KGHM Q1’26 Results wrap & Model update

Research evidence excerpt

KGHM Q1’26 Results wrap & Model update

Anna Antonova, CFA AC CEEMEA Equity Research

(971) 4428-1766 09 June 2026 J P M O R G A N

anna.antonova@jpmorgan.com

Investment Thesis, Valuation and Risks

KGHM (Neutral; Price Target: zl355.00)

Investment Thesis

KGHM has a structurally more challenged position vs peers (incl. production growth and

unit cost profile) and there is currently a lack of visibility on medium-term capital allocation

targets, as well as the company’s future development prospects. While we acknowledge a

compelling long-term outlook for global copper miners such as KGHM, in the short term

we see mounting risks to earnings from a more muted commodity price backdrop and

accelerating cost inflation (incl. FX headwinds). We thus rate KGHM as Neutral.

Valuation

Our end-Dec’27 price target is calculated by applying a long-term average 4.5x as a target

EV/EBITDA multiple to 2027E EBITDA, based on JPM EMEA Metals & Mining

commodity prices and FX forecasts.

Risks to Rating and Price Target

Risks to our Neutral rating and price target include:

• Commodity prices. KGHM’s earnings and cash flows are highly sensitive to

commodity prices, mainly copper, silver and gold. If metal prices over- or underperform

JPM’s base case forecasts, this could materially negatively affect KGHM’s earnings,

cash flows and dividend outlook and thus share price performance.

• FX. We estimate that the majority of KGHM Group’s revenues are linked to US$, while

>60% of production costs are denominated in PLN. Thus, a stronger/weaker PLN would

be negative/positive for group earnings, cash flow and margins.

• Operations. KGHM operates various mines and metals processing facilities. In the

event of mine disruptions/stoppages/damage, financial results may differ significantly

from our forecasts.