* No dividend payments yet, company seeks to cut debt
* Cash costs among lowest in industry
* Expect full production around 300,000 tonnes in 2018 (Adds quotes, detail)
By Barbara Lewis
LONDON, Aug 17 (Reuters) - Kaz Minerals, a copper company focused on Kazakhstan, narrowed its full-year production guidance on Thursday to 235,000-260,000 tonnes after first-half output more than doubled, boosted by a market hitting multi-year highs.
Copper prices have reached their strongest since late 2014, as expectations mount demand will outstrip supply following a period of under-investment and that technology, such as electric vehicles, will increase use.
Kaz Minerals, which is ramping up two new major copper projects Bozshakol and Aktogay in Kazakhstan, has seen its share price double this year.
First-half operating profit was $291 million, compared with $68 million in the same period a year ago and previous full-year output guidance was 225,000-260,000 tonnes. First-half output was 118,000 tonnes.
Kaz Minerals expects output to reach around 300,000 tonnes in 2018, Chief Financial Officer Andrew Southam said in a telephone call.
The mines are open pit, which means they are cheaper to run than deep underground extraction and Kaz Minerals says its operating costs of 64 U.S. cents per pound are among the lowest in the world.
Kaz Minerals still has relatively high net debt at 2.9 times EBITDA (earnings before interest, tax, depreciation and amortisation), a ratio closely watched in the capital-intensive mining industry.
Major miners have achieved ratios of 1 or less as they recover from the commodities slump of 2015-16.
Kaz Minerals, which last paid a dividend in 2013, said it would not declare an interim dividend as it had invested heavily in new output and strove to cut debt, but intended to resume dividend payments in future.
China, the world’s biggest commodity consumer, is its main market and the China Development Bank is among its investors.
But it says it is being approached by new clients in both China and Europe as smelters seek to lock in supplies.
“We have an increasing number of options as to whom we can sell our metal and increased interest in long-term supply contracts,” Southam said.
After doubling so far this year, Kaz Minerals’ share price was around flat by 0924 GMT, but analysts said the results had beaten expectations.
Citibank, which rates Kaz Minerals “buy”, said in a note the results should reassure investors about the group’s “ability to deliver and de-lever”. (additional reporting by Sanjeeban Sarkar in Bengaluru; Editing by Edmund Blair and Susan Thomas)