In 2014 payable copper production was similar to the level achieved in 2013 and amounted to 663 thousand tonnes. Metallic silver production increased by 8 percent and amounted to 1 256 tonnes. Production of precious metals, such as gold, palladium and platinum amounted to 152.9 thousand troy ounces, or an increase of 15 percent. The KGHM Group ended 2014 with a net profit of PLN 2.45 billion.

"The low commodity prices, especially of copper and silver, had the greatest impact on the year-on-year change in our results. The price of silver fell by almost 20 percent and copper by more than 6 percent versus 2013. The minerals extraction tax, which amounted to PLN 1.5 billion and accounted for 12 percent of our operating costs, had a significant impact on KGHM's results. The net profit achieved in such conditions is the result of stable production and continued cost discipline," says Jarosław Romanowski, First Vice President of the Management Board and CFO.

One of the most important events in 2014 was the start of production at the Sierra Gorda mine in Chile.

"Completion of this project is the best testimony of the competence of KGHM and allowed us to join the ranks of the largest copper producers in the world. By commissioning production at Sierra Gorda, KGHM has not only increased its production of copper, but has also enhanced its cost efficiency and expanded its products portfolio," says Herbert Wirth, President of the Management Board and CFO of KGHM.

We will reach target phase I production capacity at Sierra Gorda as planned by mid-year. There is also substantial exploration potential in adjacent areas. Initial estimates indicate significant potential to increase mine life.

Stable production by the operations in Poland is ensured by the start of production in 2014 from the area of Deep Głogów at a depth below 1 200 meters as well as intensive work aimed at increasing the resource base.

"We have obtained rights to new concessions in areas adjacent to our current operating sites. As a result of exploration work we documented resources of 4.1 million tonnes of copper and about 7.5 thousand tonnes of silver in the region of Gaworzyce-Radwanice. As a consequence, the life of our deposits in Poland is currently estimated at 30-40 years. We want to replace every tonne of extracted copper with three tonnes of the metal in newly-documented resources," explains Maciej Koński, Executive Director of the Business Development Center.

KGHM accomplished the main goals of the strategy for the years 2009-2018 ahead of plan, expanding the resource base and increasing copper production to 700 thousand tonnes. At the beginning of 2015 we adopted a Strategy for the years 2015-2020 with an outlook to 2040. The main objective of the new strategic outlook is to achieve annual production capacity of over 1 million tonnes of copper equivalent and to continue work aimed at improving mine operating efficiency.

"According to the strategy, over the next six years we intend to carry out the largest investment program in the history of KGHM amounting to PLN 27 billion. A significant portion of these funds, 65%, will be allocated to development-related investments, with the rest to be spent on maintenance and replacement projects. Achievement of our strategic goals will be based on efficiency and innovation, which already distinguish KGHM and will become our competitive advantage in the future,"  says Herbert Wirth, President of the Management Board and CFO of KGHM.

The development of new projects will be possible thanks to the financing we secured in 2014 for the Group's investment program. arranged syndicated credit in the amount of USD 2.5 billion and an investment loan with the European Investment Bank in the amount of PLN 2 billion.

"The funds will allow us to carry out future projects and to develop KGHM in subsequent years. At the same time we plan to continue a policy of sustainable financing, using internal sources supplemented with debt to maintain the net debt to EBITDA ratio at a safe level," - says Jarosław Romanowski, First Vice President of the Management Board and CFO.

The following goals and priorities have been set for 2015:

• Maintaining a stable level of electrolytic copper production;
• Achieving full phase I production capacity at the Sierra Gorda mine (daily processing of 110 thousand tonnes of ore) and commencing molybdenum production;
• Maintaining the rate of progress in the Victoria and Ajax projects;
• Continuing work related to expansion of the Żelazny Most tailings storage facility;
• Continuing investment work aimed at creating modern and environmentally-friendly smelting and refining activities.

Taking into consideration the adopted Dividend Policy and the assumptions and goals of the Company's Strategy, including necessary expenditures by the Group to accomplish its development program while maintaining a safe level of debt, the Management Board of KGHM proposes payment of a dividend in the amount of PLN 800 million (PLN 4.00 per share), representing 33% of net profit earned in 2014.

Today, KGHM is a global corporation, showing respect for the public good and ethical and environmental issues, in accordance with the common values of the Group, which are  zero harm, teamwork, orientation on results, accountability and courage. Regardless of where its operations are located, KGHM acts in compliance with the same, high standards. We are a reliable producer, a trustworthy client, a stable employer and a corporation committed to pursuing a responsible policy of sustainable development.

Communications and CSR Department