Sumitomo Metal Mining : Supplementary Explanation for Financial Summary 1st Quarter FY2022

Supplementary Explanation

for Financial Summary

1st Quarter FY2022

【IFRS】

August 8th,2022

The materials provided herein are not intended as disclosure under the Securities Law, and no warranty is made as to their completeness or accuracy. Any projections included in these materials are based solely on information available at the time of this briefing, and are subject to change based on market conditions, competitive conditions, and a number of other factors. Therefore, we ask that you refrain from making any investment decisions based on these materials alone. The Company cannot be held responsible in any way for any losses that may occur as a result of the use of these materials.

All copyrights, trademarks, and intellectual property rights attaching to the materials herein are the sole property of Sumitomo Metal Mining Co., Ltd..

Comparison

FY2022/1Q Result vs FY2021/1Q Result

			JPY100M
	2022/1Q	2021/1Q	Diff.
	① Result	②Result	①-②
Net sales	3,577	2,943	+634
Gross profit	945	556	+389
Profit before tax	1,040	599	+441
Net income *1	765	431	+334
(Inventory evaluation P&L)	265	34	+231
(Other exchange gain / loss *2)	112	0	+112
Cu ($/t)	9,526	9,711	-185
Ni ($/lb)	13.17	7.87	+5.30
Au ($/toz)	1,873	1,815	+58
Co ($/lb)	37.84	20.67	+17.17
Exchange (/$)	129.58	109.50	+20.08
Exchange	22/6E	22/3E	21/12E	21/9E	21/6E
(/$)	136.64	122.41	115.01	111.95	110.61

【Diff of FY2022/1Q Result vs FY2021/1Q Result ① -②】

Profit before tax +441

Metal Price/Exchange +554（Metal Price +231（Cu +90, Ni +106, Co +35, Au +1, etc.）, Exchange +79, Inventory evaluation +244）, Quantity -40, Other exchange gain / loss +112, Cost@ -112, Material Business +29, Profit of Sierra Gorda (of FY2021) -29, Other/unrealized profit etc -73

New and Old Forecast of FY2022/1H and FY2022 (in Aug. vs in May)

								JPY100M
	FY2022	FY2022	FY2022	FY2022	Diff.	FY2022	FY2022	Diff.
	1Q	2Q	1H	1H
	Result	Forecast(in Aug.)	① Forecast(in Aug.)	②Forecast(in May)	①-②	③Forecast(in Aug.)	④Forecast(in May)	③-④
Net sales	3,577	3,313	6,890	6,590	+300	13,570	13,310	+260
Gross profit	945	655	1,600	1,120	+480		2,220
Profit before tax	1,040	450	1,490	940	+550	2,180	1,940	+240
Net income *1	765	265	1,030	680	+350	1,480	1,370	+110
(Inventory evaluation P&L)	265	116	381	17	+364		1
(Other exchange gain / loss *2)	112	-10	102	-24	+126		-24
Cu（＄/t）	9,526	7,000	8,263	9,000	-737	8,232	9,000	-769
Ni（＄/lb）	13.17	9.50	11.34	9.50	+1.84	10.42	9.50	+0.92
Au（＄/toz）	1,873	1,700	1,787	1,750	+37	1,743	1,750	-7
Co ($/lb)	37.84	25.00	31.42	30.00	+1.42	28.21	30.00	-1.79
Exchange (/$)	129.58	135.00	132.29	120.00	+12.29	131.15	120.00	+11.15
【Diff. of FY2022/1H Forecast in Aug. vs Forecast in May	①-②】
Profit before tax +550

Metal Price/Exchange +508（Metal Price +53（Cu +26, Ni +29, Co -8, Au +7, etc.）, Exchange +65,

Inventory evaluation +390）, Quantity -32, Other exchange gain / loss +126, Cost@ -86, Material Business +70, Other/unrealized profit etc -36

【Diff. of FY2022 Forecast in Aug. vs Forecast in May ③-④】

Profit before tax +240

Metal Price/Exchange +400（Metal Price -150、Exchange +160、Inventory evaluation +390）、Cost@ -210、 Quantity -40、 Material Business +20、Other ＋70

*1: Net income (loss)＝Profit (loss) attributable to owners of parent

*2: Other exchange gain / loss: Exchange gain or loss included in Finance income (or cost) and Other income (or expenses).

(1)

Metal price and Exchange rate

	Copper ($/t)	Copper (￠ /lb)	Nickel ($/lb)
	FY2020	FY2021	FY2022	FY2020	FY2021	FY2022	FY2020	FY2021	FY2022
Apr	5,048	9,336	10,183	229	423	462	5.33	7.48	15.10
May	5,234	10,184	9,363	237	462	425	5.50	7.99	12.68
Jun	5,742	9,612	9,033	260	436	410	5.76	8.14	11.72
1QAve.	5,341	9,711	9,526	242	440	432	5.53	7.87	13.17
Jul	6,354	9,434		288	428		6.05	8.54
Aug	6,497	9,357		295	424		6.57	8.69
Sep	6,712	9,324		304	423		6.74	8.80
2QAve.	6,521	9,372		296	425		6.45	8.68
Oct	6,703	9,779		304	444		6.90	8.81
Nov	7,063	9,765		320	443		7.16	9.06
Dec	7,755	9,550		352	433		7.62	9.10
3QAve.	7,174	9,698		325	440		7.23	8.99
Jan	7,971	9,776		362	443		8.10	10.13
Feb	8,460	9,941		384	451		8.42	10.97
Mar	9,005	10,238		408	464		7.47	14.45
4QAve.	8,479	9,985		385	453		8.00	11.85
FY Ave.	6,879	9,691		312	440		6.80	9.35
Jan-Dec Ave.	6,169	9,315		280	423		6.25	8.38
FY2022/2Q			7,000			318			9.50
(FCST. in Aug.)
FY2022/2H			8,200			372			9.50
(FCST. in Aug.)
FY2022			9,000			408			9.50
(FCST. in May)
	Cobalt ($/lb)(Standard-Low)	Gold (＄/toz)	Exchange （/US$)
	FY2020	FY2021	FY2022	FY2020	FY2021	FY2022	FY2020	FY2021	FY2022
Apr	15.55	21.48	39.40	1,681	1,760	1,934	107.96	109.15	125.98
May	14.91	20.03	39.42	1,716	1,850	1,850	107.35	109.20	128.82
Jun	14.45	20.50	34.70	1,733	1,835	1,835	107.56	110.14	133.93
1QAve.	14.97	20.67	37.84	1,710	1,815	1,873	107.62	109.50	129.58
Jul	13.82	24.20		1,842	1,807		106.84	110.31
Aug	14.97	23.97		1,970	1,784		106.05	109.85
Sep	15.36	24.40		1,923	1,779		105.77	110.18
2QAve.	14.72	24.19		1,912	1,790		106.22	110.11
Oct	15.56	26.50		1,901	1,776		105.27	113.12
Nov	15.51	29.13		1,866	1,820		104.42	114.15
Dec	15.45	32.79		1,855	1,788		103.85	113.89
3QAve.	15.50	29.47		1,874	1,795		104.51	113.72
Jan	17.31	34.01		1,868	1,817		103.70	114.86
Feb	22.38	34.70		1,811	1,857		105.38	115.23
Mar	24.17	37.84		1,720	1,948		108.64	118.54
4QAve.	21.29	35.51		1,800	1,874		105.91	116.21
FY Ave.	16.62	27.46		1,824	1,818		106.07	112.39
Jan-Dec Ave.	15.40	23.90		1,770	1,800		106.82	109.81
FY2022/2Q			25.00			1,700			135.00
(FCST. in Aug.)
FY2022/2H			25.00			1,700			130.00
(FCST. in Aug.)
FY2022			30.00			1,750			120.00
(FCST. in May)
LME Price		22/1Q		22/2Q(F)
E-Ni applied	Mar-May	14.08	Jun-Aug	10.24
Fe-Ni applied	Jan-Mar	11.85	Apr-Jun	13.17
Exchange		22/1Q		22/2Q(F)
E-Ni applied	Mar-May	124.45	Jun-Aug	134.64
Fe-Ni applied	Jan-Mar	116.21	Apr-Jun	129.58

(2)

Comparison

(2022/1Q Result vs 2021/1Q Result)

				JPY100M
Gross Profit
	2022/1Q	2021/1Q	Diff.
	①		②	①-②
Mineral Resources	250		228	+22
Smelting & Refining	634		250	+384
Materials	128		103	+25
Others	4		6	-2
Diff. Adjustment	-71		-31	-40
Gross Profit	945		556	+389

			JPY100M
Segment Profit (loss)
	2022/1Q	2021/1Q	Diff.
	③	④	③-④
Mineral Resources	345	336	+9
Smelting & Refining	564	227	+337
Materials	96	67	+29
Others	-9	0	-9
Diff. Adjustment	44	-31	+75
Profit before tax	1,040	599	+441

<>				JPY100M
1. Mineral Resources
	Diff.	Quantity	Price	Exchange	Cost@	Others
Hishikari (Au)	-12	-28	+2	+18	-3	-1
Morenci / NP (Cu)	+37	-2	+48	+15	-27	+3
Others	-3
Total	+22
Au Sales (t)	2022/1Q	2021/1Q	Diff.
Hishikari (Au)	1.4	1.9	-0.5

2．Smelting & Refining					JPY100M
	Diff.		Quantity	Price	Cost@	Inventory	Others
Copper	+137		-5	-5	-19	+139	+27
Nickel	+220		-13	+141	-54	+105	+41
Others*	+27					0	+27
Total	+384		-18	+136	-73	+244	+95

*Others consisits mainly the eliminations of transactions within the segment.

・Inventory evaluation P&L

	Total	Cu	Ni	Others
2022/1Q	278	168	112	-2
2021/1Q	34	29	7	-2

(3)

Comparison

(2022/1Q Result vs 2021/1Q Result) 3．Materials (Net sales)

			JPY100M
	2022/1Q	2021/1Q	Diff.
	①	②	①-②
Battery Materials (NCA, NMC, Nickel Hydroxide, etc.)	404	307	+97
Applied Powder Materials	124	126	-2
(Thick Film, Thin Film, Magnet, Alloy, Ink, etc. )
Package Materials (CuPI, PWB, etc.)	56	53	+3
Crystal Material, Construction Materials, Connector, Others	169	169	0
Total	753	655	+98

Equity in earnings of affiliated companies

				JPY100M
		2022/1Q	2021/1Q	Diff.
		①	②	①-②
	Cerro Verde	102	51	+51
	Candelaria/Ojos	24	8	+16
Cu	Sierra Gorda	-	29	-29
	Acids/Jinlong/MSMMBC	13	13	0
	Total	139	101	+38
Ni	Figesbal/NAC	3	3	0
	NECC/NK/MSZ/others	-19	0	-19
	Total	123	104	+19
Segment	Mineral Resources	105	95	+10
Smelting & Refining	17	17	0
	Materials/Others	1	-8	+9
	Total	123	104	+19

Sierra Gorda is excluded from 21/3Q

Main changes in financial income/cost and other income/cost

（amount displayed in profit and loss）	JPY100M
	2022/1Q	2021/1Q	Diff.
	①	②	①-②
Finance income/cost	227	-4	+231
(exchange gain/loss from valuation of financial assets and liabilities)
Other income/cost	-115	4	-119
(exchange gain/loss from settlement of other assets and liabilities)

(4)