Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2018shares | |
Document and Entity Information | |
Entity Registrant Name | Nexa Resources S.A. |
Entity Central Index Key | 0001713930 |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2018 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Accelerated Filer |
Entity Common Stock, Shares Outstanding | 133,208,125 |
Entity Shell Company | false |
Entity Emerging Growth Company | false |
Document Fiscal Year Focus | 2018 |
Document Fiscal Period Focus | FY |
Consolidated balance sheet
Consolidated balance sheet - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash and cash equivalents | $ 1,032,938 | $ 1,019,037 |
Financial investments | 91,878 | 206,155 |
Derivative financial instruments | 7,385 | 7,483 |
Trade accounts receivable | 173,204 | 182,713 |
Inventory | 269,705 | 324,878 |
Other assets | 122,857 | 98,641 |
Total current assets | 1,697,967 | 1,838,907 |
Non-current assets | ||
Financial investments | 355 | 392 |
Derivative financial instruments | 3,820 | 4,294 |
Related parties | 740 | 738 |
Deferred taxes | 201,154 | 224,513 |
Other assets | 120,175 | 73,138 |
Investments in associates | 283 | 309 |
Property, plant and equipment | 1,968,451 | 1,996,514 |
Intangible assets | 1,742,461 | 1,822,719 |
Total non-current assets | 4,037,439 | 4,122,617 |
Total assets | 5,735,406 | 5,961,524 |
Current liabilities | ||
Loans and financing | 32,513 | 40,841 |
Derivative financial instruments | 8,662 | 12,588 |
Trade payables | 387,225 | 329,814 |
Confirming payable | 70,411 | 111,024 |
Salaries and payroll charges | 58,166 | 79,798 |
Dividends payable | 663 | 4,138 |
Related parties | 63 | 87,686 |
Provisions | 20,357 | 14,641 |
Contractual liabilities | 31,992 | 31,296 |
Other liabilities | 41,798 | 56,389 |
Total current liabilities | 651,850 | 768,215 |
Non-current liabilities | ||
Loans and financing | 1,392,354 | 1,406,458 |
Derivative financial instruments | 5,560 | 2,449 |
Related parties | 1,517 | 2,238 |
Provisions | 280,566 | 326,520 |
Deferred taxes | 298,598 | 324,931 |
Contractual liabilities | 167,645 | 190,589 |
Other liabilities | 35,515 | 31,221 |
Total non-current liabilities | 2,181,755 | 2,284,406 |
Total liabilities | 2,833,605 | 3,052,621 |
Shareholders' equity | ||
Capital | 133,320 | 133,320 |
Treasury shares | (1,352) | |
Share premium | 1,043,755 | 1,123,755 |
Additional paid in capital | 1,318,728 | 1,318,728 |
Retained earnings (cumulative deficit) | 61,430 | (11,612) |
Accumulated other comprehensive loss | (79,288) | (77,356) |
Total equity attributable to Nexa's shareholders | 2,476,593 | 2,486,835 |
Non-controlling interests | 425,208 | 422,068 |
Total shareholders' equity | 2,901,801 | 2,908,903 |
Total liabilities and shareholders' equity | $ 5,735,406 | $ 5,961,524 |
Consolidated income statement
Consolidated income statement - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Consolidated income statement | |||
Net revenues | $ 2,491,202 | $ 2,449,484 | $ 1,964,841 |
Cost of sales | (1,888,944) | (1,752,825) | (1,504,229) |
Gross profit | 602,258 | 696,659 | 460,612 |
Operating expenses | |||
Selling | (18,743) | (17,616) | (25,519) |
General and administrative | (140,860) | (136,878) | (118,694) |
Mineral exploration and project development | (126,278) | (92,698) | (46,711) |
Other income and expenses, net | 18,176 | (47,887) | (139,719) |
Total operating expenses | (267,705) | (295,079) | (330,643) |
Operating income | 334,553 | 401,580 | 129,969 |
Net financial results | |||
Financial income | 67,509 | 29,868 | 24,955 |
Financial expenses | (121,662) | (106,169) | (70,374) |
Foreign exchange (loss) gain, net | (148,501) | (53,880) | 124,500 |
Net financial results | (202,654) | (130,181) | 79,081 |
Results of investees | |||
Share in the results of associates | 60 | (158) | |
Income before income tax | 131,899 | 271,459 | 208,892 |
Income tax | |||
Current | (71,787) | (125,691) | (75,282) |
Deferred | 30,864 | 19,497 | (23,101) |
Net income for the year | 90,976 | 165,265 | 110,509 |
Attributable to NEXA's shareholders | 74,860 | 126,885 | 93,167 |
Attributable to non-controlling interests | $ 16,116 | $ 38,380 | $ 17,342 |
Average number of outstanding shares | 133,313 | 116,527 | 80,699 |
Basic and diluted earnings per share (in dollars per share) | $ 0.56 | $ 1.09 | $ 1.15 |
Consolidated statement of compr
Consolidated statement of comprehensive income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Consolidated statement of comprehensive income | |||
Net income for the year | $ 90,976 | $ 165,265 | $ 110,509 |
Other comprehensive income (loss) net of taxes, all of which can be reclassified to the income statement | |||
Cash flow hedge accounting | (2,192) | 12,556 | (16,256) |
Translation adjustment of foreign subsidiaries | (9,959) | (10,742) | 30,373 |
Total other comprehensive income (loss) net of taxes, all of which can be reclassified to the income statement | (12,151) | 1,814 | 14,117 |
Total comprehensive income (loss) for the year | 78,825 | 167,079 | 124,626 |
Comprehensive income attributable to NEXA's shareholders | 72,928 | 125,941 | 101,199 |
Comprehensive income attributable to non-controlling interests | 5,897 | 41,138 | 23,427 |
Total comprehensive income (loss) for the year | $ 78,825 | $ 167,079 | $ 124,626 |
Consolidated statement of chang
Consolidated statement of changes in shareholders' equity - USD ($) $ in Thousands | Capital | Treasury shares | Share premium | Additional paid in capital | Retained earnings (cumulative deficit) | Accumulated other comprehensive income (loss) | Total attributable to Nexa's shareholders | Non-controlling interests | Total |
Beginning balance at Dec. 31, 2015 | $ 1,280,505 | $ 1,616,158 | $ (230,167) | $ (81,117) | $ 2,585,379 | $ 943,096 | $ 3,528,475 | ||
Total comprehensive income for the year | |||||||||
Net income for the year | 93,167 | 93,167 | 17,342 | 110,509 | |||||
Other comprehensive income (loss) for the year | 8,032 | 8,032 | 6,085 | 14,117 | |||||
Total comprehensive income (loss) for the year | 93,167 | 8,032 | 101,199 | 23,427 | 124,626 | ||||
Total contributions by and distributions to shareholders | |||||||||
Disbursements from equity transactions with non-controlling shareholders | (6,819) | (6,819) | (2,635) | (9,454) | |||||
Constitution of share premium | (350,000) | $ 350,000 | |||||||
Reimbursement of share premium | (69,931) | (69,931) | (69,931) | ||||||
Dividend distribution | (959) | (959) | (9,396) | (10,355) | |||||
Issuance of new shares / Proceed from initial public offering, net of underwritter expenses | 110,911 | 59,159 | 170,070 | 170,070 | |||||
Put option of shares | (170,070) | (170,070) | (170,070) | ||||||
Energy Assets compensation | (52,847) | (52,847) | (52,847) | ||||||
Cancellation of the loan due by NEXA BR to VSA | 15,717 | 15,717 | 15,717 | ||||||
Acquisition of shares from non-controlling shareholders | 276,317 | (84) | 276,233 | (478,148) | (201,915) | ||||
Total contributions by and distributions to shareholders | (239,089) | 339,228 | 62,298 | (1,043) | 161,394 | (490,179) | (328,785) | ||
Ending balance at Dec. 31, 2016 | 1,041,416 | 339,228 | 1,678,456 | (138,043) | (73,085) | 2,847,972 | 476,344 | 3,324,316 | |
Total comprehensive income for the year | |||||||||
Net income for the year | 126,885 | 126,885 | 38,380 | 165,265 | |||||
Other comprehensive income (loss) for the year | 3,327 | (4,271) | (944) | 2,758 | 1,814 | ||||
Total comprehensive income (loss) for the year | 130,212 | (4,271) | 125,941 | 41,138 | 167,079 | ||||
Total contributions by and distributions to shareholders | |||||||||
Reversion of Put Option | 173,734 | 173,734 | 173,734 | ||||||
Capital reduction related to Pollarix acquisition | (87,711) | (87,711) | (87,711) | ||||||
Purchase of Pollarix | (81,615) | (81,615) | (81,615) | ||||||
Constitution of share premium | (928,596) | 928,596 | |||||||
Reimbursement of share premium | (430,000) | (430,000) | (430,000) | ||||||
Increase (decrease) in non-controlling interests, net | (366,197) | (366,197) | (38,280) | (404,477) | |||||
Increase in participation in associates | 2,061 | 2,061 | (2,061) | ||||||
Dividend distribution | (3,781) | (3,781) | (55,073) | (58,854) | |||||
Issuance of new shares / Proceed from initial public offering, net of underwritter expenses | 20,500 | 285,931 | 306,431 | 306,431 | |||||
Total contributions by and distributions to shareholders | (908,096) | 784,527 | (359,728) | (3,781) | (487,078) | (95,414) | (582,492) | ||
Ending balance at Dec. 31, 2017 | 133,320 | 1,123,755 | 1,318,728 | (11,612) | (77,356) | 2,486,835 | 422,068 | 2,908,903 | |
Impact of the adoption of IFRS 9 | (1,818) | (1,818) | (1,818) | ||||||
At January 1, 2018 after impacts of IFRS 9 adoption | 133,320 | 1,123,755 | 1,318,728 | (13,430) | (77,356) | 2,485,017 | 422,068 | 2,907,085 | |
Total comprehensive income for the year | |||||||||
Net income for the year | 74,860 | 74,860 | 16,116 | 90,976 | |||||
Other comprehensive income (loss) for the year | (1,932) | (1,932) | (10,219) | (12,151) | |||||
Total comprehensive income (loss) for the year | 74,860 | (1,932) | 72,928 | 5,897 | 78,825 | ||||
Total contributions by and distributions to shareholders | |||||||||
Disbursements from equity transactions with non-controlling shareholders | (2,757) | (2,757) | |||||||
Reimbursement of share premium | (80,000) | (80,000) | (80,000) | ||||||
Repurchase of the Company's own shares | $ (1,352) | (1,352) | (1,352) | ||||||
Total contributions by and distributions to shareholders | (1,352) | (80,000) | (81,352) | (2,757) | (84,109) | ||||
Ending balance at Dec. 31, 2018 | $ 133,320 | $ (1,352) | $ 1,043,755 | $ 1,318,728 | $ 61,430 | $ (79,288) | $ 2,476,593 | $ 425,208 | $ 2,901,801 |
Consolidated statement of cash
Consolidated statement of cash flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flow from operating activities | |||
Income before income tax | $ 131,899 | $ 271,459 | $ 208,892 |
Depreciation and amortization | 267,189 | 270,454 | 275,034 |
Interest and foreign exchange (gain) or loss | 143,199 | 52,287 | (96,766) |
Loss on sale of property, plant and equipment and intangible assets | 8,616 | 694 | 552 |
Impairment (reversal) of property, plant and equipment | 3,283 | (979) | |
Changes in provisions | 29,777 | 32,798 | 93,701 |
Tax credits | (63,615) | (53) | |
Gain on sale of investment | (348) | (4,588) | (408) |
Share in the results of associates | (60) | 158 | |
Changes in operating assets and liabilities | 10,575 | (85,152) | 181,067 |
Interest paid | (74,592) | (58,635) | (37,321) |
Income taxes paid | (108,385) | (100,265) | (38,869) |
Net cash provided by operating activities | 347,598 | 378,939 | 585,061 |
Cash flow from investing activities | |||
Acquisitions of property, plant and equipment and intangible assets | (299,773) | (197,638) | (182,989) |
Changes in financial investments | 140,402 | (65,661) | (47,749) |
Loan received from related parties | 10,284 | ||
Advance paid for Pollarix acquisition | (81,615) | ||
Proceed from capital reduction of investees | 6,248 | ||
Proceeds from sale of non-current assets | 1,268 | 16,542 | 12,787 |
Net cash used in investing activities | (158,103) | (328,372) | (201,419) |
Cash flow from financing activities | |||
Proceeds from new loans and financing | 292,901 | 830,598 | 550,966 |
Payments of loans and financing | (295,104) | (537,254) | (483,100) |
Capital reduction related to Pollarix acquisition | (87,623) | (55,380) | |
Dividends distribution | (3,475) | (61,549) | (59,660) |
Reimbursement of share premium | (80,000) | (430,000) | (69,931) |
Proceeds from initial public offering, net of underwriter expenses | 306,431 | ||
Issuance of new shares | 170,070 | ||
Proceeds from transactions with related parties | 3,967 | ||
Acquisition of shares from non-controlling shareholders | (201,915) | ||
Repurchase of the Company's own shares | (1,352) | ||
Disbursement from equity transactions with non-controlling shareholders | (2,757) | (2,635) | |
Net cash provided by (used in) financing activities | (177,410) | 52,846 | (92,238) |
Effects of foreign exchange rates on cash and cash equivalents | 1,816 | 48 | 2,757 |
Increase in cash and cash equivalents | 13,901 | 103,461 | 294,161 |
Cash and cash equivalents at the beginning of the year | 1,019,037 | 915,576 | 621,415 |
Cash and cash equivalents at the end of the year | $ 1,032,938 | $ 1,019,037 | $ 915,576 |
General information
General information | 12 Months Ended |
Dec. 31, 2018 | |
General information | |
General information | 1 General information Nexa Resources S.A. (“NEXA”) was incorporated on February 26, 2014 under the laws of Luxembourg as a public limited liability company (société anonyme). Its shares are publicly traded on the New York Stock Exchange (“NYSE”) and the Toronto Stock Exchange (“TSX”). The Company’s registered office is located at 37A, Avenue J. F. Kennedy in the city of Luxembourg in the Grand Duchy of Luxembourg. NEXA and its subsidiaries (the “Company”) own and operate three polymetallic mines in Peru and two polymetallic mines in Brazil. Its operations are large-scale, mechanized underground and open pit mines. The Company also owns a zinc smelter in Peru and two zinc smelters in Brazil. The Company's majority shareholder is Votorantim S.A. (“VSA”), which holds 64.25% of its equity. VSA is a Brazilian privately-owned industrial conglomerate that holds ownership interests in metal, steel, cement and energy companies, among others. Information by business segment and geographic area Business segment definition The Company’s CEO has been identified as the chief operating decision maker (“CODM”), since he has the final authority over resource allocation decisions and performance assessment. The CEO analyzes performance from a product perspective and the Company has identified two reportable segments: · Mining: consists of five long-life polymetallic mines, three located in the Central Andes of Peru and two located in the state of Minas Gerais in Brazil. In addition to zinc, the Company produces substantial amounts of copper, lead, silver and gold as by-products, which reduce the overall cost to produce mined zinc. · Smelting: consists of three operating units, one located in Cajamarquilla in Peru and two located in the state of Minas Gerais in Brazil. The facilities recover and produce metallic zinc (SHG zinc and zinc alloys), zinc oxide and by-products, such as sulfuric acid. Accounting policy Segment performance is measured based on Adjusted EBITDA, since financial results and income taxes are managed within the corporate level and are not allocated to operating segments. Adjusted EBITDA is defined as net income (loss) for the year, adjusted by (i) share in the results of associates, (ii) depreciation and amortization, (iii) net financial results, (iv) income tax, (v) gain (loss) on sale of investment, (vi) impairment and impairment reversal. In addition, management may exclude non-cash and non-recurring items considered exceptional from the measurement of Adjusted EBITDA. The internal information used for making decisions is prepared applying accounting measurement basis with managerial reclassifications between income statements lines, which are reconciled to the consolidated financial statements in the column “Adjustments”. When applicable, the Company uses arm's length commercial terms for intersegment sales. The Company’s corporate headquarters expenses are allocated to the reportable segments to the extent they are allocated in the measures of performance used by the CODM. Segment results The presentation of segment results and reconciliation to income before income tax in the consolidated income statement is as follows: 2018 Intersegments Mining Smelting sales Adjustments Consolidated Net revenues 1,163,741 2,030,568 (704,031) 924 2,491,202 Cost of sales (694,024) (1,876,034) 704,031 (22,917) (1,888,944) Gross Profit 469,716 154,534 — (21,993) 602,258 Selling, general and administrative (44,940) (79,969) — (34,693) (159,603) Mineral explorations and project development (112,713) (11,067) — (2,498) (126,278) Other income and expenses, net (54,042) 16,450 — 55,768 18,176 Operating income 258,021 79,948 — (3,416) 334,553 Depreciation and amortization 172,357 94,832 — — 267,189 Exceptional items (i) — — — 3,050 3,050 Adjusted EBITDA 430,378 174,781 — (366) 604,792 Exceptional items (i) (3,050) (3,050) Depreciation and amortization (267,189) Net financial results (202,654) Income before income tax 131,899 2017 Intersegments Mining Smelting sales Adjustments Consolidated Net revenues 1,213,221 1,952,006 (721,463) 5,719 2,449,484 Cost of sales (680,811) (1,746,771) 721,463 (46,706) (1,752,825) Gross Profit 532,410 205,235 — (40,987) 696,659 Selling, general and administrative (41,054) (89,128) — (24,312) (154,494) Mineral explorations and project development (86,119) (3,989) — (2,590) (92,698) Other income and expenses, net (54,777) (58,749) — 65,640 (47,887) Operating income 350,460 53,369 — (2,249) 401,580 Depreciation and amortization 171,085 99,370 — — 270,456 Exceptional items (i) — — — (4,515) (4,515) Adjusted EBITDA 521,545 152,739 — (6,764) 667,519 Exceptional items (i) 4,515 4,515 Share in the results of associates 60 Depreciation and amortization (270,456) Net financial results (130,181) Income before income tax 271,459 2016 Intersegments Mining Smelting sales Adjustments Consolidated Net revenues 907,425 1,491,988 (438,238) 3,666 1,964,841 Cost of sales (608,825) (1,307,436) 438,238 (26,206) (1,504,229) Gross Profit 298,600 184,552 — (22,540) 460,612 Selling, general and administrative (46,829) (69,950) — (27,436) (144,213) Mineral explorations and project development (41,759) (2,925) — (2,026) (46,711) Other income and expenses, net (49,478) (139,922) — 49,681 (139,719) Operating income 160,534 (28,245) — (2,321) 129,969 Depreciation and amortization 176,261 98,772 — — 275,036 Exceptional items (i) — — — (1,079) (1,079) Adjusted EBITDA 336,796 70,528 — (3,400) 403,924 Exceptional items (i) 1,079 1,079 Share in the results of associates (158) Depreciation and amortization (275,036) Net financial results 79,081 Income before income tax 208,892 (i) |
Basis of preparation of the con
Basis of preparation of the consolidated financial statements | 12 Months Ended |
Dec. 31, 2018 | |
Basis of preparation of the consolidated financial statements | |
Basis of preparation of the consolidated financial statements | 2 Basis of preparation of the consolidated financial statements The consolidated financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (“IFRS”) and interpretations issued by the IFRS Interpretations Committee applicable to companies reporting under IFRS. The consolidated financial statements comply with IFRS as issued by the International Accounting Standards Board. The consolidated financial statements have been prepared under the historical cost convention, except for some financial assets and financial liabilities (including derivative financial instruments) measured at fair value at the end of each reporting period. The consolidated financial statements of the Company for the year ended December 31, 2018 were approved to be issued in accordance with a resolution of the Board of Directors on February 15, 2019. 2.1 Principles of consolidation (a) Subsidiaries Subsidiaries include all entities over which the Company has control. The Company controls an entity when it (i) has the power over the entity; (ii) is exposed, or has the right, to variable returns from its involvement with the entity; and (iii) has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company, except when the predecessor basis of accounting is applied. Subsidiaries are deconsolidated from the date on which that control ceases. When the Company has less than a majority of the voting rights of an investee, it considers that it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. Non-controlling interests in the equity and results of subsidiaries are shown separately in the consolidated balance sheet, income statement, statement of comprehensive income and statement of changes in shareholders’ equity. Transactions, balances and unrealized gains and losses between consolidated entities are eliminated. (b) Joint operations The Company recognizes its direct right to the assets, liabilities, revenues and expenses of joint operations and its share of any jointly held assets or incurred liabilities and revenues and expenses. A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the assets, and obligations for the liabilities, relating to the arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control. Transactions, balances and unrealized gains and losses between consolidated entities are eliminated. Main companies included in the consolidated financial statements: Percentage of capital 2018 2017 Headquarters Activities Subsidiaries Cia. Magistral S.A.C 100.00 100.00 Peru Mining projects Nexa Resources Atacocha S.A.A. - "NEXA ATACOCHA" 66.62 66.62 Peru Mining Nexa Resources Perú S.A.A. - "NEXA PERU" 80.23 80.23 Peru Mining Inversiones Garza Azul S.A.C 99.75 100.00 Peru Holding and others Votorantim GmbH 100.00 100.00 Austria Holding and others Pollarix S.A. - "Pollarix" (i) 33.33 33.33 Brazil Holding and others L.D.O.S.P.E. Geração de Energia e Participações Ltda. - "L.D.O.S.P.E." 100.00 100.00 Brazil Energy L.D.Q.S.P.E. Geração de Energia e Participações Ltda. - "L.D.Q.S.P.E." 100.00 100.00 Brazil Energy L.D.R.S.P.E. Geração de Energia e Participações Ltda. - "L.D.R.S.P.E." 100.00 100.00 Brazil Energy Nexa Resources El Porvenir S.A.C. 99.99 99.99 Peru Mining Nexa Resources UK Ltd. - "NEXA UK" 100.00 100.00 United Kingdom Mining Minera Bongará S.A. 61.00 61.00 Peru Mining projects Minera Pampa de Cobre S.A.C 99.99 99.99 Peru Mining Mineração Dardanelos Ltda. 70.00 70.00 Brazil Mining projects Mineração Santa Maria Ltda. 99.99 99.99 Brazil Mining projects Rayrock Antofagasta S.A.C 99.99 99.99 Chile Holding and others Nexa Resources Cajamarquilla S.A. - "NEXA CJM" 99.99 99.99 Peru Smelting Nexa Recursos Minerais S.A. - "NEXA BR" 100.00 100.00 Brazil Mining / Smelting Votorantim US. Inc. 100.00 100.00 United States Holding and others Joint-operation Campos Novos Energia S.A. - "Enercan" 20.98 20.98 Brazil Energy Cia. Minera Shalipayco S.A.C 75.00 75.00 Peru Mining projects (i) (c) Foreign currency translation (i) Functional and presentation currency Items included in the financial statements of each of the Company’s entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The Company’s consolidated financial statements are presented in US Dollars ("USD"), which is NEXA’s functional and reporting currency. (ii) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at the end of each reporting period are recognized in the income statement. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. (iii) Consolidated The results of operations and financial position of consolidated entities that have a functional currency different from the reporting currency are translated into the reporting currency as follows: · Assets and liabilities for each balance sheet presented are translated at the closing rate at the end of the reporting period; · Income and expenses for each income statement are translated at average exchange rates which is a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates; and · All resulting exchange differences are recognized in other comprehensive income and accumulated in a separate component of shareholders’ equity. (d) Transactions with non-controlling interests Transactions with non-controlling interests that do not result in a loss of control are accounted within the shareholders’ equity. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and any consideration paid or received is recognized in a separate reserve within shareholders’ equity. 2.2 Reclassification of income statement (a) Reclassification of mineral exploration and project development expenses and impact of adoption of IFRS 15 The Company changed the presentation of mineral exploration and project development expenses that were previously presented as “General and administrative expense” and “Other income and expenses, net” in the income statement to a new line item labeled “Mineral exploration and project development”. Refer to Note 24 for details of mineral exploration and project development expenses. The reclassification has no impact on the Company’s financial position, net income for the year or cash flows. Refer to Note 3(a) for details about the impact of the adoption of IFRS 15. (b) Reconciliation of reclassified comparative figures and effects of adoption of IFRS 15 (i) Income statement Reclassification of mineral exploration and (Original) Adoption of IFRS project (Revised) 2017 15 development 2017 Net revenues 2,449,484 — — 2,449,484 Cost of sales (1,681,202) (71,623) — (1,752,825) Gross profit 768,282 (71,623) — 696,659 Reclassification of mineral exploration and (Original) First adoption of project (Revised) 2017 IFRS 15 development 2017 Operating expenses Selling (89,239) 71,623 — (17,616) General and administrative (148,242) — 11,364 (136,878) Mineral exploration and project development — — (92,698) (92,698) Other income and expenses, net (129,221) — 81,334 (47,887) (366,702) 71,623 — (295,079) Operating income 401,580 — — 401,580 Reclassification of mineral exploration and (Original) First adoption of project (Revised) 2016 IFRS 15 development 2016 Net revenues 1,964,841 — — 1,964,841 Cost of sales (1,439,101) (65,128) — (1,504,229) Gross profit 525,740 (65,128) — 460,612 Reclassification of mineral exploration and (Original) First adoption of project (Revised) 2016 IFRS 15 development 2016 Operating expenses Selling (90,647) 65,128 — (25,519) General and administrative (127,305) — 8,611 (118,694) Mineral exploration and project development — — (46,711) (46,711) Other income and expenses, net (177,819) — 38,100 (139,719) (395,771) 65,128 — (330,643) Operating income 129,969 — — 129,969 (ii) Expenses by nature Reclassification of mineral exploration (Original) and project (Revised) 2017 Adoption of IFRS 15 development 2017 Raw materials and consumables used 1,120,540 — — 1,120,540 Employee benefit expenses 278,285 — 1,086 279,371 Depreciation and amortization 270,454 — 2 270,456 Services, miscellaneous 232,165 (71,623) 59,993 220,535 Other Expenses 17,239 71,623 20,253 109,115 1,918,683 — 81,334 2,000,017 Reconciliation Cost of sales 1,681,202 71,623 — 1,752,825 Selling, general and administrative expenses 237,481 (71,623) (11,364) 154,494 Mineral exploration and project development — — 92,698 92,698 1,918,683 — 81,334 2,000,017 Reclassification of mineral exploration (Original) First adoption of and project (Revised) 2016 IFRS 15 development 2016 Raw materials and consumables used 956,909 — — 956,909 Employee benefit expenses 233,755 — 450 234,205 Depreciation and amortization 275,034 — 2 275,036 Services, miscellaneous 158,388 (65,128) 29,297 122,557 Other Expenses 32,967 65,128 8,351 106,446 1,657,053 — 38,100 1,695,153 Reconciliation Cost of sales 1,439,101 65,128 — 1,504,229 Selling, general and administrative expenses 217,952 (65,128) (8,611) 144,213 Mineral exploration and project development — — 46,711 46,711 1,657,053 — 38,100 1,695,153 |
Changes in accounting policies
Changes in accounting policies and disclosures | 12 Months Ended |
Dec. 31, 2018 | |
Changes in accounting policies and disclosures | |
Changes in accounting policies and disclosures | 3 Changes in accounting policies and disclosures (a) New and amended IFRS standards that are effective beginning on January 1, 2018 IFRS 9 - "Financial instruments: Recognition and measurement" Main impacts introduced by the standard IFRS 9 – “Financial Instruments” replaces IAS 39 and all previous versions of IFRS 9. IFRS 9 brings together all three aspects of the accounting for financial instruments project, which are classification and measurements, impairment, and hedge accounting. IFRS 9 became effective on January 1, 2018 and the Company has applied it accordingly. Impacts of adoption Classification and measurement The Company adopted retrospective transition method as mentioned by IFRS 9, however no adjustments to the accounting balances were deemed necessary. IFRS 9 has changed the categories for classification of financial assets, eliminating the categories held-to-maturity, loans and receivables and available for sale. The Company’s financial assets have been classified in one of the following categories: measured at amortized cost, measured at fair value through other comprehensive income or, measured at fair value through profit or loss. The classification of financial assets under IFRS 9 is generally based on the business model in which a financial asset is managed and its contractual cash flow characteristics. The following table summarizes the differences in classification and measurements categories under IAS 39 and the new measurement categories under IFRS 9 for each class of the Company’s financial assets. There were no changes in classification and measurement of the Company’s financial liabilities. January 1, 2018 Original carrying New carrying Financial assets Classification under IAS 39 New classification under IFRS 9 amount under IAS 39 amount under IFRS 9 Cash and cash equivalents Loans and receivable Fair value through profit or loss 1,019,037 1,019,037 Financial investments Assets held for trading Fair value through profit or loss 206,547 206,547 Derivative financial instruments Assets held for trading/Used for hedging Fair value through profit or loss / Fair value through other comprehensive income 11,777 11,777 Trade accounts receivable Loans and receivable Fair value through profit or loss / Amortized cost 182,713 182,469 Related parties Loans and receivable Fair value through profit or loss / Amortized cost 738 738 The most significant changes are related to the classification and measurement of trade account receivables where the Company has concluded that it operates using different business models, being (i) held to collect and sell and (ii) held to collect. See Note 10 for details of the Company`s business model for trade account receivables. At January 1, 2018, the fair value adjustment of trade accounts receivable that are held to collect and sell recognized in “Cumulative deficit” was USD 244, net of taxes. Impairment The Company adopted the retrospective transition method as mentioned by IFRS 9. However, the Company did not restate years prior to January 1, 2018, because it would not be possible without the use of hindsight. IFRS 9 replaced the incurred loss model in IAS 39 and requires impairment of financial assets to be determined using an expected credit loss model. The new impairment model applies to financial assets that are subsequently measured at amortized cost or fair value through other comprehensive income, including trade accounts receivable. The most significant impact for the Company is related to impairment of trade accounts receivable, which is measured at amortized cost. The Company elected to apply the simplified approach set forth in IFRS 9 and recognized impairment losses for trade accounts receivable based on lifetime expected losses and using a loss provision matrix. At January 1, 2018, incremental impairment losses under IFRS 9 recognized in “Cumulative deficit” was USD 1,574, net of taxes. Hedge accounting New hedge accounting requirements impacted the Company’s hedge documentation, without having impacted the Company’s financial position or results of its operations. IFRS 15 – "Revenue from contracts with customers" Main impacts introduced by the standard IFRS 15 – “Revenue from Contracts” with customers establishes a comprehensive framework for determining the amount and timing when revenue is recognized. It replaced the guidance contained in IAS 18 – “Revenue” which the Company followed until December 31, 2017. IFRS 15 became effective on January 1, 2018 and the Company has applied it accordingly. The Company elected to adopt IFRS 15 using the full retrospective method. Comparative financial information has been restated. Adoption of IFRS 15 by the Company has not resulted in any material changes in timing or amount of revenue recognition under IFRS 15 model as compared to revenue that would be reported under IAS 18 - “Revenue”. Therefore, there were no impacts of the adoption of IFRS 15 on the Company’s balance sheet and statement of cash flows. However, the Company identified distinct performance obligations that affected the presentation of the income statement as discussed below. Impacts of adoption Identification of performance obligations and timing of satisfaction of performance obligations As a result of the distinct performance obligations identified, part of the Company’s revenues is presented as revenues from services. Cost related to revenues from services is presented as “Cost of sales”. Revenues from services was USD 70,896 for the year ended December 31, 2018 (2017 – USD 71,623; 2016 – USD 65,128). Determining the transaction price and the amounts allocated to performance obligations The Company has considered the terms of the contracts and its customary business practices to determine the transaction price. The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to its customers. Transaction price is allocated to each performance obligation on a relative standalone selling price basis. For the purpose of determining the transaction price, the Company’s contracts have mainly fixed prices. However, the Company’s silver streaming arrangement have variable consideration related to Cerro Lindo’s silver production. The impact on recognition of revenues related to these sales was not material. Contractual liabilities The advance payment received in connection with the Company’s silver streaming agreement has been accounted for as contractual liability, with amounts recognized as revenue as the silver is delivered to the customer. The impact on recognition of revenue related to these sales was not material. (b) New standards and interpretations not yet adopted IFRS 16 - "Leases" Main aspects introduced by the standard IFRS 16 was issued in January 2016. It will result in almost all leases being recognized on the balance sheet by lessees, as the distinction between operating and finance leases is removed. Under the new standard, an asset (the right to use the leased item) and a financial liability to pay rentals are recognized. The only exceptions are short-term and low-value leases. Transition method The Company will apply IFRS 16 from its mandatory adoption date of January 1, 2019, using the simplified transition approach and will not restate comparative periods for the years prior to the adoption. Right-of-use assets will be measured on transition at the amount of the lease liability, adjusted by any prepaid or accrued lease expense. Impacts of adoption IFRS 16 will affect primarily the accounting for the Company’s operating leases, except for short-term and low value leases, since the Company will adopt the practical expedients permitted by IFRS 16 and will recognize both as an expense in the income statement. The Company expects to recognize lease liabilities and right-of-use assets in the amount of approximately USD 46,618. Net current assets will be USD 18,379 lower due to the presentation of a portion of the liability as a current liability. The Company expects that income before income tax will decrease by approximately USD 1,413 for 2019 as a result of adopting the new rules. Adjusted EBITDA used to measure segment results is expected to increase by approximately USD 17,654, as the operating lease payments were included in EBITDA, but the amortization of the right-of-use assets and interest on the lease liability are excluded from this measure. IFRIC 23 - Uncertainty over income tax treatments Nature of change The interpretation explains how to recognize and measure deferred and current income tax assets and liabilities where there is uncertainty over a tax treatment. Specifically, it discusses: · how to determine the appropriate unit of account, and that each uncertain tax treatment should be considered separately or together as a group, depending on which approach better predicts the resolution of the uncertainty; · that the entity should assume a tax authority will examine the uncertain tax treatments and have full knowledge of all related information; · that the entity should reflect the effect of the uncertainty in its income tax accounting when it is not probable that the tax authorities will accept the treatment; · that the impact of the uncertainty should be measured using either the most likely amount or the expected value method, depending on which method better predicts the resolution of the uncertainty; and · that the judgements and estimates made must be reassessed whenever circumstances have changed or there is new information that affects the judgements. Transaction The Company will apply the standard from its mandatory adoption date of January 1, 2019. Impacts of adoption The Company expects that the impact of the adoption will not be material. |
Changes in accounting estimates
Changes in accounting estimates - Rights to use natural resources | 12 Months Ended |
Dec. 31, 2018 | |
Changes in accounting estimates - Rights to use natural resources | |
Changes in accounting estimates - Rights to use natural resources | 4 Changes in accounting estimates - Rights to use natural resources In accordance with its accounting policy, the Company reviews the estimated useful lives and the pattern of consumption of the future economic benefits of its intangible assets on an ongoing basis. This review indicated a change in future pattern of consumption over its “Rights to use natural resources”, which is substantially related to an increase in extraction experience of the Company’s mines, updates in the extraction period and expected changes in extraction volume at the end of the mining life. As a result, effective April 1, 2018, the Company changed the amortization of “Rights to use natural resources” from the straight-line method to the units of production method, in accordance with Note 14. This change has been accounted for prospectively as a change in accounting estimate in accordance with IAS 8 – “Accounting policies, Changes in Accounting Estimates and Errors”. The effect of this change in estimate was not material for the fiscal year ended December 31, 2018. |
Financial risk management
Financial risk management | 12 Months Ended |
Dec. 31, 2018 | |
Financial risk management | |
Financial risk management | 5 Financial risk management 5.1 Financial risk factors The Company's activities expose it to a variety of financial risks: a) market risk (including currency risk, interest rate risk and commodities risk); b) credit risk; and c) liquidity risk. A significant portion of the products sold by the Company are commodities, with prices pegged to international indices and denominated in US Dollars. Part of the costs of production, however, is denominated in Brazilian Reais and Peruvian Soles, and therefore, there is a mismatch of currencies between revenues and costs. Additionally, the Company has debts linked to different indices and currencies, which may impact its cash flows. In order to mitigate the potential adverse effects of each financial risk factor, the Company follows a Financial Risk Management Policy that establishes governance and guidelines for the financial risk management process, as well as metrics for measurement and monitoring. This policy establishes guidelines and rules for: (i) Commodities Exposure Management, (ii) Foreign Exchange Exposure Management, (iii) Interest Rate Exposure Management, (iv) Issuers and Counterparties Risk Management, and (v) Liquidity and Financial Indebtedness Management. All strategies and proposals must comply with the Financial Risk Management Policy guidelines and rules, be presented to and discussed with the Finance Committee of the board of directors, and, when applicable, submitted for the approval of the Board of Directors, under the governance structure described in the Financial Risk Management Policy. (a) Market risk The purpose of the market risk management process is to protect the Company's cash flow against adverse events, such as changes in foreign exchange rates, commodity prices and interest rates. (i) Foreign exchange risk Foreign exchange risk is managed through the Company’s Financial Risk Management Policy, which states that the objectives of derivative transactions are to reduce cash flow volatility, hedge against foreign exchange exposure and minimize currency mismatches. The US Dollar is NEXA’s functional currency, and all actions related to the market risk management process are intended to protect cash flows in this currency, maintain the ability to pay financial obligations, and comply with liquidity and indebtedness levels defined by management. Presented below are the financial assets and liabilities in foreign currencies at December 31, 2018 – these mainly result from the foreign operations of NEXA BR for which the functional currency is the Brazilian Real. USD amounts of foreign currency transactions 2018 2017 Assets Cash, cash equivalents and financial investments 140,860 229,877 Derivative financial instruments 11,205 4,280 Trade accounts receivable 39,000 66,834 191,065 300,991 Liabilities Loans and financing 123,471 161,706 Derivative financial instruments 14,222 3,634 Trade payables 4,689 78,286 142,382 243,626 Net exposure 48,683 57,365 (ii) Interest rate risk The Company's interest rate risk arises mainly from long-term loans. Loans at variable rates expose the Company to cash flow interest rate risk. Loans at fixed rates expose the Company to fair value risk associated with interest rates. For further information related to interest rates, refer to Note 15. The Company’s Financial Risk Management Policy establishes guidelines and rules to hedge against changes in interest rates that impact the cash flows of the Company. Exposure to each interest rate is projected until the maturity of the assets and liabilities exposed to this index. Occasionally the Company enters into floating to fixed interest rate swaps to manage its cash flow interest rate risk. (iii) Commodity price risk This risk is related to the volatility in the prices of the Company's commodities. Prices fluctuate depending on demand, production capacity, producers' inventory levels, the commercial strategies adopted by large producers, and the availability of substitutes for these products in the global market. The Company’s Financial Risk Management Policy establishes guidelines to mitigate the risk of fluctuations in commodity prices that could impact the cash flows of the Company. The exposure to the price of each commodity considers the monthly projections of production, purchases of inputs and the maturity flows of hedges associated with them. Commodity prices hedge transactions are classified into the following hedging strategies: Hedges for sales of zinc at a fixed price (Customer Hedge) The objective is to convert fixed prices sales to floating London Metal Exchange (LME) prices. The purpose of the strategy is to maintain the revenues of a business unit linked to the LME prices. These transactions usually relate to purchases of zinc for future settlement on the over-the-counter market. Hedges for mismatches of quotational periods (Book Hedges) The objective is to hedge quotational periods mismatches arising between the purchases of metal concentrate or processed metal and the sale of the processed metal. These transactions usually relate to purchases and sales of zinc and silver for future trading on the over-the-counter market. Hedges for the operating margin of metals (Strategic Hedges) The objective is to reduce the volatility of the cash flow from LME prices for zinc, copper and silver and ensure a more predicable operating margin. This strategy is carried out through the sale of zinc forward contracts. For NEXA BR, the transaction also involves the sale of US dollars forward contracts in order to hedge the operating margin in Brazilian reais. (b) Credit risk Trade receivables, derivative financial instruments, term deposits, bank deposit certificates ("CDBs") and repurchase transactions backed by debentures and government securities create exposure to credit risk with respect to the counterparties and issuers. The Company has a policy of making deposits in financial institutions that have, at least, a rating from two of the following international rating agencies: Fitch, Moody’s or Standard & Poor’s. The minimum rating required for counterparties is A+/A1 (local rating scale) or BBB-/Baa3 (global rating scale). In the specific case of financial institutions in Peru where only global rating assessments are available, it will be eligible provided it has a rating of "BBB-" at least by one rating agency. The pre-settlement risk methodology is used to assess counterparty risks in derivative transactions. This methodology consists of determining the risk associated with the likelihood (via Monte Carlo simulations) of a counterparty defaulting on the financial commitments defined by contract. The global ratings were obtained from the rating agencies Standard & Poor's, Moody's and Fitch ratings and are related to commitments in foreign or local currency and, in both cases, they assess the capacity to honor these commitments, using a scale applicable on a global basis. Therefore, both ratings in foreign currency and in local currency are internationally comparable ratings. The ratings used by the Company are always the most conservative ratings of the referred agencies. In the case of credit risk arising from customer credit exposure, the Company assesses the credit quality of the customer, considering mainly the history of the relationship and financial indicators defining individual credit limits, which are continuously monitored. The Company performs initial analyses of customer credit and, when deemed necessary, guarantees or letters of credit are obtained to mitigate the credit risk. Additionally, most sales to the United States of America, Europe and Asia are collateralized by letters of credit and credit insurance. The following table reflects the credit quality of issuers and counterparties for transactions involving cash and cash equivalents, financial investments and derivative financial instruments: 2018 2017 Local rating Global rating Total Local rating Global rating Total Cash and cash equivalents AAA 1,484 — 1,484 — — — AA+ 861 — 861 1,089 — 1,089 AA 24 78,245 78,269 — — — AA- — 20,179 20,179 — 115,269 115,269 A+ — 178,730 178,730 — 172,052 172,052 A — 361,484 361,484 — 235,445 235,445 A- — 29,162 29,162 3 86,189 86,192 BBB+ — 181,411 181,411 — 96,436 96,436 BBB — 20,245 20,245 — 110,733 110,733 BBB- — 83,919 83,919 — — — No rating 3 77,191 77,194 — 201,821 201,821 2,372 1,030,566 1,032,938 1,092 1,017,945 1,019,037 Financial investments AAA 51,913 — 51,913 — — — AA+ 10,840 — 10,840 17,111 — 17,111 AA 24,965 — 24,965 — — — AA- — — — 180,127 4,238 184,365 A- — — — 5,053 — 5,053 No rating 4,515 — 4,515 — 18 18 92,233 — 92,233 202,291 4,256 206,547 Derivative financial instruments AAA 3,749 — 3,749 — — — AA — 2,164 2,164 — — — AA- — — — 4,769 3,634 8,403 A+ — 5,275 5,275 — 3,141 3,141 A — 17 17 — 233 233 3,749 7,456 11,205 4,769 7,008 11,777 98,354 1,038,022 1,136,376 208,152 1,029,209 1,237,361 (c) Liquidity risk This risk is managed through the Company's Financial Risk Management Policy, which aims to ensure the availability of sufficient net funds to meet the Company's financial commitments. The main liquidity measurement and monitoring instrument is the cash flow projection, using a minimum projection period of 12 months from the benchmark date. The table below analyzes the Company's financial liabilities to be settled by the Company based on their maturity (the remaining period from the balance sheet up to the contractual maturity date). The amounts below represent the estimated undiscounted future cash flow, which include interest to be incurred and, accordingly, do not reconcile directly with the amounts presented in the consolidated balance sheet. Less than 1 Between 1 and Between 3 and Over 5 years Total At December 31, 2018 Loans and financing 91,890 261,186 619,958 897,701 1,870,735 Derivative financial instruments 8,663 4,954 605.00 — 14,222 Trade payables 387,225 — — — 387,225 Confirming payable 70,411 — — — 70,411 Salaries and payroll charges 58,166 — — — 58,166 Related parties 63 1,517 — — 1,580 Provisions - Asset Retirement Obligation 12,283 40,171 36,561 198,061 287,075 Use of public assets 1,411 3,092 3,485 33,658 41,646 630,775 310,920 660,609 1,129,420 2,731,723 At December 31, 2017 Loans and financing 102,294 373,324 236,927 1,228,474 1,941,018 Derivative financial instruments 12,588 2,449 — — 15,037 Trade payables 329,814 — — — 329,814 Confirming payable 111,024 — — — 111,024 Salaries and payroll charges 79,798 — — — 79,798 Dividends payable 4,138 — — — 4,138 Related parties 87,686 2,238 — — 89,924 Provisions - Asset Retirement Obligation 7,526 53,429 33,186 237,788 331,929 Use of public assets 1,740 3,755 4,233 45,309 55,037 736,607 435,195 274,346 1,511,571 2,957,719 5.2 Capital management The Company is subject to financial covenants on its loans and financing. The compliance with the financial covenants is verified by using the gearing ratio, calculated as net debt divided by Adjusted EBITDA. Net debt is defined as (i) loans and financing, less (ii) cash and cash equivalents, less (iii) financial investments, plus or minus (iv) the fair value of derivative financial liabilities or assets, respectively. Adjusted EBITDA for capital management calculation uses the same assumptions described in Note 1 for Adjusted EBITDA by segment. Net debt and Adjusted EBITDA measures should not be considered in isolation or as a substitute for net income or operating income, as indicators of operating performance, or as alternatives to cash flow as measures of liquidity. Additionally, management’s calculation of Adjusted EBITDA may be different from the calculation used by other companies, including competitors in the mining and smelting industry, so these measures may not be comparable to those of other companies. The gearing ratio is as follows: Note 2018 2017 2016 Loans and financing 1,424,867 1,447,299 1,144,385 Cash and cash equivalents (1,032,938) (1,019,037) (915,576) Derivative financial instruments 3,017 3,260 16,718 Financial investments (92,233) (206,547) (119,498) Net debt 302,713 224,975 126,029 Net income for the year 90,976 165,265 110,509 Plus (less): Share in the results of associates — (60) 158 Depreciation and amortization 13 and 14 267,189 270,456 275,036 Net financial results 202,654 130,181 (79,081) Income tax 40,923 106,194 98,383 EBITDA 601,742 672,034 405,003 Exceptional items 1 (i) 3,050 (4,515) (1,079) Adjusted EBITDA 604,792 667,519 403,924 Gearing ratio (Net Debt/Adjusted EBITDA) 0.50 0.34 0.31 5.3 Fair v alue estimates Critical accounting estimates and judgments The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. The Company uses judgment to select among a variety of methods and makes assumptions that are mainly based on market conditions existing at the end of each reporting period. (a) Analysis The carrying amounts of trade accounts receivable, less impairment losses, confirming payables and advances from customers approximate their fair values. The fair value of loans and financing for disclosure purposes are estimated by discounting the future contractual cash flow at the current market interest rate and adjusted for the Company’s credit risk. The main financial instruments and the assumptions made by the Company for their valuation are described below: · Cash and cash equivalents, financial investments, trade accounts receivable and other current assets - considering their nature, terms and maturity, the carrying amounts approximate their fair value. · Financial liabilities - these instruments are subject to the usual market interest rates. The fair value was based on the present value of expected future cash disbursement, at interest rates currently available for debt with similar maturities and terms and adjusted for the Company’s credit risk. · Derivative financial instruments – the fair value of the derivative financial instruments is determined by calculating their present value through yield curves at the closing dates. The curves and prices used in the calculation for each group of instruments are developed based on data from Brazilian Securities, Commodities and Futures Exchange - B3, Central Bank of Brazil, LME and Bloomberg, interpolated between the available maturities. · Swap contracts - the present value of both the assets and liabilities are calculated through the discount of forecasted cash flow by the interest rate of the currency in which the swap is denominated. The difference between the present value of the assets and the liabilities generates its fair value. · Forward contracts – the present value is estimated by discounting the notional amount multiplied by the difference between the future price at the reference date and the contracted price. The future price is calculated using the convenience yield of the underlying asset. It is common to use Asian non-deliverable forwards for hedging non-ferrous metals positions. Asian contracts are derivatives in which the underlying is the average price of certain asset over a range of days. · Option contracts - the present value is estimated based on Black model, with assumptions that include the underlying asset price, strike price, volatility, time to maturity and interest rate. The underlying asset price is the average price of the foreign exchange rate in the fixing month. (b) Fair value hierarchy Financial assets and financial liabilities recognized and measured at fair value were classified as Level 1 and 2 in the fair value measurement hierarchy, as follows: Note Level 1 Level 2 Total fair value Assets Cash and cash equivalents 1,032,938 — 1,032,938 Financial investments 39,167 53,065 92,233 Derivative financial instruments — 11,205 11,205 Trade accounts receivables — 151,058 151,058 1,072,105 215,328 1,287,434 Liabilities Derivative financial instruments — 14,222 14,222 — 14,222 14,222 Note Level 1 Level 2 Total fair value Assets Cash and cash equivalents 1,019,037 — 1,019,037 Financial investments 134,168 72,379 206,547 Derivative financial instruments — 11,777 11,777 Trade accounts receivables — 62,693 62,693 1,153,205 146,849 1,300,054 Liabilities Derivative financial instruments — 15,037 15,037 — 15,037 15,037 The Company discloses fair value measurements based on their level of the following fair value measurement hierarchy: Level 1: Quoted prices (unadjusted) in active markets for identical assets and liabilities traded in active markets at the balance sheet date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm's length basis. The quoted market price used for financial assets held by the Company is the current bid price. Level 2: Financial instruments not traded in an active market for which fair value is determined using valuation techniques, when all of the significant inputs required to identify the fair value of an instrument are observable. Specific valuation techniques used to value financial instruments include: · Quoted market prices or dealer quotes for similar instruments are used where available; · The fair values of interest rate swaps are calculated at the present value of the estimated future cash flow based on observable yield curves; and · The fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance sheet date, with the resulting value discounted to present value. Other techniques, such as discounted cash flow analysis, are used to determine the fair value for the remaining financial instruments. Level 3: Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) are classified as Level 3. As of December 31, 2018, there were not any financial assets and liabilities carried at fair value classified as Level 3. |
Derivative financial instrument
Derivative financial instruments | 12 Months Ended |
Dec. 31, 2018 | |
Derivative financial instrument | |
Derivative financial instruments | 6 Derivative financial instruments Accounting policy Derivatives are initially recognized at fair value as at the date on which a derivative contract is entered into and are subsequently measured at fair value. Derivatives are only used for risk mitigation purposes and not as speculative investments. When derivatives do not meet the hedge accounting criteria, they are classified as held for trading and accounted for at fair value through profit or loss. The Company documents at the inception of the hedging transaction the relationship between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking the hedge transactions. The Company also documents its assessment, both at hedge inception and on an ongoing basis, whether the derivatives that are used in hedging transactions and accounted for as hedge accounting were, and will continue to be, highly effective in offsetting changes in the fair value or cash flow of hedged items. (i) Cash flow hedge Derivatives that are designated for hedge accounting recognition are qualified as cash flow hedges when they are related to a highly probable forecasted transaction. The effective portion of the changes in fair value is recognized in shareholders’ equity in "Accumulated other comprehensive income (loss)" and is subsequently reclassified to the income statement in the same period when the hedged expected cash flows affect the income statement. The reclassification adjustment is recognized in the same income statement line item affected by the highly probable forecasted transaction, while gains or losses related to the non-effective portion are immediately recognized as "Other income and expenses, net". When a hedging instrument expires, is sold or no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in shareholders’ equity at that time remains in shareholders’ equity and is recognized when the forecast transaction is ultimately recognized in the income statement. When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was previously accounted in shareholders’ equity is immediately transferred to the income statement within "Other income and expenses, net". (ii) Fair value hedge Derivatives that are designated for hedge accounting are qualified as fair value hedges when they are related to assets or liabilities already recognized in the consolidated balance sheet. Changes in the fair values of derivatives that are designated and qualify as fair value hedges and changes in the fair value of the hedged item are recorded in the income statement in the same period. (iii) Derivatives not designated as hedging instruments Changes in the fair value of derivative financial instruments not designated as hedging instruments are recognized immediately in the income statement within "Other income and expenses, net" when related to price risk and within "Net financial results" when related to interest rate or foreign exchange rate risk. This category includes derivatives contracts entered into in November 2018 by the Company to mitigate its exposure to the foreign currency risk associated with changes in the Brazilian real exchange rate for the majority of the estimated capital expenditures of the Aripuanã project. The transaction involved the purchase of collars in the notional amount of USD 294 million (BRL 1,057 million) which relates to the estimated Aripuanã’s disbursements from 2019 to 2021. The table below summarizes the derivative financial instruments, the underlying hedged items and the hedge accounting derivatives operations as at December 31, 2018: Notional 2017 Changes in fair Value 2018 Fair value by maturity Strategy 2018 2017 Per unit Fair Value - Inventory Net revenues Other income and Net financial Other Realized gain Fair value - 2019 2020 2021 Hedges for mismatches of quotational periods Zinc forward 261,020 387,240 ton (4,638) 3,038 (1,353) 20,460 — (968) 17,096 (557) (557) — — Silver forward — 503 k oz 129 — — 159 — 67 355 — — — — (4,508) 3,038 (1,353) 20,618 — (901) 17,451 (557) (557) — — Hedges for sales of zinc at a fixed price Zinc forward 10,566 2,230 ton 603 — — (3,090) — — (1,629) (858) (815) (43) — 603 — — (3,090) — — (1,629) (858) (815) (43) — Interest rates risk LIBOR floating rate vs. USD fixed rate swaps — 31,393 USD 646 — — — (936) — (290) — — — — 646 — — — (936) — (290) — — — — Foreign exhange risk Collars foreign exchange (USD) 1,056,922 — BRL — — — — (1,602) — — (1,602) 95 (1,431) (266) — — — — (1,602) — — (1,602) 95 (1,431) (266) (3,260) 3,038 (1,353) 17,528 (2,538) (901) 15,532 (3,017) (1,276) (1,474) (266) 6.1 Sensitivity analysis Presented below is a sensitivity analysis of the main risk factors that affect the pricing of the outstanding financial instruments relating to cash and cash equivalents, financial investments, loans and financing, and derivative financial instruments. The main sensitivities are the exposure to changes of the US Dollar exchange rate, the London Interbank Offered Rate (LIBOR) and Interbank Deposit Certificate (CDI) interest rates, the US Dollar coupon and the commodity prices. The scenarios for these factors are prepared using market sources and other relevant sources, in compliance with the Company's policies. The scenarios at December 31, 2018 are described below: · Scenario I: considers a change in the market forward yield curves and quotations as of December 31, 2018, according to the base scenario defined by the Company for March 31, 2019. · Scenario II: considers a change of + or -25% in the market forward yield curves as of December 31, 2018. · Scenario III: considers a change of + or -50% in the market forward yield curves as of December 31, 2018. Impacts on income stament Impacts on statement of comprehensive income Scenario I Scenarios II e III Scenario I Scenarios II e III Risk factor Cash and cash Loans and Notional of Unit Quotation Changes Results of -25% -50% +25% +50% Results of -25% -50% +25% +50% Foreign exchange rates BRL 94,603 123,471 293,589 USD 0.2581 % 703 63,484 230,801 (24,677) (52,495) (48) (2,278) (7,245) 1,695 2,689 PEN 43,601 — — PEN 1.1482 1.00 % 112 (2,813) (5,626) 2,813 5,626 — — — — — Interest rates BRL - CDI 93,093 27,724 1,056,922 BRL 6.40 % bps (183) 2,336 4,870 (2,180) (4,243) — — — — — USD - LIBOR — — 681,817 USD 2.81 % bps — (5) (11) 5 10 — (4) (8) 4 9 US Dollar coupon — — 293,589 USD 3.31 % bps (394) (1,627) (3,280) 1,614 3,225 — — — — — Price - commodities Zinc — — 271,586 mt 2,511 % (1,919) 30,499 60,999 (30,499) (60,999) 466 (7,401) (14,802) 7,401 14,802 6.2 Value and type of margins pledged in guarantee Derivative transactions entered into by the Company are not subject to collateral deposits, margin calls or any other type of guarantee. |
Financial instruments by catego
Financial instruments by category | 12 Months Ended |
Dec. 31, 2018 | |
Financial instruments by category | |
Financial instruments by category | 7 Financial instruments by category Accounting policy Normal purchases and sales of financial assets are recognized on the trade date – the date on which the Company commits to purchase or sell the asset. Financial assets are initially recognized at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets carried at fair value through profit or loss, if any, are initially recognized at fair value, and transaction costs are expensed in the income statement. Financial assets are derecognized when the rights to receive cash flow from the investments have expired or the Company has transferred substantially all of the risks and rewards of ownership. Financial assets at fair value through profit or loss and at fair value through other comprehensive income are subsequently carried at fair value. Financial assets at amortized costs are subsequently measured using the effective interest rate method. Gains or losses arising from changes in the fair value of the financial assets classified as fair value through profit or loss are presented in the income statement under "Net financial results" in the year in which they arise. The Company classifies its financial assets under the following categories: amortized cost, fair value through other comprehensive income and fair value through profit or loss. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of the Company’s financial assets upon initial recognition. (i) Amortized cost Financial assets measured at amortized cost are assets held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and for which the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. (ii) Fair value through profit or loss Financial assets measured at fair value through profit or loss are assets which an entity manages with the objective of realizing cash flows through the sale of such assets and financial assets that do not give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding. (iii) Fair value through other comprehensive income Financial assets measured at fair value through other comprehensive income are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and for which the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Analysis 2018 Assets per balance sheet Note Amortized cost Fair value Fair value Total Cash and cash equivalents 8 — 1,032,938 — 1,032,938 Financial investments 9 — 92,233 — 92,233 Derivative financial instruments 6 — 6,885 4,320 11,205 Trade accounts receivable 10 22,146 151,058 — 173,204 Related parties 12 740 — — 740 22,886 1,283,114 4,320 1,310,320 2018 Liabilities per balance sheet Note Amortized cost Fair value Fair value Total Loans and financing 15 1,424,867 — — 1,424,867 Derivative financial instruments 6 — 10,155 4,068 14,222 Trade payables 387,225 — — 387,225 Confirming payable 16 70,411 — — 70,411 Use of public assets 22,126 — — 22,126 Related parties 12 1,580 — — 1,580 1,906,209 10,155 4,068 1,920,431 2017 Assets per balance sheet Note Amortized cost Fair value Fair value Total Cash and cash equivalents 8 — 1,019,037 — 1,019,037 Financial investments 9 — 206,547 — 206,547 Derivative financial instruments 6 — 8,811 2,966 11,777 Trade accounts receivable 10 120,020 62,693 — 182,713 Related parties 12 738 — — 738 120,758 1,297,088 2,966 1,420,812 2017 Liabilities per balance sheet Note Amortized cost Fair value Fair value Total Loans and financing 15 1,447,299 — — 1,447,299 Derivative financial instruments 6 — 12,842 2,195 15,037 Trade payables 329,814 — — 329,814 Confirming payable 16 111,024 — — 111,024 Use of public assets 24,309 — — 24,309 Related parties 12 89,924 — — 89,924 2,002,370 12,842 2,195 2,017,407 |
Cash and cash equivalents
Cash and cash equivalents | 12 Months Ended |
Dec. 31, 2018 | |
Cash and cash equivalents | |
Cash and cash equivalents | 8 Cash and cash equivalents Accounting policy Cash and cash equivalents includes cash, bank deposits, and highly liquid short-term investments (investments with an original maturity less than 90 days), which are readily convertible into a known amount of cash and subject to an immaterial risk of changes in value. Bank overdrafts are shown within loans and financing in current liabilities in the balance sheet. (a) Composition 2018 2017 Cash and banks 320,069 319,920 Term deposits 712,869 699,117 1,032,938 1,019,037 (b) Changes in operating assets and liabilities The operational cash flow impact due to the changes in operating assets and liabilities is presented below: 2018 2017 2016 Decrease (increase) in assets Trade accounts receivable 8,537 (63,172) (54,188) Inventory 52,472 (15,675) (62,586) Other assets (70,101) 23,256 9,144 Increase (decrease) in liabilities Trade payables 57,411 47,573 9,557 Confirming payable (40,613) 8,737 5,743 Salaries and payroll charges (21,632) 9,776 25,206 Contractual liabilities (29,543) (36,299) 250,000 Related parties 27,167 — — Other liabilities 26,877 (59,348) (1,809) 10,575 (85,152) 181,067 |
Financial investments
Financial investments | 12 Months Ended |
Dec. 31, 2018 | |
Financial investments | |
Financial investments | 9 Financial investments Accounting policy Financial investments are mainly short-term investments that do not meet the definition of cash and cash equivalents. The financial investments are used as part of the cash-management strategy of the Company and are measured at fair value through profit or loss. (a) Composition 2018 2017 Investment fund quotas (i) 38,677 138,945 Bank deposit certificate 44,595 42,067 Repurchase agreements — 18,289 Other 8,961 7,246 92,233 206,547 (i) The investment fund is exclusively held by VSA and its subsidiaries. The fund’s portfolio is comprised of repurchase agreements and treasury bills. · |
Trade accounts receivable
Trade accounts receivable | 12 Months Ended |
Dec. 31, 2018 | |
Trade accounts receivable. | |
Trade accounts receivable | 10 Trade accounts receivable Accounting policy Trade accounts receivable are amounts due from customers for goods sold in the ordinary course of the Company’s business. Trade accounts receivable are recognized initially at fair value and subsequently measured at: (i) Fair value through profit or loss when related to the Company’s accounts receivable portfolio that is included in a true sale program whereby the Company, at its discretion, can discount certain outstanding trade accounts receivables and receive payments in advance. The program is used to meet short-term liquidity needs. Trade accounts receivable within this program are derecognized since the contractual rights to receive the cash flows of the assets are transferred to the counterparty. (ii) Fair value through profit or loss when related to sales that are subsequently adjusted to changes of LME prices. These accounts receivable do not meet the solely payments of principal and interest (SPPI) criteria because there is a component of commodity price risk that modifies the cash flows that otherwise would be required by the sales contract. (iii) Amortized cost using the effective interest rate method, less impairment, when the receivable do not meet the aforementioned classification. Credit risk can arise from non-performance by counterparties of their contractual obligations to the Company. To ensure an effective evaluation of credit risk, management applies procedures related to the application for credit granting and approvals, renewal of credit limits, continuous monitoring of credit exposure in relation to established limits and events that trigger requirements for secured payment terms. As part of the Company’s process, the credit exposures with all counterparties are regularly monitored and assessed. The Company applied the IFRS 9 simplified approach to measure the impairment losses for trade accounts receivable. This approach requires the use of the lifetime expected credit losses on its trade accounts receivable measured at amortized cost. To calculate the lifetime expected credit losses the Company used a provision matrix and forward-looking information. The additions to impairment of trade accounts receivable are included in selling expenses. Trade accounts receivable are generally written off when there is no expectation of recovering additional cash. In 2017 and 2016, the impairment of trade accounts receivable was based on the incurred loss model. (a) Composition Note 2018 2017 Trade accounts receivables 174,931 181,084 Related parties 12 963 3,775 Impairment of trade accounts receivable (2,690) (2,146) 173,204 182,713 (b) Changes in impairment of trade accounts receivable 2018 2017 Balance at the beginning of the year (2,146) (1,618) Additions (1,238) (3,300) Reversals 428 2,779 Foreign exchange gains (losses) 266 (7) Balance at the end of the year (2,690) (2,146) (c) Analysis by currency 2018 2017 Brazilian Real 39,000 66,486 US Dollar 133,689 115,879 Other 515 348 173,204 182,713 (d) Aging of trade accounts receivable 2018 2017 Current 146,064 163,196 Up to 3 months past due 28,366 19,775 From 3 to 6 months past due 455 914 Over 6 months past due 1,009 974 175,894 184,859 Impairment (2,690) (2,146) 173,204 182,713 |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2018 | |
Inventory. | |
Inventory | 11 Inventory Accounting policy Inventory is stated at the lower of cost and net realizable value. Cost is determined using the weighted average cost method. The cost of finished goods and work in progress comprises raw materials, direct labor, other direct costs and related fixed production overheads (based on normal operating capacity). Variable production overhead costs are included in inventory cost on the basis of actual level of production. The net realizable value is the estimated selling price in the ordinary course of business, less any additional selling expenses. Imports in transit are stated at the accumulated cost of each import. A provision for obsolete inventory - finished products, semi-finished products, raw materials and auxiliary materials - is recognized when items cannot be used in normal production or sold because they are damaged or do not meet the Company’s specification. Slow-moving provision is recognized for inventory items that are in excess of the expected normal use or sale. The amount of slow-moving provision recognized is determined on the basis of 20% of the carrying amount for each six-month period without use or sale. (a) Composition 2018 2017 Finished products 106,245 106,026 Semi-finished products 52,534 85,458 Raw materials 52,864 30,128 Auxiliary materials and consumables 69,566 81,261 Imports in transit 11,718 41,878 Other 215 863 Provision for obsolete and slow-moving inventory (23,437) (20,736) 269,705 324,878 The Company had no inventory pledged as collateral for any of its liabilities. Inventories recognized as an expense during the year ended December 31, 2018 amounted to USD 1,701,456 (2017: USD 1,320,379; 2016: USD 1,287,662). These were included in Cost of sales. (b) Changes in the provision for obsolete and slow-moving inventory 2018 2017 Finished Semi- Raw Auxiliary Total Total Balance at the beginning of the year (40) (10,019) (214) (10,463) (20,736) (38,384) Additions (32) (1,363) (17) (11,291) (12,703) (1,814) Reversals 41 8,701 207 311 9,260 19,249 Exchange variation gains (losses) 3 959 18 (238) 742 213 Balance at the end of the year (28) (1,722) (6) (21,681) (23,437) (20,736) |
Related parties
Related parties | 12 Months Ended |
Dec. 31, 2018 | |
Related parties. | |
Related parties | 12 Related parties Trade accounts receivable Related parties (assets) Trade payables Dividends payable Related parties (liabilities) 2018 2017 2018 2017 2018 2017 2018 2017 2018 2017 Parent Votorantim S.A. (i) (ii) — 8 3 3 478 336 — — — 87,686 Related parties Companhia Brasileira de Alumínio 214 1,843 — — — 5,246 — — 12 13 Votorantim Cimentos S.A. 623 1,696 737 735 85 47 — — — — Votener - Votorantim Comercializadora de Energia Ltda. — — — — 2,060 — — — — — Other 126 228 — — 785 1,414 663 4,138 1,568 2,225 963 3,775 740 738 3,408 7,043 663 4,138 1,580 89,924 Current 963 3,775 — — 3,408 7,043 663 4,138 63 87,686 Non-current — — 740 738 — — — — 1,517 2,238 963 3,775 740 738 3,408 7,043 663 4,138 1,580 89,924 Sales Purchases Financial results 2018 2017 2016 2018 2017 2016 2018 2017 2016 Parent Votorantim S.A. (ii) — — — 3,649 3,651 4,653 — — — Related parties Companhia Brasileira de Alumínio 39 2,125 70 1,626 42,434 31,162 — 1,012 3,582 Votoratim Metais S.A. — — — — — 51 — — 3,583 Votener - Votorantim Comercializadora de Energia Ltda. — — — 10,054 13,510 13,400 — — — Votorantim Cimentos S.A. 173 138 45 365 365 273 — — — Other 2,115 — 2,856 4,920 1,134 1,427 — — — 2,327 2,263 2,971 20,614 61,094 50,966 — 1,012 7,165 (i) On September 2018, the Brazilian Electricity Regulatory Agency (“ANEEL”) consented to the transfer of certain energy assets owned by NEXA BR to Pollarix. In accordance with the agreement between NEXA BR and VSA, after the approval, NEXA BR was required to settle a prior obligation of USD 87,623 (BRL 290,000) with VSA related to the rights to use these assets. In December 2018, NEXA BR paid this amount. (ii) The Company entered into an agreement with VSA on September 4, 2008, for services provided by the Center of Excellence (“CoE”) of VSA related to administrative activities, human resources, back office, accounting, taxes, technical assistance, training, among others. Under a cost sharing agreement, the Company reimburses VSA for the expenses related to these activities in respect of NEXA. (a) Key management compensation Key management includes the members of the Company's global executive team and Board of Directors. Key management compensation, including all benefits, was as follows: 2018 2017 Short-term benefits 7,225 6,668 Other long-term benefits 1,039 1,162 8,264 7,830 Short-term benefits include fixed compensation, payroll charges and short-term benefits under the Company’s variable compensation program. Other long-term benefits relate to the variable compensation program. |
Property, plant and equipment
Property, plant and equipment | 12 Months Ended |
Dec. 31, 2018 | |
Property, plant and equipment | |
Property, plant and equipment | 13 Property, plant and equipment Accounting policy Property, plant and equipment are stated at the historical cost of acquisition or construction less accumulated depreciation and any recognized impairment losses. Historical cost includes expenditures that are directly attributable to the acquisition and construction of the assets. Subsequent costs are included in the asset’s carrying amount, or recognized as a separate asset as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and they can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognized when replaced. All other repairs and maintenance are charged to the income statement during the reporting period in which they are incurred. Replacement costs are included in the carrying amount of the asset when it is probable that the Company will realize future economic benefits in excess of the benefits expected from the asset in its current condition. Replacement costs are depreciated over the remaining useful life of the related asset. Land is not depreciated. Depreciation of other assets is calculated using the straight-line method to reduce their costs to their residual values over their estimated useful lives. The assets' residual values and useful lives are reviewed annually and adjusted if appropriate. An asset's carrying amount is reduced to its recoverable amount when it is greater than the estimated recoverable amount, in accordance with the criteria adopted by the Company in order to determine the recoverable amount. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognized within "Other income and expenses, net" in the income statement. Loans and financing costs directly related to the acquisition, construction or production of a qualifying asset that requires a substantial period of time to prepare for its intended use or sale are capitalized as part of the cost of that asset when it is probable that future economic benefits associated with the item will flow to the Company and costs can be measured reliably. Stripping costs In its surface mining operations, the Company must remove overburden and other waste to gain access to mineral ore deposits. The removal process is referred to as stripping. During the development of a mine, before production commences, when the stripping activity improves access to the ore body, the component of the ore body for which access has been improved can be identified and the costs can be measured reliably, a stripping activity asset is capitalized as part of the investment in the construction of the mine, accounted for as part of property, plant and equipment, and subsequently depreciated over the life of the mine on a units of production basis. Stripping costs incurred during the production phase of operations are treated as a production cost that forms part of the cost of inventory. Exploration and development costs The Company incurs mineral exploration costs such as exploratory drilling, geological and geophysical studies in order to determine the mineral potential of a given area, which are expensed as incurred. The Company uses the front-end loading (“FEL”) methodology for project and development management. Development scoping costs and pre-feasibility studies for greenfield and brownfield projects are expensed during FEL 1 and FEL 2 phases, together with research and development costs for the smelting segment, until the project has demonstrated technical feasibility and economic viability. Mining development costs are capitalized when the FEL 3 phase starts and the mineral potential and commercial viability of the project can be assessed reliably. Such costs include feasibility studies and engineering work. The development costs are assessed for impairment at least annually or whenever evidences indicate that the assets may be impaired. Asset retirement obligation An asset retirement obligation is an obligation related to the permanent removal from service of a tangible long-lived asset that results from the acquisition, construction or development, or the normal operations of a tangible long-lived asset. At the initial recognition of an asset retirement obligation and at the periodical revisions of the expected disbursements and the discount rate, the changes in the liability are charged to property, plant and equipment. The capitalized amount recognized in property, plant and equipment is depreciated based on the useful life of the underlying asset. Any reduction in the provision that exceeds the carrying amount of the asset, is immediately recognized in the income statement as "Other income and expenses, net". Leases Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under an operating lease (net of any incentive received from the lessor) are charged to the income statement on a straight-line basis over the period of the lease. Leases of property, plant and equipment, where the Company has substantially all the risks and rewards of ownership, are classified as finance leases. Finance leases are capitalized at the inception of the lease at the lower of the fair value of the leased item and the present value of the minimum lease payments and are depreciated over the shorter of the asset’s useful life and the lease term. Impairment of non-financial assets The Company assesses, at each reporting date, whether there is an indicator that an asset or cash generating unit (“CGU”) may be impaired. If any indication exists, such as volumes and prices reductions or unusual events that can affect the business, the Company estimates the asset’s or CGU’s recoverable amount. The recoverable amount is the higher of an asset’s or CGU’s fair value less cost of disposal and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets, in which case, the asset is tested as part of a larger CGU to which it belongs. If the carrying amount of an asset or CGU exceeds its recoverable amount, the asset or CGU is considered impaired and is reduced to its recoverable amount. Non-financial assets other than goodwill that were adjusted due to impairment are subsequently reviewed for possible reversal of the impairment at each reporting date. a) Analysis 2018 Machinery, Assets and Asset Land and Dams and equipment and projects under retirement improvements Buildings facilities construction obligation Mining projects Other Total Balance at the beginning of the year Cost 24,490 1,030,686 2,422,254 235,501 178,662 243,938 35,055 4,170,586 Accumulated depreciation (275) (453,140) (1,504,433) — (101,527) (85,455) (29,242) (2,174,072) Net balance 24,215 577,546 917,821 235,501 77,135 158,483 5,813 1,996,514 Additions (i) — 2,613 2,878 294,229 — — 53 299,773 Disposals (638) (3,207) (6,985) (1,148) — — (53) (12,031) Depreciation (19) (48,072) (131,099) — (4,592) (1,931) (1,752) (187,465) Foreign exchange (losses) gains (2,160) (42,117) (58,574) (28,827) (9,688) — (477) (141,843) Transfers (22) 63,562 78,485 (147,403) — 173 1,214 (3,991) Remeasurement of asset retirement obligation — — — — 20,777 — — 20,777 Impairment (c) — — — (3,283) — — — (3,283) Balance at the end of the year 21,376 550,325 802,526 349,069 83,632 156,725 4,798 1,968,451 Cost 21,629 1,002,885 2,357,254 349,069 175,506 243,629 29,513 4,179,485 Accumulated depreciation (253) (452,560) (1,554,728) — (91,874) (86,904) (24,715) (2,211,034) Net balance at the end of the year 21,376 550,325 802,526 349,069 83,632 156,725 4,798 1,968,451 Average annual depreciation rates - % — 4 7 — 5 8 — — 2017 Machinery, Assets and Asset Land and Dams and equipment and projects under retirement improvements buildings facilities construction obligation Mining projects Other Total Balance at the beginning of the year Cost 24,036 980,242 2,466,265 219,254 132,824 271,466 36,503 4,130,590 Accumulated depreciation (257) (435,372) (1,485,939) — (96,108) (102,828) (31,624) (2,152,128) Net balance 23,779 544,870 980,326 219,254 36,716 168,638 4,879 1,978,462 Additions (i) 46 100 5,761 185,688 4,303 240 579 196,717 Disposals (930) (92) (2,915) (6,917) — — (128) (10,982) Depreciation (22) (34,175) (142,519) — (5,834) (11,121) (1,766) (195,437) Foreign exchange (losses) gains (231) (4,309) (6,381) (3,965) (1,839) (2,115) (118) (18,958) Transfers 1,573 71,152 83,297 (158,559) — 2,841 2,367 2,671 Remeasurement of asset retirement obligation — — — — 43,789 — — 43,789 Transfers of assets held for sale — — 252 — — — — 252 Balance at the end of the year 24,215 577,546 917,821 235,501 77,135 158,483 5,813 1,996,514 Cost 24,490 1,030,686 2,422,254 235,501 178,662 243,938 35,055 4,170,586 Accumulated depreciation (275) (453,140) (1,504,433) — (101,527) (85,455) (29,242) (2,174,072) Net balance at the end of the year 24,215 577,546 917,821 235,501 77,135 158,483 5,813 1,996,514 Average annual depreciation rates - % — 4 7 — 5 8 — — (i) Additions include capitalized borrowing costs in the amount of USD 36,534 in 2018 (2017 – USD 35,164). (b) Assets and projects under construction The balance mainly comprises projects for the expansion and optimization of the Company’s plant and mines, as described below: 2018 2017 Expansion and modernization projects 174,634 64,043 Sustaining projects 90,604 78,860 Health, safety and enviroment projects 63,406 73,611 Information technology projects 12,970 7,397 Other 7,456 11,590 349,069 235,501 Aripuanã project - Approval of the construction On October 19, 2018, after the conclusion of the feasibility study and detailed analysis by the Company’s management, the Board of Directors approved the construction of the Aripuanã project, an underground polymetallic mine and concentrate processing facility in the state of Mato Grosso, Brazil. On December 20, 2018 the Environmental Authority of the State of Mato Grosso, Brazil granted the Installation License for the Aripuanã project, which enabled the Company to start the construction phase. The Aripuanã project is estimated to be operational by the beginning of 2021, with total investment estimated at approximately USD 392,000 . The Company owns a 70% interest in the Aripuanã project through its subsidiaries. (c) Impairment of non-financial assets The Company considered the decline in LME spot prices during 2018 as an impairment indicator and performed an impairment test for the CGUs of Juiz de Fora and Três Marias system, that were not covered by the annual goodwill impairment testing disclosed in the Note 14. The recoverable amount was estimated based on the value in use method, using the same key assumptions and calculation metrics defined in Note 14. No impairment was identified for these CGUs. The Company also evaluated the assets and projects under construction and identified that the amount invested in some projects would not be recoverable. The amount of USD 3,283 was impaired and recognized in “Other income and expenses, net” in 2018. |
Intangible assets
Intangible assets | 12 Months Ended |
Dec. 31, 2018 | |
Intangible assets | |
Intangible assets | 14 Intangible assets Accounting policy Goodwill Goodwill arising from business combinations is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net assets acquired. Goodwill is not amortized but is tested for impairment annually and whenever circumstances indicate that the carrying amount may not be recovered. The recoverable amount is the higher of an asset's fair value less costs to sell and its value in use. If either the fair value less costs to sell or the value in use is higher than the carrying amount, the Company need not estimate the other amount. Impairment is determined by assessing the recoverable amount of each CGU (or group of CGUs) to which the goodwill relates. For the purposes of assessing impairment, assets are grouped at the lowest level for which there is separately identifiable cash flow (CGU level). Impairment losses relating to goodwill cannot be reversed in future periods. As part of the impairment testing procedures, the goodwill is allocated to a CGU that is the lowest level at which goodwill is monitored. If the recoverable amount of the asset (or CGU) is lower than its carrying amount, the carrying amount of the asset (or CGU) is reduced to its recoverable amount. The difference between the carrying amount and recoverable amount is recognized as an impairment loss in the income statement. Critical accounting estimates and judgments - Impairment of goodwill The process of estimating the recoverable amount involves the use of assumptions, judgment and projections for future cash flows. Management’s assumptions and estimates of future cash flow used for the Company’s impairment testing of goodwill and non-financial assets are subject to risk and uncertainties, including metal prices and macroeconomic conditions, which are particularly volatile and partially or totally outside the Company’s control. The calculations used for the impairment testing reflect several market assumptions, such as LME prices, consensus models and other available data regarding global base metals demand. The discount factor applied to the discounted cash flow model is the Company’s pre-tax weighted average cost of capital (“WACC”), adjusted for country-specific risk factors. These calculations use cash flow projections, before income taxes, based on financial and operational budgets for a five-year period. After the five-year period, the cash flows are extended until the end of the useful life of mine or indefinitely for the smelters. The smelters cash flows do not use growth rates in the cash flow projections of the terminal value. Rights to use natural resources Costs for the acquisition of rights to explore and develop mineral properties are capitalized and amortized as a cost of production using the units of production method over their useful lives. Useful lives consider the period of extraction for both mineral reserves and mineral resources, which includes a portion of the Company’s inferred resources in the Company’s mining operations. The Company selected the physical unit model to compute amortization expenses under the units of production method. This model consists of amortization being calculated based on actual ore produced during the period compared to the total ore expected to be produced over the life of mine. Critical accounting estimates and judgments - Quantification of mineral reserves and resources for useful life calculation The Company classifies measured, indicated and inferred resources based on the definitions of the Canadian Institute of Mining, Metallurgy and Petroleum (or CIM) Definition Standards for Mineral Resources and Mineral Reserves (or the 2014 CIM Definition Standards). The useful life determination applied to the rights to use natural resources reflect the pattern in which the benefits are expected to be derived by the Company and is based on the estimated life of mine. Any changes to life of mine, based on new information regarding estimates of mineral reserves and mineral resources and mining plan, may affect prospectively the life of mine and amortization rates. The estimation process of mineral reserves and mineral resources is based on a technical evaluation, which includes geological, geophysics, engineering, environmental, legal and economic estimates and may have relevant impact on the economic viability of the mineral reserves and mineral resources. These estimates are reviewed periodically, and any changes are reflected in the expected life of mine. Management is confident based on testing, continuity of the ore bodies and conversion experience that a part of the inferred resources will be converted into measured and indicated resources, and if they are economically recoverable, such inferred resources may also be classified as proven and probable mineral reserves. Where the Company can demonstrate the expected economic recovery with a high level of confidence, inferred resources are included in the calculation of amortization. However, the future conversion of inferred resources is inherently uncertain and involves judgement and estimates that could have a material impact on the Company’s results of operations. (a) Analysis 2018 Rights to use natural Goodwill resources Other Total Balance at the beginning of the year Cost 673,287 1,672,931 62,084 2,408,302 Accumulated amortization — (543,927) (41,656) (585,583) Net balance 673,287 1,129,004 20,428 1,822,719 Disposals — (17) (11) (28) Amortization — (77,792) (1,932) (79,724) Transfers — 1,463 2,528 3,991 Foreign exchange (losses) gains 1,513 (3,613) (2,397) (4,497) Balance at the end of the year 674,800 1,049,045 18,616 1,742,461 Cost 674,800 1,669,645 56,853 2,401,298 Accumulated amortization — (620,600) (38,237) (658,837) Net balance at the end of the year 674,800 1,049,045 18,616 1,742,461 Average annual amortization rates % — 6 19 — 2017 Rights to use natural Goodwill resources Other Total Balance at the beginning of the year Cost 675,561 1,673,091 55,115 2,403,767 Accumulated amortization — (469,381) (31,234) (500,615) Net balance 675,561 1,203,710 23,881 1,903,152 Acquisitions — — 921 921 Disposals — — (36) (36) Amortization — (74,024) (993) (75,017) Foreign exchange losses (2,274) (682) (674) (3,630) Transfers — — (2,671) (2,671) Balance at the end of the year 673,287 1,129,004 20,428 1,822,719 Cost 673,287 1,672,931 62,084 2,408,302 Accumulated amortization — (543,927) (41,656) (585,583) Net balance at the end of the year 673,287 1,129,004 20,428 1,822,719 Average annual amortization rates % — 5 20 — The Company assesses at each reporting period whether there is objective evidence that any item of intangible asset is impaired. No impairment was identified at December 31, 2018. (b) Goodwill on acquisitions The goodwill is allocated to a CGU or a group of CGUs based on the expected benefits from the synergies of the acquisition. A CGU or a group of CGUs represent the lowest level within the Company at which goodwill is monitored. Other net assets Total carrying Goodwill carrying amount amount Group of CGUs - Mining Peru 582,306 1,099,557 1,681,863 CGU - Smelter Peru 92,494 774,040 866,534 674,800 1,873,597 2,548,397 (c) Key assumptions used in goodwill impairment testing The Company performed the annual goodwill impairment testing for the Mining Peru and Smelter Peru at September 30, 2018. The recoverable amount was estimated using the value in use method and exceeded the carrying value. Therefore, no impairment was recognized in the consolidated financial statements. The Company identified metal prices, WACC and life of mine (“LOM”) as key assumptions for the recoverable amount determination, due to the material impact of such assumptions on the discounted cash flow determination. These assumptions are summarized below: Key assumptions Zinc (US$/t) 2,517 Copper (US$/t) 6,478 Discount rate Pre-tax discount rate (Brazil) 11.98 % Pre-tax discount rate (Peru) 10.34 % LOM (Years) Brownfield mines from 9 to 21 Greenfield projects from 12 to 24 The Company performed a stress test on the key assumptions used for cash flow determination. If the LME zinc price assumption for the value in use calculation had been 20% lower than management's estimates at September 30, 2018 (US$/t 2,014), the Company would have had to recognize an impairment against the carrying amount of this CGU of approximately USD 180,534. Also, under the reasonable stress test scenarios performed by the Company, an increase of 20% in the WACC would not result in an impairment loss. |
Loans and Financings
Loans and Financings | 12 Months Ended |
Dec. 31, 2018 | |
Loans and financings | |
Loans and financings | 15 Loans and financings Accounting policy Loans and financings are recognized initially at fair value, net of transaction costs incurred, and are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the total amount payable is recognized in the income statement as interest expense over the period of the loans using the effective interest rate method. Loans and financings are classified as current liabilities unless the Company has the unconditional right to defer repayment of the liability for at least 12 months after the reporting period. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the drawdown occurs. To the extent that there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as a prepayment for liquidity services and amortized over the period of the facility to which it relates. Composition and maturity profile Current Non-current Total Fair value Type Average annual charges 2018 2017 2018 2017 2018 2017 2018 2017 Eurobonds – USD Fixed 5.13 % 9,907 8,778 1,032,664 1,032,664 1,042,571 1,041,442 1,014,974 1,120,901 Debt with banks Libor + 1.27 % 773 435 196,519 199,179 197,292 199,614 206,349 214,293 BNDES TJLP + 2.82% / SELIC + 3.10% / TLP + 5.23 % 6,117 19,795 83,808 73,653 89,925 93,448 82,208 85,969 Debentures 110.5% CDI 7,432 8,885 20,756 32,403 28,188 41,288 28,269 41,405 Export credit note — 1,102 — 61,622 — 62,724 — 64,058 Other 8,284 1,846 58,607 6,937 66,891 8,783 69,778 8,506 32,513 40,841 1,392,354 1,406,458 1,424,867 1,447,299 1,401,578 1,535,132 Current portion of long term loans and financing (principal) 21,107 28,019 Interest on loans and financing 11,406 12,822 32,513 40,841 BNDES - Brazilian National Bank for Economic and Social Development TJLP - Long-term interest rate set by the Brazilian National Monetary Council SELIC - Brazilian basic interest rate CDI - Brazilian Interbank Deposit Certificate TLP - Set by the Brazilian National Monetary Council and composed by Brazil’s expected inflation plus spread The maturity profile of loans and financing at December 31, 2018, was as follows: Total As from 2019 2020 2021 2022 2023 2024 2025 2026 Total Eurobonds - USD 9,907 — — — 339,601 — — 693,063 1,042,571 Debt with banks 773 — 78,607 78,607 39,305 — — — 197,292 BNDES 6,117 6,763 8,112 12,156 12,156 11,912 11,176 21,533 89,925 Debentures 7,432 6,909 6,924 6,923 — — — — 28,188 Other 8,284 10,271 10,273 8,820 7,796 7,737 7,736 5,974 66,891 32,513 23,943 103,916 106,506 398,858 19,649 18,912 720,570 1,424,867 3 % 2 % 7 % 7 % 28 % 1 % 1 % 51 % 100 % (a) Changes 2018 2017 Balance at the beginning of the year 1,447,299 1,144,385 Payments (295,104) (537,254) New loans and financing 292,901 830,598 Foreign exchange gain (5,777) (2,873) Gain on debt modification (3,428) — Interest accrual 61,385 69,481 Interest paid (72,409) (57,038) Balance at the end of the year 1,424,867 1,447,299 (b) Analysis by currency Current Non-current Total 2018 2017 2018 2017 2018 2017 US Dollar 17,267 13,260 1,284,128 1,272,223 1,301,395 1,285,483 Brazilian Real 15,246 27,471 108,226 134,235 123,472 161,706 Other — 110 — — — 110 32,513 40,841 1,392,354 1,406,458 1,424,867 1,447,299 (c) Analysis by index Current Non-current Total 2018 2017 2018 2017 2018 2017 Fixed rate 9,884 11,192 1,037,361 1,038,459 1,047,245 1,049,651 LIBOR 7,719 610 247,614 230,573 255,333 231,183 TJLP 1,467 12,509 14,700 35,341 16,167 47,850 UMBNDES — 3,211 — 5,496 — 8,707 CDI 7,430 9,811 20,758 62,632 28,188 72,443 TLP 5,881 — 52,606 — 58,487 — BNDES Selic 132 3,508 19,315 33,957 19,447 37,465 32,513 40,841 1,392,354 1,406,458 1,424,867 1,447,299 (d) Guarantees and covenants At December 31, 2018, NEXA is the guarantor of NEXA BR’s loans with BNDES in the amount of USD 89,925. At December 31, 2018, NEXA BR provided collateral guarantee in the form of machinery and equipment on part of its loans in the amount of USD 1,183. The Company has borrowings that are subject to financial covenants at the consolidated level, such as: (i) the gearing ratio (net debt/adjusted EBITDA); (ii) the capitalization ratio (total debt/total debt + shareholders’ equity or shareholders’ equity/total assets); and (iii) interest coverage ratio (cash + adjusted EBITDA/interest + short-term debt). When applicable, these compliance obligations are standardized for all borrowing agreements. At December 31, 2018, the Company was in compliance with all applicable covenants. (e) Bonds On May 4, 2017, NEXA issued an aggregate principal amount of USD 700,000 in unsecured bonds set to mature in 2027 at an interest rate of 5.375% per year. The proceeds from this offering were used to repay a portion of existing consolidated debt with banks, thereby extending the maturity of outstanding debt. These securities are guaranteed by NEXA BR, NEXA PERU and NEXA CJM. On March 28, 2013, NEXA PERU conducted a bond offering in the international market for USD 350,000, at an annual fixed interest rate of 4.625% to be paid semi-annually. These financial instruments have a term of ten years and will be redeemed on March 28, 2023. (f) Repayment of debt On May 25, 2018, the Company prepaid a term loan with principal amount of USD 100,000, maturity of November 2021 and cost of three-month Libor plus 2.55% p.a. The amount paid was USD 101,083, corresponding to the principal plus accrued and unpaid interest. On March 9, 2018, the Company repaid certain Export Credit Notes with principal amount of USD 31,393, maturity of April 2020 and cost of three-month LIBOR + 1.85% p.a. The accompanying foreign exchange and interest rate swaps intended to change the interest index and currency of debt service repayments of this note was also liquidated in advance, generating a gain of USD 91 recognized in Net financial results. On March 9, 2018, the Company repaid in full its Export Credit Notes with principal amount of USD 30,807, maturity of April 2020 and a cost of 118% of the CDI rate. The amount paid was USD 30,891 and includes principal plus accrued and unpaid interest. (g) Renegotiation of debt On May 22, 2018, the Company renegotiated a term loan with principal amount of USD 100,000, maturity of November 2021 and cost of six-month Libor plus 2.50% p.a. The renegotiated debt with the same counter-party has a maturity of May 2023 and a cost of six-month Libor plus 1.27% p.a. This transaction was accounted for as debt modification due to non-substantial modifications made to the original debt and a gain of USD 3,428 was recognized in Net financial results. This loan is guaranteed by NEXA CJM and NEXA BR. On December 27, 2018, the NEXA BR renegotiated contractual terms with BNDES comprising loans of a total principal amount of USD 58,990 (equivalent to BRL 228,573), original maturity dates from 2019 until 2023 and subjected to interest rates of TJLP plus spread (between 2.36% and 2.48% p.a.) or SELIC plus spread (between 2.48% to 2.72% p.a.). The renegotiated debts with the same counter-party have the final maturity in December 2028 and are subjected to a cost of TLP plus spread (between 2.09% to 2.29% p.a.) and replaces the guarantor from VSA to NEXA. This transaction was accounted for as a debt extinguishment due to the substantial modifications made to the original debt and no gain or loss was recognized in the income statement. On January 2019, NEXA BR contracted a swap to change the Brazilian inflation component of the TLP rate to 53.04% of the CDI rate. (h) New loans On May 22, 2018, the Company entered into a term loan agreement in the principal amount of USD 100,000, maturing in May 2023 and with a cost of six-month Libor plus 1.27% p.a. Proceeds from this transaction were used to prepay a term loan with interest rate of three-month Libor plus 2.55% p.a. No gain or loss were recognized on the early payment of the debt. This loan is guaranteed by NEXA CJM and NEXA BR. On June 27, 2018, the Company utilized the amount of USD 62,500 of a new facility agreement to finance the purchase of machinery and equipment. The facility matures in 2027 and has an effective interest rate of 5.29% p.a. |
Confirming payables
Confirming payables | 12 Months Ended |
Dec. 31, 2018 | |
Confirming payables | |
Confirming payables | 16 Confirming payables The Company entered into agreements extending payment terms from 90 to 180 days with a number of suppliers. These suppliers have the option to discount their receivables with banks. At December 31, 2018, accounts payable amounting to USD 70,411 (2017: USD 111,024) were included in such agreements. |
Salaries and payroll charges
Salaries and payroll charges | 12 Months Ended |
Dec. 31, 2018 | |
Salaries and payroll charges | |
Salaries and payroll charges | 17 Salaries and payroll charges 2018 2017 Direct remuneration and payroll charges 17,404 21,357 Provision for profit sharing and other payable 40,762 58,441 58,166 79,798 |
Current and deferred income tax
Current and deferred income taxes | 12 Months Ended |
Dec. 31, 2018 | |
Current and deferred income taxes | |
Current and deferred income taxes | 18 Current and deferred income taxes Accounting policy The current and deferred taxes on income are calculated on the basis of the tax laws enacted or substantively enacted up to balance sheet date in the countries where the entities operate and generate taxable income. Management periodically evaluates positions taken by the Company in the taxes on income returns with respect to situations in which the applicable tax regulations are subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities. The current income tax is presented net, separated by taxpaying entity, in liabilities when there are amounts payable, or in assets when the amounts prepaid exceed the total amount due on the reporting date. Deferred tax assets are recognized only to the extent it is probable that future taxable income will be available against which the temporary differences and/or tax losses can be utilized. Deferred tax assets and liabilities are offset when there is a legally enforceable right and an intention to offset them in the calculation of current taxes, generally when they are related to the same legal entity and the same tax authority. Accordingly, deferred tax assets and liabilities in different entities or in different countries are generally presented separately, and not on a net basis. Deferred tax liabilities and assets are not recognized for temporary differences between the carrying amounts and tax bases of investments in foreign operations where the Company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not be reversed in the near future. Deferred income tax are provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred tax liabilities are not recognized if they arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from the initial recognition of an asset or liability in a transaction other than a business combination that, at the time of the transaction, affects neither the accounting nor the taxable income or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income taxes asset is realized or the deferred income tax liability is settled. Critical accounting estimates and judgments The Company is subject to income tax in all countries in which it operates. Significant judgment is required in determining the income tax provision. There are many transactions and calculations for which the ultimate tax determination is uncertain. The Company also recognizes liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the current and deferred tax assets and liabilities in the period in which such determination is made. (a) Reconciliation of income taxes expenses 2018 2017 2016 Income before income tax 131,898 271,459 208,892 Standard rate (i) 26.01 % 27.08 % 29.22 % Income tax (34,307) (73,511) (61,038) Difference in tax rate for subsidiaries outside Luxembourg (11,227) (19,912) (11,425) Re-measurement of deferred tax - change in Peru tax rate (ii) — — (41,588) Taxes on dividend received from foreign subsidiary — (8,299) — Special mining levy and special mining tax (14,565) (22,766) (10,953) Other permanent differences 19,176 18,294 26,621 Income tax (40,923) (106,194) (98,383) Current (71,787) (125,691) (75,282) Deferred 30,864 19,497 (23,101) Taxes on income on the income statement (40,923) (106,194) (98,383) (i) The combined applicable income tax rate was 29.22% for the fiscal year ending 2016. On December 14, 2016, the Luxembourg government approved Law 7020, that decreased the income tax rate to 27.08% in 2017 and to 26.01% from 2018 onwards. (ii) The Peruvian companies pay their taxes based on the general regime of taxation, which provides for a progressive decrease in the tax rate after the year 2015. In 2016 the rate was 28% while for 2017 and 2018 the rate was expected to be 27% and from 2019 onwards the rate was expected to be 26%. However, in December 2016, the tax rate changed to 29.5% applicable from January 1, 2017. Analysis of deferred tax balances 2018 2017 Tax credits on non-operating losses (i) 106,817 104,100 Tax credits on temporary diferences Foreign exchange losses 50,766 79,430 Environmental liabilities 28,808 28,504 Asset retirement obligation 19,879 23,990 Tax, civil and labor provisions 9,389 15,666 Other provisions 6,443 12,481 Provision for profit sharing 5,409 6,521 Provision for inventory losses 5,308 4,395 Other 12,094 10,231 Tax debits on temporary diferences Capitalized interest (11,725) (10,624) Accelerated depreciation and adjustment of useful lives (10,636) (28,371) Depreciation and amortization of fair value adjustment to PP&E and intangible assets (318,198) (344,531) Other (1,798) (2,210) (97,444) (100,418) Net deferred tax assets related to the same legal entity 201,154 224,513 Net deferred tax liabilities related to the same legal entity (298,598) (324,931) (97,444) (100,418) (i) Tax credits on non-operating losses can be used to offset future tax payments. These credits do not expire if not used by the Company. The breakdown by country is as follows: 2018 2017 Brazil 104,195 103,791 Peru 2,622 309 106,817 104,100 The Company had unutilised tax losses resulting from its holding activities in Luxembourg in the amount of USD 57,800 in 2018 (USD 54,328 in 2017). These tax losses do not expire if not used by the Company. Given uncertainty in the future profitability, no deferred tax assets were recognised in respect of these losses. (b) Effects of deferred tax on income statement and other comprehensive income 2018 2017 Balance at the beginning of the year (100,418) (107,304) Effect on income for the year 30,864 19,497 Effect on other comprehensive income (126) (4,119) Foreign exchange translation effect (27,764) (8,492) Balance at the end of the year (97,444) (100,418) |
Provisions
Provisions | 12 Months Ended |
Dec. 31, 2018 | |
Provisions | |
Provisions | 19 Provisions Accounting policy Provisions for tax, civil, labor, environmental and legal claims and judicial deposits Provisions for legal claims (labor, civil, tax and environmental) are recognized when: (i) the Company has a present legal or constructive obligation as a result of past events; (ii) it is probable that an outflow of resources will be required to settle the obligation; and (iii) the amount can be reliably estimated. The provisions are periodically estimated and the likelihood of losses is supported by the Company's legal counsel. Provisions are measured at the present value of the expenditure expected to be required to settle the obligation using a discount rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to the passage of time is recognized as "Financial expenses". When a claim is secured by a judicial deposit, the Company offsets the provision with the judicial deposit amount in the consolidated balance sheet. However, the Company also has judicial deposits for claims for which the likelihood of loss is possible or remote and for which no provision is recognized. In such cases, these amounts are recognized as outstanding judicial deposits in the Company’s assets. The Company splits the provisions by nature at the balance sheet due to the specifics underlying risks and assessment requirements for each claim. Critical accounting estimates - Tax, civil, labor and environmental provisions The Company is part of ongoing labor, civil, tax and environmental lawsuits which are pending at different court levels. The provisions for potentially unfavorable outcomes of litigation in progress are established and updated based on management evaluation, as supported by the positions of external legal counsel, and require a high level of judgment regarding the matters involved. Asset retirement obligation Provision is made for asset retirement obligation, restoration and environmental costs when the liability arises due to the development or mineral production of an operating asset, based on the net present value of estimated closure costs. Management uses its judgment and previous experience to determine the potential scope of rehabilitation work required and the related costs associated with that work. The cash flows are discounted to present value using a credit risk-adjusted rate that reflects current market assessments of the time value of the money and the specifics risks for the asset to be restored. The interest rate charges relating to the liability are recognized as an accretion expense in net financial results. Difference in the settlement amount of the liability are recognized in the income statement. Critical accounting estimates and judgments - Asset retirement obligations The initial recognition and the subsequent revisions of the asset retirement obligation considers critical future closure costs estimates and several assumptions such as interest rates, inflation and useful lives of the assets. These estimates are reviewed quarterly by the Company. Cost estimates can vary in response to many factors of each site that include timing, expected life of mine, changes to the relevant legal or government requirements and commitments with stakeholders, review of remediation and relinquishment options, emergence of new restoration techniques, among others. External experts support the cost estimation process where appropriate. These factors either isolated or consolidated could significantly affect the future financial results and balance the sheet position. At December 31, 2018, the credit risk-adjusted rate used for Peru was between 3.4% to 9.5% (2017: 1.5% to 2.4%) and for Brazil was between 3% to 5.4% (2017: 7.8%). (a) Analysis 2018 2017 Judicial provision Asset Retirement Environmental Obligation Obligation Tax Labor Civil Environmental Total Total Balance at the beginning of the year 199,445 83,835 18,575 16,421 18,320 4,565 341,161 296,879 Additions — — 2,958 11,811 4,173 2,960 21,902 47,816 Reversals (15,119) — (8,753) (15,012) (20,908) (2,320) (62,112) (42,019) Interest 8,443 5,049 794 1,387 105 213 15,991 13,476 Write-off 462 (5,140) — — — — (4,678) (18,666) Foreign exchange variation (losses) gains (15,133) (12,263) (1,707) (2,188) (215) (404) (31,910) (2,367) Cost and interest revision 7,454 13,249 — — — — 20,703 43,789 Other — — 201 (231) (104) — (134) 2,253 Balance at the end of the year 185,552 84,730 12,068 12,188 1,371 5,014 300,923 341,161 Current — 20,357 — — — — 20,357 14,641 Non-current 185,552 64,373 12,068 12,188 1,371 5,014 280,566 326,520 185,552 84,730 12,068 12,188 1,371 5,014 300,923 341,161 (b) Breakdown of tax, civil, labor and environmental provisions The provisions and the corresponding judicial deposits are as follow: 2018 2017 Outstanding Outstanding Judicial judicial Judicial judicial deposits Provision Net amount deposits deposits Provision Net amount deposits Tax (2,048) 14,116 12,068 2,245 (2,318) 20,893 18,575 3,130 Labor (4,258) 16,446 12,188 6,555 (4,765) 21,186 16,421 7,408 Civil (746) 2,117 1,371 17 (758) 19,078 18,320 23 Environmental — 5,014 5,014 413 — 4,565 4,565 388 (7,052) 37,693 30,641 9,230 (7,841) 65,722 57,881 10,949 (i) Comments of tax provisions Tax provisions relate to tax proceedings, with a probable likelihood of loss relating to federal, state and municipal taxes. (ii) Comments on civil provisions Civil provisions relate to indemnification actions mainly related to claims seeking loss of profits, compensatory, and incidental damages. There are also claims regarding real estate and property matters, such as possessory lawsuits. (iii) Comments on labor lawsuits provisions Labor lawsuits provisions relate to labor lawsuits filed by former employees, third parties and labor unions mostly claiming the payment of indemnities on dismissals, health hazard premiums and hazardous duty premiums, overtime, and commuting hours, as well as alleged occupational illnesses, work accidents, property and personal damage. (iv) Comments on environmental provisions The Company has established policies and procedures to comply with environmental laws and on a regular basis performs analyses to identify environmental legal risks to ensure that the prevention and detection systems are in place to adequately manage these risks. Environmental litigation consists basically of civil public actions to interrupt the environmental licensing for the Company’s mines and smelters and indemnity actions for alleged environmental impacts arising from the Company's activities. (c) Summary of contingent liabilities The Company is part of other litigation involving a risk of possible loss, for which no provision is recognized, as detailed below: 2018 2017 Tax 137,170 125,438 Labor 29,079 46,402 Civil 20,130 24,911 Environmental 119,747 133,851 306,126 330,602 (i) Comments on contingent tax liabilities The main contingent liabilities relating to tax lawsuits are discussed below. Compensation for exploration for mineral resources It relates to assessments issued by the Brazilian National Department of Mineral Production for alleged failure to pay or underpayment of Financial Compensation for the Exploration of Mineral Resources (“CFEM”). The estimate of financial effect of this contingent liability is USD 6,947. Indirect taxes on sales It relates to assessments issued by the Brazilian Internal Revenue Service concerning certain credits taken by the Company when calculating those indirect taxes on sales. The estimate of financial effect of this contingent liability is USD 4,788. Brazilian corporate income taxes It relates to assessments issued by the Brazilian Internal Revenue Service concerning the following: • • Value-added tax on sales It relates to assessments issued by the tax authorities of the State of Minas Gerais concerning the following: • Incidence of value-added tax on sales of certain energy contracts. The estimate of financial effect of this contingent liability is USD 32,849. • • (ii) Comments on contingent labor liabilities Include several claims filed by former employees, third parties and labor unions, mostly claiming the payment of indemnities on dismissals, health hazard premiums and hazardous duty premiums, overtime and commuting hours, as well as indemnity claims by former employees and third parties based on alleged occupational illnesses and work accidents. The individual amount of the claims are not material. (iii) Comments on contingent civil liabilities The main contingent civil liability is related to indemnity lawsuits alleging property damage, pain and suffering. The estimate of financial effect of this contingent liability is USD 10,341. (iv) Comments on contingent environmental liabilities The main contingent environmental liabilities were filed by fishermen communities against the Company for indemnification, compensation for material and moral damages due to alleged pollution of the São Francisco River. The estimate of financial effect of these contingent liabilities is USD 96,946. |
Contractual Liabilities
Contractual Liabilities | 12 Months Ended |
Dec. 31, 2018 | |
Contractual liabilities | |
Contractual liabilities | 20 Contractual liabilities In 2016, the Company entered into a silver streaming arrangement, which consisted of an upfront payment of USD 250,000 for the anticipated sale of a portion of the silver contained in the ore concentrates produced by the Cerro Lindo mining unit. The prepaid amount was recognized as a contractual liability and the corresponding revenue is recognized as the silver is delivered, which is the time that the contractual performance obligations are satisfied. The changes in the contractual liabilities are shown below: 2018 2017 At January 221,885 250,000 Revenue recognition upon ore delivery (29,543) (36,299) Accretion for year 7,295 8,184 At December 199,637 221,885 Current 31,992 31,296 Non-current 167,645 190,589 199,637 221,885 |
Shareholders' equity
Shareholders' equity | 12 Months Ended |
Dec. 31, 2018 | |
Shareholders' equity | |
Shareholders' equity | 21 Shareholders’ equity Accounting policy Common shares are classified in shareholders’ equity. Each time a share premium is paid to the Company for an issued share, the respective share premium is allocated to the share premium account. Each time the repayment of a share premium is decided, such repayment shall be done pro-rata to the existing shareholders. The distribution of dividends to the Company’s shareholders is recognized as a liability in the Company’s consolidated financial statements in the period in which the dividends are approved by the Company’s shareholders. Shares repurchased under the Company’s buyback program and that are not cancelled, are reported as treasury shares and are deducted from shareholders’ equity. These shares are also deducted in earnings per share calculation. (a) Capital As of December 31, 2018, the outstanding capital of USD 133,320 (2017: 133,320) is comprised of 133,320 thousand subscribed and issued common shares (2017: 133,320 thousand), with par value of US$ 1.00 per share. In addition to the subscribed and issued common shares, NEXA also has an authorized, but unissued and unsubscribed share capital set at USD 231,925. (b) Treasury shares On September 20, 2018, the Company’s Board of Directors approved a share buyback program to repurchase up to USD 30,000 of its outstanding common shares, over the 12-month period beginning on November 6, 2018 and ending on November 6, 2019. The repurchased shares will not be cancelled but held in treasury at this time. As of December 31, 2018, the Company had repurchased USD 1,352, corresponding to 112 thousand shares. (c) Share premium The share premium, if any, may be distributed to the shareholders in accordance with Luxembourg Commercial Companies Act by a resolution of the Board of Directors. On February 15, 2018, the Board of Directors approved a distribution to the shareholders in the form of a reimbursement of share premium of USD 0.60 cents per common share to shareholders on record at the close of business on March 14, 2018 and paid USD 80,000 to its shareholders on March 28, 2018. (d) Additional paid in capital Additional paid in capital arises from transactions recognized in equity that do not qualify as capital or share premium in accordance with Luxembourg Commercial Companies Act and, therefore, cannot be distributed to the shareholders of the Company. (e) Accumulated other comprehensive income (loss) The changes in the accumulated other comprehensive income (loss) are as follows: Cumulative translation Remeasurements of Hedge adjustment retirement benefits accounting Total At January 1, 2016 (119,460) 3,327 6,276 (109,857) Translation adjustment on foreign investments 30,373 — — 30,373 Cash flow hedge accounting — — (16,256) (16,256) At December 31, 2016 (89,087) 3,327 (9,980) (95,740) Translation adjustment on foreign investments (10,742) — — (10,742) Cash flow hedge accounting — — 12,556 12,556 Remeasurements of retirement benefits — (3,327) — (3,327) At December 31, 2017 (99,829) — 2,576 (97,253) Translation adjustment on foreign investments (9,959) — — (9,959) Cash flow hedge accounting — — (2,192) (2,192) At December 31, 2018 (109,788) — 384 (109,404) Attributable to non-controlling interests (30,116) Attributable to NEXA's shareholders (79,288) (f) Earnings per share Basic earnings per share are computed by dividing the net income attributable to the NEXA’s shareholders by the average number of outstanding shares for the year. Diluted earnings per share is computed in a similar way, but with the adjustment in the denominator when assuming the conversion of all shares that may be dilutive. The Company does not have any dilutive shares and consequently the Basic and diluted earnings per share are the same. 2018 2017 2016 Net income for the year attributable to NEXA's shareholders 74,860 126,885 93,167 Weighted average number of outstanding common shares (thousands) 133,313 116,527 80,699 Earnings per share in US Dollars 0.56 1.09 1.15 (g) Non-controlling interests Summarized balance sheet NEXA PERU Pollarix 2018 2017 2018 2017 Current assets 957,821 854,295 10,280 6,717 Current liabilities 248,938 236,558 3,459 911 Current net assets 708,883 617,737 6,821 5,806 Non-current assets 642,007 634,757 91,702 110,246 Non-current liabilities 581,172 624,856 21,478 24,978 Non-current net assets 60,835 9,901 70,224 85,268 Net assets 769,718 627,638 77,045 91,074 Accumulated non-controlling interests 373,838 361,265 51,363 60,716 Summarized income statement NEXA PERU Pollarix 2018 2017 2018 2017 Net revenues 827,537 911,745 11,916 11,512 Net income for the year 142,082 224,480 3,742 12,187 Other comprehensive income (loss) — 8,538 (15,322) 4,210 Total comprehensive income (loss) for the year 142,082 233,018 (11,580) 16,397 Comprehensive income (loss) attributable to non- controlling interests 13,621 30,207 (7,724) 10,931 Dividends paid to non-controlling interests — 55,073 2,137 — Summarized statement of cash flows NEXA PERU Pollarix 2018 2017 2018 2017 Net cash provided by operating activities 232,391 131,304 7,201 16,137 Net cash used in investing activities (76,695) (19,371) (762) (80) Net cash used in financing activities — (335,297) (6,441) (16,055) Increase (decrease) in cash and cash equivalents 155,696 (223,364) (2) 2 |
Net revenues
Net revenues | 12 Months Ended |
Dec. 31, 2018 | |
Net revenues | |
Net revenues | 22 Net revenues Accounting policy Revenue represents the fair value of the consideration received or receivable for the sale of goods in the ordinary course of the Company’s activities. Revenues are shown net of value-added tax, returns, rebates and discounts, after eliminating sales between the consolidated companies. The Company recognizes revenue when a performance obligation is satisfied by transferring a promised good or service to a customer. The asset is transferred when the customer obtains control of that asset. To determine the point in time at which a customer obtains control of a promised asset the Company considers the following indicators: (i) the entity has a present right to payment for the asset; (ii) the customer has legal title to the asset; (iii) the entity transferred physical possession of the asset; (iv) the customer has the significant risks and rewards of ownership of the asset; (v) the customer has accepted the asset. Identification of performance obligations and timing of satisfaction of performance obligations The Company has two distinct performance obligations included in certain sales contracts, being: (i) the promise to provide goods to its customers, and (ii) the promise to provide freight services to its customers. Promise to provide goods: this performance obligation is satisfied when the control of such goods is transferred to the final customer, which is substantially determined based on the Incoterms agreed upon in each of the contracts with customers. Promise to provide freight service: this performance obligation is satisfied when the freight service contracted to customers is completed. As a result of the distinct performance obligations identified part of the Company’s revenue is presented as revenue from services. Cost related to revenue from services is presented as “Cost of sales”. Determining the transaction price and the amounts allocated to performance obligations The Company has considered the terms of the contract and its customary business practices to determine the transaction price. The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to its customers. Transaction price is allocated to each performance obligation on a relative standalone selling price basis. For the purpose of determining the transaction price, the entity has mainly fixed prices. However, the Company’s silver streaming arrangement for Cerro Lindo mine has the transaction price linked to silver production, which might change over time. Therefore, it is accounted for as variable consideration. The impact on recognition of revenue related to these sales was not material for December 31, 2018. (a) Composition of net revenues (Revised) (Revised) 2018 2017 2016 Gross revenues 2,779,008 2,709,236 2,193,867 Revenues of products 2,708,112 2,637,613 2,128,739 Revenues of services 70,896 71,623 65,128 Taxes on sales (284,316) (257,347) (227,344) Return on products sales (3,490) (2,405) (1,682) Net revenues 2,491,202 2,449,484 1,964,841 (b) Information on geographical areas in which the Company operates The geographical areas are determined based on the location of the Company’s customers. The net revenues of the Company, classified by currency and destination, is as follows: (i) Revenues by destination (Revised) (Revised) 2018 2017 2016 Brazil 693,409 721,640 560,878 Peru 674,228 696,527 573,884 Luxembourg 172,791 130,723 100,631 United States of America 141,131 158,060 156,634 Switzerland 126,156 108,798 59,873 Japan 93,474 69,565 36,005 Argentina 90,338 79,463 45,050 South Korea 54,894 7,064 66,887 Colombia 51,724 47,734 39,137 Chile 51,215 38,101 67,546 Turkey 48,265 35,522 19,498 Austria 40,531 37,270 22,982 Singapore 37,506 60,857 42,666 Germany 20,906 23,154 42,560 China 9,538 18,172 12,838 Italy 5,327 15,799 3,608 Others 179,769 201,035 114,164 2,491,202 2,449,484 1,964,841 (ii) Revenues by Curreny (Revised) (Revised) 2018 2017 2016 US Dollar 1,806,590 1,729,234 1,414,992 Brazilian Real 684,612 717,032 547,537 Other — 3,218 2,312 2,491,202 2,449,484 1,964,841 |
Expenses by nature
Expenses by nature | 12 Months Ended |
Dec. 31, 2018 | |
Expenses by nature | |
Expenses by nature | 23 Expenses by nature (Revised) (Revised) 2018 2017 2016 Mineral exploration Selling, general and project Cost of sales and administrative development Total Total Total Raw materials and consumables used 1,114,959 838 — 1,115,797 1,120,540 956,909 Employee benefit expenses (i) 159,329 91,000 12,635 262,964 279,371 234,205 Depreciation and amortization 262,948 4,219 22 267,189 270,456 275,036 Services, miscellaneous 231,501 34,211 83,379 349,091 220,535 122,557 Other expenses 120,207 29,335 30,242 179,784 109,115 106,446 1,888,944 159,603 126,278 2,174,825 2,000,017 1,695,153 (i) A provision is recorded to recognize the expenses related to employee profit sharing. This provision is calculated based on the qualitative and quantitative targets established by management. For the year ended December 31, 2018, the average number of employees was 6,159 (2017: 5,643; 2016: 5,561). |
Mineral exploration and project
Mineral exploration and project development | 12 Months Ended |
Dec. 31, 2018 | |
Mineral exploration and project development | |
Mineral exploration and project development | 24 Mineral exploration and project development 2018 2017 2016 Mineral exploration (i) 83,182 76,161 33,547 Project development (FEL 1 and FEL 2) (ii) 43,096 16,537 13,164 126,278 92,698 46,711 (i) (ii) |
Other income and expenses, net
Other income and expenses, net | 12 Months Ended |
Dec. 31, 2018 | |
Other income and expenses, net | |
Other income and expenses, net | 25 Other income and expenses, net 2018 2017 2016 Corporate projects (13,445) (12,947) (7,675) Mining obligations (12,637) (11,498) (8,967) Loss on sale of property, plant and equipment (i) (9,884) (694) (552) Provision for tax, labor, civil and environmental claims (3,671) 258 (15,331) Impairment of property, plant and equipment - Note 13 (3,283) — 979 Gain on sale of investment 348 4,588 408 Environmental and asset retirement obligations (i) 12,078 433 (68,605) Commodities derivative financial instruments 17,528 (18,785) (33,514) Tax credits (ii) 37,582 57 — Other operating expenses, net (6,440) (9,299) (6,462) 18,176 (47,887) (139,719) (i) (ii) |
Net financial results
Net financial results | 12 Months Ended |
Dec. 31, 2018 | |
Net financial results | |
Net financial results | 26 Net financial results 2018 2017 2016 Financial income Gains on financial investments 26,062 21,388 12,032 Interest on tax credits - Note 25 26,033 — — Other financial income 15,414 8,480 12,923 67,509 29,868 24,955 Financial expenses Interest on loans and financing (77,647) (56,434) (36,059) Interest on contractual liabilities (7,294) (8,184) — Monetary adjustment of provisions (4,763) (9,478) (9,595) Derivative financial instruments - Note 6 (iii) (2,538) — — Other financial expenses (29,420) (32,073) (24,720) (121,662) (106,169) (70,374) Foreign exchange losses, net (i) (148,501) (53,880) 124,500 Net financial results (202,654) (130,181) 79,081 (i) Foreign exchange losses, net is mainly related to the gain or loss effect of intercompany transactions denominated in a currency other than the functional currency of the parties involved in the transaction, which is not eliminated during the consolidation process, even though the intercompany balances are eliminated. Consistent with the Company’s strategy of reducing its exposure to foreign exchange changes, the subsidiary NEXA BR prepaid in 2018 USD 600,000 of the USD 1,113,400 outstanding debt to NEXA. |
Long-term commitments
Long-term commitments | 12 Months Ended |
Dec. 31, 2018 | |
Long-term commitments | |
Long-term commitments | 27 Long-term commitments (a) Capital commitments – Aripuanã project At December 31, 2018, the Company had contracted for USD 15,953 of capital expenditures related to the Aripuanã project that have not yet been incurred for the purchase of property, plant and equipment. (b) Process inputs materials The Company has forward purchase commitments in the amount of USD 33,395 for process inputs materials, which are used as part of the Company’s operations. This contract contains monthly fixed prices and expires in 2026. |
Events after the reporting peri
Events after the reporting period | 12 Months Ended |
Dec. 31, 2018 | |
Events after the reporting period | |
Events after the reporting period | 28 Events after the reporting period (a) Dividend distribution On February 15, 2019, the Board of Directors approved, subject to ratification by the Company’s shareholders at its upcoming annual meeting, a dividend distribution in the amount of USD 0.525494 cents per common share, equivalent to approximately USD 70,000, to be paid in cash to the Company’s shareholders on record at March 14, 2019. The dividends are expected to be paid on March 28, 2019. (b) Peruvian income tax assessment On January 2019, the Company was assessed by the Peruvian tax authorities concerning its income tax calculation in the amount USD 37,809. The likelihood of loss is considered possible and no provision was recognized at December 31, 2018. |
Summary of significant accounti
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Summary of significant accounting policies | |
Segment reporting | Segment performance is measured based on Adjusted EBITDA, since financial results and income taxes are managed within the corporate level and are not allocated to operating segments. Adjusted EBITDA is defined as net income (loss) for the year, adjusted by (i) share in the results of associates, (ii) depreciation and amortization, (iii) net financial results, (iv) income tax, (v) gain (loss) on sale of investment, (vi) impairment and impairment reversal. In addition, management may exclude non-cash and non-recurring items considered exceptional from the measurement of Adjusted EBITDA. The internal information used for making decisions is prepared applying accounting measurement basis with managerial reclassifications between income statements lines, which are reconciled to the consolidated financial statements in the column “Adjustments”. When applicable, the Company uses arm's length commercial terms for intersegment sales. The Company’s corporate headquarters expenses are allocated to the reportable segments to the extent they are allocated in the measures of performance used by the CODM |
Subsidiaries | Subsidiaries include all entities over which the Company has control. The Company controls an entity when it (i) has the power over the entity; (ii) is exposed, or has the right, to variable returns from its involvement with the entity; and (iii) has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company, except when the predecessor basis of accounting is applied. Subsidiaries are deconsolidated from the date on which that control ceases. When the Company has less than a majority of the voting rights of an investee, it considers that it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. Non-controlling interests in the equity and results of subsidiaries are shown separately in the consolidated balance sheet, income statement, statement of comprehensive income and statement of changes in shareholders’ equity. Transactions, balances and unrealized gains and losses between consolidated entities are eliminated. |
Joint operations | The Company recognizes its direct right to the assets, liabilities, revenues and expenses of joint operations and its share of any jointly held assets or incurred liabilities and revenues and expenses. A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the assets, and obligations for the liabilities, relating to the arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control. Transactions, balances and unrealized gains and losses between consolidated entities are eliminated. |
Foreign currency translation | (i) Functional and presentation currency Items included in the financial statements of each of the Company’s entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The Company’s consolidated financial statements are presented in US Dollars ("USD"), which is NEXA’s functional and reporting currency. (ii) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at the end of each reporting period are recognized in the income statement. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. (iii) Consolidated entities The results of operations and financial position of consolidated entities that have a functional currency different from the reporting currency are translated into the reporting currency as follows: · Assets and liabilities for each balance sheet presented are translated at the closing rate at the end of the reporting period; · Income and expenses for each income statement are translated at average exchange rates which is a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates; and · All resulting exchange differences are recognized in other comprehensive income and accumulated in a separate component of shareholders’ equity. |
Transactions with non-controlling interests | Transactions with non-controlling interests that do not result in a loss of control are accounted within the shareholders’ equity. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and any consideration paid or received is recognized in a separate reserve within shareholders’ equity. |
Derivatives | Derivatives are initially recognized at fair value as at the date on which a derivative contract is entered into and are subsequently measured at fair value. Derivatives are only used for risk mitigation purposes and not as speculative investments. When derivatives do not meet the hedge accounting criteria, they are classified as held for trading and accounted for at fair value through profit or loss. The Company documents at the inception of the hedging transaction the relationship between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking the hedge transactions. The Company also documents its assessment, both at hedge inception and on an ongoing basis, whether the derivatives that are used in hedging transactions and accounted for as hedge accounting were, and will continue to be, highly effective in offsetting changes in the fair value or cash flow of hedged items. (i) Cash flow hedge Derivatives that are designated for hedge accounting recognition are qualified as cash flow hedges when they are related to a highly probable forecasted transaction. The effective portion of the changes in fair value is recognized in shareholders’ equity in "Accumulated other comprehensive income (loss)" and is subsequently reclassified to the income statement in the same period when the hedged expected cash flows affect the income statement. The reclassification adjustment is recognized in the same income statement line item affected by the highly probable forecasted transaction, while gains or losses related to the non-effective portion are immediately recognized as "Other income and expenses, net". When a hedging instrument expires, is sold or no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in shareholders’ equity at that time remains in shareholders’ equity and is recognized when the forecast transaction is ultimately recognized in the income statement. When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was previously accounted in shareholders’ equity is immediately transferred to the income statement within "Other income and expenses, net". (ii) Fair value hedge Derivatives that are designated for hedge accounting are qualified as fair value hedges when they are related to assets or liabilities already recognized in the consolidated balance sheet. Changes in the fair values of derivatives that are designated and qualify as fair value hedges and changes in the fair value of the hedged item are recorded in the income statement in the same period. (iii) Derivatives not designated as hedging instruments Changes in the fair value of derivative financial instruments not designated as hedging instruments are recognized immediately in the income statement within "Other income and expenses, net" when related to price risk and within "Net financial results" when related to interest rate or foreign exchange rate risk. This category includes derivatives contracts entered into in November 2018 by the Company to mitigate its exposure to the foreign currency risk associated with changes in the Brazilian real exchange rate for the majority of the estimated capital expenditures of the Aripuanã project. The transaction involved the purchase of collars in the notional amount of USD 294 million (BRL 1,057 million) which relates to the estimated Aripuanã’s disbursements from 2019 to 2021. |
Financial instruments by category | Normal purchases and sales of financial assets are recognized on the trade date – the date on which the Company commits to purchase or sell the asset. Financial assets are initially recognized at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets carried at fair value through profit or loss, if any, are initially recognized at fair value, and transaction costs are expensed in the income statement. Financial assets are derecognized when the rights to receive cash flow from the investments have expired or the Company has transferred substantially all of the risks and rewards of ownership. Financial assets at fair value through profit or loss and at fair value through other comprehensive income are subsequently carried at fair value. Financial assets at amortized costs are subsequently measured using the effective interest rate method. Gains or losses arising from changes in the fair value of the financial assets classified as fair value through profit or loss are presented in the income statement under "Net financial results" in the year in which they arise. The Company classifies its financial assets under the following categories: amortized cost, fair value through other comprehensive income and fair value through profit or loss. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of the Company’s financial assets upon initial recognition. (i) Amortized cost Financial assets measured at amortized cost are assets held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and for which the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. (ii) Fair value through profit or loss Financial assets measured at fair value through profit or loss are assets which an entity manages with the objective of realizing cash flows through the sale of such assets and financial assets that do not give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding. (iii) Fair value through other comprehensive income Financial assets measured at fair value through other comprehensive income are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and for which the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. |
Cash and cash equivalents | Cash and cash equivalents includes cash, bank deposits, and highly liquid short-term investments (investments with an original maturity less than 90 days), which are readily convertible into a known amount of cash and subject to an immaterial risk of changes in value. Bank overdrafts are shown within loans and financing in current liabilities in the balance sheet. |
Financial investments | Financial investments are mainly short-term investments that do not meet the definition of cash and cash equivalents. The financial investments are used as part of the cash-management strategy of the Company and are measured at fair value through profit or loss. |
Trade accounts receivable | Trade accounts receivable are amounts due from customers for goods sold in the ordinary course of the Company’s business. Trade accounts receivable are recognized initially at fair value and subsequently measured at: (i) Fair value through profit or loss when related to the Company’s accounts receivable portfolio that is included in a true sale program whereby the Company, at its discretion, can discount certain outstanding trade accounts receivables and receive payments in advance. The program is used to meet short-term liquidity needs. Trade accounts receivable within this program are derecognized since the contractual rights to receive the cash flows of the assets are transferred to the counterparty. (ii) Fair value through profit or loss when related to sales that are subsequently adjusted to changes of LME prices. These accounts receivable do not meet the solely payments of principal and interest (SPPI) criteria because there is a component of commodity price risk that modifies the cash flows that otherwise would be required by the sales contract. (iii) Amortized cost using the effective interest rate method, less impairment, when the receivable do not meet the aforementioned classification. Credit risk can arise from non-performance by counterparties of their contractual obligations to the Company. To ensure an effective evaluation of credit risk, management applies procedures related to the application for credit granting and approvals, renewal of credit limits, continuous monitoring of credit exposure in relation to established limits and events that trigger requirements for secured payment terms. As part of the Company’s process, the credit exposures with all counterparties are regularly monitored and assessed. The Company applied the IFRS 9 simplified approach to measure the impairment losses for trade accounts receivable. This approach requires the use of the lifetime expected credit losses on its trade accounts receivable measured at amortized cost. To calculate the lifetime expected credit losses the Company used a provision matrix and forward-looking information. The additions to impairment of trade accounts receivable are included in selling expenses. Trade accounts receivable are generally written off when there is no expectation of recovering additional cash. In 2017 and 2016, the impairment of trade accounts receivable was based on the incurred loss model. |
Inventory | Inventory is stated at the lower of cost and net realizable value. Cost is determined using the weighted average cost method. The cost of finished goods and work in progress comprises raw materials, direct labor, other direct costs and related fixed production overheads (based on normal operating capacity). Variable production overhead costs are included in inventory cost on the basis of actual level of production. The net realizable value is the estimated selling price in the ordinary course of business, less any additional selling expenses. Imports in transit are stated at the accumulated cost of each import. A provision for obsolete inventory - finished products, semi-finished products, raw materials and auxiliary materials - is recognized when items cannot be used in normal production or sold because they are damaged or do not meet the Company’s specification. Slow-moving provision is recognized for inventory items that are in excess of the expected normal use or sale. The amount of slow-moving provision recognized is determined on the basis of 20% of the carrying amount for each six-month period without use or sale. |
Property, plant and equipment | Property, plant and equipment are stated at the historical cost of acquisition or construction less accumulated depreciation and any recognized impairment losses. Historical cost includes expenditures that are directly attributable to the acquisition and construction of the assets. Subsequent costs are included in the asset’s carrying amount, or recognized as a separate asset as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and they can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognized when replaced. All other repairs and maintenance are charged to the income statement during the reporting period in which they are incurred. Replacement costs are included in the carrying amount of the asset when it is probable that the Company will realize future economic benefits in excess of the benefits expected from the asset in its current condition. Replacement costs are depreciated over the remaining useful life of the related asset. Land is not depreciated. Depreciation of other assets is calculated using the straight-line method to reduce their costs to their residual values over their estimated useful lives. The assets' residual values and useful lives are reviewed annually and adjusted if appropriate. An asset's carrying amount is reduced to its recoverable amount when it is greater than the estimated recoverable amount, in accordance with the criteria adopted by the Company in order to determine the recoverable amount. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognized within "Other income and expenses, net" in the income statement. Loans and financing costs directly related to the acquisition, construction or production of a qualifying asset that requires a substantial period of time to prepare for its intended use or sale are capitalized as part of the cost of that asset when it is probable that future economic benefits associated with the item will flow to the Company and costs can be measured reliably. Stripping costs In its surface mining operations, the Company must remove overburden and other waste to gain access to mineral ore deposits. The removal process is referred to as stripping. During the development of a mine, before production commences, when the stripping activity improves access to the ore body, the component of the ore body for which access has been improved can be identified and the costs can be measured reliably, a stripping activity asset is capitalized as part of the investment in the construction of the mine, accounted for as part of property, plant and equipment, and subsequently depreciated over the life of the mine on a units of production basis. Stripping costs incurred during the production phase of operations are treated as a production cost that forms part of the cost of inventory. Exploration and development costs The Company incurs mineral exploration costs such as exploratory drilling, geological and geophysical studies in order to determine the mineral potential of a given area, which are expensed as incurred. The Company uses the front-end loading (“FEL”) methodology for project and development management. Development scoping costs and pre-feasibility studies for greenfield and brownfield projects are expensed during FEL 1 and FEL 2 phases, together with research and development costs for the smelting segment, until the project has demonstrated technical feasibility and economic viability. Mining development costs are capitalized when the FEL 3 phase starts and the mineral potential and commercial viability of the project can be assessed reliably. Such costs include feasibility studies and engineering work. The development costs are assessed for impairment at least annually or whenever evidences indicate that the assets may be impaired. Asset retirement obligation An asset retirement obligation is an obligation related to the permanent removal from service of a tangible long-lived asset that results from the acquisition, construction or development, or the normal operations of a tangible long-lived asset. At the initial recognition of an asset retirement obligation and at the periodical revisions of the expected disbursements and the discount rate, the changes in the liability are charged to property, plant and equipment. The capitalized amount recognized in property, plant and equipment is depreciated based on the useful life of the underlying asset. Any reduction in the provision that exceeds the carrying amount of the asset, is immediately recognized in the income statement as "Other income and expenses, net". |
Leases | Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under an operating lease (net of any incentive received from the lessor) are charged to the income statement on a straight-line basis over the period of the lease. Leases of property, plant and equipment, where the Company has substantially all the risks and rewards of ownership, are classified as finance leases. Finance leases are capitalized at the inception of the lease at the lower of the fair value of the leased item and the present value of the minimum lease payments and are depreciated over the shorter of the asset’s useful life and the lease term. |
Impairment of non-financial assets | The Company assesses, at each reporting date, whether there is an indicator that an asset or cash generating unit (“CGU”) may be impaired. If any indication exists, such as volumes and prices reductions or unusual events that can affect the business, the Company estimates the asset’s or CGU’s recoverable amount. The recoverable amount is the higher of an asset’s or CGU’s fair value less cost of disposal and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets, in which case, the asset is tested as part of a larger CGU to which it belongs. If the carrying amount of an asset or CGU exceeds its recoverable amount, the asset or CGU is considered impaired and is reduced to its recoverable amount. Non-financial assets other than goodwill that were adjusted due to impairment are subsequently reviewed for possible reversal of the impairment at each reporting date. |
Goodwill | Goodwill arising from business combinations is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net assets acquired. Goodwill is not amortized but is tested for impairment annually and whenever circumstances indicate that the carrying amount may not be recovered. The recoverable amount is the higher of an asset's fair value less costs to sell and its value in use. If either the fair value less costs to sell or the value in use is higher than the carrying amount, the Company need not estimate the other amount. Impairment is determined by assessing the recoverable amount of each CGU (or group of CGUs) to which the goodwill relates. For the purposes of assessing impairment, assets are grouped at the lowest level for which there is separately identifiable cash flow (CGU level). Impairment losses relating to goodwill cannot be reversed in future periods. As part of the impairment testing procedures, the goodwill is allocated to a CGU that is the lowest level at which goodwill is monitored. If the recoverable amount of the asset (or CGU) is lower than its carrying amount, the carrying amount of the asset (or CGU) is reduced to its recoverable amount. The difference between the carrying amount and recoverable amount is recognized as an impairment loss in the income statement. |
Rights to use natural resources | Costs for the acquisition of rights to explore and develop mineral properties are capitalized and amortized as a cost of production using the units of production method over their useful lives. Useful lives consider the period of extraction for both mineral reserves and mineral resources, which includes a portion of the Company’s inferred resources in the Company’s mining operations. The Company selected the physical unit model to compute amortization expenses under the units of production method. This model consists of amortization being calculated based on actual ore produced during the period compared to the total ore expected to be produced over the life of mine. |
Loans and financings | Loans and financings are recognized initially at fair value, net of transaction costs incurred, and are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the total amount payable is recognized in the income statement as interest expense over the period of the loans using the effective interest rate method. Loans and financings are classified as current liabilities unless the Company has the unconditional right to defer repayment of the liability for at least 12 months after the reporting period. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the drawdown occurs. To the extent that there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as a prepayment for liquidity services and amortized over the period of the facility to which it relates. |
Current and deferred taxes on income | The current and deferred taxes on income are calculated on the basis of the tax laws enacted or substantively enacted up to balance sheet date in the countries where the entities operate and generate taxable income. Management periodically evaluates positions taken by the Company in the taxes on income returns with respect to situations in which the applicable tax regulations are subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities. The current income tax is presented net, separated by taxpaying entity, in liabilities when there are amounts payable, or in assets when the amounts prepaid exceed the total amount due on the reporting date. Deferred tax assets are recognized only to the extent it is probable that future taxable income will be available against which the temporary differences and/or tax losses can be utilized. Deferred tax assets and liabilities are offset when there is a legally enforceable right and an intention to offset them in the calculation of current taxes, generally when they are related to the same legal entity and the same tax authority. Accordingly, deferred tax assets and liabilities in different entities or in different countries are generally presented separately, and not on a net basis. Deferred tax liabilities and assets are not recognized for temporary differences between the carrying amounts and tax bases of investments in foreign operations where the Company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not be reversed in the near future. Deferred income tax are provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred tax liabilities are not recognized if they arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from the initial recognition of an asset or liability in a transaction other than a business combination that, at the time of the transaction, affects neither the accounting nor the taxable income or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income taxes asset is realized or the deferred income tax liability is settled. |
Provisions | Provisions for tax, civil, labor, environmental and legal claims and judicial deposits Provisions for legal claims (labor, civil, tax and environmental) are recognized when: (i) the Company has a present legal or constructive obligation as a result of past events; (ii) it is probable that an outflow of resources will be required to settle the obligation; and (iii) the amount can be reliably estimated. The provisions are periodically estimated and the likelihood of losses is supported by the Company's legal counsel. Provisions are measured at the present value of the expenditure expected to be required to settle the obligation using a discount rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to the passage of time is recognized as "Financial expenses". When a claim is secured by a judicial deposit, the Company offsets the provision with the judicial deposit amount in the consolidated balance sheet. However, the Company also has judicial deposits for claims for which the likelihood of loss is possible or remote and for which no provision is recognized. In such cases, these amounts are recognized as outstanding judicial deposits in the Company’s assets. The Company splits the provisions by nature at the balance sheet due to the specifics underlying risks and assessment requirements for each claim. Critical accounting estimates - Tax, civil, labor and environmental provisions The Company is part of ongoing labor, civil, tax and environmental lawsuits which are pending at different court levels. The provisions for potentially unfavorable outcomes of litigation in progress are established and updated based on management evaluation, as supported by the positions of external legal counsel, and require a high level of judgment regarding the matters involved. Asset retirement obligation Provision is made for asset retirement obligation, restoration and environmental costs when the liability arises due to the development or mineral production of an operating asset, based on the net present value of estimated closure costs. Management uses its judgment and previous experience to determine the potential scope of rehabilitation work required and the related costs associated with that work. The cash flows are discounted to present value using a credit risk-adjusted rate that reflects current market assessments of the time value of the money and the specifics risks for the asset to be restored. The interest rate charges relating to the liability are recognized as an accretion expense in net financial results. Difference in the settlement amount of the liability are recognized in the income statement. |
Shareholders' equity | Common shares are classified in shareholders’ equity. Each time a share premium is paid to the Company for an issued share, the respective share premium is allocated to the share premium account. Each time the repayment of a share premium is decided, such repayment shall be done pro-rata to the existing shareholders. The distribution of dividends to the Company’s shareholders is recognized as a liability in the Company’s consolidated financial statements in the period in which the dividends are approved by the Company’s shareholders. Shares repurchased under the Company’s buyback program and that are not cancelled, are reported as treasury shares and are deducted from shareholders’ equity. These shares are also deducted in earnings per share calculation. |
Net revenue | Revenue represents the fair value of the consideration received or receivable for the sale of goods in the ordinary course of the Company’s activities. Revenues are shown net of value-added tax, returns, rebates and discounts, after eliminating sales between the consolidated companies. The Company recognizes revenue when a performance obligation is satisfied by transferring a promised good or service to a customer. The asset is transferred when the customer obtains control of that asset. To determine the point in time at which a customer obtains control of a promised asset the Company considers the following indicators: (i) the entity has a present right to payment for the asset; (ii) the customer has legal title to the asset; (iii) the entity transferred physical possession of the asset; (iv) the customer has the significant risks and rewards of ownership of the asset; (v) the customer has accepted the asset. Identification of performance obligations and timing of satisfaction of performance obligations The Company has two distinct performance obligations included in certain sales contracts, being: (i) the promise to provide goods to its customers, and (ii) the promise to provide freight services to its customers. Promise to provide goods: this performance obligation is satisfied when the control of such goods is transferred to the final customer, which is substantially determined based on the Incoterms agreed upon in each of the contracts with customers. Promise to provide freight service: this performance obligation is satisfied when the freight service contracted to customers is completed. As a result of the distinct performance obligations identified part of the Company’s revenue is presented as revenue from services. Cost related to revenue from services is presented as “Cost of sales”. Determining the transaction price and the amounts allocated to performance obligations The Company has considered the terms of the contract and its customary business practices to determine the transaction price. The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to its customers. Transaction price is allocated to each performance obligation on a relative standalone selling price basis. For the purpose of determining the transaction price, the entity has mainly fixed prices. However, the Company’s silver streaming arrangement for Cerro Lindo mine has the transaction price linked to silver production, which might change over time. Therefore, it is accounted for as variable consideration. The impact on recognition of revenue related to these sales was not material for December 31, 2018. |
General Information (Tables)
General Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
General information | |
Schedule of segment results | 2018 Intersegments Mining Smelting sales Adjustments Consolidated Net revenues 1,163,741 2,030,568 (704,031) 924 2,491,202 Cost of sales (694,024) (1,876,034) 704,031 (22,917) (1,888,944) Gross Profit 469,716 154,534 — (21,993) 602,258 Selling, general and administrative (44,940) (79,969) — (34,693) (159,603) Mineral explorations and project development (112,713) (11,067) — (2,498) (126,278) Other income and expenses, net (54,042) 16,450 — 55,768 18,176 Operating income 258,021 79,948 — (3,416) 334,553 Depreciation and amortization 172,357 94,832 — — 267,189 Exceptional items (i) — — — 3,050 3,050 Adjusted EBITDA 430,378 174,781 — (366) 604,792 Exceptional items (i) (3,050) (3,050) Depreciation and amortization (267,189) Net financial results (202,654) Income before income tax 131,899 2017 Intersegments Mining Smelting sales Adjustments Consolidated Net revenues 1,213,221 1,952,006 (721,463) 5,719 2,449,484 Cost of sales (680,811) (1,746,771) 721,463 (46,706) (1,752,825) Gross Profit 532,410 205,235 — (40,987) 696,659 Selling, general and administrative (41,054) (89,128) — (24,312) (154,494) Mineral explorations and project development (86,119) (3,989) — (2,590) (92,698) Other income and expenses, net (54,777) (58,749) — 65,640 (47,887) Operating income 350,460 53,369 — (2,249) 401,580 Depreciation and amortization 171,085 99,370 — — 270,456 Exceptional items (i) — — — (4,515) (4,515) Adjusted EBITDA 521,545 152,739 — (6,764) 667,519 Exceptional items (i) 4,515 4,515 Share in the results of associates 60 Depreciation and amortization (270,456) Net financial results (130,181) Income before income tax 271,459 2016 Intersegments Mining Smelting sales Adjustments Consolidated Net revenues 907,425 1,491,988 (438,238) 3,666 1,964,841 Cost of sales (608,825) (1,307,436) 438,238 (26,206) (1,504,229) Gross Profit 298,600 184,552 — (22,540) 460,612 Selling, general and administrative (46,829) (69,950) — (27,436) (144,213) Mineral explorations and project development (41,759) (2,925) — (2,026) (46,711) Other income and expenses, net (49,478) (139,922) — 49,681 (139,719) Operating income 160,534 (28,245) — (2,321) 129,969 Depreciation and amortization 176,261 98,772 — — 275,036 Exceptional items (i) — — — (1,079) (1,079) Adjusted EBITDA 336,796 70,528 — (3,400) 403,924 Exceptional items (i) 1,079 1,079 Share in the results of associates (158) Depreciation and amortization (275,036) Net financial results 79,081 Income before income tax 208,892 (i) |
Basis of preparation of the c_2
Basis of preparation of the consolidated financial statements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Basis of preparation of the consolidated financial statements | |
Schedule of ownership percentages | Percentage of capital 2018 2017 Headquarters Activities Subsidiaries Cia. Magistral S.A.C 100.00 100.00 Peru Mining projects Nexa Resources Atacocha S.A.A. - "NEXA ATACOCHA" 66.62 66.62 Peru Mining Nexa Resources Perú S.A.A. - "NEXA PERU" 80.23 80.23 Peru Mining Inversiones Garza Azul S.A.C 99.75 100.00 Peru Holding and others Votorantim GmbH 100.00 100.00 Austria Holding and others Pollarix S.A. - "Pollarix" (i) 33.33 33.33 Brazil Holding and others L.D.O.S.P.E. Geração de Energia e Participações Ltda. - "L.D.O.S.P.E." 100.00 100.00 Brazil Energy L.D.Q.S.P.E. Geração de Energia e Participações Ltda. - "L.D.Q.S.P.E." 100.00 100.00 Brazil Energy L.D.R.S.P.E. Geração de Energia e Participações Ltda. - "L.D.R.S.P.E." 100.00 100.00 Brazil Energy Nexa Resources El Porvenir S.A.C. 99.99 99.99 Peru Mining Nexa Resources UK Ltd. - "NEXA UK" 100.00 100.00 United Kingdom Mining Minera Bongará S.A. 61.00 61.00 Peru Mining projects Minera Pampa de Cobre S.A.C 99.99 99.99 Peru Mining Mineração Dardanelos Ltda. 70.00 70.00 Brazil Mining projects Mineração Santa Maria Ltda. 99.99 99.99 Brazil Mining projects Rayrock Antofagasta S.A.C 99.99 99.99 Chile Holding and others Nexa Resources Cajamarquilla S.A. - "NEXA CJM" 99.99 99.99 Peru Smelting Nexa Recursos Minerais S.A. - "NEXA BR" 100.00 100.00 Brazil Mining / Smelting Votorantim US. Inc. 100.00 100.00 United States Holding and others Joint-operation Campos Novos Energia S.A. - "Enercan" 20.98 20.98 Brazil Energy Cia. Minera Shalipayco S.A.C 75.00 75.00 Peru Mining projects (i) |
Schedule of revision to financial statements - Income Statement | Reclassification of mineral exploration and (Original) Adoption of IFRS project (Revised) 2017 15 development 2017 Net revenues 2,449,484 — — 2,449,484 Cost of sales (1,681,202) (71,623) — (1,752,825) Gross profit 768,282 (71,623) — 696,659 Reclassification of mineral exploration and (Original) First adoption of project (Revised) 2017 IFRS 15 development 2017 Operating expenses Selling (89,239) 71,623 — (17,616) General and administrative (148,242) — 11,364 (136,878) Mineral exploration and project development — — (92,698) (92,698) Other income and expenses, net (129,221) — 81,334 (47,887) (366,702) 71,623 — (295,079) Operating income 401,580 — — 401,580 Reclassification of mineral exploration and (Original) First adoption of project (Revised) 2016 IFRS 15 development 2016 Net revenues 1,964,841 — — 1,964,841 Cost of sales (1,439,101) (65,128) — (1,504,229) Gross profit 525,740 (65,128) — 460,612 Reclassification of mineral exploration and (Original) First adoption of project (Revised) 2016 IFRS 15 development 2016 Operating expenses Selling (90,647) 65,128 — (25,519) General and administrative (127,305) — 8,611 (118,694) Mineral exploration and project development — — (46,711) (46,711) Other income and expenses, net (177,819) — 38,100 (139,719) (395,771) 65,128 — (330,643) Operating income 129,969 — — 129,969 |
Schedule of revision to financial statements - Expenses by nature | Reclassification of mineral exploration (Original) and project (Revised) 2017 Adoption of IFRS 15 development 2017 Raw materials and consumables used 1,120,540 — — 1,120,540 Employee benefit expenses 278,285 — 1,086 279,371 Depreciation and amortization 270,454 — 2 270,456 Services, miscellaneous 232,165 (71,623) 59,993 220,535 Other Expenses 17,239 71,623 20,253 109,115 1,918,683 — 81,334 2,000,017 Reconciliation Cost of sales 1,681,202 71,623 — 1,752,825 Selling, general and administrative expenses 237,481 (71,623) (11,364) 154,494 Mineral exploration and project development — — 92,698 92,698 1,918,683 — 81,334 2,000,017 Reclassification of mineral exploration (Original) First adoption of and project (Revised) 2016 IFRS 15 development 2016 Raw materials and consumables used 956,909 — — 956,909 Employee benefit expenses 233,755 — 450 234,205 Depreciation and amortization 275,034 — 2 275,036 Services, miscellaneous 158,388 (65,128) 29,297 122,557 Other Expenses 32,967 65,128 8,351 106,446 1,657,053 — 38,100 1,695,153 Reconciliation Cost of sales 1,439,101 65,128 — 1,504,229 Selling, general and administrative expenses 217,952 (65,128) (8,611) 144,213 Mineral exploration and project development — — 46,711 46,711 1,657,053 — 38,100 1,695,153 |
Changes in accounting policie_2
Changes in accounting policies and disclosures (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Changes in accounting policies and disclosures | |
Schedule of differences in classification and measurements categories under IAS 39 and the new measurement categories under IFRS 9 | January 1, 2018 Original carrying New carrying Financial assets Classification under IAS 39 New classification under IFRS 9 amount under IAS 39 amount under IFRS 9 Cash and cash equivalents Loans and receivable Fair value through profit or loss 1,019,037 1,019,037 Financial investments Assets held for trading Fair value through profit or loss 206,547 206,547 Derivative financial instruments Assets held for trading/Used for hedging Fair value through profit or loss / Fair value through other comprehensive income 11,777 11,777 Trade accounts receivable Loans and receivable Fair value through profit or loss / Amortized cost 182,713 182,469 Related parties Loans and receivable Fair value through profit or loss / Amortized cost 738 738 |
Financial risk management (Tabl
Financial risk management (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Financial risk management | |
Summary of financial assets and liabilities in foreign currency | USD amounts of foreign currency transactions 2018 2017 Assets Cash, cash equivalents and financial investments 140,860 229,877 Derivative financial instruments 11,205 4,280 Trade accounts receivable 39,000 66,834 191,065 300,991 Liabilities Loans and financing 123,471 161,706 Derivative financial instruments 14,222 3,634 Trade payables 4,689 78,286 142,382 243,626 Net exposure 48,683 57,365 |
Schedule of credit quality of financial assets | 2018 2017 Local rating Global rating Total Local rating Global rating Total Cash and cash equivalents AAA 1,484 — 1,484 — — — AA+ 861 — 861 1,089 — 1,089 AA 24 78,245 78,269 — — — AA- — 20,179 20,179 — 115,269 115,269 A+ — 178,730 178,730 — 172,052 172,052 A — 361,484 361,484 — 235,445 235,445 A- — 29,162 29,162 3 86,189 86,192 BBB+ — 181,411 181,411 — 96,436 96,436 BBB — 20,245 20,245 — 110,733 110,733 BBB- — 83,919 83,919 — — — No rating 3 77,191 77,194 — 201,821 201,821 2,372 1,030,566 1,032,938 1,092 1,017,945 1,019,037 Financial investments AAA 51,913 — 51,913 — — — AA+ 10,840 — 10,840 17,111 — 17,111 AA 24,965 — 24,965 — — — AA- — — — 180,127 4,238 184,365 A- — — — 5,053 — 5,053 No rating 4,515 — 4,515 — 18 18 92,233 — 92,233 202,291 4,256 206,547 Derivative financial instruments AAA 3,749 — 3,749 — — — AA — 2,164 2,164 — — — AA- — — — 4,769 3,634 8,403 A+ — 5,275 5,275 — 3,141 3,141 A — 17 17 — 233 233 3,749 7,456 11,205 4,769 7,008 11,777 98,354 1,038,022 1,136,376 208,152 1,029,209 1,237,361 |
Summary of estimated future cash flow | Less than 1 Between 1 and Between 3 and Over 5 years Total At December 31, 2018 Loans and financing 91,890 261,186 619,958 897,701 1,870,735 Derivative financial instruments 8,663 4,954 605.00 — 14,222 Trade payables 387,225 — — — 387,225 Confirming payable 70,411 — — — 70,411 Salaries and payroll charges 58,166 — — — 58,166 Related parties 63 1,517 — — 1,580 Provisions - Asset Retirement Obligation 12,283 40,171 36,561 198,061 287,075 Use of public assets 1,411 3,092 3,485 33,658 41,646 630,775 310,920 660,609 1,129,420 2,731,723 At December 31, 2017 Loans and financing 102,294 373,324 236,927 1,228,474 1,941,018 Derivative financial instruments 12,588 2,449 — — 15,037 Trade payables 329,814 — — — 329,814 Confirming payable 111,024 — — — 111,024 Salaries and payroll charges 79,798 — — — 79,798 Dividends payable 4,138 — — — 4,138 Related parties 87,686 2,238 — — 89,924 Provisions - Asset Retirement Obligation 7,526 53,429 33,186 237,788 331,929 Use of public assets 1,740 3,755 4,233 45,309 55,037 736,607 435,195 274,346 1,511,571 2,957,719 |
Summary of gearing ratio | Note 2018 2017 2016 Loans and financing 1,424,867 1,447,299 1,144,385 Cash and cash equivalents (1,032,938) (1,019,037) (915,576) Derivative financial instruments 3,017 3,260 16,718 Financial investments (92,233) (206,547) (119,498) Net debt 302,713 224,975 126,029 Net income for the year 90,976 165,265 110,509 Plus (less): Share in the results of associates — (60) 158 Depreciation and amortization 13 and 14 267,189 270,456 275,036 Net financial results 202,654 130,181 (79,081) Income tax 40,923 106,194 98,383 EBITDA 601,742 672,034 405,003 Exceptional items 1 (i) 3,050 (4,515) (1,079) Adjusted EBITDA 604,792 667,519 403,924 Gearing ratio (Net Debt/Adjusted EBITDA) 0.50 0.34 0.31 |
Classification of financial assets and liabilities in the fair value hierarchy | Note Level 1 Level 2 Total fair value Assets Cash and cash equivalents 1,032,938 — 1,032,938 Financial investments 39,167 53,065 92,233 Derivative financial instruments — 11,205 11,205 Trade accounts receivables — 151,058 151,058 1,072,105 215,328 1,287,434 Liabilities Derivative financial instruments — 14,222 14,222 — 14,222 14,222 Note Level 1 Level 2 Total fair value Assets Cash and cash equivalents 1,019,037 — 1,019,037 Financial investments 134,168 72,379 206,547 Derivative financial instruments — 11,777 11,777 Trade accounts receivables — 62,693 62,693 1,153,205 146,849 1,300,054 Liabilities Derivative financial instruments — 15,037 15,037 — 15,037 15,037 |
Derivative financial instrume_2
Derivative financial instruments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Derivative financial instrument | |
Summary of derivative financial instruments and the underlying hedged items | Notional 2017 Changes in fair Value 2018 Fair value by maturity Strategy 2018 2017 Per unit Fair Value - Inventory Net revenues Other income and Net financial Other Realized gain Fair value - 2019 2020 2021 Hedges for mismatches of quotational periods Zinc forward 261,020 387,240 ton (4,638) 3,038 (1,353) 20,460 — (968) 17,096 (557) (557) — — Silver forward — 503 k oz 129 — — 159 — 67 355 — — — — (4,508) 3,038 (1,353) 20,618 — (901) 17,451 (557) (557) — — Hedges for sales of zinc at a fixed price Zinc forward 10,566 2,230 ton 603 — — (3,090) — — (1,629) (858) (815) (43) — 603 — — (3,090) — — (1,629) (858) (815) (43) — Interest rates risk LIBOR floating rate vs. USD fixed rate swaps — 31,393 USD 646 — — — (936) — (290) — — — — 646 — — — (936) — (290) — — — — Foreign exhange risk Collars foreign exchange (USD) 1,056,922 — BRL — — — — (1,602) — — (1,602) 95 (1,431) (266) — — — — (1,602) — — (1,602) 95 (1,431) (266) (3,260) 3,038 (1,353) 17,528 (2,538) (901) 15,532 (3,017) (1,276) (1,474) (266) |
Schedule of sensitivity analysis | Impacts on income stament Impacts on statement of comprehensive income Scenario I Scenarios II e III Scenario I Scenarios II e III Risk factor Cash and cash Loans and Notional of Unit Quotation Changes Results of -25% -50% +25% +50% Results of -25% -50% +25% +50% Foreign exchange rates BRL 94,603 123,471 293,589 USD 0.2581 % 703 63,484 230,801 (24,677) (52,495) (48) (2,278) (7,245) 1,695 2,689 PEN 43,601 — — PEN 1.1482 1.00 % 112 (2,813) (5,626) 2,813 5,626 — — — — — Interest rates BRL - CDI 93,093 27,724 1,056,922 BRL 6.40 % bps (183) 2,336 4,870 (2,180) (4,243) — — — — — USD - LIBOR — — 681,817 USD 2.81 % bps — (5) (11) 5 10 — (4) (8) 4 9 US Dollar coupon — — 293,589 USD 3.31 % bps (394) (1,627) (3,280) 1,614 3,225 — — — — — Price - commodities Zinc — — 271,586 mt 2,511 % (1,919) 30,499 60,999 (30,499) (60,999) 466 (7,401) (14,802) 7,401 14,802 |
Financial instruments by cate_2
Financial instruments by category (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Financial instruments by category | |
Schedule of financial instruments analysis | 2018 Assets per balance sheet Note Amortized cost Fair value Fair value Total Cash and cash equivalents 8 — 1,032,938 — 1,032,938 Financial investments 9 — 92,233 — 92,233 Derivative financial instruments 6 — 6,885 4,320 11,205 Trade accounts receivable 10 22,146 151,058 — 173,204 Related parties 12 740 — — 740 22,886 1,283,114 4,320 1,310,320 2018 Liabilities per balance sheet Note Amortized cost Fair value Fair value Total Loans and financing 15 1,424,867 — — 1,424,867 Derivative financial instruments 6 — 10,155 4,068 14,222 Trade payables 387,225 — — 387,225 Confirming payable 16 70,411 — — 70,411 Use of public assets 22,126 — — 22,126 Related parties 12 1,580 — — 1,580 1,906,209 10,155 4,068 1,920,431 2017 Assets per balance sheet Note Amortized cost Fair value Fair value Total Cash and cash equivalents 8 — 1,019,037 — 1,019,037 Financial investments 9 — 206,547 — 206,547 Derivative financial instruments 6 — 8,811 2,966 11,777 Trade accounts receivable 10 120,020 62,693 — 182,713 Related parties 12 738 — — 738 120,758 1,297,088 2,966 1,420,812 2017 Liabilities per balance sheet Note Amortized cost Fair value Fair value Total Loans and financing 15 1,447,299 — — 1,447,299 Derivative financial instruments 6 — 12,842 2,195 15,037 Trade payables 329,814 — — 329,814 Confirming payable 16 111,024 — — 111,024 Use of public assets 24,309 — — 24,309 Related parties 12 89,924 — — 89,924 2,002,370 12,842 2,195 2,017,407 |
Cash and cash equivalents (Tabl
Cash and cash equivalents (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Cash and cash equivalents | |
Schedule of cash and cash equivalents | 2018 2017 Cash and banks 320,069 319,920 Term deposits 712,869 699,117 1,032,938 1,019,037 |
Schedule of changes in operating assets and liabilities | 2018 2017 2016 Decrease (increase) in assets Trade accounts receivable 8,537 (63,172) (54,188) Inventory 52,472 (15,675) (62,586) Other assets (70,101) 23,256 9,144 Increase (decrease) in liabilities Trade payables 57,411 47,573 9,557 Confirming payable (40,613) 8,737 5,743 Salaries and payroll charges (21,632) 9,776 25,206 Contractual liabilities (29,543) (36,299) 250,000 Related parties 27,167 — — Other liabilities 26,877 (59,348) (1,809) 10,575 (85,152) 181,067 |
Financial investments (Tables)
Financial investments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Financial investments | |
Summary of financial investments | 2018 2017 Investment fund quotas (i) 38,677 138,945 Bank deposit certificate 44,595 42,067 Repurchase agreements — 18,289 Other 8,961 7,246 92,233 206,547 (i) The investment fund is exclusively held by VSA and its subsidiaries. The fund’s portfolio is comprised of repurchase agreements and treasury bills. |
Trade accounts receivable (Tabl
Trade accounts receivable (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Trade accounts receivable. | |
Schedule of composition of trade accounts receivable | Note 2018 2017 Trade accounts receivables 174,931 181,084 Related parties 12 963 3,775 Impairment of trade accounts receivable (2,690) (2,146) 173,204 182,713 |
Schedule of changes in impairment of trade accounts receivable | 2018 2017 Balance at the beginning of the year (2,146) (1,618) Additions (1,238) (3,300) Reversals 428 2,779 Foreign exchange gains (losses) 266 (7) Balance at the end of the year (2,690) (2,146) |
Schedule of analysis of trade accounts receivable by currency | 2018 2017 Brazilian Real 39,000 66,486 US Dollar 133,689 115,879 Other 515 348 173,204 182,713 |
Schedule of aging of trade accounts receivable | 2018 2017 Current 146,064 163,196 Up to 3 months past due 28,366 19,775 From 3 to 6 months past due 455 914 Over 6 months past due 1,009 974 175,894 184,859 Impairment (2,690) (2,146) 173,204 182,713 |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Inventory. | |
Schedule of composition of inventory | 2018 2017 Finished products 106,245 106,026 Semi-finished products 52,534 85,458 Raw materials 52,864 30,128 Auxiliary materials and consumables 69,566 81,261 Imports in transit 11,718 41,878 Other 215 863 Provision for obsolete and slow-moving inventory (23,437) (20,736) 269,705 324,878 |
Schedule of changes in provision for obsolete and slow-moving inventory | 2018 2017 Finished Semi- Raw Auxiliary Total Total Balance at the beginning of the year (40) (10,019) (214) (10,463) (20,736) (38,384) Additions (32) (1,363) (17) (11,291) (12,703) (1,814) Reversals 41 8,701 207 311 9,260 19,249 Exchange variation gains (losses) 3 959 18 (238) 742 213 Balance at the end of the year (28) (1,722) (6) (21,681) (23,437) (20,736) |
Related parties (Tables)
Related parties (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related parties. | |
Schedule of related parties transactions | Trade accounts receivable Related parties (assets) Trade payables Dividends payable Related parties (liabilities) 2018 2017 2018 2017 2018 2017 2018 2017 2018 2017 Parent Votorantim S.A. (i) (ii) — 8 3 3 478 336 — — — 87,686 Related parties Companhia Brasileira de Alumínio 214 1,843 — — — 5,246 — — 12 13 Votorantim Cimentos S.A. 623 1,696 737 735 85 47 — — — — Votener - Votorantim Comercializadora de Energia Ltda. — — — — 2,060 — — — — — Other 126 228 — — 785 1,414 663 4,138 1,568 2,225 963 3,775 740 738 3,408 7,043 663 4,138 1,580 89,924 Current 963 3,775 — — 3,408 7,043 663 4,138 63 87,686 Non-current — — 740 738 — — — — 1,517 2,238 963 3,775 740 738 3,408 7,043 663 4,138 1,580 89,924 Sales Purchases Financial results 2018 2017 2016 2018 2017 2016 2018 2017 2016 Parent Votorantim S.A. (ii) — — — 3,649 3,651 4,653 — — — Related parties Companhia Brasileira de Alumínio 39 2,125 70 1,626 42,434 31,162 — 1,012 3,582 Votoratim Metais S.A. — — — — — 51 — — 3,583 Votener - Votorantim Comercializadora de Energia Ltda. — — — 10,054 13,510 13,400 — — — Votorantim Cimentos S.A. 173 138 45 365 365 273 — — — Other 2,115 — 2,856 4,920 1,134 1,427 — — — 2,327 2,263 2,971 20,614 61,094 50,966 — 1,012 7,165 (i) On September 2018, the Brazilian Electricity Regulatory Agency (“ANEEL”) consented to the transfer of certain energy assets owned by NEXA BR to Pollarix. In accordance with the agreement between NEXA BR and VSA, after the approval, NEXA BR was required to settle a prior obligation of USD 87,623 (BRL 290,000) with VSA related to the rights to use these assets. In December 2018, NEXA BR paid this amount. (ii) The Company entered into an agreement with VSA on September 4, 2008, for services provided by the Center of Excellence (“CoE”) of VSA related to administrative activities, human resources, back office, accounting, taxes, technical assistance, training, among others. Under a cost sharing agreement, the Company reimburses VSA for the expenses related to these activities in respect of NEXA. |
Schedule of key management compensation | 2018 2017 Short-term benefits 7,225 6,668 Other long-term benefits 1,039 1,162 8,264 7,830 |
Property, plant and equipment (
Property, plant and equipment (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, plant and equipment | |
Schedule of property, plant and equipment | 2018 Machinery, Assets and Asset Land and Dams and equipment and projects under retirement improvements Buildings facilities construction obligation Mining projects Other Total Balance at the beginning of the year Cost 24,490 1,030,686 2,422,254 235,501 178,662 243,938 35,055 4,170,586 Accumulated depreciation (275) (453,140) (1,504,433) — (101,527) (85,455) (29,242) (2,174,072) Net balance 24,215 577,546 917,821 235,501 77,135 158,483 5,813 1,996,514 Additions (i) — 2,613 2,878 294,229 — — 53 299,773 Disposals (638) (3,207) (6,985) (1,148) — — (53) (12,031) Depreciation (19) (48,072) (131,099) — (4,592) (1,931) (1,752) (187,465) Foreign exchange (losses) gains (2,160) (42,117) (58,574) (28,827) (9,688) — (477) (141,843) Transfers (22) 63,562 78,485 (147,403) — 173 1,214 (3,991) Remeasurement of asset retirement obligation — — — — 20,777 — — 20,777 Impairment (c) — — — (3,283) — — — (3,283) Balance at the end of the year 21,376 550,325 802,526 349,069 83,632 156,725 4,798 1,968,451 Cost 21,629 1,002,885 2,357,254 349,069 175,506 243,629 29,513 4,179,485 Accumulated depreciation (253) (452,560) (1,554,728) — (91,874) (86,904) (24,715) (2,211,034) Net balance at the end of the year 21,376 550,325 802,526 349,069 83,632 156,725 4,798 1,968,451 Average annual depreciation rates - % — 4 7 — 5 8 — — 2017 Machinery, Assets and Asset Land and Dams and equipment and projects under retirement improvements buildings facilities construction obligation Mining projects Other Total Balance at the beginning of the year Cost 24,036 980,242 2,466,265 219,254 132,824 271,466 36,503 4,130,590 Accumulated depreciation (257) (435,372) (1,485,939) — (96,108) (102,828) (31,624) (2,152,128) Net balance 23,779 544,870 980,326 219,254 36,716 168,638 4,879 1,978,462 Additions (i) 46 100 5,761 185,688 4,303 240 579 196,717 Disposals (930) (92) (2,915) (6,917) — — (128) (10,982) Depreciation (22) (34,175) (142,519) — (5,834) (11,121) (1,766) (195,437) Foreign exchange (losses) gains (231) (4,309) (6,381) (3,965) (1,839) (2,115) (118) (18,958) Transfers 1,573 71,152 83,297 (158,559) — 2,841 2,367 2,671 Remeasurement of asset retirement obligation — — — — 43,789 — — 43,789 Transfers of assets held for sale — — 252 — — — — 252 Balance at the end of the year 24,215 577,546 917,821 235,501 77,135 158,483 5,813 1,996,514 Cost 24,490 1,030,686 2,422,254 235,501 178,662 243,938 35,055 4,170,586 Accumulated depreciation (275) (453,140) (1,504,433) — (101,527) (85,455) (29,242) (2,174,072) Net balance at the end of the year 24,215 577,546 917,821 235,501 77,135 158,483 5,813 1,996,514 Average annual depreciation rates - % — 4 7 — 5 8 — — (i) Additions include capitalized borrowing costs in the amount of USD 36,534 in 2018 (2017 – USD 35,164). |
Schedule of assets and projects under constructions | 2018 2017 Expansion and modernization projects 174,634 64,043 Sustaining projects 90,604 78,860 Health, safety and enviroment projects 63,406 73,611 Information technology projects 12,970 7,397 Other 7,456 11,590 349,069 235,501 |
Intangible assets (Tables)
Intangible assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Intangible assets | |
Schedule of reconciliation of changes in intangible assets | 2018 Rights to use natural Goodwill resources Other Total Balance at the beginning of the year Cost 673,287 1,672,931 62,084 2,408,302 Accumulated amortization — (543,927) (41,656) (585,583) Net balance 673,287 1,129,004 20,428 1,822,719 Disposals — (17) (11) (28) Amortization — (77,792) (1,932) (79,724) Transfers — 1,463 2,528 3,991 Foreign exchange (losses) gains 1,513 (3,613) (2,397) (4,497) Balance at the end of the year 674,800 1,049,045 18,616 1,742,461 Cost 674,800 1,669,645 56,853 2,401,298 Accumulated amortization — (620,600) (38,237) (658,837) Net balance at the end of the year 674,800 1,049,045 18,616 1,742,461 Average annual amortization rates % — 6 19 — 2017 Rights to use natural Goodwill resources Other Total Balance at the beginning of the year Cost 675,561 1,673,091 55,115 2,403,767 Accumulated amortization — (469,381) (31,234) (500,615) Net balance 675,561 1,203,710 23,881 1,903,152 Acquisitions — — 921 921 Disposals — — (36) (36) Amortization — (74,024) (993) (75,017) Foreign exchange losses (2,274) (682) (674) (3,630) Transfers — — (2,671) (2,671) Balance at the end of the year 673,287 1,129,004 20,428 1,822,719 Cost 673,287 1,672,931 62,084 2,408,302 Accumulated amortization — (543,927) (41,656) (585,583) Net balance at the end of the year 673,287 1,129,004 20,428 1,822,719 Average annual amortization rates % — 5 20 — |
Schedule of cash generating units | Other net assets Total carrying Goodwill carrying amount amount Group of CGUs - Mining Peru 582,306 1,099,557 1,681,863 CGU - Smelter Peru 92,494 774,040 866,534 674,800 1,873,597 2,548,397 |
Schedule of assumptions of impairment testing on goodwill | Key assumptions Zinc (US$/t) 2,517 Copper (US$/t) 6,478 Discount rate Pre-tax discount rate (Brazil) 11.98 % Pre-tax discount rate (Peru) 10.34 % LOM (Years) Brownfield mines from 9 to 21 Greenfield projects from 12 to 24 |
Loans and financings (Tables)
Loans and financings (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Loans and financings | |
Schedule of analysis of the loans and financings | Current Non-current Total Fair value Type Average annual charges 2018 2017 2018 2017 2018 2017 2018 2017 Eurobonds – USD Fixed 5.13 % 9,907 8,778 1,032,664 1,032,664 1,042,571 1,041,442 1,014,974 1,120,901 Debt with banks Libor + 1.27 % 773 435 196,519 199,179 197,292 199,614 206,349 214,293 BNDES TJLP + 2.82% / SELIC + 3.10% / TLP + 5.23 % 6,117 19,795 83,808 73,653 89,925 93,448 82,208 85,969 Debentures 110.5% CDI 7,432 8,885 20,756 32,403 28,188 41,288 28,269 41,405 Export credit note — 1,102 — 61,622 — 62,724 — 64,058 Other 8,284 1,846 58,607 6,937 66,891 8,783 69,778 8,506 32,513 40,841 1,392,354 1,406,458 1,424,867 1,447,299 1,401,578 1,535,132 Current portion of long term loans and financing (principal) 21,107 28,019 Interest on loans and financing 11,406 12,822 32,513 40,841 BNDES - Brazilian National Bank for Economic and Social Development TJLP - Long-term interest rate set by the Brazilian National Monetary Council SELIC - Brazilian basic interest rate CDI - Brazilian Interbank Deposit Certificate TLP - Set by the Brazilian National Monetary Council and composed by Brazil’s expected inflation plus spread |
Schedule of maturity profile of the loans and financings | Total As from 2019 2020 2021 2022 2023 2024 2025 2026 Total Eurobonds - USD 9,907 — — — 339,601 — — 693,063 1,042,571 Debt with banks 773 — 78,607 78,607 39,305 — — — 197,292 BNDES 6,117 6,763 8,112 12,156 12,156 11,912 11,176 21,533 89,925 Debentures 7,432 6,909 6,924 6,923 — — — — 28,188 Other 8,284 10,271 10,273 8,820 7,796 7,737 7,736 5,974 66,891 32,513 23,943 103,916 106,506 398,858 19,649 18,912 720,570 1,424,867 3 % 2 % 7 % 7 % 28 % 1 % 1 % 51 % 100 % |
Schedule of movements in loans and financings | 2018 2017 Balance at the beginning of the year 1,447,299 1,144,385 Payments (295,104) (537,254) New loans and financing 292,901 830,598 Foreign exchange gain (5,777) (2,873) Gain on debt modification (3,428) — Interest accrual 61,385 69,481 Interest paid (72,409) (57,038) Balance at the end of the year 1,424,867 1,447,299 |
Schedule of analysis of the loans and financings, by currency | Current Non-current Total 2018 2017 2018 2017 2018 2017 US Dollar 17,267 13,260 1,284,128 1,272,223 1,301,395 1,285,483 Brazilian Real 15,246 27,471 108,226 134,235 123,472 161,706 Other — 110 — — — 110 32,513 40,841 1,392,354 1,406,458 1,424,867 1,447,299 |
Schedule of analysis of the loans and financings, by index | Current Non-current Total 2018 2017 2018 2017 2018 2017 Fixed rate 9,884 11,192 1,037,361 1,038,459 1,047,245 1,049,651 LIBOR 7,719 610 247,614 230,573 255,333 231,183 TJLP 1,467 12,509 14,700 35,341 16,167 47,850 UMBNDES — 3,211 — 5,496 — 8,707 CDI 7,430 9,811 20,758 62,632 28,188 72,443 TLP 5,881 — 52,606 — 58,487 — BNDES Selic 132 3,508 19,315 33,957 19,447 37,465 32,513 40,841 1,392,354 1,406,458 1,424,867 1,447,299 |
Salaries and payroll charges (T
Salaries and payroll charges (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Salaries and payroll charges | |
Schedule of salaries and payroll charges | 2018 2017 Direct remuneration and payroll charges 17,404 21,357 Provision for profit sharing and other payable 40,762 58,441 58,166 79,798 |
Current and deferred income t_2
Current and deferred income taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Current and deferred income taxes | |
Schedule of reconciliation of income taxes expenses | 2018 2017 2016 Income before income tax 131,898 271,459 208,892 Standard rate (i) 26.01 % 27.08 % 29.22 % Income tax (34,307) (73,511) (61,038) Difference in tax rate for subsidiaries outside Luxembourg (11,227) (19,912) (11,425) Re-measurement of deferred tax - change in Peru tax rate (ii) — — (41,588) Taxes on dividend received from foreign subsidiary — (8,299) — Special mining levy and special mining tax (14,565) (22,766) (10,953) Other permanent differences 19,176 18,294 26,621 Income tax (40,923) (106,194) (98,383) Current (71,787) (125,691) (75,282) Deferred 30,864 19,497 (23,101) Taxes on income on the income statement (40,923) (106,194) (98,383) (i) The combined applicable income tax rate was 29.22% for the fiscal year ending 2016. On December 14, 2016, the Luxembourg government approved Law 7020, that decreased the income tax rate to 27.08% in 2017 and to 26.01% from 2018 onwards. (ii) The Peruvian companies pay their taxes based on the general regime of taxation, which provides for a progressive decrease in the tax rate after the year 2015. In 2016 the rate was 28% while for 2017 and 2018 the rate was expected to be 27% and from 2019 onwards the rate was expected to be 26%. However, in December 2016, the tax rate changed to 29.5% applicable from January 1, 2017. |
Schedule of analysis of deferred tax balances | 2018 2017 Tax credits on non-operating losses (i) 106,817 104,100 Tax credits on temporary diferences Foreign exchange losses 50,766 79,430 Environmental liabilities 28,808 28,504 Asset retirement obligation 19,879 23,990 Tax, civil and labor provisions 9,389 15,666 Other provisions 6,443 12,481 Provision for profit sharing 5,409 6,521 Provision for inventory losses 5,308 4,395 Other 12,094 10,231 Tax debits on temporary diferences Capitalized interest (11,725) (10,624) Accelerated depreciation and adjustment of useful lives (10,636) (28,371) Depreciation and amortization of fair value adjustment to PP&E and intangible assets (318,198) (344,531) Other (1,798) (2,210) (97,444) (100,418) Net deferred tax assets related to the same legal entity 201,154 224,513 Net deferred tax liabilities related to the same legal entity (298,598) (324,931) (97,444) (100,418) (i) Tax credits on non-operating losses can be used to offset future tax payments. These credits do not expire if not used by the Company. The breakdown by country is as follows: 2018 2017 Brazil 104,195 103,791 Peru 2,622 309 106,817 104,100 |
Schedule of effects of deferred tax and taxes on profit or loss and other comprehensive income | 2018 2017 Balance at the beginning of the year (100,418) (107,304) Effect on income for the year 30,864 19,497 Effect on other comprehensive income (126) (4,119) Foreign exchange translation effect (27,764) (8,492) Balance at the end of the year (97,444) (100,418) |
Provisions (Tables)
Provisions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Provisions | |
Schedule of provisions | 2018 2017 Judicial provision Asset Retirement Environmental Obligation Obligation Tax Labor Civil Environmental Total Total Balance at the beginning of the year 199,445 83,835 18,575 16,421 18,320 4,565 341,161 296,879 Additions — — 2,958 11,811 4,173 2,960 21,902 47,816 Reversals (15,119) — (8,753) (15,012) (20,908) (2,320) (62,112) (42,019) Interest 8,443 5,049 794 1,387 105 213 15,991 13,476 Write-off 462 (5,140) — — — — (4,678) (18,666) Foreign exchange variation (losses) gains (15,133) (12,263) (1,707) (2,188) (215) (404) (31,910) (2,367) Cost and interest revision 7,454 13,249 — — — — 20,703 43,789 Other — — 201 (231) (104) — (134) 2,253 Balance at the end of the year 185,552 84,730 12,068 12,188 1,371 5,014 300,923 341,161 Current — 20,357 — — — — 20,357 14,641 Non-current 185,552 64,373 12,068 12,188 1,371 5,014 280,566 326,520 185,552 84,730 12,068 12,188 1,371 5,014 300,923 341,161 |
Schedule of provisions and judicial deposits | 2018 2017 Outstanding Outstanding Judicial judicial Judicial judicial deposits Provision Net amount deposits deposits Provision Net amount deposits Tax (2,048) 14,116 12,068 2,245 (2,318) 20,893 18,575 3,130 Labor (4,258) 16,446 12,188 6,555 (4,765) 21,186 16,421 7,408 Civil (746) 2,117 1,371 17 (758) 19,078 18,320 23 Environmental — 5,014 5,014 413 — 4,565 4,565 388 (7,052) 37,693 30,641 9,230 (7,841) 65,722 57,881 10,949 |
Schedule of contingent liabilities | 2018 2017 Tax 137,170 125,438 Labor 29,079 46,402 Civil 20,130 24,911 Environmental 119,747 133,851 306,126 330,602 |
Contractual liabilities (Tables
Contractual liabilities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Contractual liabilities | |
Schedule of changes in the contractual liabilities | 2018 2017 At January 221,885 250,000 Revenue recognition upon ore delivery (29,543) (36,299) Accretion for year 7,295 8,184 At December 199,637 221,885 Current 31,992 31,296 Non-current 167,645 190,589 199,637 221,885 |
Shareholders' equity (Tables)
Shareholders' equity (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Shareholders' equity | |
Schedule of accumulated other comprehensive income (loss) | Cumulative translation Remeasurements of Hedge adjustment retirement benefits accounting Total At January 1, 2016 (119,460) 3,327 6,276 (109,857) Translation adjustment on foreign investments 30,373 — — 30,373 Cash flow hedge accounting — — (16,256) (16,256) At December 31, 2016 (89,087) 3,327 (9,980) (95,740) Translation adjustment on foreign investments (10,742) — — (10,742) Cash flow hedge accounting — — 12,556 12,556 Remeasurements of retirement benefits — (3,327) — (3,327) At December 31, 2017 (99,829) — 2,576 (97,253) Translation adjustment on foreign investments (9,959) — — (9,959) Cash flow hedge accounting — — (2,192) (2,192) At December 31, 2018 (109,788) — 384 (109,404) Attributable to non-controlling interests (30,116) Attributable to NEXA's shareholders (79,288) |
Summary of earnings per share information | 2018 2017 2016 Net income for the year attributable to NEXA's shareholders 74,860 126,885 93,167 Weighted average number of outstanding common shares (thousands) 133,313 116,527 80,699 Earnings per share in US Dollars 0.56 1.09 1.15 |
Summarised financial information of the non-controlling interests | Summarized balance sheet NEXA PERU Pollarix 2018 2017 2018 2017 Current assets 957,821 854,295 10,280 6,717 Current liabilities 248,938 236,558 3,459 911 Current net assets 708,883 617,737 6,821 5,806 Non-current assets 642,007 634,757 91,702 110,246 Non-current liabilities 581,172 624,856 21,478 24,978 Non-current net assets 60,835 9,901 70,224 85,268 Net assets 769,718 627,638 77,045 91,074 Accumulated non-controlling interests 373,838 361,265 51,363 60,716 Summarized income statement NEXA PERU Pollarix 2018 2017 2018 2017 Net revenues 827,537 911,745 11,916 11,512 Net income for the year 142,082 224,480 3,742 12,187 Other comprehensive income (loss) — 8,538 (15,322) 4,210 Total comprehensive income (loss) for the year 142,082 233,018 (11,580) 16,397 Comprehensive income (loss) attributable to non- controlling interests 13,621 30,207 (7,724) 10,931 Dividends paid to non-controlling interests — 55,073 2,137 — Summarized statement of cash flows NEXA PERU Pollarix 2018 2017 2018 2017 Net cash provided by operating activities 232,391 131,304 7,201 16,137 Net cash used in investing activities (76,695) (19,371) (762) (80) Net cash used in financing activities — (335,297) (6,441) (16,055) Increase (decrease) in cash and cash equivalents 155,696 (223,364) (2) 2 |
Net revenues (Tables)
Net revenues (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Net revenues | |
Schedule of composition of net revenue | (Revised) (Revised) 2018 2017 2016 Gross revenues 2,779,008 2,709,236 2,193,867 Revenues of products 2,708,112 2,637,613 2,128,739 Revenues of services 70,896 71,623 65,128 Taxes on sales (284,316) (257,347) (227,344) Return on products sales (3,490) (2,405) (1,682) Net revenues 2,491,202 2,449,484 1,964,841 |
Schedule of revenue by destination | (Revised) (Revised) 2018 2017 2016 Brazil 693,409 721,640 560,878 Peru 674,228 696,527 573,884 Luxembourg 172,791 130,723 100,631 United States of America 141,131 158,060 156,634 Switzerland 126,156 108,798 59,873 Japan 93,474 69,565 36,005 Argentina 90,338 79,463 45,050 South Korea 54,894 7,064 66,887 Colombia 51,724 47,734 39,137 Chile 51,215 38,101 67,546 Turkey 48,265 35,522 19,498 Austria 40,531 37,270 22,982 Singapore 37,506 60,857 42,666 Germany 20,906 23,154 42,560 China 9,538 18,172 12,838 Italy 5,327 15,799 3,608 Others 179,769 201,035 114,164 2,491,202 2,449,484 1,964,841 |
Schedule of revenue by currency | (Revised) (Revised) 2018 2017 2016 US Dollar 1,806,590 1,729,234 1,414,992 Brazilian Real 684,612 717,032 547,537 Other — 3,218 2,312 2,491,202 2,449,484 1,964,841 |
Expenses by nature (Tables)
Expenses by nature (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Expenses by nature | |
Schedule of expense by nature | (Revised) (Revised) 2018 2017 2016 Mineral exploration Selling, general and project Cost of sales and administrative development Total Total Total Raw materials and consumables used 1,114,959 838 — 1,115,797 1,120,540 956,909 Employee benefit expenses (i) 159,329 91,000 12,635 262,964 279,371 234,205 Depreciation and amortization 262,948 4,219 22 267,189 270,456 275,036 Services, miscellaneous 231,501 34,211 83,379 349,091 220,535 122,557 Other expenses 120,207 29,335 30,242 179,784 109,115 106,446 1,888,944 159,603 126,278 2,174,825 2,000,017 1,695,153 (i) A provision is recorded to recognize the expenses related to employee profit sharing. This provision is calculated based on the qualitative and quantitative targets established by management. |
Mineral exploration and proje_2
Mineral exploration and project development (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Mineral exploration and project development | |
Schedule of mineral exploration and project development | 2018 2017 2016 Mineral exploration (i) 83,182 76,161 33,547 Project development (FEL 1 and FEL 2) (ii) 43,096 16,537 13,164 126,278 92,698 46,711 (i) (ii) |
Other income and expenses, net
Other income and expenses, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Other income and expenses, net | |
Schedule of other income and expenses, net | 2018 2017 2016 Corporate projects (13,445) (12,947) (7,675) Mining obligations (12,637) (11,498) (8,967) Loss on sale of property, plant and equipment (i) (9,884) (694) (552) Provision for tax, labor, civil and environmental claims (3,671) 258 (15,331) Impairment of property, plant and equipment - Note 13 (3,283) — 979 Gain on sale of investment 348 4,588 408 Environmental and asset retirement obligations (i) 12,078 433 (68,605) Commodities derivative financial instruments 17,528 (18,785) (33,514) Tax credits (ii) 37,582 57 — Other operating expenses, net (6,440) (9,299) (6,462) 18,176 (47,887) (139,719) (i) (ii) |
Net financial results (Tables)
Net financial results (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Net financial results | |
Schedule of net financial results | 2018 2017 2016 Financial income Gains on financial investments 26,062 21,388 12,032 Interest on tax credits - Note 25 26,033 — — Other financial income 15,414 8,480 12,923 67,509 29,868 24,955 Financial expenses Interest on loans and financing (77,647) (56,434) (36,059) Interest on contractual liabilities (7,294) (8,184) — Monetary adjustment of provisions (4,763) (9,478) (9,595) Derivative financial instruments - Note 6 (iii) (2,538) — — Other financial expenses (29,420) (32,073) (24,720) (121,662) (106,169) (70,374) Foreign exchange losses, net (i) (148,501) (53,880) 124,500 Net financial results (202,654) (130,181) 79,081 (i) Foreign exchange losses, net is mainly related to the gain or loss effect of intercompany transactions denominated in a currency other than the functional currency of the parties involved in the transaction, which is not eliminated during the consolidation process, even though the intercompany balances are eliminated. |
General information (Details)
General information (Details) | 12 Months Ended |
Dec. 31, 2018itemsegment | |
General information | |
Number of reportable segments | segment | 2 |
Mining | |
General information | |
Number of mines | 5 |
Mining | Peru | |
General information | |
Number of mines | 3 |
Mining | Brazil | |
General information | |
Number of mines | 2 |
Smelting | |
General information | |
Number of operating units | 3 |
Smelting | Peru | |
General information | |
Number of operating units | 1 |
Smelting | Brazil | |
General information | |
Number of operating units | 2 |
Votorantim S.A. | |
General information | |
Percentage of equity interest held by the controlling shareholder (as a percent) | 64.25% |
General information - Segment r
General information - Segment results (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
General information | |||
Net revenue | $ 2,491,202 | $ 2,449,484 | $ 1,964,841 |
Cost of sales | (1,888,944) | (1,752,825) | (1,504,229) |
Gross profit | 602,258 | 696,659 | 460,612 |
Selling, general and administrative expense | (159,603) | (154,494) | (144,213) |
Mineral exploration and project development | (126,278) | (92,698) | (46,711) |
Other operating income and expenses, net | 18,176 | (47,887) | (139,719) |
Operating income | 334,553 | 401,580 | 129,969 |
Depreciation and amortization | 267,189 | 270,456 | 275,036 |
Exceptional items | 3,050 | (4,515) | (1,079) |
Adjusted EBITDA | 604,792 | 667,519 | 403,924 |
Share in the results of associates | 60 | (158) | |
Net financial results | (202,654) | (130,181) | 79,081 |
Income before income tax | 131,899 | 271,459 | 208,892 |
Impairment loss recognised in profit or loss, property, plant and equipment | 3,283 | ||
Intersegment sales | |||
General information | |||
Net revenue | (704,031) | (721,463) | (438,238) |
Cost of sales | 704,031 | 721,463 | 438,238 |
Adjustments | |||
General information | |||
Net revenue | 924 | 5,719 | 3,666 |
Cost of sales | (22,917) | (46,706) | (26,206) |
Gross profit | (21,993) | (40,987) | (22,540) |
Selling, general and administrative expense | (34,693) | (24,312) | (27,436) |
Mineral exploration and project development | (2,498) | (2,590) | (2,026) |
Other operating income and expenses, net | 55,768 | 65,640 | 49,681 |
Operating income | (3,416) | (2,249) | (2,321) |
Exceptional items | 3,050 | (4,515) | (1,079) |
Adjusted EBITDA | (366) | (6,764) | (3,400) |
Mining | Operating segment | |||
General information | |||
Net revenue | 1,163,741 | 1,213,221 | 907,425 |
Cost of sales | (694,024) | (680,811) | (608,825) |
Gross profit | 469,716 | 532,410 | 298,600 |
Selling, general and administrative expense | (44,940) | (41,054) | (46,829) |
Mineral exploration and project development | (112,713) | (86,119) | (41,759) |
Other operating income and expenses, net | (54,042) | (54,777) | (49,478) |
Operating income | 258,021 | 350,460 | 160,534 |
Depreciation and amortization | 172,357 | 171,085 | 176,261 |
Adjusted EBITDA | 430,378 | 521,545 | 336,796 |
Smelting | Operating segment | |||
General information | |||
Net revenue | 2,030,568 | 1,952,006 | 1,491,988 |
Cost of sales | (1,876,034) | (1,746,771) | (1,307,436) |
Gross profit | 154,534 | 205,235 | 184,552 |
Selling, general and administrative expense | (79,969) | (89,128) | (69,950) |
Mineral exploration and project development | (11,067) | (3,989) | (2,925) |
Other operating income and expenses, net | 16,450 | (58,749) | (139,922) |
Operating income | 79,948 | 53,369 | (28,245) |
Depreciation and amortization | 94,832 | 99,370 | 98,772 |
Adjusted EBITDA | $ 174,781 | $ 152,739 | $ 70,528 |
Basis of preparation of the c_3
Basis of preparation of the consolidated financial statements (Details) | Dec. 31, 2018 | Dec. 31, 2017 |
Campos Novos Energia S.a. | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in joint operation | 20.98% | 20.98% |
Cia. Minera Shalipayco S.A.C | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in joint operation | 75.00% | 75.00% |
Cia. Magistral S.A.C | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 100.00% | 100.00% |
Nexa Resources Atacocha S.A.A. - "NEXA ATACOCHA" | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 66.62% | 66.62% |
NEXA PERU | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 80.23% | 80.23% |
Inversiones Garza Azul S.A.C | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 99.75% | 100.00% |
Votorantim GmbH | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 100.00% | 100.00% |
Pollarix S. A. | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 33.33% | 33.33% |
L.D.O.S.P.E. Empreendimentos e Participaes Ltda. | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 100.00% | 100.00% |
L.D.Q.S.P.E. Empreendimentos e Participaes Ltda. | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 100.00% | 100.00% |
L.D.R.S.P.E. Empreendimentos e Participaes Ltda. | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 100.00% | 100.00% |
Nexa Resources El Porvenir S.A.C. | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 99.99% | 99.99% |
Nexa Resources UK Ltd. - "NEXA UK" | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 100.00% | 100.00% |
Minera Bongara S.A. | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 61.00% | 61.00% |
Minera Pampa de Cobre S.A.C | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 99.99% | 99.99% |
Mineracao Dardanelos Ltda. | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 70.00% | 70.00% |
Mineracao Santa Maria Ltda. | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 99.99% | 99.99% |
Rayrock Antofagasta S.A.C | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 99.99% | 99.99% |
Nexa Resources Cajamarquilla S.A. - "NEXA CJM" | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 99.99% | 99.99% |
NEXA BR | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 100.00% | 100.00% |
Votorantim US. Inc. | ||
Significant investment in subsidiary or joint operation | ||
Percentage of capital in subsidiary | 100.00% | 100.00% |
Basis of preparation of the c_4
Basis of preparation of the consolidated financial statements - Revision - Income Statement (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disclosure of revision of income statement | |||
Net revenues | $ 2,491,202 | $ 2,449,484 | $ 1,964,841 |
Cost of sales | (1,888,944) | (1,752,825) | (1,504,229) |
Gross profit | 602,258 | 696,659 | 460,612 |
Operating expenses | |||
Selling | (18,743) | (17,616) | (25,519) |
General and administrative | (140,860) | (136,878) | (118,694) |
Mineral exploration and project development | (126,278) | (92,698) | (46,711) |
Other income and expenses, net | 18,176 | (47,887) | (139,719) |
Total operating expenses | (267,705) | (295,079) | (330,643) |
Operating income | $ 334,553 | 401,580 | 129,969 |
Original | |||
Disclosure of revision of income statement | |||
Net revenues | 2,449,484 | 1,964,841 | |
Cost of sales | (1,681,202) | (1,439,101) | |
Gross profit | 768,282 | 525,740 | |
Operating expenses | |||
Selling | (89,239) | (90,647) | |
General and administrative | (148,242) | (127,305) | |
Other income and expenses, net | (129,221) | (177,819) | |
Total operating expenses | (366,702) | (395,771) | |
Operating income | 401,580 | 129,969 | |
First adoption of IFRS 15 | |||
Disclosure of revision of income statement | |||
Cost of sales | (71,623) | (65,128) | |
Gross profit | (71,623) | (65,128) | |
Operating expenses | |||
Selling | 71,623 | 65,128 | |
Total operating expenses | 71,623 | 65,128 | |
Reclassification of mineral exploration and project development | |||
Operating expenses | |||
General and administrative | 11,364 | 8,611 | |
Mineral exploration and project development | (92,698) | (46,711) | |
Other income and expenses, net | $ 81,334 | $ 38,100 |
Basis of preparation of the c_5
Basis of preparation of the consolidated financial statements - Revision - Expenses by nature (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Expenses by nature | |||
Raw materials and consumables used | $ 1,115,797 | $ 1,120,540 | $ 956,909 |
Employee benefit expenses | 262,964 | 279,371 | 234,205 |
Depreciation and amortization | 267,189 | 270,456 | 275,036 |
Services, miscellaneous | 349,091 | 220,535 | 122,557 |
Other expenses | 179,784 | 109,115 | 106,446 |
Expenses by nature | 2,174,825 | 2,000,017 | 1,695,153 |
Reconciliation | |||
Cost of sales | 1,888,944 | 1,752,825 | 1,504,229 |
Selling, general and administrative expense | 159,603 | 154,494 | 144,213 |
Mineral exploration and project development | 126,278 | 92,698 | 46,711 |
Expenses by nature | $ 2,174,825 | 2,000,017 | 1,695,153 |
Original | |||
Expenses by nature | |||
Raw materials and consumables used | 1,120,540 | 956,909 | |
Employee benefit expenses | 278,285 | 233,755 | |
Depreciation and amortization | 270,454 | 275,034 | |
Services, miscellaneous | 232,165 | 158,388 | |
Other expenses | 17,239 | 32,967 | |
Expenses by nature | 1,918,683 | 1,657,053 | |
Reconciliation | |||
Cost of sales | 1,681,202 | 1,439,101 | |
Selling, general and administrative expense | 237,481 | 217,952 | |
Expenses by nature | 1,918,683 | 1,657,053 | |
First adoption of IFRS 15 | |||
Expenses by nature | |||
Services, miscellaneous | (71,623) | (65,128) | |
Other expenses | 71,623 | 65,128 | |
Reconciliation | |||
Cost of sales | 71,623 | 65,128 | |
Selling, general and administrative expense | (71,623) | (65,128) | |
Reclassification of mineral exploration and project development | |||
Expenses by nature | |||
Employee benefit expenses | 1,086 | 450 | |
Depreciation and amortization | 2 | 2 | |
Services, miscellaneous | 59,993 | 29,297 | |
Other expenses | 20,253 | 8,351 | |
Expenses by nature | 81,334 | 38,100 | |
Reconciliation | |||
Selling, general and administrative expense | (11,364) | (8,611) | |
Mineral exploration and project development | 92,698 | 46,711 | |
Expenses by nature | $ 81,334 | $ 38,100 |
Changes in accounting policie_3
Changes in accounting policies and disclosures - Financial assets reclassification (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Cash and cash equivalents | Loans and receivables | |
Impact of IFRS 9 | |
Original carrying amount under IAS 39 | $ 1,019,037 |
Cash and cash equivalents | Assets at fair value through profit or loss | |
Impact of IFRS 9 | |
New carrying amount under IFRS 9 | 1,019,037 |
Financial investments | Assets held for trading | |
Impact of IFRS 9 | |
Original carrying amount under IAS 39 | 206,547 |
Financial investments | Assets at fair value through profit or loss | |
Impact of IFRS 9 | |
New carrying amount under IFRS 9 | 206,547 |
Derivative financial instruments | Assets held for trading/Used for hedging | |
Impact of IFRS 9 | |
Original carrying amount under IAS 39 | 11,777 |
Derivative financial instruments | Fair value through profit or loss / Fair value through other comprehensive income | |
Impact of IFRS 9 | |
New carrying amount under IFRS 9 | 11,777 |
Trade accounts receivable | Loans and receivables | |
Impact of IFRS 9 | |
Original carrying amount under IAS 39 | 182,713 |
Trade accounts receivable | Fair value through profit or loss / Amortized cost | |
Impact of IFRS 9 | |
New carrying amount under IFRS 9 | 182,469 |
Related parties | Loans and receivables | |
Impact of IFRS 9 | |
Original carrying amount under IAS 39 | 738 |
Related parties | Fair value through profit or loss / Amortized cost | |
Impact of IFRS 9 | |
New carrying amount under IFRS 9 | $ 738 |
Changes in accounting policie_4
Changes in accounting policies and disclosures - Impact of IFRS 9 adoption on assets (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Impact of IFRS 9 | |
Impact of the adoption of IFRS 9 | $ (1,818) |
IFRS 9 adoption | Trade accounts receivable | Cost/gross carrying amount | |
Impact of IFRS 9 | |
Impact of the adoption of IFRS 9 | (244) |
IFRS 9 adoption | Trade accounts receivable | Accumulated impairment | |
Impact of IFRS 9 | |
Impact of the adoption of IFRS 9 | $ (1,574) |
Changes in accounting policie_5
Changes in accounting policies and disclosures - Impact of IFRS 15 (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Retrospective adoption | |||
Revenues of services | $ 70,896 | $ 71,623 | $ 65,128 |
First adoption of IFRS 15 | |||
Retrospective adoption | |||
Revenues of services | $ 70,896 | $ 71,623 | $ 65,128 |
Changes in accounting policie_6
Changes in accounting policies and disclosures - Impact of IFRS 16 (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Impact of IFRS 16 | ||||
Income before income tax | $ 131,899 | $ 271,459 | $ 208,892 | |
Adjusted EBITDA | 604,792 | $ 667,519 | $ 403,924 | |
Increase (decrease) due to IFRS 16 | ||||
Impact of IFRS 16 | ||||
Lease liabilities | 46,618 | |||
Right-of-use assets | 46,618 | |||
Net current assets | $ (18,379) | |||
Increase (decrease) due to IFRS 16 | Forecast | ||||
Impact of IFRS 16 | ||||
Income before income tax | $ (1,413) | |||
Adjusted EBITDA | $ 17,654 |
Financial risk management - For
Financial risk management - Foreign Exchange Risk (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Financial risk management | |||
Trade accounts receivable | $ 173,204 | $ 182,713 | |
Total assets | 5,735,406 | 5,961,524 | |
Loans and financing | 1,424,867 | 1,447,299 | $ 1,144,385 |
Trade payables | 387,225 | 329,814 | |
Total liabilities | 2,833,605 | 3,052,621 | |
Foreign currencies | |||
Financial risk management | |||
Cash, cash equivalents and financial investments | 140,860 | 229,877 | |
Derivative financial instruments | 11,205 | 4,280 | |
Trade accounts receivable | 39,000 | 66,834 | |
Total assets | 191,065 | 300,991 | |
Loans and financing | 123,471 | 161,706 | |
Derivative financial instruments | 14,222 | 3,634 | |
Trade payables | 4,689 | 78,286 | |
Total liabilities | 142,382 | 243,626 | |
Net assets | $ 48,683 | $ 57,365 |
Financial risk management - Cre
Financial risk management - Credit Risk (Details) | 12 Months Ended |
Dec. 31, 2018itemAgency | |
Disclosure of external credit agencies | |
Number of ratings from international rating agencies required for making deposit | item | 2 |
Peru | |
Disclosure of external credit agencies | |
Number of agencies that have given BBB minus rating required if only global rating available | Agency | 1 |
Financial risk management - C_2
Financial risk management - Credit quality of financial assets (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Credit quality of financial assets | ||
Financial assets | $ 1,310,320 | $ 1,420,812 |
Cash and cash equivalents, financial investments and derivative financial instruments | ||
Credit quality of financial assets | ||
Financial assets | 1,136,376 | 1,237,361 |
Cash and cash equivalents, financial investments and derivative financial instruments | Local | ||
Credit quality of financial assets | ||
Financial assets | 98,354 | 208,152 |
Cash and cash equivalents, financial investments and derivative financial instruments | Global | ||
Credit quality of financial assets | ||
Financial assets | 1,038,022 | 1,029,209 |
Cash and cash equivalents | ||
Credit quality of financial assets | ||
Financial assets | 1,032,938 | 1,019,037 |
Cash and cash equivalents | AAA | ||
Credit quality of financial assets | ||
Financial assets | 1,484 | |
Cash and cash equivalents | AA+ | ||
Credit quality of financial assets | ||
Financial assets | 861 | 1,089 |
Cash and cash equivalents | AA | ||
Credit quality of financial assets | ||
Financial assets | 78,269 | |
Cash and cash equivalents | AA- | ||
Credit quality of financial assets | ||
Financial assets | 20,179 | 115,269 |
Cash and cash equivalents | A+ | ||
Credit quality of financial assets | ||
Financial assets | 178,730 | 172,052 |
Cash and cash equivalents | A | ||
Credit quality of financial assets | ||
Financial assets | 361,484 | 235,445 |
Cash and cash equivalents | A- | ||
Credit quality of financial assets | ||
Financial assets | 29,162 | 86,192 |
Cash and cash equivalents | BBB+ | ||
Credit quality of financial assets | ||
Financial assets | 181,411 | 96,436 |
Cash and cash equivalents | BBB | ||
Credit quality of financial assets | ||
Financial assets | 20,245 | 110,733 |
Cash and cash equivalents | BBB- | ||
Credit quality of financial assets | ||
Financial assets | 83,919 | |
Cash and cash equivalents | No rating | ||
Credit quality of financial assets | ||
Financial assets | 77,194 | 201,821 |
Cash and cash equivalents | Local | ||
Credit quality of financial assets | ||
Financial assets | 2,372 | 1,092 |
Cash and cash equivalents | Local | AAA | ||
Credit quality of financial assets | ||
Financial assets | 1,484 | |
Cash and cash equivalents | Local | AA+ | ||
Credit quality of financial assets | ||
Financial assets | 861 | 1,089 |
Cash and cash equivalents | Local | AA | ||
Credit quality of financial assets | ||
Financial assets | 24 | |
Cash and cash equivalents | Local | A- | ||
Credit quality of financial assets | ||
Financial assets | 3 | |
Cash and cash equivalents | Local | No rating | ||
Credit quality of financial assets | ||
Financial assets | 3 | |
Cash and cash equivalents | Global | ||
Credit quality of financial assets | ||
Financial assets | 1,030,566 | 1,017,945 |
Cash and cash equivalents | Global | AA | ||
Credit quality of financial assets | ||
Financial assets | 78,245 | |
Cash and cash equivalents | Global | AA- | ||
Credit quality of financial assets | ||
Financial assets | 20,179 | 115,269 |
Cash and cash equivalents | Global | A+ | ||
Credit quality of financial assets | ||
Financial assets | 178,730 | 172,052 |
Cash and cash equivalents | Global | A | ||
Credit quality of financial assets | ||
Financial assets | 361,484 | 235,445 |
Cash and cash equivalents | Global | A- | ||
Credit quality of financial assets | ||
Financial assets | 29,162 | 86,189 |
Cash and cash equivalents | Global | BBB+ | ||
Credit quality of financial assets | ||
Financial assets | 181,411 | 96,436 |
Cash and cash equivalents | Global | BBB | ||
Credit quality of financial assets | ||
Financial assets | 20,245 | 110,733 |
Cash and cash equivalents | Global | BBB- | ||
Credit quality of financial assets | ||
Financial assets | 83,919 | |
Cash and cash equivalents | Global | No rating | ||
Credit quality of financial assets | ||
Financial assets | 77,191 | 201,821 |
Financial investments | ||
Credit quality of financial assets | ||
Financial assets | 92,233 | 206,547 |
Financial investments | AAA | ||
Credit quality of financial assets | ||
Financial assets | 51,913 | |
Financial investments | AA+ | ||
Credit quality of financial assets | ||
Financial assets | 10,840 | 17,111 |
Financial investments | AA | ||
Credit quality of financial assets | ||
Financial assets | 24,965 | |
Financial investments | AA- | ||
Credit quality of financial assets | ||
Financial assets | 184,365 | |
Financial investments | A- | ||
Credit quality of financial assets | ||
Financial assets | 5,053 | |
Financial investments | No rating | ||
Credit quality of financial assets | ||
Financial assets | 4,515 | 18 |
Financial investments | Local | ||
Credit quality of financial assets | ||
Financial assets | 92,233 | 202,291 |
Financial investments | Local | AAA | ||
Credit quality of financial assets | ||
Financial assets | 51,913 | |
Financial investments | Local | AA+ | ||
Credit quality of financial assets | ||
Financial assets | 10,840 | 17,111 |
Financial investments | Local | AA | ||
Credit quality of financial assets | ||
Financial assets | 24,965 | |
Financial investments | Local | AA- | ||
Credit quality of financial assets | ||
Financial assets | 180,127 | |
Financial investments | Local | A- | ||
Credit quality of financial assets | ||
Financial assets | 5,053 | |
Financial investments | Local | No rating | ||
Credit quality of financial assets | ||
Financial assets | 4,515 | |
Financial investments | Global | ||
Credit quality of financial assets | ||
Financial assets | 4,256 | |
Financial investments | Global | AA- | ||
Credit quality of financial assets | ||
Financial assets | 4,238 | |
Financial investments | Global | No rating | ||
Credit quality of financial assets | ||
Financial assets | 18 | |
Derivative financial instruments | ||
Credit quality of financial assets | ||
Financial assets | 11,205 | 11,777 |
Derivative financial instruments | AAA | ||
Credit quality of financial assets | ||
Financial assets | 3,749 | |
Derivative financial instruments | AA | ||
Credit quality of financial assets | ||
Financial assets | 2,164 | |
Derivative financial instruments | AA- | ||
Credit quality of financial assets | ||
Financial assets | 8,403 | |
Derivative financial instruments | A+ | ||
Credit quality of financial assets | ||
Financial assets | 5,275 | 3,141 |
Derivative financial instruments | A | ||
Credit quality of financial assets | ||
Financial assets | 17 | 233 |
Derivative financial instruments | Local | ||
Credit quality of financial assets | ||
Financial assets | 3,749 | 4,769 |
Derivative financial instruments | Local | AAA | ||
Credit quality of financial assets | ||
Financial assets | 3,749 | |
Derivative financial instruments | Local | AA- | ||
Credit quality of financial assets | ||
Financial assets | 4,769 | |
Derivative financial instruments | Global | ||
Credit quality of financial assets | ||
Financial assets | 7,456 | 7,008 |
Derivative financial instruments | Global | AA | ||
Credit quality of financial assets | ||
Financial assets | 2,164 | |
Derivative financial instruments | Global | AA- | ||
Credit quality of financial assets | ||
Financial assets | 3,634 | |
Derivative financial instruments | Global | A+ | ||
Credit quality of financial assets | ||
Financial assets | 5,275 | 3,141 |
Derivative financial instruments | Global | A | ||
Credit quality of financial assets | ||
Financial assets | $ 17 | $ 233 |
Financial risk management - Liq
Financial risk management - Liquidity Risk - Estimated future cash flow (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Maturity analysis of financial instruments | ||
Financial liabilities, undiscounted cash flows | $ 2,731,723 | $ 2,957,719 |
Minimum | ||
Maturity analysis of financial instruments | ||
Cash flow projection period for liquidity measurement and monitoring | 12 months | |
Loans and financing | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | $ 1,870,735 | 1,941,018 |
Derivative financial instruments | ||
Maturity analysis of financial instruments | ||
Derivative financial liabilities, undiscounted cash flows | 14,222 | 15,037 |
Trade payables | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 387,225 | 329,814 |
Confirming payable | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 70,411 | 111,024 |
Salaries and payroll charges | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 58,166 | 79,798 |
Dividends payable | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 4,138 | |
Related parties | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 1,580 | 89,924 |
Asset retirement obligation | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 287,075 | 331,929 |
Use of public asset | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 41,646 | 55,037 |
Less than 1 year / 2019 | ||
Maturity analysis of financial instruments | ||
Financial liabilities, undiscounted cash flows | 630,775 | 736,607 |
Less than 1 year / 2019 | Loans and financing | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 91,890 | 102,294 |
Less than 1 year / 2019 | Derivative financial instruments | ||
Maturity analysis of financial instruments | ||
Derivative financial liabilities, undiscounted cash flows | 8,663 | 12,588 |
Less than 1 year / 2019 | Trade payables | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 387,225 | 329,814 |
Less than 1 year / 2019 | Confirming payable | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 70,411 | 111,024 |
Less than 1 year / 2019 | Salaries and payroll charges | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 58,166 | 79,798 |
Less than 1 year / 2019 | Dividends payable | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 4,138 | |
Less than 1 year / 2019 | Related parties | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 63 | 87,686 |
Less than 1 year / 2019 | Asset retirement obligation | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 12,283 | 7,526 |
Less than 1 year / 2019 | Use of public asset | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 1,411 | 1,740 |
Between 1 and 3 years | ||
Maturity analysis of financial instruments | ||
Financial liabilities, undiscounted cash flows | 310,920 | 435,195 |
Between 1 and 3 years | Loans and financing | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 261,186 | 373,324 |
Between 1 and 3 years | Derivative financial instruments | ||
Maturity analysis of financial instruments | ||
Derivative financial liabilities, undiscounted cash flows | 4,954 | 2,449 |
Between 1 and 3 years | Related parties | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 1,517 | 2,238 |
Between 1 and 3 years | Asset retirement obligation | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 40,171 | 53,429 |
Between 1 and 3 years | Use of public asset | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 3,092 | 3,755 |
Between 3 and 5 years | ||
Maturity analysis of financial instruments | ||
Financial liabilities, undiscounted cash flows | 660,609 | 274,346 |
Between 3 and 5 years | Loans and financing | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 619,958 | 236,927 |
Between 3 and 5 years | Derivative financial instruments | ||
Maturity analysis of financial instruments | ||
Derivative financial liabilities, undiscounted cash flows | 605 | |
Between 3 and 5 years | Asset retirement obligation | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 36,561 | 33,186 |
Between 3 and 5 years | Use of public asset | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 3,485 | 4,233 |
Over 5 years | ||
Maturity analysis of financial instruments | ||
Financial liabilities, undiscounted cash flows | 1,129,420 | 1,511,571 |
Over 5 years | Loans and financing | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 897,701 | 1,228,474 |
Over 5 years | Asset retirement obligation | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | 198,061 | 237,788 |
Over 5 years | Use of public asset | ||
Maturity analysis of financial instruments | ||
Non-derivative financial liabilities, undiscounted cash flows | $ 33,658 | $ 45,309 |
Financial risk management - Net
Financial risk management - Net debt ratio (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Gearing ratio | ||||
Loans and financing | $ 1,424,867 | $ 1,447,299 | $ 1,144,385 | |
Cash and cash equivalents | (1,032,938) | (1,019,037) | (915,576) | $ (621,415) |
Derivative financial instruments | 3,017 | 3,260 | 16,718 | |
Financial investments | (92,233) | (206,547) | (119,498) | |
Net debt | 302,713 | 224,975 | 126,029 | |
Net income for the year | 90,976 | 165,265 | 110,509 | |
Plus (less): | ||||
Results of investees | (60) | 158 | ||
Depreciation and amortization | 267,189 | 270,456 | 275,036 | |
Net financial results | 202,654 | 130,181 | (79,081) | |
Taxes on income | 40,923 | 106,194 | 98,383 | |
EBITDA | 601,742 | 672,034 | 405,003 | |
Exceptional items | ||||
Exceptional Items | 3,050 | (4,515) | (1,079) | |
Adjusted EBITDA | $ 604,792 | $ 667,519 | $ 403,924 | |
Gearing ratio | 0.50 | 0.34 | 0.31 |
Financial risk management - Fin
Financial risk management - Financial assets and liabilities at fair value (Details) - Fair value - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financial risk Management | ||
Financial assets, at fair value | $ 1,287,434 | $ 1,300,054 |
Financial liabilities, at fair value | 14,222 | 15,037 |
Derivative financial instruments | ||
Financial risk Management | ||
Financial liabilities, at fair value | 14,222 | 15,037 |
Level 1 | ||
Financial risk Management | ||
Financial assets, at fair value | 1,072,105 | 1,153,205 |
Level 2 | ||
Financial risk Management | ||
Financial assets, at fair value | 215,328 | 146,849 |
Financial liabilities, at fair value | 14,222 | 15,037 |
Level 2 | Derivative financial instruments | ||
Financial risk Management | ||
Financial liabilities, at fair value | 14,222 | 15,037 |
Cash and cash equivalents | ||
Financial risk Management | ||
Financial assets, at fair value | 1,032,938 | 1,019,037 |
Cash and cash equivalents | Level 1 | ||
Financial risk Management | ||
Financial assets, at fair value | 1,032,938 | 1,019,037 |
Financial investments | ||
Financial risk Management | ||
Financial assets, at fair value | 92,233 | 206,547 |
Financial investments | Level 1 | ||
Financial risk Management | ||
Financial assets, at fair value | 39,167 | 134,168 |
Financial investments | Level 2 | ||
Financial risk Management | ||
Financial assets, at fair value | 53,065 | 72,379 |
Derivative financial instruments | ||
Financial risk Management | ||
Financial assets, at fair value | 11,205 | 11,777 |
Derivative financial instruments | Level 2 | ||
Financial risk Management | ||
Financial assets, at fair value | 11,205 | 11,777 |
Trade accounts receivable | ||
Financial risk Management | ||
Financial assets, at fair value | 151,058 | 62,693 |
Trade accounts receivable | Level 2 | ||
Financial risk Management | ||
Financial assets, at fair value | $ 151,058 | $ 62,693 |
Derivative financial instrume_3
Derivative financial instruments - Derivative financial instruments and underlying hedged items (Details) oz in Thousands, R$ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018USD ($)BRL (R$)T | Nov. 30, 2018BRL (R$) | Nov. 30, 2018USD ($) | Dec. 31, 2017TozUSD ($) | |
Financial risk management | ||||
Derivative financial assets (liabilities) at beginning of period | $ (3,260) | |||
Inventory | 3,038 | |||
Net revenue | (1,353) | |||
Other income and expenses, net | 17,528 | |||
Net financial results | (2,538) | |||
Other comprehensive income | (901) | |||
Realized gain (loss) | 15,532 | |||
Derivative financial assets (liabilities) at end of period | (3,017) | |||
Aripuana project | ||||
Financial risk management | ||||
Principal amount | 1,057,000 | 294,000 | ||
Less than 1 year / 2019 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | (1,276) | |||
2020 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | (1,474) | |||
2021 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | (266) | |||
Hedging programs for mismatches of quotation periods | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at beginning of period | (4,508) | |||
Inventory | 3,038 | |||
Net revenue | (1,353) | |||
Other income and expenses, net | 20,618 | |||
Other comprehensive income | (901) | |||
Realized gain (loss) | 17,451 | |||
Derivative financial assets (liabilities) at end of period | (557) | |||
Hedging programs for mismatches of quotation periods | Less than 1 year / 2019 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | $ (557) | |||
Hedging programs for mismatches of quotation periods | Zinc forward | ||||
Financial risk management | ||||
Principal amount | T | 261,020 | 387,240 | ||
Derivative financial assets (liabilities) at beginning of period | $ (4,638) | |||
Inventory | 3,038 | |||
Net revenue | (1,353) | |||
Other income and expenses, net | 20,460 | |||
Other comprehensive income | (968) | |||
Realized gain (loss) | 17,096 | |||
Derivative financial assets (liabilities) at end of period | (557) | |||
Hedging programs for mismatches of quotation periods | Zinc forward | Less than 1 year / 2019 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | (557) | |||
Hedging programs for mismatches of quotation periods | Silver forward | ||||
Financial risk management | ||||
Principal amount | oz | 503 | |||
Derivative financial assets (liabilities) at beginning of period | 129 | |||
Other income and expenses, net | 159 | |||
Other comprehensive income | 67 | |||
Realized gain (loss) | 355 | |||
Hedging programs for sales of zinc at fixed price | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at beginning of period | 603 | |||
Other income and expenses, net | (3,090) | |||
Realized gain (loss) | (1,629) | |||
Derivative financial assets (liabilities) at end of period | (858) | |||
Hedging programs for sales of zinc at fixed price | Less than 1 year / 2019 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | (815) | |||
Hedging programs for sales of zinc at fixed price | 2020 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | $ (43) | |||
Hedging programs for sales of zinc at fixed price | Zinc forward | ||||
Financial risk management | ||||
Principal amount | T | 10,566 | 2,230 | ||
Derivative financial assets (liabilities) at beginning of period | $ 603 | |||
Other income and expenses, net | (3,090) | |||
Realized gain (loss) | (1,629) | |||
Derivative financial assets (liabilities) at end of period | (858) | |||
Hedging programs for sales of zinc at fixed price | Zinc forward | Less than 1 year / 2019 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | (815) | |||
Hedging programs for sales of zinc at fixed price | Zinc forward | 2020 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | (43) | |||
Hedging of changes in interest rates in US dollar | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at beginning of period | 646 | |||
Net financial results | (936) | |||
Realized gain (loss) | (290) | |||
Hedging of changes in interest rates in US dollar | LIBOR floating rate vs. US Dollar fixed rate swaps | ||||
Financial risk management | ||||
Principal amount | 31,393 | |||
Derivative financial assets (liabilities) at beginning of period | 646 | |||
Net financial results | (936) | |||
Realized gain (loss) | (290) | |||
Hedging of changes in foreign exchange rates | ||||
Financial risk management | ||||
Net financial results | (1,602) | |||
Derivative financial assets (liabilities) at end of period | (1,602) | |||
Hedging of changes in foreign exchange rates | Less than 1 year / 2019 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | 95 | |||
Hedging of changes in foreign exchange rates | 2020 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | (1,431) | |||
Hedging of changes in foreign exchange rates | 2021 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | $ (266) | |||
Hedging of changes in foreign exchange rates | Collar foreign exchange | ||||
Financial risk management | ||||
Principal amount | R$ | 1,056,922 | |||
Net financial results | $ (1,602) | |||
Derivative financial assets (liabilities) at end of period | (1,602) | |||
Hedging of changes in foreign exchange rates | Collar foreign exchange | Less than 1 year / 2019 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | 95 | |||
Hedging of changes in foreign exchange rates | Collar foreign exchange | 2020 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | (1,431) | |||
Hedging of changes in foreign exchange rates | Collar foreign exchange | 2021 | ||||
Financial risk management | ||||
Derivative financial assets (liabilities) at end of period | $ (266) |
Derivative financial instrume_4
Derivative financial instruments - Sensitivity analysis (Details) - 12 months ended Dec. 31, 2018 R$ in Thousands, $ in Thousands | USD ($) | BRL (R$)S/ / $R$ / $$ / TT | USD ($)S/ / $R$ / $$ / TT |
Scenario II | |||
Financial risk management | |||
Decrease in risk assumption | (25.00%) | (25.00%) | |
Increase in risk assumption | 25.00% | 25.00% | |
Scenario III | |||
Financial risk management | |||
Decrease in risk assumption | (50.00%) | (50.00%) | |
Increase in risk assumption | 50.00% | 50.00% | |
Foreign exchange risk | BRL | |||
Financial risk management | |||
Quotation - price | R$ / $ | 0.2581 | 0.2581 | |
Foreign exchange risk | BRL | Scenario I | |||
Financial risk management | |||
Increase in risk assumption | 0.64% | 0.64% | |
Impact on profit (loss) of increase in assumption | $ 703 | ||
Impacts on comprehensive income of increase in assumption | (48) | ||
Foreign exchange risk | BRL | Scenario II | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | 63,484 | ||
Impact on comprehensive income of decrease in assumption | (2,278) | ||
Impact on profit (loss) of increase in assumption | (24,677) | ||
Impacts on comprehensive income of increase in assumption | 1,695 | ||
Foreign exchange risk | BRL | Scenario III | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | 230,801 | ||
Impact on comprehensive income of decrease in assumption | (7,245) | ||
Impact on profit (loss) of increase in assumption | (52,495) | ||
Impacts on comprehensive income of increase in assumption | 2,689 | ||
Foreign exchange risk | PEN | |||
Financial risk management | |||
Quotation - price | S/ / $ | 1.1482 | 1.1482 | |
Foreign exchange risk | PEN | Scenario I | |||
Financial risk management | |||
Increase in risk assumption | 1.00% | 1.00% | |
Impact on profit (loss) of increase in assumption | 112 | ||
Foreign exchange risk | PEN | Scenario II | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | (2,813) | ||
Impact on profit (loss) of increase in assumption | 2,813 | ||
Foreign exchange risk | PEN | Scenario III | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | (5,626) | ||
Impact on profit (loss) of increase in assumption | 5,626 | ||
Foreign exchange risk | Cash, cash equivalents and financial investments | BRL | |||
Financial risk management | |||
Net exposure | $ 94,603 | ||
Foreign exchange risk | Cash, cash equivalents and financial investments | PEN | |||
Financial risk management | |||
Net exposure | 43,601 | ||
Foreign exchange risk | Loans and financing | BRL | |||
Financial risk management | |||
Net exposure | 123,471 | ||
Foreign exchange risk | Derivative financial instruments | BRL | |||
Financial risk management | |||
Net exposure | $ 293,589 | ||
BRL - CDI interest rate risk | |||
Financial risk management | |||
Quotation - rate | 6.40% | 6.40% | |
BRL - CDI interest rate risk | Scenario I | |||
Financial risk management | |||
Increase in risk assumption | 0.16% | 0.16% | |
Impact on profit (loss) of increase in assumption | (183) | ||
BRL - CDI interest rate risk | Scenario II | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | 2,336 | ||
Impact on profit (loss) of increase in assumption | (2,180) | ||
BRL - CDI interest rate risk | Scenario III | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | 4,870 | ||
Impact on profit (loss) of increase in assumption | (4,243) | ||
BRL - CDI interest rate risk | Cash, cash equivalents and financial investments | |||
Financial risk management | |||
Net exposure | $ 93,093 | ||
BRL - CDI interest rate risk | Loans and financing | |||
Financial risk management | |||
Net exposure | $ 27,724 | ||
BRL - CDI interest rate risk | Derivative financial instruments | |||
Financial risk management | |||
Net exposure | R$ | R$ 1056922 | ||
USD - LIBOR interest rate risk | |||
Financial risk management | |||
Quotation - rate | 2.81% | 2.81% | |
USD - LIBOR interest rate risk | Scenario I | |||
Financial risk management | |||
Decrease in risk assumption | (0.06%) | (0.06%) | |
USD - LIBOR interest rate risk | Scenario II | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | (5) | ||
Impact on comprehensive income of decrease in assumption | (4) | ||
Impact on profit (loss) of increase in assumption | 5 | ||
Impacts on comprehensive income of increase in assumption | 4 | ||
USD - LIBOR interest rate risk | Scenario III | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | (11) | ||
Impact on comprehensive income of decrease in assumption | (8) | ||
Impact on profit (loss) of increase in assumption | 10 | ||
Impacts on comprehensive income of increase in assumption | 9 | ||
USD - LIBOR interest rate risk | Derivative financial instruments | |||
Financial risk management | |||
Net exposure | $ 681,817 | ||
US Dollar coupon interest rate risk | |||
Financial risk management | |||
Quotation - rate | 3.31% | 3.31% | |
US Dollar coupon interest rate risk | Scenario I | |||
Financial risk management | |||
Increase in risk assumption | 0.26% | 0.26% | |
Impact on profit (loss) of increase in assumption | (394) | ||
US Dollar coupon interest rate risk | Scenario II | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | (1,627) | ||
Impact on profit (loss) of increase in assumption | 1,614 | ||
US Dollar coupon interest rate risk | Scenario III | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | (3,280) | ||
Impact on profit (loss) of increase in assumption | 3,225 | ||
US Dollar coupon interest rate risk | Derivative financial instruments | |||
Financial risk management | |||
Net exposure | $ 293,589 | ||
Zinc price risk | |||
Financial risk management | |||
Quotation - price | $ / T | 2,511 | 2,511 | |
Zinc price risk | Scenario I | |||
Financial risk management | |||
Increase in risk assumption | 1.57% | 1.57% | |
Impact on profit (loss) of increase in assumption | (1,919) | ||
Impacts on comprehensive income of increase in assumption | 466 | ||
Zinc price risk | Scenario II | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | 30,499 | ||
Impact on comprehensive income of decrease in assumption | (7,401) | ||
Impact on profit (loss) of increase in assumption | (30,499) | ||
Impacts on comprehensive income of increase in assumption | 7,401 | ||
Zinc price risk | Scenario III | |||
Financial risk management | |||
Impact on profit (loss) of decrease in assumption | 60,999 | ||
Impact on comprehensive income of decrease in assumption | (14,802) | ||
Impact on profit (loss) of increase in assumption | (60,999) | ||
Impacts on comprehensive income of increase in assumption | $ 14,802 | ||
Zinc price risk | Derivative financial instruments | |||
Financial risk management | |||
Net exposure | T | 271,586 | 271,586 |
Financial instruments by cate_3
Financial instruments by category - Analysis (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financial instruments by category | ||
Financial assets | $ 1,310,320 | $ 1,420,812 |
Financial liabilities | 1,920,431 | 2,017,407 |
Loans and financing | ||
Financial instruments by category | ||
Financial liabilities | 1,424,867 | 1,447,299 |
Derivative financial instruments | ||
Financial instruments by category | ||
Financial liabilities | 14,222 | 15,037 |
Trade payables | ||
Financial instruments by category | ||
Financial liabilities | 387,225 | 329,814 |
Confirming payable | ||
Financial instruments by category | ||
Financial liabilities | 70,411 | 111,024 |
Use of public asset | ||
Financial instruments by category | ||
Financial liabilities | 22,126 | 24,309 |
Related parties | ||
Financial instruments by category | ||
Financial liabilities | 1,580 | 89,924 |
Cash and cash equivalents | ||
Financial instruments by category | ||
Financial assets | 1,032,938 | 1,019,037 |
Financial investments | ||
Financial instruments by category | ||
Financial assets | 92,233 | 206,547 |
Derivative financial instruments | ||
Financial instruments by category | ||
Financial assets | 11,205 | 11,777 |
Trade accounts receivable | ||
Financial instruments by category | ||
Financial assets | 173,204 | 182,713 |
Related parties | ||
Financial instruments by category | ||
Financial assets | 740 | 738 |
Liabilities at amortized cost | ||
Financial instruments by category | ||
Financial liabilities | 1,906,209 | 2,002,370 |
Liabilities at amortized cost | Loans and financing | ||
Financial instruments by category | ||
Financial liabilities | 1,424,867 | 1,447,299 |
Liabilities at amortized cost | Trade payables | ||
Financial instruments by category | ||
Financial liabilities | 387,225 | 329,814 |
Liabilities at amortized cost | Confirming payable | ||
Financial instruments by category | ||
Financial liabilities | 70,411 | 111,024 |
Liabilities at amortized cost | Use of public asset | ||
Financial instruments by category | ||
Financial liabilities | 22,126 | 24,309 |
Liabilities at amortized cost | Related parties | ||
Financial instruments by category | ||
Financial liabilities | 1,580 | 89,924 |
Liabilities at fair value through profit or loss | ||
Financial instruments by category | ||
Financial liabilities | 10,155 | 12,842 |
Liabilities at fair value through profit or loss | Derivative financial instruments | ||
Financial instruments by category | ||
Financial liabilities | 10,155 | 12,842 |
Liabilities at fair value through other comprehensive income | ||
Financial instruments by category | ||
Financial liabilities | 4,068 | 2,195 |
Liabilities at fair value through other comprehensive income | Derivative financial instruments | ||
Financial instruments by category | ||
Financial liabilities | 4,068 | 2,195 |
Assets at amortised cost | ||
Financial instruments by category | ||
Financial assets | 22,886 | 120,758 |
Assets at amortised cost | Trade accounts receivable | ||
Financial instruments by category | ||
Financial assets | 22,146 | 120,020 |
Assets at amortised cost | Related parties | ||
Financial instruments by category | ||
Financial assets | 740 | 738 |
Assets at fair value through profit or loss | ||
Financial instruments by category | ||
Financial assets | 1,283,114 | 1,297,088 |
Assets at fair value through profit or loss | Cash and cash equivalents | ||
Financial instruments by category | ||
Financial assets | 1,032,938 | 1,019,037 |
Assets at fair value through profit or loss | Financial investments | ||
Financial instruments by category | ||
Financial assets | 92,233 | 206,547 |
Assets at fair value through profit or loss | Derivative financial instruments | ||
Financial instruments by category | ||
Financial assets | 6,885 | 8,811 |
Assets at fair value through profit or loss | Trade accounts receivable | ||
Financial instruments by category | ||
Financial assets | 151,058 | 62,693 |
Assets at fair value through other comprehensive income | ||
Financial instruments by category | ||
Financial assets | 4,320 | 2,966 |
Assets at fair value through other comprehensive income | Derivative financial instruments | ||
Financial instruments by category | ||
Financial assets | $ 4,320 | $ 2,966 |
Cash and cash equivalents (Deta
Cash and cash equivalents (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Cash and cash equivalents | ||||
Cash and banks | $ 320,069 | $ 319,920 | ||
Term deposits | 712,869 | 699,117 | ||
Total cash and cash equivalents | $ 1,032,938 | $ 1,019,037 | $ 915,576 | $ 621,415 |
Cash and cash equivalents - Cha
Cash and cash equivalents - Changes in operating assets and liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Decrease (increase) in assets | |||
Trade accounts receivable | $ 8,537 | $ (63,172) | $ (54,188) |
Inventory | 52,472 | (15,675) | (62,586) |
Other assets | (70,101) | 23,256 | 9,144 |
Increase (decrease) in liabilities | |||
Trade payables | 57,411 | 47,573 | 9,557 |
Confirming payables | (40,613) | 8,737 | 5,743 |
Salaries and payroll charges | (21,632) | 9,776 | 25,206 |
Contractual liabilities | (29,543) | (36,299) | 250,000 |
Related parties | 27,167 | ||
Other liabilities | 26,877 | (59,348) | (1,809) |
Changes in operating assets and liabilities | $ 10,575 | $ (85,152) | $ 181,067 |
Financial investments (Details)
Financial investments (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Financial investments | |||
Financial investments | $ 92,233 | $ 206,547 | $ 119,498 |
Investment fund quotas | |||
Financial investments | |||
Financial investments | 38,677 | 138,945 | |
Bank deposit certificate | |||
Financial investments | |||
Financial investments | 44,595 | 42,067 | |
Repurchase agreements | |||
Financial investments | |||
Financial investments | 18,289 | ||
Other | |||
Financial investments | |||
Financial investments | $ 8,961 | $ 7,246 |
Trade accounts receivable - Com
Trade accounts receivable - Composition (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Disclosure of composition of trade accounts receivable | ||
Related parties | $ 963 | $ 3,775 |
Total trade accounts receivable | 173,204 | 182,713 |
Cost/gross carrying amount | ||
Disclosure of composition of trade accounts receivable | ||
Trade receivables | 174,931 | 181,084 |
Related parties | 963 | 3,775 |
Total trade accounts receivable | 175,894 | 184,859 |
Accumulated impairment | ||
Disclosure of composition of trade accounts receivable | ||
Total trade accounts receivable | $ (2,690) | $ (2,146) |
Trade accounts receivable - Cha
Trade accounts receivable - Changes in impairment of trade accounts receivable (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Changes in impairment of trade accounts receivable | ||
Financial assets at beginning of period | $ 1,420,812 | |
Financial assets at end of period | 1,310,320 | $ 1,420,812 |
Trade accounts receivable | ||
Changes in impairment of trade accounts receivable | ||
Financial assets at beginning of period | 182,713 | |
Financial assets at end of period | 173,204 | 182,713 |
Accumulated impairment | Trade accounts receivable | ||
Changes in impairment of trade accounts receivable | ||
Financial assets at beginning of period | (2,146) | (1,618) |
Additions | (1,238) | (3,300) |
Reversals | 428 | 2,779 |
Foreign exchange gains (losses) | 266 | (7) |
Financial assets at end of period | $ (2,690) | $ (2,146) |
Trade accounts receivable - Ana
Trade accounts receivable - Analysis by currency (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Disclosure of analysis of trade accounts receivable by currency | ||
Trade accounts receivable | $ 173,204 | $ 182,713 |
BRL | ||
Disclosure of analysis of trade accounts receivable by currency | ||
Trade accounts receivable | 39,000 | 66,486 |
US Dollar | ||
Disclosure of analysis of trade accounts receivable by currency | ||
Trade accounts receivable | 133,689 | 115,879 |
Other | ||
Disclosure of analysis of trade accounts receivable by currency | ||
Trade accounts receivable | $ 515 | $ 348 |
Trade accounts receivable - Agi
Trade accounts receivable - Aging (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Disclosure of aging of trade accounts receivable | ||
Trade accounts receivable | $ 173,204 | $ 182,713 |
Cost/gross carrying amount | ||
Disclosure of aging of trade accounts receivable | ||
Trade accounts receivable | 175,894 | 184,859 |
Cost/gross carrying amount | Current | ||
Disclosure of aging of trade accounts receivable | ||
Trade accounts receivable | 146,064 | 163,196 |
Cost/gross carrying amount | Up to 3 months past due | ||
Disclosure of aging of trade accounts receivable | ||
Trade accounts receivable | 28,366 | 19,775 |
Cost/gross carrying amount | From 3 to 6 months past due | ||
Disclosure of aging of trade accounts receivable | ||
Trade accounts receivable | 455 | 914 |
Cost/gross carrying amount | Over 6 months past due | ||
Disclosure of aging of trade accounts receivable | ||
Trade accounts receivable | 1,009 | 974 |
Accumulated impairment | ||
Disclosure of aging of trade accounts receivable | ||
Trade accounts receivable | $ (2,690) | $ (2,146) |
Inventory - Composition (Detail
Inventory - Composition (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Inventory | |||
Percentage of carrying amount used as basis for inventory provision for each 6-month period without use or sale | 20.00% | ||
Total | $ 269,705 | $ 324,878 | |
Inventories recognized as an expense | 1,701,456 | 1,320,379 | $ 1,287,662 |
Accumulated impairment | |||
Inventory | |||
Total | (23,437) | (20,736) | $ (38,384) |
Cost/gross carrying amount | |||
Inventory | |||
Finished products | 106,245 | 106,026 | |
Semi-finished products | 52,534 | 85,458 | |
Raw materials | 52,864 | 30,128 | |
Auxiliary materials and consumables | 69,566 | 81,261 | |
Imports in transit | 11,718 | 41,878 | |
Other | $ 215 | $ 863 |
Inventory - Provision (Details)
Inventory - Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Changes in the provision for obsolete and slow-moving inventory | ||
Beginning balance | $ 324,878 | |
Ending balance | 269,705 | $ 324,878 |
Accumulated impairment | ||
Changes in the provision for obsolete and slow-moving inventory | ||
Beginning balance | (20,736) | (38,384) |
Inventory write-down | (12,703) | (1,814) |
Reversal of inventory write-down | 9,260 | 19,249 |
Exchange variation gains (losses) | 742 | 213 |
Ending balance | (23,437) | (20,736) |
Accumulated impairment | Finished products | ||
Changes in the provision for obsolete and slow-moving inventory | ||
Beginning balance | (40) | |
Inventory write-down | (32) | |
Reversal of inventory write-down | 41 | |
Exchange variation gains (losses) | 3 | |
Ending balance | (28) | (40) |
Accumulated impairment | Semi-finished products | ||
Changes in the provision for obsolete and slow-moving inventory | ||
Beginning balance | (10,019) | |
Inventory write-down | (1,363) | |
Reversal of inventory write-down | 8,701 | |
Exchange variation gains (losses) | 959 | |
Ending balance | (1,722) | (10,019) |
Accumulated impairment | Raw materials | ||
Changes in the provision for obsolete and slow-moving inventory | ||
Beginning balance | (214) | |
Inventory write-down | (17) | |
Reversal of inventory write-down | 207 | |
Exchange variation gains (losses) | 18 | |
Ending balance | (6) | (214) |
Accumulated impairment | Auxiliary materials and consumables | ||
Changes in the provision for obsolete and slow-moving inventory | ||
Beginning balance | (10,463) | |
Inventory write-down | (11,291) | |
Reversal of inventory write-down | 311 | |
Exchange variation gains (losses) | (238) | |
Ending balance | $ (21,681) | $ (10,463) |
Related parties - Balances (Det
Related parties - Balances (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Related parties | ||
Trade accounts receivable | $ 963 | $ 3,775 |
Trade accounts receivable, current | 963 | 3,775 |
Related parties (assets) | 740 | 738 |
Related parites (assets), non-current | 740 | 738 |
Trade payables | 3,408 | 7,043 |
Trade payables, current | 3,408 | 7,043 |
Dividends payable | 663 | 4,138 |
Dividends payable, current | 663 | 4,138 |
Related parties (liabilities) | 1,580 | 89,924 |
Related parties (liabilities), current | 63 | 87,686 |
Related parties (liabilities), non-current | 1,517 | 2,238 |
Votorantim S.A. | ||
Related parties | ||
Trade accounts receivable | 8 | |
Related parties (assets) | 3 | 3 |
Trade payables | 478 | 336 |
Related parties (liabilities) | 87,686 | |
Companhia Brasileira de Aluminio | ||
Related parties | ||
Trade accounts receivable | 214 | 1,843 |
Trade payables | 5,246 | |
Related parties (liabilities) | 12 | 13 |
Votorantim Cimentos S.A. | ||
Related parties | ||
Trade accounts receivable | 623 | 1,696 |
Related parties (assets) | 737 | 735 |
Trade payables | 85 | 47 |
Votener Votorantim Comercializadora de Energia Ltda. | ||
Related parties | ||
Trade payables | 2,060 | |
Other related parties | ||
Related parties | ||
Trade accounts receivable | 126 | 228 |
Trade payables | 785 | 1,414 |
Dividends payable | 663 | 4,138 |
Related parties (liabilities) | $ 1,568 | $ 2,225 |
Related parties - Transaction (
Related parties - Transaction (Details) R$ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Sep. 30, 2018BRL (R$) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Related parties | |||||
Sales | $ 2,327 | $ 2,263 | $ 2,971 | ||
Purchases | 20,614 | 61,094 | 50,966 | ||
Financial results | 1,012 | 7,165 | |||
Votorantim S.A. | |||||
Related parties | |||||
Purchases | 3,649 | 3,651 | 4,653 | ||
Settlement of energy assets | R$ 290000 | $ 87,623 | |||
Companhia Brasileira de Aluminio | |||||
Related parties | |||||
Sales | 39 | 2,125 | 70 | ||
Purchases | 1,626 | 42,434 | 31,162 | ||
Financial results | 1,012 | 3,582 | |||
Votoratim Metais S.A. | |||||
Related parties | |||||
Purchases | 51 | ||||
Financial results | 3,583 | ||||
Votener Votorantim Comercializadora de Energia Ltda. | |||||
Related parties | |||||
Purchases | 10,054 | 13,510 | 13,400 | ||
Votorantim Cimentos S.A. | |||||
Related parties | |||||
Sales | 173 | 138 | 45 | ||
Purchases | 365 | 365 | 273 | ||
Other related parties | |||||
Related parties | |||||
Sales | 2,115 | 2,856 | |||
Purchases | $ 4,920 | $ 1,134 | $ 1,427 |
Related parties (Details)
Related parties (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Related parties. | ||
Short-term benefits | $ 7,225 | $ 6,668 |
Other long-term benefits | 1,039 | 1,162 |
Total key management compensation | $ 8,264 | $ 7,830 |
Property, plant and equipment_2
Property, plant and equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | $ 1,996,514 | $ 1,978,462 |
Additions | 299,773 | 196,717 |
Disposals | (12,031) | (10,982) |
Depreciation | (187,465) | (195,437) |
Foreign exchange (losses) gains | (141,843) | (18,958) |
Transfers | (3,991) | 2,671 |
Remeasurement of asset retirement obligation | 20,777 | 43,789 |
Impairment | (3,283) | |
Transfers of assets held for sale | 252 | |
Balance at the end of the year | 1,968,451 | 1,996,514 |
Borrowing costs capitalized | 36,534 | 35,164 |
Cost/gross carrying amount | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 4,170,586 | 4,130,590 |
Balance at the end of the year | 4,179,485 | 4,170,586 |
Accumulated depreciation/amortization | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | (2,174,072) | (2,152,128) |
Balance at the end of the year | (2,211,034) | (2,174,072) |
Land and improvements | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 24,215 | 23,779 |
Additions | 46 | |
Disposals | (638) | (930) |
Depreciation | (19) | (22) |
Foreign exchange (losses) gains | (2,160) | (231) |
Transfers | (22) | 1,573 |
Balance at the end of the year | 21,376 | 24,215 |
Land and improvements | Cost/gross carrying amount | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 24,490 | 24,036 |
Balance at the end of the year | 21,629 | 24,490 |
Land and improvements | Accumulated depreciation/amortization | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | (275) | (257) |
Balance at the end of the year | (253) | (275) |
Dams and Buildings | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 577,546 | 544,870 |
Additions | 2,613 | 100 |
Disposals | (3,207) | (92) |
Depreciation | (48,072) | (34,175) |
Foreign exchange (losses) gains | (42,117) | (4,309) |
Transfers | 63,562 | 71,152 |
Balance at the end of the year | $ 550,325 | $ 577,546 |
Average annual depreciation rates - % | 4.00% | 4.00% |
Dams and Buildings | Cost/gross carrying amount | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | $ 1,030,686 | $ 980,242 |
Balance at the end of the year | 1,002,885 | 1,030,686 |
Dams and Buildings | Accumulated depreciation/amortization | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | (453,140) | (435,372) |
Balance at the end of the year | (452,560) | (453,140) |
Machinery, equipment and facilities | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 917,821 | 980,326 |
Additions | 2,878 | 5,761 |
Disposals | (6,985) | (2,915) |
Depreciation | (131,099) | (142,519) |
Foreign exchange (losses) gains | (58,574) | (6,381) |
Transfers | 78,485 | 83,297 |
Transfers of assets held for sale | 252 | |
Balance at the end of the year | $ 802,526 | $ 917,821 |
Average annual depreciation rates - % | 7.00% | 7.00% |
Machinery, equipment and facilities | Cost/gross carrying amount | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | $ 2,422,254 | $ 2,466,265 |
Balance at the end of the year | 2,357,254 | 2,422,254 |
Machinery, equipment and facilities | Accumulated depreciation/amortization | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | (1,504,433) | (1,485,939) |
Balance at the end of the year | (1,554,728) | (1,504,433) |
Assets and projects under construction, PPE | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 235,501 | 219,254 |
Additions | 294,229 | 185,688 |
Disposals | (1,148) | (6,917) |
Foreign exchange (losses) gains | (28,827) | (3,965) |
Transfers | (147,403) | (158,559) |
Impairment | (3,283) | |
Balance at the end of the year | 349,069 | 235,501 |
Assets and projects under construction, PPE | Cost/gross carrying amount | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 235,501 | 219,254 |
Balance at the end of the year | 349,069 | 235,501 |
Asset retirement obligation (ARO) | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 77,135 | 36,716 |
Additions | 4,303 | |
Depreciation | (4,592) | (5,834) |
Foreign exchange (losses) gains | (9,688) | (1,839) |
Remeasurement of asset retirement obligation | 20,777 | 43,789 |
Balance at the end of the year | $ 83,632 | $ 77,135 |
Average annual depreciation rates - % | 5.00% | 5.00% |
Asset retirement obligation (ARO) | Cost/gross carrying amount | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | $ 178,662 | $ 132,824 |
Balance at the end of the year | 175,506 | 178,662 |
Asset retirement obligation (ARO) | Accumulated depreciation/amortization | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | (101,527) | (96,108) |
Balance at the end of the year | (91,874) | (101,527) |
Mining projects | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 158,483 | 168,638 |
Additions | 240 | |
Depreciation | (1,931) | (11,121) |
Foreign exchange (losses) gains | (2,115) | |
Transfers | 173 | 2,841 |
Balance at the end of the year | $ 156,725 | $ 158,483 |
Average annual depreciation rates - % | 8.00% | 8.00% |
Mining projects | Cost/gross carrying amount | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | $ 243,938 | $ 271,466 |
Balance at the end of the year | 243,629 | 243,938 |
Mining projects | Accumulated depreciation/amortization | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | (85,455) | (102,828) |
Balance at the end of the year | (86,904) | (85,455) |
Other PPE | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 5,813 | 4,879 |
Additions | 53 | 579 |
Disposals | (53) | (128) |
Depreciation | (1,752) | (1,766) |
Foreign exchange (losses) gains | (477) | (118) |
Transfers | 1,214 | 2,367 |
Balance at the end of the year | 4,798 | 5,813 |
Other PPE | Cost/gross carrying amount | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | 35,055 | 36,503 |
Balance at the end of the year | 29,513 | 35,055 |
Other PPE | Accumulated depreciation/amortization | ||
Reconciliation of changes in property, plant and equipment | ||
Balance at the beginning of the year | (29,242) | (31,624) |
Balance at the end of the year | $ (24,715) | $ (29,242) |
Property, plant and equipment -
Property, plant and equipment - Assets and projects under constructions (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Property, plant and equipment | ||||
Property, plant and equipment | $ 1,968,451 | $ 1,996,514 | $ 1,978,462 | |
Assets and projects under construction, PPE | ||||
Property, plant and equipment | ||||
Property, plant and equipment | 349,069 | 235,501 | $ 219,254 | |
Expansion and modernization projects | ||||
Property, plant and equipment | ||||
Property, plant and equipment | 174,634 | 64,043 | ||
Sustaining projects | ||||
Property, plant and equipment | ||||
Property, plant and equipment | 90,604 | 78,860 | ||
Health, safety and environment projects | ||||
Property, plant and equipment | ||||
Property, plant and equipment | 63,406 | 73,611 | ||
Information technology projects | ||||
Property, plant and equipment | ||||
Property, plant and equipment | 12,970 | 7,397 | ||
Other projects under construction | ||||
Property, plant and equipment | ||||
Property, plant and equipment | $ 7,456 | $ 11,590 | ||
Aripuana project | ||||
Property, plant and equipment | ||||
Percentage of interest in project | 70.00% | |||
Aripuana project | Forecast | ||||
Property, plant and equipment | ||||
Property, plant and equipment | $ 392,000 |
Property, plant and equipment_3
Property, plant and equipment - Impairment of non-financial assets (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Property, plant and equipment | |
Impairment | $ 3,283 |
Assets and projects under construction, PPE | |
Property, plant and equipment | |
Impairment | 3,283 |
Juiz de Fora and Tres Marias system | |
Property, plant and equipment | |
Impairment | $ 0 |
Intangible assets (Details)
Intangible assets (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill | |
Disclosure of detailed information about intangible assets | |
Period of financial budgets | 5 years |
Intangible assets - Analysis (D
Intangible assets - Analysis (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | $ 1,822,719 | $ 1,903,152 |
Acquisitions | 921 | |
Disposals | (28) | (36) |
Amortization | (79,724) | (75,017) |
Foreign exchange gains (losses) | (4,497) | (3,630) |
Transfers | 3,991 | (2,671) |
Balance at the end of the year | 1,742,461 | 1,822,719 |
Impairment loss | 0 | |
Goodwill | ||
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | 673,287 | 675,561 |
Foreign exchange gains (losses) | 1,513 | (2,274) |
Balance at the end of the year | 674,800 | 673,287 |
Rights to use natural resources | ||
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | 1,129,004 | 1,203,710 |
Disposals | (17) | |
Amortization | (77,792) | (74,024) |
Foreign exchange gains (losses) | (3,613) | (682) |
Transfers | 1,463 | |
Balance at the end of the year | $ 1,049,045 | $ 1,129,004 |
Average annual amortization rates % | 6.00% | 5.00% |
Other | ||
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | $ 20,428 | $ 23,881 |
Acquisitions | 921 | |
Disposals | (11) | (36) |
Amortization | (1,932) | (993) |
Foreign exchange gains (losses) | (2,397) | (674) |
Transfers | 2,528 | (2,671) |
Balance at the end of the year | $ 18,616 | $ 20,428 |
Average annual amortization rates % | 19.00% | 20.00% |
Cost/gross carrying amount | ||
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | $ 2,408,302 | $ 2,403,767 |
Balance at the end of the year | 2,401,298 | 2,408,302 |
Cost/gross carrying amount | Goodwill | ||
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | 673,287 | 675,561 |
Balance at the end of the year | 674,800 | 673,287 |
Cost/gross carrying amount | Rights to use natural resources | ||
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | 1,672,931 | 1,673,091 |
Balance at the end of the year | 1,669,645 | 1,672,931 |
Cost/gross carrying amount | Other | ||
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | 62,084 | 55,115 |
Balance at the end of the year | 56,853 | 62,084 |
Accumulated depreciation/amortization | ||
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | (585,583) | (500,615) |
Balance at the end of the year | (658,837) | (585,583) |
Accumulated depreciation/amortization | Rights to use natural resources | ||
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | (543,927) | (469,381) |
Balance at the end of the year | (620,600) | (543,927) |
Accumulated depreciation/amortization | Other | ||
Disclosure of reconciliation of changes in intangible assets and goodwill | ||
Balance at the beginning of the year | (41,656) | (31,234) |
Balance at the end of the year | $ (38,237) | $ (41,656) |
Intangible assets - Goodwill on
Intangible assets - Goodwill on acquisition (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Disclosure of information for cash-generating units | |
Impairment loss | $ 0 |
Peru | |
Disclosure of information for cash-generating units | |
Goodwill | 674,800 |
Other net assets carrying amount | 1,873,597 |
Total carrying amount | 2,548,397 |
Peru | Mining | |
Disclosure of information for cash-generating units | |
Goodwill | 582,306 |
Other net assets carrying amount | 1,099,557 |
Total carrying amount | 1,681,863 |
Peru | Smelting | |
Disclosure of information for cash-generating units | |
Goodwill | 92,494 |
Other net assets carrying amount | 774,040 |
Total carrying amount | 866,534 |
Goodwill | Peru | Mining | |
Disclosure of information for cash-generating units | |
Impairment loss | 0 |
Goodwill | Peru | Smelting | |
Disclosure of information for cash-generating units | |
Impairment loss | $ 0 |
Intangible assets - Impairment
Intangible assets - Impairment testing of goodwill (Details) $ in Thousands | Sep. 30, 2018$ / T | Dec. 31, 2018USD ($) |
Disclosure of impairment testing of goodwill | ||
Zinc (US$ per ton) | 2,517 | |
Copper (US$ per ton) | 6,478 | |
Percentage of reasonably possible decrease in long-term metal price | 20.00% | |
Zinc price after reasonably possible decrease in long-term metal price (US$ per ton) | 2,014 | |
Increase (decrease) in profit due to reasonably possible decrease in long-term metal price | $ | $ (180,534) | |
Percentage of reasonably possible increase in discount rate | 20.00% | |
Increase (decrease) in profit due to reasonably possible increase in discount rate | $ | $ 0 | |
Brazil | ||
Disclosure of impairment testing of goodwill | ||
Percentage of reasonably possible increase in discount rate | 11.98% | |
Peru | ||
Disclosure of impairment testing of goodwill | ||
Percentage of reasonably possible increase in discount rate | 10.34% | |
Minimum | ||
Disclosure of impairment testing of goodwill | ||
Mines LOM | 9 years | |
Greenfield LOM | 12 years | |
Maximum | ||
Disclosure of impairment testing of goodwill | ||
Mines LOM | 21 years | |
Greenfield LOM | 24 years |
Loans and financings - Analysis
Loans and financings - Analysis (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Mar. 09, 2018 | Dec. 31, 2017 | May 04, 2017 | Dec. 31, 2016 |
Loans and financings | |||||
Current | $ 32,513 | $ 40,841 | |||
Non-current | 1,392,354 | 1,406,458 | |||
Total borrowings | 1,424,867 | 1,447,299 | $ 1,144,385 | ||
Current portion of long term loans and financing (principal) | 21,107 | 28,019 | |||
Interest on loans and financing | 11,406 | 12,822 | |||
Total current borrowings and current portion of non-current borrowings | 32,513 | 40,841 | |||
Fair value disclosed | |||||
Loans and financings | |||||
Total borrowings | 1,401,578 | 1,535,132 | |||
Eurobonds - USD | |||||
Loans and financings | |||||
Current | 9,907 | 8,778 | |||
Non-current | 1,032,664 | 1,032,664 | |||
Total borrowings | 1,042,571 | 1,041,442 | |||
Total current borrowings and current portion of non-current borrowings | 9,907 | 8,778 | |||
Eurobonds - USD | Fair value disclosed | |||||
Loans and financings | |||||
Total borrowings | 1,014,974 | 1,120,901 | |||
Debt with banks | |||||
Loans and financings | |||||
Current | 773 | 435 | |||
Non-current | 196,519 | 199,179 | |||
Total borrowings | 197,292 | 199,614 | |||
Total current borrowings and current portion of non-current borrowings | 773 | 435 | |||
Debt with banks | Fair value disclosed | |||||
Loans and financings | |||||
Total borrowings | 206,349 | 214,293 | |||
Debt with BNDES | |||||
Loans and financings | |||||
Current | 6,117 | 19,795 | |||
Non-current | 83,808 | 73,653 | |||
Total borrowings | 89,925 | 93,448 | |||
Total current borrowings and current portion of non-current borrowings | 6,117 | 19,795 | |||
Debt with BNDES | Fair value disclosed | |||||
Loans and financings | |||||
Total borrowings | 82,208 | 85,969 | |||
Debentures | |||||
Loans and financings | |||||
Current | 7,432 | 8,885 | |||
Non-current | 20,756 | 32,403 | |||
Total borrowings | 28,188 | 41,288 | |||
Total current borrowings and current portion of non-current borrowings | 7,432 | 8,885 | |||
Debentures | Fair value disclosed | |||||
Loans and financings | |||||
Total borrowings | 28,269 | 41,405 | |||
Export credit note | |||||
Loans and financings | |||||
Current | 1,102 | ||||
Non-current | 61,622 | ||||
Total borrowings | 62,724 | ||||
Total current borrowings and current portion of non-current borrowings | 1,102 | ||||
Export credit note | Fair value disclosed | |||||
Loans and financings | |||||
Total borrowings | 64,058 | ||||
Other | |||||
Loans and financings | |||||
Current | 8,284 | 1,846 | |||
Non-current | 58,607 | 6,937 | |||
Total borrowings | 66,891 | 8,783 | |||
Total current borrowings and current portion of non-current borrowings | 8,284 | 1,846 | |||
Other | Fair value disclosed | |||||
Loans and financings | |||||
Total borrowings | 69,778 | 8,506 | |||
Fixed rate | |||||
Loans and financings | |||||
Current | 9,884 | 11,192 | |||
Non-current | 1,037,361 | 1,038,459 | |||
Total borrowings | 1,047,245 | 1,049,651 | |||
Total current borrowings and current portion of non-current borrowings | $ 9,884 | 11,192 | |||
Fixed rate | Eurobonds - USD | |||||
Loans and financings | |||||
Interest rate (as a percent) | 5.13% | 5.375% | |||
LIBOR | |||||
Loans and financings | |||||
Current | $ 7,719 | 610 | |||
Non-current | 247,614 | 230,573 | |||
Total borrowings | 255,333 | 231,183 | |||
Total current borrowings and current portion of non-current borrowings | $ 7,719 | 610 | |||
LIBOR | Debt with banks | |||||
Loans and financings | |||||
Borrowings, adjustment to interest rate basis | 1.27% | ||||
TJLP | |||||
Loans and financings | |||||
Current | $ 1,467 | 12,509 | |||
Non-current | 14,700 | 35,341 | |||
Total borrowings | 16,167 | 47,850 | |||
Total current borrowings and current portion of non-current borrowings | $ 1,467 | 12,509 | |||
TJLP | Debt with BNDES | |||||
Loans and financings | |||||
Borrowings, adjustment to interest rate basis | 2.82% | ||||
SELIC | Debt with BNDES | |||||
Loans and financings | |||||
Borrowings, adjustment to interest rate basis | 3.10% | ||||
TLP | |||||
Loans and financings | |||||
Current | $ 5,881 | ||||
Non-current | 52,606 | ||||
Total borrowings | 58,487 | ||||
Total current borrowings and current portion of non-current borrowings | $ 5,881 | ||||
TLP | Debt with BNDES | |||||
Loans and financings | |||||
Borrowings, adjustment to interest rate basis | 5.23% | ||||
CDI | |||||
Loans and financings | |||||
Current | $ 7,430 | 9,811 | |||
Non-current | 20,758 | 62,632 | |||
Total borrowings | 28,188 | 72,443 | |||
Total current borrowings and current portion of non-current borrowings | $ 7,430 | $ 9,811 | |||
CDI | Debentures | |||||
Loans and financings | |||||
Borrowings, percentage of reference rate | 110.50% | ||||
CDI | Export credit note | |||||
Loans and financings | |||||
Borrowings, percentage of reference rate | 118.00% |
Loans and financings - Maturity
Loans and financings - Maturity profile (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Loans and financings | |||
Loans and financing | $ 1,424,867 | $ 1,447,299 | $ 1,144,385 |
Borrowings, percentage of total | 100.00% | ||
Eurobonds - USD | |||
Loans and financings | |||
Loans and financing | $ 1,042,571 | 1,041,442 | |
Debt with banks | |||
Loans and financings | |||
Loans and financing | 197,292 | 199,614 | |
Debt with BNDES | |||
Loans and financings | |||
Loans and financing | 89,925 | 93,448 | |
Debentures | |||
Loans and financings | |||
Loans and financing | 28,188 | 41,288 | |
Export credit note | |||
Loans and financings | |||
Loans and financing | 62,724 | ||
Other | |||
Loans and financings | |||
Loans and financing | 66,891 | $ 8,783 | |
Less than 1 year / 2019 | |||
Loans and financings | |||
Loans and financing | $ 32,513 | ||
Borrowings, percentage of total | 3.00% | ||
Less than 1 year / 2019 | Eurobonds - USD | |||
Loans and financings | |||
Loans and financing | $ 9,907 | ||
Less than 1 year / 2019 | Debt with banks | |||
Loans and financings | |||
Loans and financing | 773 | ||
Less than 1 year / 2019 | Debt with BNDES | |||
Loans and financings | |||
Loans and financing | 6,117 | ||
Less than 1 year / 2019 | Debentures | |||
Loans and financings | |||
Loans and financing | 7,432 | ||
Less than 1 year / 2019 | Other | |||
Loans and financings | |||
Loans and financing | 8,284 | ||
2020 | |||
Loans and financings | |||
Loans and financing | $ 23,943 | ||
Borrowings, percentage of total | 2.00% | ||
2020 | Debt with BNDES | |||
Loans and financings | |||
Loans and financing | $ 6,763 | ||
2020 | Debentures | |||
Loans and financings | |||
Loans and financing | 6,909 | ||
2020 | Other | |||
Loans and financings | |||
Loans and financing | 10,271 | ||
2021 | |||
Loans and financings | |||
Loans and financing | $ 103,916 | ||
Borrowings, percentage of total | 7.00% | ||
2021 | Debt with banks | |||
Loans and financings | |||
Loans and financing | $ 78,607 | ||
2021 | Debt with BNDES | |||
Loans and financings | |||
Loans and financing | 8,112 | ||
2021 | Debentures | |||
Loans and financings | |||
Loans and financing | 6,924 | ||
2021 | Other | |||
Loans and financings | |||
Loans and financing | 10,273 | ||
2022 | |||
Loans and financings | |||
Loans and financing | $ 106,506 | ||
Borrowings, percentage of total | 7.00% | ||
2022 | Debt with banks | |||
Loans and financings | |||
Loans and financing | $ 78,607 | ||
2022 | Debt with BNDES | |||
Loans and financings | |||
Loans and financing | 12,156 | ||
2022 | Debentures | |||
Loans and financings | |||
Loans and financing | 6,923 | ||
2022 | Other | |||
Loans and financings | |||
Loans and financing | 8,820 | ||
2023 | |||
Loans and financings | |||
Loans and financing | $ 398,858 | ||
Borrowings, percentage of total | 28.00% | ||
2023 | Eurobonds - USD | |||
Loans and financings | |||
Loans and financing | $ 339,601 | ||
2023 | Debt with banks | |||
Loans and financings | |||
Loans and financing | 39,305 | ||
2023 | Debt with BNDES | |||
Loans and financings | |||
Loans and financing | 12,156 | ||
2023 | Other | |||
Loans and financings | |||
Loans and financing | 7,796 | ||
2024 | |||
Loans and financings | |||
Loans and financing | $ 19,649 | ||
Borrowings, percentage of total | 1.00% | ||
2024 | Debt with BNDES | |||
Loans and financings | |||
Loans and financing | $ 11,912 | ||
2024 | Other | |||
Loans and financings | |||
Loans and financing | 7,737 | ||
2025 | |||
Loans and financings | |||
Loans and financing | $ 18,912 | ||
Borrowings, percentage of total | 1.00% | ||
2025 | Debt with BNDES | |||
Loans and financings | |||
Loans and financing | $ 11,176 | ||
2025 | Other | |||
Loans and financings | |||
Loans and financing | 7,736 | ||
As from 2026 | |||
Loans and financings | |||
Loans and financing | $ 720,570 | ||
Borrowings, percentage of total | 51.00% | ||
As from 2026 | Eurobonds - USD | |||
Loans and financings | |||
Loans and financing | $ 693,063 | ||
As from 2026 | Debt with BNDES | |||
Loans and financings | |||
Loans and financing | 21,533 | ||
As from 2026 | Other | |||
Loans and financings | |||
Loans and financing | $ 5,974 |
Loans and financings - Changes
Loans and financings - Changes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Changes in loans and financings | ||
Balance at the beginning of the year | $ 1,447,299 | $ 1,144,385 |
Payments | (295,104) | (537,254) |
New loans and financing | 292,901 | 830,598 |
Foreign exchange gain | (5,777) | (2,873) |
Gain on debt modification | (3,428) | |
Interest accrual | 61,385 | 69,481 |
Interest paid | (72,409) | (57,038) |
Balance at the end of the year | $ 1,424,867 | $ 1,447,299 |
Loans and financings - Analys_2
Loans and financings - Analysis by currency (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Loans and financings | |||
Current | $ 32,513 | $ 40,841 | |
Non-current | 1,392,354 | 1,406,458 | |
Total | 1,424,867 | 1,447,299 | $ 1,144,385 |
US Dollar | |||
Loans and financings | |||
Current | 17,267 | 13,260 | |
Non-current | 1,284,128 | 1,272,223 | |
Total | 1,301,395 | 1,285,483 | |
BRL | |||
Loans and financings | |||
Current | 15,246 | 27,471 | |
Non-current | 108,226 | 134,235 | |
Total | $ 123,472 | 161,706 | |
Other | |||
Loans and financings | |||
Current | 110 | ||
Total | $ 110 |
Loans and financings - Analys_3
Loans and financings - Analysis by index (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Loans and financings | |||
Current | $ 32,513 | $ 40,841 | |
Non-current | 1,392,354 | 1,406,458 | |
Total | 1,424,867 | 1,447,299 | $ 1,144,385 |
Fixed rate | |||
Loans and financings | |||
Current | 9,884 | 11,192 | |
Non-current | 1,037,361 | 1,038,459 | |
Total | 1,047,245 | 1,049,651 | |
LIBOR | |||
Loans and financings | |||
Current | 7,719 | 610 | |
Non-current | 247,614 | 230,573 | |
Total | 255,333 | 231,183 | |
TJLP | |||
Loans and financings | |||
Current | 1,467 | 12,509 | |
Non-current | 14,700 | 35,341 | |
Total | 16,167 | 47,850 | |
UMBNDES | |||
Loans and financings | |||
Current | 3,211 | ||
Non-current | 5,496 | ||
Total | 8,707 | ||
CDI | |||
Loans and financings | |||
Current | 7,430 | 9,811 | |
Non-current | 20,758 | 62,632 | |
Total | 28,188 | 72,443 | |
TLP | |||
Loans and financings | |||
Current | 5,881 | ||
Non-current | 52,606 | ||
Total | 58,487 | ||
BNDES Selic | |||
Loans and financings | |||
Current | 132 | 3,508 | |
Non-current | 19,315 | 33,957 | |
Total | $ 19,447 | $ 37,465 |
Loans and financings - Guarante
Loans and financings - Guarantees and covenants (Details) $ in Thousands | Dec. 31, 2018USD ($) |
NEXA BR | |
Loans and financings | |
Collateral provided | $ 1,183 |
NEXA BR | |
Loans and financings | |
Guarantees provided | $ 89,925 |
Loans and financings - Bonds (D
Loans and financings - Bonds (Details) - Eurobonds - USD - Fixed rate - USD ($) $ in Thousands | Mar. 28, 2013 | Dec. 31, 2018 | May 04, 2017 |
Loans and financings | |||
Principal amount | $ 700,000 | ||
Interest rate (as a percent) | 5.13% | 5.375% | |
NEXA PERU | |||
Loans and financings | |||
Principal amount | $ 350,000 | ||
Interest rate (as a percent) | 4.625% | ||
Term of bond | 10 years |
Loans and financings - Repaymen
Loans and financings - Repayment of debt (Details) - USD ($) $ in Thousands | May 25, 2018 | Mar. 09, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Disclosure of detailed information about borrowings [line items] | |||||
Payments | $ 295,104 | $ 537,254 | $ 483,100 | ||
Term loan | LIBOR 3M | |||||
Disclosure of detailed information about borrowings [line items] | |||||
Principal amount | $ 100,000 | ||||
Adjustment to interest rate (as a percent) | 2.55% | ||||
Payments | $ 101,083 | ||||
Export credit note | LIBOR 3M | |||||
Disclosure of detailed information about borrowings [line items] | |||||
Principal amount | $ 31,393 | ||||
Adjustment to interest rate (as a percent) | 1.85% | ||||
Gain (loss) on termination of derivatives | $ 91 | ||||
Export credit note | CDI | |||||
Disclosure of detailed information about borrowings [line items] | |||||
Principal amount | $ 30,807 | ||||
Reference rate (as a percent) | 118.00% | ||||
Payments | $ 30,891 |
Loans and financings - Renegoti
Loans and financings - Renegotiation of debt (Details) R$ in Thousands, $ in Thousands | Dec. 27, 2018USD ($) | May 22, 2018USD ($) | Jan. 31, 2019 | Dec. 31, 2018 | Dec. 28, 2018 | Dec. 27, 2018BRL (R$) | Dec. 27, 2018USD ($) | May 23, 2018 |
Interest rate swap contract | CDI | NEXA BR | ||||||||
Loans and financings | ||||||||
Borrowings, percentage of reference rate | 53.04% | |||||||
Term loan | LIBOR 6M | ||||||||
Loans and financings | ||||||||
Principal amount | $ 100,000 | |||||||
Adjustment to interest rate (as a percent) | 2.50% | 1.27% | ||||||
Gain on debt modification | $ 3,428 | |||||||
Debt with BNDES | ||||||||
Loans and financings | ||||||||
Principal amount | R$ 228573 | $ 58,990 | ||||||
Gain on debt modification | $ 0 | |||||||
Debt with BNDES | TJLP | ||||||||
Loans and financings | ||||||||
Adjustment to interest rate (as a percent) | 2.82% | |||||||
Debt with BNDES | TJLP | Minimum | ||||||||
Loans and financings | ||||||||
Adjustment to interest rate (as a percent) | 2.36% | 2.36% | ||||||
Debt with BNDES | TJLP | Maximum | ||||||||
Loans and financings | ||||||||
Adjustment to interest rate (as a percent) | 2.48% | 2.48% | ||||||
Debt with BNDES | SELIC | ||||||||
Loans and financings | ||||||||
Adjustment to interest rate (as a percent) | 3.10% | |||||||
Debt with BNDES | SELIC | Minimum | ||||||||
Loans and financings | ||||||||
Adjustment to interest rate (as a percent) | 2.48% | 2.48% | ||||||
Debt with BNDES | SELIC | Maximum | ||||||||
Loans and financings | ||||||||
Adjustment to interest rate (as a percent) | 2.72% | 2.72% | ||||||
Debt with BNDES | TLP | ||||||||
Loans and financings | ||||||||
Adjustment to interest rate (as a percent) | 5.23% | |||||||
Debt with BNDES | TLP | Minimum | ||||||||
Loans and financings | ||||||||
Adjustment to interest rate (as a percent) | 2.09% | |||||||
Debt with BNDES | TLP | Maximum | ||||||||
Loans and financings | ||||||||
Adjustment to interest rate (as a percent) | 2.29% |
Loans and financings - New loan
Loans and financings - New loans (Details) - USD ($) $ in Thousands | May 22, 2018 | Jun. 27, 2018 |
New term loan | LIBOR 6M | ||
Loans and financings | ||
Principal amount | $ 100,000 | |
Adjustment to interest rate (as a percent) | 1.27% | |
Gain on debt modification | $ 0 | |
Prepaid term loan | LIBOR 3M | ||
Loans and financings | ||
Adjustment to interest rate (as a percent) | 2.55% | |
New facility agreement | ||
Loans and financings | ||
Principal amount | $ 62,500 | |
Interest rate (as a percent) | 5.29% |
Confirming payables (Details)
Confirming payables (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Confirming payables | ||
Suppliers payment term (in days) | 90 days | |
Extended supplier payment terms (in days) | 180 days | |
Confirming payable | $ 70,411 | $ 111,024 |
Salaries and payroll charges (D
Salaries and payroll charges (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Salaries and payroll charges | ||
Direct remuneration and payroll charges | $ 17,404 | $ 21,357 |
Provision for profit sharing and other payable | 40,762 | 58,441 |
Salaries and payroll charges | $ 58,166 | $ 79,798 |
Current and deferred income t_3
Current and deferred income taxes - Reconciliation of income taxes expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Reconciliation of taxes on income expenses | ||||
Profit before taxation | $ 131,898 | $ 271,459 | $ 208,892 | |
Standard rate | 26.01% | 27.08% | 29.22% | |
Taxes on income at standard rates | $ (34,307) | $ (73,511) | $ (61,038) | |
Difference in tax rate for subsidiaries outside Luxembourg | (11,227) | (19,912) | (11,425) | |
Re-measurement of deferred tax - change in Peru tax rate | (41,588) | |||
Taxes on dividend received from foreign subsidiary | (8,299) | |||
Tax effect of special mining levy and special mining tax | (14,565) | (22,766) | (10,953) | |
Other permanent differences | 19,176 | 18,294 | 26,621 | |
Taxes on income on the income statement | (40,923) | (106,194) | (98,383) | |
Current | (71,787) | (125,691) | (75,282) | |
Deferred | $ 30,864 | $ 19,497 | $ (23,101) | |
Peru | ||||
Reconciliation of taxes on income expenses | ||||
Standard rate | 29.50% | 29.50% | 28.00% | |
Expected applicable tax rate | 27.00% | 27.00% | ||
Peru | Forecast | ||||
Reconciliation of taxes on income expenses | ||||
Expected applicable tax rate | 26.00% |
Current and deferred income t_4
Current and deferred income taxes - Analysis of deferred tax balances (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Analysis of deferred tax balances | |||
Net deferred tax assets related to the same legal entity | $ 201,154 | $ 224,513 | |
Net deferred tax liabilities related to the same legal entity | (298,598) | (324,931) | |
Total | (97,444) | (100,418) | $ (107,304) |
Tax credits on non-operating losses | |||
Analysis of deferred tax balances | |||
Tax credits | 106,817 | 104,100 | |
Foreign exchange losses | |||
Analysis of deferred tax balances | |||
Tax credits | 50,766 | 79,430 | |
Environmental obligation | |||
Analysis of deferred tax balances | |||
Tax credits | 28,808 | 28,504 | |
Asset retirement obligation | |||
Analysis of deferred tax balances | |||
Tax credits | 19,879 | 23,990 | |
Tax, civil and labor provisions | |||
Analysis of deferred tax balances | |||
Tax credits | 9,389 | 15,666 | |
Other provisions | |||
Analysis of deferred tax balances | |||
Tax credits | 6,443 | 12,481 | |
Provision for profit sharing | |||
Analysis of deferred tax balances | |||
Tax credits | 5,409 | 6,521 | |
Provision for inventory losses | |||
Analysis of deferred tax balances | |||
Tax credits | 5,308 | 4,395 | |
Capitalized interest | |||
Analysis of deferred tax balances | |||
Tax debits on temporary differences | (11,725) | (10,624) | |
Accelerated depreciation and adjustment of useful lives | |||
Analysis of deferred tax balances | |||
Tax debits on temporary differences | (10,636) | (28,371) | |
Depreciation and amortization of fair value adjustment to PP&E and intangible assets | |||
Analysis of deferred tax balances | |||
Tax debits on temporary differences | (318,198) | (344,531) | |
Other differences | |||
Analysis of deferred tax balances | |||
Tax credits | 12,094 | 10,231 | |
Tax debits on temporary differences | (1,798) | (2,210) | |
Brazil | Tax credits on non-operating losses | |||
Analysis of deferred tax balances | |||
Tax credits | 104,195 | 103,791 | |
Peru | Tax credits on non-operating losses | |||
Analysis of deferred tax balances | |||
Tax credits | 2,622 | 309 | |
Luxembourg | |||
Analysis of deferred tax balances | |||
Unused tax losses for which no deferred tax asset recognised | $ 57,800 | $ 54,328 |
Current and deferred income t_5
Current and deferred income taxes - Effects of deferred tax and taxes on profit or loss for the year and other comprehensive income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Effects of deferred tax and taxes on profit or loss for the year and other comprehensive income | |||
Balance at beginning of year | $ (100,418) | $ (107,304) | |
Effect on income for the period | 30,864 | 19,497 | $ (23,101) |
Effect on comprehensive income | (126) | (4,119) | |
Exchange variation | (27,764) | (8,492) | |
Balance at end of year | $ (97,444) | $ (100,418) | $ (107,304) |
Provisions (Details)
Provisions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Provisions reconciliation | ||
Balance at the beginning of the year | $ 341,161 | $ 296,879 |
Additions | 21,902 | 47,816 |
Reversals | (62,112) | (42,019) |
Interest | 15,991 | 13,476 |
Write-off | (4,678) | (18,666) |
Foreign exchange variation (losses) gains | (31,910) | (2,367) |
Cost and interest revision | 20,703 | 43,789 |
Other | (134) | 2,253 |
Balance at the end of the year | 300,923 | 341,161 |
Current | 20,357 | 14,641 |
Non-current | $ 280,566 | $ 326,520 |
Peru | Minimum | ||
Provisions reconciliation | ||
Credit risk-adjusted rate | 3.40% | 1.50% |
Peru | Maximum | ||
Provisions reconciliation | ||
Credit risk-adjusted rate | 9.50% | 2.40% |
Brazil | ||
Provisions reconciliation | ||
Credit risk-adjusted rate | 7.80% | |
Brazil | Minimum | ||
Provisions reconciliation | ||
Credit risk-adjusted rate | 3.00% | |
Brazil | Maximum | ||
Provisions reconciliation | ||
Credit risk-adjusted rate | 5.40% | |
Asset retirement obligation | ||
Provisions reconciliation | ||
Balance at the beginning of the year | $ 199,445 | |
Reversals | (15,119) | |
Interest | 8,443 | |
Write-off | 462 | |
Foreign exchange variation (losses) gains | (15,133) | |
Cost and interest revision | 7,454 | |
Balance at the end of the year | 185,552 | $ 199,445 |
Non-current | 185,552 | |
Environmental obligation | ||
Provisions reconciliation | ||
Balance at the beginning of the year | 83,835 | |
Interest | 5,049 | |
Write-off | (5,140) | |
Foreign exchange variation (losses) gains | (12,263) | |
Cost and interest revision | 13,249 | |
Balance at the end of the year | 84,730 | 83,835 |
Current | 20,357 | |
Non-current | 64,373 | |
Tax | ||
Provisions reconciliation | ||
Balance at the beginning of the year | 18,575 | |
Additions | 2,958 | |
Reversals | (8,753) | |
Interest | 794 | |
Foreign exchange variation (losses) gains | (1,707) | |
Other | 201 | |
Balance at the end of the year | 12,068 | 18,575 |
Non-current | 12,068 | |
Labor | ||
Provisions reconciliation | ||
Balance at the beginning of the year | 16,421 | |
Additions | 11,811 | |
Reversals | (15,012) | |
Interest | 1,387 | |
Foreign exchange variation (losses) gains | (2,188) | |
Other | (231) | |
Balance at the end of the year | 12,188 | 16,421 |
Non-current | 12,188 | |
Civil | ||
Provisions reconciliation | ||
Balance at the beginning of the year | 18,320 | |
Additions | 4,173 | |
Reversals | (20,908) | |
Interest | 105 | |
Foreign exchange variation (losses) gains | (215) | |
Other | (104) | |
Balance at the end of the year | 1,371 | 18,320 |
Non-current | 1,371 | |
Environmental | ||
Provisions reconciliation | ||
Balance at the beginning of the year | 4,565 | |
Additions | 2,960 | |
Reversals | (2,320) | |
Interest | 213 | |
Foreign exchange variation (losses) gains | (404) | |
Balance at the end of the year | 5,014 | $ 4,565 |
Non-current | $ 5,014 |
Provisions - Tax, civil, labor
Provisions - Tax, civil, labor and environmental provisions (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Provisions and the corresponding judicial deposits | |||
Net amount | $ 300,923 | $ 341,161 | $ 296,879 |
Judicial provision | |||
Provisions and the corresponding judicial deposits | |||
Judicial deposits | (7,052) | (7,841) | |
Provision | 37,693 | 65,722 | |
Net amount | 30,641 | 57,881 | |
Outstanding judicial deposits | 9,230 | 10,949 | |
Tax | |||
Provisions and the corresponding judicial deposits | |||
Judicial deposits | (2,048) | (2,318) | |
Provision | 14,116 | 20,893 | |
Net amount | 12,068 | 18,575 | |
Outstanding judicial deposits | 2,245 | 3,130 | |
Labor | |||
Provisions and the corresponding judicial deposits | |||
Judicial deposits | (4,258) | (4,765) | |
Provision | 16,446 | 21,186 | |
Net amount | 12,188 | 16,421 | |
Outstanding judicial deposits | 6,555 | 7,408 | |
Civil | |||
Provisions and the corresponding judicial deposits | |||
Judicial deposits | (746) | (758) | |
Provision | 2,117 | 19,078 | |
Net amount | 1,371 | 18,320 | |
Outstanding judicial deposits | 17 | 23 | |
Environmental | |||
Provisions and the corresponding judicial deposits | |||
Provision | 5,014 | 4,565 | |
Net amount | 5,014 | 4,565 | |
Outstanding judicial deposits | $ 413 | $ 388 |
Provisions - Litigation with li
Provisions - Litigation with likelihood of loss considered possible (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Litigation with likelihood of loss considered possible | ||
Amount under litigation considered as a possible loss | $ 306,126 | $ 330,602 |
Tax | ||
Litigation with likelihood of loss considered possible | ||
Amount under litigation considered as a possible loss | 137,170 | 125,438 |
Labor | ||
Litigation with likelihood of loss considered possible | ||
Amount under litigation considered as a possible loss | 29,079 | 46,402 |
Civil | ||
Litigation with likelihood of loss considered possible | ||
Amount under litigation considered as a possible loss | 20,130 | 24,911 |
Environmental | ||
Litigation with likelihood of loss considered possible | ||
Amount under litigation considered as a possible loss | $ 119,747 | $ 133,851 |
Provisions - Contingent liabili
Provisions - Contingent liabilities - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | $ 306,126 | $ 330,602 |
Tax | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 137,170 | 125,438 |
Compensation for exploration for mineral resources | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 6,947 | |
Indirect taxes on sales | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 4,788 | |
Net operating losses for Brazilian corporate income taxes | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 5,189 | |
Foreign exchange losses for Brazilian corporate income taxes | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 10,177 | |
Value-added tax on sales of certain energy contracts | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 32,849 | |
Tax rate applied to interstate sales for manufactured goods with imported content | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 4,058 | |
Credits to the purchases of property, plant and equipment | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 8,662 | |
Civil | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 20,130 | 24,911 |
Indemnity lawsuits alleging property damage | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 10,341 | |
Environmental | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | 119,747 | $ 133,851 |
Alleged pollution of Sao Francisco River | ||
Contingent tax liabilities with likelihood of loss considered possible | ||
Estimate of financial effect of contingent liability | $ 96,946 |
Contractual liabilities (Detail
Contractual liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Contractual liabilities | ||
At January | $ 221,885 | $ 250,000 |
Revenue recognition upon ore delivery | (29,543) | (36,299) |
Accretion for year | 7,295 | 8,184 |
At December | 199,637 | 221,885 |
Contractual liabilities breakdown | ||
Current | 31,992 | 31,296 |
Non-current | $ 167,645 | $ 190,589 |
Shareholders' equity - Capital,
Shareholders' equity - Capital, Treasury shares and Share premium (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Sep. 20, 2018 | Mar. 28, 2018 | Feb. 15, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Shareholders' equity | ||||||
Capital | $ 133,320 | $ 133,320 | ||||
Capital, shares | 133,320 | 133,320 | ||||
Par value ($ per share) | $ 1 | $ 1 | ||||
Authorized, but unissued and unsubscribed share capital | $ 231,925 | |||||
Maximum amount authorized to repurchase under the share buy-back program | $ 30,000 | |||||
Period of time for repurchase of shares under buy-back program | 12 months | |||||
Treasury shares | $ 1,352 | |||||
Treasury shares, shares | 112 | |||||
Reimbursement of share premium, amount approved | $ 0.60 | |||||
Payments for reimbursement of share premium | $ 80,000 | $ 80,000 | $ 430,000 | $ 69,931 |
Shareholders' equity - Accumula
Shareholders' equity - Accumulated other comprehensive income (loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Reconciliation of changes in accumulated other comprehensive income | |||
Beginning balance | $ 2,908,903 | $ 3,324,316 | $ 3,528,475 |
Translation adjustment of foreign investments | (9,959) | (10,742) | 30,373 |
Cash flow hedge accounting | (2,192) | 12,556 | (16,256) |
Ending balance | 2,901,801 | 2,908,903 | 3,324,316 |
Accumulated non-controlling interest | 425,208 | 422,068 | |
Attributable to NEXA's shareholders | 2,476,593 | 2,486,835 | |
Accumulated other comprehensive income | |||
Reconciliation of changes in accumulated other comprehensive income | |||
Beginning balance | (97,253) | (95,740) | (109,857) |
Translation adjustment of foreign investments | (9,959) | (10,742) | 30,373 |
Cash flow hedge accounting | (2,192) | 12,556 | (16,256) |
Remeasurements of retirement benefits | (3,327) | ||
Ending balance | (109,404) | (97,253) | (95,740) |
Accumulated non-controlling interest | (30,116) | ||
Attributable to NEXA's shareholders | (79,288) | ||
Cumulative translation adjustment | |||
Reconciliation of changes in accumulated other comprehensive income | |||
Beginning balance | (99,829) | (89,087) | (119,460) |
Translation adjustment of foreign investments | (9,959) | (10,742) | 30,373 |
Ending balance | (109,788) | (99,829) | (89,087) |
Remeasurements with retirement benefits | |||
Reconciliation of changes in accumulated other comprehensive income | |||
Beginning balance | 3,327 | 3,327 | |
Remeasurements of retirement benefits | (3,327) | ||
Ending balance | 3,327 | ||
Hedge accounting | |||
Reconciliation of changes in accumulated other comprehensive income | |||
Beginning balance | 2,576 | (9,980) | 6,276 |
Cash flow hedge accounting | (2,192) | 12,556 | (16,256) |
Ending balance | $ 384 | $ 2,576 | $ (9,980) |
Shareholders' equity - Earnings
Shareholders' equity - Earnings per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Shareholders' equity | |||
Net income for the year attributable to NEXA's shareholders | $ 74,860 | $ 126,885 | $ 93,167 |
Weighted average number of outstanding common shares | 133,313 | 116,527 | 80,699 |
Earnings per share in US Dollars | $ 0.56 | $ 1.09 | $ 1.15 |
Shareholders' equity - Non-cont
Shareholders' equity - Non-controlling interests (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Summarized balance sheet | |||
Current assets | $ 1,697,967 | $ 1,838,907 | |
Current liabilities | 651,850 | 768,215 | |
Non-current assets | 4,037,439 | 4,122,617 | |
Non-current liabilities | 2,181,755 | 2,284,406 | |
Accumulated non-controlling interest | 425,208 | 422,068 | |
Summarized income statement | |||
Net revenues | 2,491,202 | 2,449,484 | $ 1,964,841 |
Net income for the year | 90,976 | 165,265 | 110,509 |
Other comprehensive income (loss) for the year | (12,151) | 1,814 | 14,117 |
Total comprehensive income (loss) for the year | 78,825 | 167,079 | 124,626 |
Comprehensive income (loss) attributable to non- controlling interests | 5,897 | 41,138 | 23,427 |
Summarized statement of cash flows | |||
Net cash provided by operating activities | 347,598 | 378,939 | 585,061 |
Net cash used in investing activities | (158,103) | (328,372) | (201,419) |
Net cash used in financing activities | (177,410) | 52,846 | (92,238) |
Increase in cash and cash equivalents | 13,901 | 103,461 | $ 294,161 |
NEXA PERU | |||
Summarized balance sheet | |||
Current assets | 957,821 | 854,295 | |
Current liabilities | 248,938 | 236,558 | |
Current net assets | 708,883 | 617,737 | |
Non-current assets | 642,007 | 634,757 | |
Non-current liabilities | 581,172 | 624,856 | |
Non-current net assets | 60,835 | 9,901 | |
Net assets | 769,718 | 627,638 | |
Accumulated non-controlling interest | 373,838 | 361,265 | |
Summarized income statement | |||
Net revenues | 827,537 | 911,745 | |
Net income for the year | 142,082 | 224,480 | |
Other comprehensive income (loss) for the year | 8,538 | ||
Total comprehensive income (loss) for the year | 142,082 | 233,018 | |
Comprehensive income (loss) attributable to non- controlling interests | 13,621 | 30,207 | |
Dividends paid to non-controlling interests | 55,073 | ||
Summarized statement of cash flows | |||
Net cash provided by operating activities | 232,391 | 131,304 | |
Net cash used in investing activities | (76,695) | (19,371) | |
Net cash used in financing activities | (335,297) | ||
Increase in cash and cash equivalents | 155,696 | (223,364) | |
Pollarix S. A. | |||
Summarized balance sheet | |||
Current assets | 10,280 | 6,717 | |
Current liabilities | 3,459 | 911 | |
Current net assets | 6,821 | 5,806 | |
Non-current assets | 91,702 | 110,246 | |
Non-current liabilities | 21,478 | 24,978 | |
Non-current net assets | 70,224 | 85,268 | |
Net assets | 77,045 | 91,074 | |
Accumulated non-controlling interest | 51,363 | 60,716 | |
Summarized income statement | |||
Net revenues | 11,916 | 11,512 | |
Net income for the year | 3,742 | 12,187 | |
Other comprehensive income (loss) for the year | (15,322) | 4,210 | |
Total comprehensive income (loss) for the year | (11,580) | 16,397 | |
Comprehensive income (loss) attributable to non- controlling interests | (7,724) | 10,931 | |
Dividends paid to non-controlling interests | 2,137 | ||
Summarized statement of cash flows | |||
Net cash provided by operating activities | 7,201 | 16,137 | |
Net cash used in investing activities | (762) | (80) | |
Net cash used in financing activities | (6,441) | (16,055) | |
Increase in cash and cash equivalents | $ (2) | $ 2 |
Net revenue (Details)
Net revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net revenue | |||
Gross revenues | $ 2,779,008 | $ 2,709,236 | $ 2,193,867 |
Revenues of products | 2,708,112 | 2,637,613 | 2,128,739 |
Revenues of services | 70,896 | 71,623 | 65,128 |
Taxes on sales | (284,316) | (257,347) | (227,344) |
Return on products sales | (3,490) | (2,405) | (1,682) |
Net revenue | 2,491,202 | 2,449,484 | 1,964,841 |
Brazil | |||
Net revenue | |||
Net revenue | 693,409 | 721,640 | 560,878 |
Peru | |||
Net revenue | |||
Net revenue | 674,228 | 696,527 | 573,884 |
Luxembourg | |||
Net revenue | |||
Net revenue | 172,791 | 130,723 | 100,631 |
United States | |||
Net revenue | |||
Net revenue | 141,131 | 158,060 | 156,634 |
Switzerland | |||
Net revenue | |||
Net revenue | 126,156 | 108,798 | 59,873 |
Japan | |||
Net revenue | |||
Net revenue | 93,474 | 69,565 | 36,005 |
Argentina | |||
Net revenue | |||
Net revenue | 90,338 | 79,463 | 45,050 |
South Korea | |||
Net revenue | |||
Net revenue | 54,894 | 7,064 | 66,887 |
Colombia | |||
Net revenue | |||
Net revenue | 51,724 | 47,734 | 39,137 |
Chile | |||
Net revenue | |||
Net revenue | 51,215 | 38,101 | 67,546 |
Turkey | |||
Net revenue | |||
Net revenue | 48,265 | 35,522 | 19,498 |
Austria | |||
Net revenue | |||
Net revenue | 40,531 | 37,270 | 22,982 |
Singapore | |||
Net revenue | |||
Net revenue | 37,506 | 60,857 | 42,666 |
Germany | |||
Net revenue | |||
Net revenue | 20,906 | 23,154 | 42,560 |
China | |||
Net revenue | |||
Net revenue | 9,538 | 18,172 | 12,838 |
Italy | |||
Net revenue | |||
Net revenue | 5,327 | 15,799 | 3,608 |
Other countries | |||
Net revenue | |||
Net revenue | 179,769 | 201,035 | 114,164 |
US Dollar | |||
Net revenue | |||
Net revenue | 1,806,590 | 1,729,234 | 1,414,992 |
BRL | |||
Net revenue | |||
Net revenue | $ 684,612 | 717,032 | 547,537 |
Other | |||
Net revenue | |||
Net revenue | $ 3,218 | $ 2,312 |
Expenses by nature (Details)
Expenses by nature (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)employee | Dec. 31, 2017USD ($)employee | Dec. 31, 2016USD ($)employee | |
Expenses by nature | |||
Raw materials and consumables used | $ 1,115,797 | $ 1,120,540 | $ 956,909 |
Employee benefit expenses | 262,964 | 279,371 | 234,205 |
Depreciation and amortization | 267,189 | 270,456 | 275,036 |
Services, miscellaneous | 349,091 | 220,535 | 122,557 |
Other expenses | 179,784 | 109,115 | 106,446 |
Total | $ 2,174,825 | $ 2,000,017 | $ 1,695,153 |
Average number of employees | employee | 6,159 | 5,643 | 5,561 |
Cost of sales | |||
Expenses by nature | |||
Raw materials and consumables used | $ 1,114,959 | ||
Employee benefit expenses | 159,329 | ||
Depreciation and amortization | 262,948 | ||
Services, miscellaneous | 231,501 | ||
Other expenses | 120,207 | ||
Total | 1,888,944 | ||
Selling, general and administrative | |||
Expenses by nature | |||
Raw materials and consumables used | 838 | ||
Employee benefit expenses | 91,000 | ||
Depreciation and amortization | 4,219 | ||
Services, miscellaneous | 34,211 | ||
Other expenses | 29,335 | ||
Total | 159,603 | ||
Mineral exploration and project development | |||
Expenses by nature | |||
Employee benefit expenses | 12,635 | ||
Depreciation and amortization | 22 | ||
Services, miscellaneous | 83,379 | ||
Other expenses | 30,242 | ||
Total | $ 126,278 |
Mineral exploration and proje_3
Mineral exploration and project development (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Mineral exploration and project development | |||
Mineral exploration | $ 83,182 | $ 76,161 | $ 33,547 |
Project development (FEL 1 and FEL 2) | 43,096 | 16,537 | 13,164 |
Mineral exploration and project development | 126,278 | $ 92,698 | $ 46,711 |
Expenses relating to brownfield mineral exploration | 41,502 | ||
Expenses relating to greenfield mineral exploration | 41,860 | ||
Expenses relating to greenfield project development | $ 16,960 |
Other income and expenses, ne_2
Other income and expenses, net (Details) R$ in Thousands, $ in Thousands | May 21, 2018BRL (R$) | May 21, 2018USD ($) | Oct. 31, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Other income and expenses, net | ||||||
Corporate projects | $ (13,445) | $ (12,947) | $ (7,675) | |||
Mining obligations | (12,637) | (11,498) | (8,967) | |||
Loss on sale of property, plant and equipment and intangible assets | (9,884) | (694) | (552) | |||
Provision for tax, labor, civil and environmental claims | (3,671) | 258 | (15,331) | |||
Impairment of property, plant, equipment | (3,283) | 979 | ||||
Gain on sale of investment | 348 | 4,588 | 408 | |||
Environmental and asset retirement obligations | 12,078 | 433 | (68,605) | |||
Commodities derivative financial instruments | 17,528 | (18,785) | (33,514) | |||
Tax credits | 37,582 | 57 | ||||
Other operating expenses, net | (6,440) | (9,299) | (6,462) | |||
Total other income and expenses, net | 18,176 | $ (47,887) | $ (139,719) | |||
Interest on tax credits | $ 26,033 | |||||
Fortaleza de Minas facility | ||||||
Other income and expenses, net | ||||||
Consideration for the sale of business | R$ 100 | $ 27 | ||||
Gain on sale of business | 3,394 | |||||
Loss on sale of property, plant and equipment and intangible assets | (9,615) | |||||
Environmental and asset retirement obligations | $ 13,009 | |||||
NEXA BR | ||||||
Other income and expenses, net | ||||||
Tax credits | $ 59,686 | |||||
Principal amount of tax credits | 33,653 | |||||
Interest on tax credits | $ 26,033 |
Net financial results (Details)
Net financial results (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Financial income | |||
Gains on financial investments | $ 26,062 | $ 21,388 | $ 12,032 |
Interest on tax credits - Note 25 | 26,033 | ||
Other financial income | 15,414 | 8,480 | 12,923 |
Total financial income | 67,509 | 29,868 | 24,955 |
Financial expenses | |||
Interest on loans and financing | (77,647) | (56,434) | (36,059) |
Interest on contractual liabilities | (7,294) | (8,184) | |
Monetary adjustment of provisions | (4,763) | (9,478) | (9,595) |
Derivative financial instruments - Note 6 (iii) | (2,538) | ||
Other financial expenses | (29,420) | (32,073) | (24,720) |
Total financial expenses | (121,662) | (106,169) | (70,374) |
Foreign exchange losses, net | (148,501) | (53,880) | 124,500 |
Net financial results | (202,654) | (130,181) | 79,081 |
Prepayment of loan by the related parties | $ 10,284 | ||
NEXA BR | |||
Financial expenses | |||
Prepayment of loan by the related parties | $ 600,000 | ||
Outstanding debt from related parties | $ 1,113,400 |
Long-term commitments (Details)
Long-term commitments (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Long-term commitments | |
Contracted capital commitments | $ 15,953 |
Forward purchase commitments | $ 33,395 |
Events after the reporting pe_2
Events after the reporting period (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 15, 2019 | Jan. 31, 2019 | Dec. 31, 2018 |
Dividend distribution | |||
Events after the reporting period | |||
Dividend distribution (per share) | $ 0.525494 | ||
Dividend distribution | $ 70,000 | ||
Peruvian income tax assessment | |||
Events after the reporting period | |||
Income tax calculation assessment | $ 37,809 | ||
Provision for tax | $ 0 |