넥사 리소시스(NEXA) 2026년 3분기 실적 발표 컨퍼런스 콜: EBITDA 3억 100만 달러 달성

핵심 요약

• 조정 EBITDA는 전분기 대비 5%, 전년 동기 대비 62% 증가한 3억 100만 달러를 기록하며 2026년 최고치를 달성했습니다. 조정 EBITDA 마진율은 32%였습니다.
• 순매출은 아연 가격 상승, 제련 판매 호조, 부산물 기여도의 전년 동기 대비 6,500만 달러 증가에 힘입어 2026년 2분기 대비 3%, 2025년 3분기 대비 23% 증가한 9억 3,700만 달러를 기록했습니다.
• 넥사는 주로 주이즈데포라 및 트레스마리아스 통합 시스템에 대한 1억 2,400만 달러의 비현금성 손상차손으로 인해 4,700만 달러의 순손실을 기록했습니다. 조정 순이익은 1억 4,400만 달러(주당 0.87달러)였습니다.
• 잉여현금흐름은 총 7,300만 달러를 기록했습니다. 순차입금 비율은 지난 6월 1.4배, 전년 동기 2.21배에서 1.24배로 하락했으며, 분기 말 기준 가용 유동성은 7억 3,500만 달러를 기록했습니다.
• 아리푸아낭 제련소 가동률은 평균 84%를 기록했으며 9월에는 90%에 달했습니다. 경영진은 2027년 1분기를 포함해 향후 수개월 내에 해당 사업장이 풀 가동 상태에 도달할 것으로 예상하고 있습니다.
• 넥사는 2026년 자본적 지출(CapEx) 가이던스를 10% 상향한 4억 2,000만 달러로 조정했으나, 연간 생산 및 판매 가이던스는 유지했습니다.

주요 재무 데이터

사업 및 영업 실적

광업 부문

아리푸아낭, 바잔치, 엘 포르베니르의 처리량 및 품위 향상에 힘입어 아연 생산량은 전분기 대비 7%, 전년 동기 대비 1% 증가한 8만 5,000톤을 기록했습니다. 광업 부문 순매출은 4억 5,400만 달러였으며, 조정 EBITDA는 전분기 대비 7%, 전년 동기 대비 44% 증가한 2억 3,600만 달러를 기록했습니다. 해당 부문 마진율은 52%에 달했습니다.

부산물 차감 후 광업 현금 원가는 파운드당 마이너스(-)0.64달러였습니다. 이러한 개선은 은, 동 및 기타 부산물의 기여도 확대와 아리푸아낭의 비용 절감 및 아연 판매량 증가를 반영합니다. 채굴 원가는 톤당 54달러로 전분기 대비 5% 감소했으나 전년 동기 대비 7% 증가했습니다.

아리푸아낭은 2분기 대비 18% 증가한 분기 최대 47만 1,000톤의 광석을 처리했습니다. 아연 생산량은 48% 증가한 1만 3,000톤을 기록했습니다. 4번째 광재 필터는 해당 분기 동안 여과된 광재의 61%를 처리하며 9월 제련소 가동률 90% 달성을 뒷받침했습니다.

세로 파스코에서는 1단계 토목 공사와 주요 설비 조립이 완료되었습니다. 시운전 전 단계 및 시운전 작업이 진행 중이며, 2026년 12월 기계적 완공을 목표로 하고 있습니다.

제련 부문

카하마르키야 제련소가 5월 화재 피해에서 회복되어 누적된 음극재 재고를 처리함에 따라 제련 생산량은 전분기 대비 28%, 전년 동기 대비 8% 증가한 15만 9,000톤을 기록했습니다. 판매량은 전분기 대비 9% 증가한 14만 6,000톤을 기록했으나 전년 동기 대비로는 2% 낮은 수준을 유지했습니다.

해당 부문은 6억 9,600만 달러의 매출과 6,500만 달러의 조정 EBITDA를 창출했습니다. EBITDA는 아연 가격 상승, 부산물 매출 및 실현 제련 수수료에 힘입어 전분기 대비 전반적으로 안정적인 수준을 유지했으며, 전년 동기 대비로는 약 3배 증가했습니다.

부산물 차감 후 제련 현금 원가는 아연 가격 상승으로 인한 정광 매입 비용 증가로 전분기 대비 15% 증가한 파운드당 1.65달러를 기록했습니다. 가공 원가는 파운드당 0.36달러였습니다.

경영진 가이던스

넥사는 모든 금속에 대한 2026년 생산 및 판매 가이던스를 유지했습니다. 경영진은 세로린도의 품위 하락으로 인해 구리 생산량이 가이던스 하단 근처에서 마감될 것으로 예상되지만, 4분기가 연중 가장 높은 생산량을 기록하는 분기가 될 것으로 전망하고 있습니다.

회사는 2026년 자본적 지출(CapEx) 가이던스를 10% 상향한 4억 2,000만 달러로 조정했습니다. 이러한 증액은 아리푸아낭 광산 개발 가속화, 세로 파스코 광재 처리 시설에 대한 조기 집행, 브라질 헤알화 강세를 반영합니다. 넥사는 첫 9개월 동안 수정된 예산의 약 65%에 해당하는 2억 7,200만 달러를 집행했습니다.

세로 파스코의 2026년 프로젝트 예산은 3,100만 달러에서 4,100만 달러로 늘어났습니다. 경영진은 2026년 12월 기계적 완공, 2027년 2분기 펌핑 시스템 운용 승인 획득, 2027년 3분기 초 펌핑 개시를 예상하고 있습니다.

아리푸아낭에서 경영진은 4분기 가동률 상승 및 회수율 개선을 기대하고 있습니다. 높은 처리량이 계획된 낮은 품위를 상쇄함에 따라 아연 생산량은 안정적으로 유지될 것으로 보입니다. 가속화된 광산 개발은 추가 채굴면을 확보하고 2027년 더 높은 처리량을 지원하기 위한 것입니다.

리스크 및 주요 점검 사항

• 장기 제련 수수료 가정치 하락과 브라질 헤알화 강세가 주이즈데포라 및 트레스마리아스의 1억 2,400만 달러 손상차손을 이끌었습니다. 중국의 현물 제련 수수료는 분기 말 톤당 마이너스(-)236달러를 기록해 제련소 마진에 대한 압박을 한층 부각했습니다.
• 아리푸아낭은 원격지라는 위치적 특성 때문에 높은 물류비, 인력 확보의 어려움, 높은 이직률에 지속적으로 직면하고 있습니다. 경영진은 비용 정상화가 점진적으로 이루어질 것이라고 밝혔습니다.
• 세로린도의 품위 하락과 3분기 광산 개발 제약으로 페루 지역 생산량이 감소했으나, 경영진은 4분기에 영업 실적이 강화될 것으로 예상하고 있습니다.
• 엘 포르베니르 및 아타코차에 대한 환경 인허가 변경 건은 여전히 SENACE 심사를 받고 있습니다. 승인은 각각 2027년 3월과 4월에 이루어질 것으로 예상됩니다.
• S&P는 넥사의 장기 신용등급 및 선순위 무보증 채권 등급을 BBB-에서 BB+로 하향 조정했으며, 등급 전망은 '안정적'으로 부여했습니다. 2028년 만기 채권에 대한 경영권 변동 조항은 볼리덴의 보토란팀 지배지분 인수가 완료될 때 적용될 것으로 예상됩니다.
• 볼리덴과의 거래는 여전히 통상적인 관례적 승인 절차를 거쳐야 하며, 경영진은 2027년 1분기에 거래가 종결될 것으로 예상하고 있습니다.

애널리스트 Q&A 하이라이트

경영진은 4번째 광재 필터에 힘입어 아리푸아낭이 향후 수개월 내에 풀 가동 상태에 달할 것이라고 설명했습니다. 높은 처리량은 고정비 흡수율을 개선할 것으로 기대되지만, 물류비와 인력 이직률로 인해 단위당 원가 개선에는 시간이 걸릴 것으로 보입니다. 경영진은 해당 사업장의 원가 구조가 2027년 말까지 바잔치의 수준에 가까워질 것으로 예상합니다.

세로 파스코와 관련해 경영진은 현재 중대한 건설이나 가동 위험은 없다고 밝혔습니다. 기존 광재 용량이 새 펌핑 시스템으로 전환되는 동안 완충 역할을 제공하며, 시운전은 기계적 완공 이후 시작될 예정입니다.

페루 지역 사업과 관련해 경영진은 3분기 생산량 부진의 원인을 세로린도의 계획된 품위 하락 및 일시적인 광산 개발 제약 때문으로 돌렸습니다. 경영진은 4분기에 세로린도와 세로 파스코 모두에서 생산량이 늘어나 연간 생산 전망치를 변경 없이 유지할 수 있을 것으로 기대하고 있습니다.

실적 발표 컨퍼런스 콜 전문

전체 실적 발표 컨퍼런스 콜 녹취록

경영진 발표

Operator

Good morning, ladies and gentlemen, and welcome to Nexa Resources Third Quarter 2026 Earnings Conference Call. Please note that today's event is being recorded and broadcast live via Zoom with access also through Nexa's Investor Relations website. A slide presentation accompanying the webcast is available for download as well as a replay of the conference call, following its conclusion. [Operator Instructions]

Now I would like to turn the conference over to Mr. Rodrigo Cammarosano, Head of Investor Relations and Treasury, for his opening remarks. Please go ahead.

Rodrigo Cammarosano

Good morning, everyone, and welcome to Nexa Resources Third Quarter 2026 Earnings Call. Thank you for joining us. Today, we will walk through the results we released yesterday. The presentation is available through the webcast, if you would like to follow along. Before we begin, please take a moment to look at Slide number 2, which contains our forward-looking statements disclaimer. We encourage you to review it along with the related risk factors.

Here with me today are Ignacio Rosado, our CEO; Jose Carlos del Valle, our CFO; and Leonardo Coelho, our Senior Vice President of Mining Operations.

Ignacio, over to you.

Ignacio Rosado

Thank you, Rodrigo, and good morning, everyone. Let me start on Slide number 3. The third quarter marked another step forward for Nexa. Adjusted EBITDA reached $301 million, our highest of the year, up 62% from a year ago and 5% from the second quarter with a 32% margin. We generated $73 million in free cash flow and net leverage decreased to 1.2x, down from 1.4x in June and 2.2x a year ago. On the bottom line, we reported a net loss of $47 million, mainly due to a $124 million noncash impairment of our Juiz de Fora and Tres Marias system units in Brazil. It has no impact on cash, and Jose Carlos will provide you with more details in a few minutes.

So what drove the quarter? Three things. First, higher zinc prices and compared with last year, a much stronger by-product contribution, especially from silver and copper. Second, our Peruvian operations continue to normalize and Aripuana stepped up with the fourth tailing filter operating as expected. And third, Cajamarquilla operated normally throughout the quarter after the May fire and sales volumes recovered.

In mining, zinc production reached 85,000 tonnes, up 7% from the second quarter, driven mainly by Aripuana. In smelting, production jumped 28% to 159,000 tonnes as Cajamarquilla processed most of the cathode inventory buildup after the fire. Sales grew 9% to 146,000 tonnes, and slower than production as part of the output was allocated to fourth quarter sales.

Looking ahead, 3 factors support the fourth quarter. At Aripuana, plant utilization averaged 84% for the quarter and reached 90% in September. We expect utilization to continue to improve in the next quarter. In smelting, the metal inventory at Cajamarquilla position us to meet seasonally stronger demand in the fourth quarter. And at Cerro Pasco, the integration project is on track for mechanical completion in December.

On guidance, we raised our 2026 CapEx to $420 million, mainly to advance mine development at Aripuana, bring forward investments at Cerro Pasco and reflect the stronger Brazilian real. We also updated our cost guidance to reflect higher metal prices and a stronger real. Our production and sales guidance for the year remains unchanged.

Now let's move to Slide number 4 for a closer look at mining. Zinc production rose 7% from the second quarter to 85,000 tonnes on higher throughput and grades. Aripuana, Vazante and El Porvenir drove the increase with higher zinc production. Compared with last year, production was up 1%. Our production guidance for all metals remains unchanged, and we expect the fourth quarter to be our stronger quarter of the year. For copper, given the lower grades at Cerro Lindo, we expect to finish at the lower end of the range.

On costs, cash cost net of by-products was negative $0.64 per pound, better than both the second quarter and last year versus the second quarter, which reflects mark-to-market adjustments on lead and copper concentrates, lower costs and higher zinc sales at Aripuana. The year-over-year change is mainly driven by a stronger by-product contribution. We lowered our 2026 cash cost guidance, reflecting much higher by-product prices. So far this year, we are negative at $0.45 per pound towards the lower end of the new range. Cost per tonne of run-of-mine was $54, down 5% from the second quarter and up 7% from last year.

We adjusted the guidance mainly due to the stronger Brazilian real and higher costs at Aripuana. For the first 9 months, we are at $55.07 near the top of the range, and we expect this to improve in the fourth quarter with higher volumes. Financially, mining had a stronger quarter. Net revenues were $454 million and adjusted EBITDA was $236 million, up 7% from the second quarter and 44% year-over-year. Margin reached 52%, up 10 points from the second quarter.

Now let's move to Aripuana on Slide number 5. Aripuana had a very good quarter. Treated ore reached a record 471,000 tonnes, up 18% from the second quarter and zinc production rose 48% to 13,000 tonnes, matching its best quarter, driven by higher throughput and better grades. The fourth filter is performing well. It handled 61% of all the tailings filter in the quarter. Plant utilization averaged 84%, up from 71% in the second quarter and reached 90% in September. For the fourth quarter, we expect higher utilization and improved recoveries. Zinc production should remain stable as higher throughput offset lower grades in the mine plan. We are also accelerating mine development at Aripuana to open more mining fronts and support higher throughput in 2027.

Now to Cerro Pasco on Slide number 6. At Cerro Pasco, Phase 1 construction is advancing as planned. During the quarter, we completed all civil works, the major equipment assembly, the access road and the raise of the Atacocha Dam. Pre-commissioning and commissioning are already underway. We expect mechanical completion in December, followed by commissioning activities in the first quarter of 2027. The operating authorization for the pumping system is expected in the second quarter, and we expect to start pumping in the early third quarter of 2027, as planned.

On permitting, the Environmental Impact Study Modifications for El Porvenir and Atacocha are still under review by SENACE, and we now expect approvals in March and April 2027. On CapEx, we invested $15 million in the quarter and $31 million so far this year. We raised the project's 2026 budget to $41 million, up from $31 million as we bring forward investments.

Now let's move to smelting on the Slide number 7. In smelting, production reached 159,000 tonnes, up 28% from the second quarter and 8% from last year, driven by the recovery at Cajamarquilla and the processing of the cathode inventory buildup after the fire. Sales were 146,000 tonnes, up 9% from the second quarter. Compared with last year, sales were down 2%. The inventory we built up Cajamarquilla, together with seasonally stronger demand in the fourth quarter, supports our [indiscernible] full year sales guidance. [Technical Difficulty] important, sulfuric sales rose 18% from the second quarter to 178,000 tonnes and silver and copper cement sales were both up 14%.

On costs, cash cost net of by-products was $1.65 per pound, up 15% from the second quarter as higher zinc prices raised the cost of the concentrate we purchased. We raised the guidance range considering higher zinc prices and a strong real, partially offset by higher by-product prices. For the 9 months, we are at $1.50 per pound within the new range. Conversion cost was $0.36 per pound in the quarter and $0.35 per pound for the first 9 months. We adjusted the guidance mainly for currency and higher fixed costs. Higher volumes in the fourth quarter should dilute fixed costs and keep us within the new range.

Financially, the segment generated net revenues of $696 million and adjusted EBITDA of $65 million, which was broadly stable for the second quarter and nearly 3x higher than a year ago. The year-over-year improvement was mainly driven by by-products, higher zinc prices and higher realized treatment charges. The EBITDA margin was 9%.

With that, I will hand it over to Jose Carlos, our CFO, for the financial.

José Carlos del Valle Castro

Thank you, Ignacio, and good morning, everyone. Let's go to Slide number 8. Net revenues totaled $937 million, up 3% from the second quarter and 23% from the same period last year. Versus the second quarter, the increase came from higher smelting sales and higher zinc and copper prices, partly offset by lower silver prices and lower mining sales volumes versus last year, the improvement came from higher zinc prices and from a $65 million higher by-product contribution.

Adjusted EBITDA was $301 million, up 5% from the second quarter with a 32% margin. Higher zinc prices, the recovery in smelting sales and stronger by-products more than offset higher raw material costs that resulted from a larger share of third-party concentrates in our smelter feed as well as lower cash dividend for Enercan. Versus last year, quarterly adjusted EBITDA was up 62% as higher zinc prices and by-products more than offset higher operating costs, a stronger Brazilian real and lower smelting sales.

At the bottom line, we reported a net loss of $47 million or $0.47 per share. The main driver was a $124 million noncash impairment related to our combined Juiz de Fora and Tres Marias system. It mainly reflects lower long-term treatment charge assumptions in a tighter concentrate market as well as a stronger Brazilian real, which more than offset the benefit of higher long-term metal price assumptions. It has no cash impact and is excluded from adjusted EBITDA. Excluding this and other items, adjusted net income was $144 million and adjusted earnings per share was -- were $0.87.

Let's move to investments on Slide number 9. We raised our 2026 CapEx guidance by 10% to $420 million. There are 3 drivers: higher mine development at Aripuana; higher investment in tailings facilities as we bring forward investments at Cerro Pasco that were originally planned for 2027; and the stronger Brazilian real. We invested $111 million in the quarter and $272 million so far this year, about 65% of the new guidance. So we expect that spending will increase in the fourth quarter in line with prior years. In exploration and project evaluation, we invested $21 million in the quarter, up 24% from the second quarter with a faster pace of drilling. We are at about 62% of our full year budget of $86 million, which remains unchanged.

Now to cash flow on Slide number 10. Operating cash flow before working capital was $306 million, up 7% from the second quarter and up 50% from last year. Working capital and other variations consumed $58 million, primarily reflecting inventory buildup. This included zinc metal inventories at Cajamarquilla to support fourth quarter sales as well as higher zinc concentrate inventories as part of our El Nino preparedness strategy. We expect that metal inventory at Cajamarquilla to unwind with fourth quarter sales.

This line also includes a $16.7 million payment to SUNAT made in August related to tax contingencies for fiscal years 2016 and 2017 under the Cerro Lindo's Tax Stability Agreement. No further installments remain for those years. This payment preserves our right for the admissibility of our appeal before the tax court and does not represent acceptance of SUNAT's position.

Furthermore, we continue to believe that our technical and legal position provides a strong basis for the future recovery of these amounts. After the $63 million in interest and taxes and the $112 million in CapEx, free cash flow was $73 million. As a reminder, free cash flow is defined as net operating cash flow minus CapEx.

On the capital structure side, debt and lease payments net totaled $25 million. Other cash components are dividends to minority shareholders and the $17.5 million share premium reimbursement net of the dividend received from Enercan, which totaled $23 million. Overall, cash and cash equivalents increased by $25 million to $405 million at the end of the quarter.

Let's move to Slide number 11 to talk about liquidity, indebtedness and credit rating. Our liquidity position remains solid. We ended the quarter with $735 million available, including our undrawn $320 million revolving credit facility. Our debt profile is long dated. Only 8% of our debt or $136 million matures through the end of 2027, and the average maturity is 6.8 years at an average cost of 6.7% Net leverage continued to come down to 1.24x from 1.4x in June and from 2.21x a year ago, driven by last 12 months adjusted EBITDA of almost $1.2 billion.

On credit ratings, in August, Fitch placed our BBB- rating on rating watch negative after the Boliden transaction announcement, citing limited visibility on our ties with the future controlling shareholder. Earlier this week, S&P lowered Nexa's long-term issuer and senior unsecured notes rating to BB+ from BBB-, removing them from CreditWatch Negative where they had been placed in July 2026. At the same time, it assigned a stable outlook and affirmed its A3 short-term issuer credit rating.

According to S&P, the downgrade reflects its view that although Nexa will remain a strategically important subsidiary of Boliden, the proceed support level is one category lower than what it was with Votorantim. As a result, the change of control provisions of the 2028 notes will become applicable upon closing of the transaction. On the other hand, change of control provisions under the 2034 and the 2037 notes will only become applicable if another downgrade takes place. Going forward, our priorities remain the same: free cash flow generation; disciplined capital allocation; and gross debt reduction.

With that, I'll hand it back to Rodrigo for an overview of market fundamentals.

Rodrigo Cammarosano

Thank you, Jose Carlos. Let's turn to markets, starting with zinc and copper on Slide number 12. Zinc prices reached their highest level since 2022, driven primarily by a deepening shortage of concentrate. The LME zinc price averaged $3,825 per tonne in the quarter, 35% higher than a year ago. For smelters, however, margins remain under pressure. Spot treatment charges in China ended the quarter at negative $236 per tonne, more than double the negative level in June. What cushions that pressure is by-products, especially sulfuric acid and silver, and that is where we are well positioned as a net producer of sulfuric acid with significant silver production.

Refined metal inventories also play an important role in the current price environment. Combined LME and Shanghai exchange inventories cover only about 1 week of global consumption. As a result, we expect tight fundamentals to continue supporting zinc prices, while treatment charges remain under pressure through the year-end. In copper, the LME price averaged $14,104 per tonne, up 44% from a year ago and hit a record in September, supported by tight supplies and U.S. stockpiling ahead of a tariff decision. The key near-term uncertainty is the Section 232 decision, but demand should remain structurally strong, driven by power grids, renewables, energy storage and AI-related infrastructure.

Now let's turn to Slide number 13 for a look at precious metals. Silver averaged $62.6 per ounce in the third quarter, up 59% from a year ago, but down 14% from the second quarter. After closing June at $58.8 per ounce, it recovered and held around $65 per ounce from August onwards despite rate hikes in September by the Fed, the European Central Bank and the Bank of Japan. Looking ahead, higher real rates and stronger U.S. dollar could weigh on silver, while demand from solar, electrification and AI should remain supportive. This matters for us, with 10 million to 11 million ounces expected this year, Nexa is a significant silver producer.

Gold prices averaged $4,262 per ounce, up 23% from a year ago and about 5% below the second quarter. Investment demand, central bank buying and geopolitical uncertainty continue to support prices, while higher bond yields raised the relative cost of holding gold. Together, silver and gold by-product credits keep lowering unit cash cost at our polymetallic operations.

Finally, on Slide 14, a few takeaways from the LME week in London earlier this month. The macro backdrop was a constant theme with persistent inflation, geopolitical tensions and tariffs contributing to a more cautious market sentiment. Even so, sentiment on base metals remain constructive, particularly for copper and zinc. Copper captured the headlines, but zinc drew a lot of attention and there was broad consensus that its fundamentals are supportive and should stay that way for longer. Why? First, supply. The concentrate market is tight. Major producers are facing lower ore grades. Some polymetallic miners are prioritizing copper production, disruptions continue, and there is limited new supply coming. Demand is modest, but it is backed by infrastructure investment and to a lesser extent, the energy transition.

Second, treatment charges. With concentrate this tight, the market expects the 2027 benchmark to settle below this year's $85 per tonne. Third, and this was the standout topic, by-product. Sulfuric acid is at multiyear high and together with silver, it has become a key part of smelter margins. The smelters with recovery capabilities are the ones best placed to absorb lower treatment charge. And with refined inventories at low levels, further smelting production cuts may become increasingly likely, creating upside risk for premiums and leading to a more frequent arbitrage opportunities.

On Slide 15, you can see what we will be watching more closely and where Nexa stands. On treatment charges, lower levels pressure smelters, but benefit our mines. So our integration helps offset the impact. On by-products, our recovery capabilities, especially in sulfuric acid, allows us to capture that value. On prices, zinc is holding above roughly $3,700 per tonne, supported by tight concentrate and low stocks.

On supply, older mines are declining and new supply seems limited, while Aripuana is adding more concentrate to our own system. And on trade, the volatile geopolitical landscape reinforces our strategic position as a leading zinc producer in the Americas. In short, a tight concentrate market support our mines and by-products support our smelters. That's where our integrated model pays off.

Now let's move to our ESG agenda on Slide 16. We continue to advance our ESG priorities in the quarter. On safety, our recordable injury frequency rate improved to 1.34 from 1.50 a year ago. While this is an important improvement, we remain vigilant. Year-to-date, we are still above last year's level. So we are reinforcing controls on critical risks, including fatigue monitoring at the Cerro de Pasco complex and the Line of Fire campaign at El Porvenir and Atacocha.

In our communities in Peru, we continued our health campaigns and higher education scholarships and launched a new community contact channel. On circular economy, we are advancing new uses for jarosite, Waelz aggregate and pyrite and the fourth filter's expanded dry stacking tailings capacity at Aripuana. On climate, we are closely monitoring El Nino. There was no impact in the quarter. And with the support of a specialized consultancy, we have reviewed our preparedness plans. In Peru, we are building inventories of critical materials and reinforcing drainage and geotechnical inspections. In Brazil, we are focused on water management and wildfire prevention.

With that, I will hand it back to Ignacio for the closing remarks.

Ignacio Rosado

Thank you, Rodrigo. Before we open for questions, let me close on Slide number 17 with our priorities. First, the transaction. In August, Votorantim signed a definite agreement to sell its controlling stake in Nexa to Boliden. We continue to work constructively with all parties towards closing, which is expected in the first quarter of 2027, subject to customary approvals. Until then, Nexa continues to operate as an independent company and our strategy, capital allocation priorities and commitments to our stakeholders are unchanged.

Second, Aripuana. With the plant at 90% utilization in September and mine development accelerating, we are preparing the operation to support higher throughput in 2027. Aripuana is one of the key pillars of our long-term cash generation. Third, Cerro Pasco. Phase 1 is on track for mechanical completion in December with pumping expected to start in the early third quarter of 2027. This is a high potential polymetallic district and the project strengthens our integrated position in the district.

Fourth, exploration. We have completed about 2/3 of this year's drilling program, which is focused on extending the life of our mines. Underpinning all of this are the same priorities, operating safely, generating free cash flow, allocating capital with discipline and reducing gross debt, always with a view to creating long-term value for our shareholders and the communities where we operate. We are entering the last quarter of the year with stronger operations, a healthier balance sheet and a clear set of priorities.

With that, let's open the line for questions.

Operator

[Operator Instructions] The first question comes from Pedro Mello with Citi.

질의응답

Pedro Macedo Ferreira de Mello

First, congratulations on the strong results and on stabilizing the savings future at Aripuana, which helped plant utilization reached 90% in September. So how should we think about the quarter-over-quarter ramp-up pace going forward, supported by the additional mine development CapEx? And how should we expect the asset cost roll and unit cash cost to evolve as higher processing volumes due to fixed costs? And second, regarding the Cerro Pasco Project Integration, you raised the CapEx guidance to $41 million and maintained the target for mechanical completion by this year-end. But could you provide your view as the key operational or risks to starting up savings into next year? So if you, please?

Ignacio Rosado

So good questions. Thank you very much. I will start with Cerro Pasco. As we said, the pumping system is already finishing now in December, and the ramp-up is going to be starting in January. We don't see any risks here because we have been following construction very closely. And we have some months in our current tailings dam also that is a cushion for the overlap of the new system. So we don't see any risks here. And as we said in the presentation, permits are also on time, and we don't expect any negative news on permits. So Cerro Pasco is going really well.

And for us, is -- this is the first phase. This is an operational phase that brings, I would say, stability to El Porvenir in terms of still producing and having a new tailings dam that is the Atacocha tailings dam. For us, what is more important in Cerro Pasco is the future, which is all the mineral that we are finding, how are we going to accommodate it in the next phases. And this is things that are coming in '27 and '28, okay? So Pasco is something that is going really well, and we have recovered from the previous 3 years and it's going to be strong in 2027.

Regarding Aripuana, as you said, we are at 90% capacity today, very important because the fourth filter is performing really well. It's an automated filter. It's a different technology and has been built in a very efficient and specific way. With this filter and the ones that we had before, we expect to have to deliver 100% of capacity in the coming months. If you remember, the summer that is a rainy season was a difficult season for us. But given the capacity of the filter and the filtration we get from the tailings, we don't expect any impact on production. So coming months, first quarter, we're going to be at full capacity.

Cost is still a tricky one because some of the problems that we face is that this operation is far away from any other city and the costs related to bringing all these materials to the operation are high -- higher. And then finding the right people to work in Aripuana is key for us and the rotation is high. So it's a process for us, and that's why costs have been higher. Having said that, with the full throughput and the measures we are taking to mitigate all these things that are affecting cost, we are expecting to start reducing the cost in the third quarter and in the next year. This operation towards the end of next year should be similar to the other Brazilian operations to Vazante, but it's going to be a process for us.

So having said that as well, if you see this -- all this operating performance of Aripuana, Aripuana is now a mine. It's -- if you see any KPI of mine development, of the plant, of recoveries, of quality of concentrate, of quality of tailings, is really, really getting there. And it's been a process. It's been a very difficult process, but now we are starting to have a normal mine. Now we are working on profitability, on reducing the costs, and we are on the right track to do that. And again, with all the potential that Aripuana has, we believe that in the next 2, 3 years, Aripuana is going to bring a lot of profitability. So it's a solid advance that we have, and we're going to -- we are expecting this solid profitability in the next 3 years.

Operator

[Operator Instructions] Now I would like to turn the call over to the company for the reading questions. Please go ahead.

Rodrigo Cammarosano

Thank you, operator. We have one question from the audience. It comes from Alex Emery from S&P Global. So the question is production of most metals was down year-over-year at Nexa Peruvian operations. So apart from lower grades at Cerro Lindo, were there other factors that constrained output in Q3 and the company expects operations to return to normal levels in Q4?

Ignacio Rosado

Yes. Thank you for the question again. Yes, Cerro Lindo is having lower grades, and this is expected in the life-of-mine plan and in the reserves. And specifically in the third quarter, we have some development problems that reduce a little bit the tonnage that we extract from the mines. This is not going to be the case in the fourth quarter. Fourth quarter is going to be a strong quarter. And this combined with a stronger quarter also in Cerro Pasco, we believe that we are going to be right on track on the projections that we have. And that's why we convey the message that the fourth quarter in the Peruvian mines and in the Brazilian mines are going to be much stronger.

Operator

This concludes our question-and-answer session. I would now like to hand the call over to Mr. Ignacio Rosado for his closing remarks. Mr. Rosado, please go ahead.

Ignacio Rosado

Again, thank you all for attending the call. This has been still a very challenging quarter, but we have been delivering as expected. As we said before, the fourth quarter is going to be a stronger one. That combined with the current prices, we believe that our cash flow generation is going to be also in the projections very strong.

I would like to comment also that we are starting to interact in general terms with the senior management of Boliden. We know them very well. They are very senior and very talented. And this closing process is going as expected. We believe it's going to close in the first quarter of next year. And we are looking forward to start interacting with them more and we -- to start integrating with this know-how of them, our know-how and all of these quality teams altogether working for the benefit of Boliden and Nexa as well.

So thank you very much. Thank you. We will speak in the first half of next year regarding our closing results for the year. Have a good day.

Operator

Thank you. This concludes today's conference call. We appreciate your participation and interest in Nexa. You may now disconnect.