA LTM of 8.6. For a mining company, such multiples look high, especially given the cyclical nature of the industry. Market capitalisation is USD 49.3 billion.

According to the portal's model, which re-prices EBITDA at current commodity prices at the target EV/EBITDA, the upside to fair value is +19%. This is our own calculation, not a market consensus. It shows that even at favourable copper prices, the stock is valued close to fair value.

Return on equity (ROE) is 13.4%, which is decent but does not compensate for the high P/E. Further stock growth requires either substantial profit growth or multiple compression, which is unlikely without a correction in copper prices.

Valuation on the latest reported figures

Bottom line

Antofagasta delivered strong results for the first half of 2026: revenue up 17.9%, EBITDA up 23.3%, net profit up 62.4%. EBITDA margin reached 58.7%, and net debt turned into a net cash position of USD 1,194.8 million. However, the stock trades at a P/E of 29.8 and EV/EBITDA of 8.6, leaving no room for error. The dividend yield of 1.55% is below the key rate. According to the portal's model, upside is +19%, suggesting fair valuation. Verdict – neutral: strong operating results are already priced in.