Why did NEXA's Q3 2024 earnings exceed forecasts?

Nexa Resources SA (NEXA) reported a net income of $0.15 per share for the quarter ended June 30, 2024, which missed the Zacks Consensus Estimate of $0.18 per share. However, Nexa Resources SA (NEXA) reported a net income of $0.15 per share for the quarter ended June 30, 2024, which was a significant improvement from the previous quarter's loss of $0.77 per share and a year-over-year improvement from the previous year's loss of $0.04 per share.

The company's earnings exceeded forecasts due to strong revenue growth and improved operational performance. Here are the key points:

1. **Revenue Growth**: Nexa Resources SA (NEXA) reported a 27% increase in consolidated net revenues quarter over quarter, driven by higher LME prices and increased smelting sales volume. The company's net revenues increased to $736.3 million, surpassing the Zacks Consensus Estimate by 9.21%. This growth was primarily driven by higher LME metal prices in both cases, increased mining sales volume year-over-year, and increased smelting sales volume quarter-over-quarter.
2. **EBITDA Improvement**: The company's adjusted EBITDA reached $200 million, a 64% increase from the previous quarter and a 180% increase year over year. This was mainly due to higher sales volume, higher zinc prices, improved margins at Aripuanã, and higher by-products contribution.
3. **Cost Management**: The company's mining cash cost decreased to $0.03 per pound, down from $0.37 per pound year over year and $0.24 per pound quarter over quarter. This cost management, coupled with higher sales volumes and prices, contributed to the improved profitability.
4. **Leverage Reduction**: Nexa Resources SA (NEXA) reported a significant reduction in net leverage ratio, decreasing from 3.75 times in the previous quarter to 2.72 times in the current quarter. This leverage reduction is a result of the company's strategic portfolio optimization and disciplined capital allocation.

In conclusion, Nexa Resources SA (NEXA) reported a net income of $0.15 per share for the quarter ended June 30, 2024, which exceeded forecasts due to strong revenue growth, improved EBITDA, and cost management. These factors, coupled with a reduction in net leverage ratio, contributed to the company's improved financial performance.