10-K/APeriod: FY2001

SOUTHERN COPPER CORP/ Annual Report (Amendment), Year Ended Dec 31, 2001

Filed April 30, 2002For Securities:SCCO

Summary

This 10-K/A filing from Southern Peru Copper Corporation (SCCO) for the fiscal year ended December 31, 2001, is an amendment focused on Part III, which details director nominees, executive compensation, and related party transactions. The company operates in the mining sector, with significant ties to Grupo Mexico. A substantial portion of the filing pertains to the composition of the Board of Directors and the executive management team, highlighting individuals with extensive experience in mining, finance, and international trade. Compensation structures for executives are noted as being largely influenced by Peruvian law and the guidelines of Grupo Mexico, with a focus on base salary and mandated bonuses and benefits. The filing also clarifies that no stock options were granted or exercised in 2001, and long-term incentive compensation was not awarded during that year. Key investor considerations from this amendment include the significant influence of Grupo Mexico and its affiliates, evidenced by board representation, management roles, and extensive related party transactions. These transactions involve the purchase and sale of copper products and support services, with amounts totaling millions of dollars. While management asserts these transactions are conducted on an arm's-length basis, investors should be aware of the potential for conflicts of interest and the continuous nature of these dealings. The company also provides a five-year cumulative total return comparison, indicating mixed performance against market indices.

Key Highlights

  • 1Amendment to Form 10-K for the year ended December 31, 2001, specifically addressing Part III disclosures.
  • 2Detailed information on director nominees, including their backgrounds and affiliations with major entities like Grupo Mexico, Asarco, and Phelps Dodge.
  • 3Executive compensation primarily consists of base salary and bonuses, with significant portions mandated by Peruvian law.
  • 4No stock options were granted or exercised by executives in 2001; long-term incentive compensation was not awarded.
  • 5Extensive related party transactions with Grupo Mexico and its affiliates, involving sales of copper products and provision of support services.
  • 6Significant sales of copper products to affiliates of Class A Common Stockholders and subsidiaries of Grupo Mexico, amounting to tens of millions of dollars.
  • 7A five-year cumulative total return analysis shows SCCO's stock performance relative to the S&P 500 and S&P Metals Miscellaneous Group, with varied results over the period.

Frequently Asked Questions

This filing is an amendment (10-K/A) to Southern Peru Copper Corporation's (SCCO) 2001 Annual Report (10-K). Its primary purpose is to provide the information required for Part III of Form 10-K, which includes details on directors, executive compensation, and related party transactions.

Executive compensation is largely influenced by Peruvian law and the directives of Grupo Mexico, the controlling indirect stockholder. Base salaries, bonuses, and other compensation components are often determined by employment agreements mandated by Peruvian law or aligned with Grupo Mexico's guidelines. Incentive payments in 2001 were approved by Grupo Mexico in recognition of performance exceeding expectations.

The filing details several related party transactions. Grupo Mexico and its affiliates provide support services to SCCO for which they are reimbursed. Additionally, affiliates of Class A Common Stockholders and subsidiaries of Grupo Mexico (such as Asarco and Minera Mexico Internacional) purchase copper products from SCCO. Phelps Dodge and The Marmon Group also purchased copper products. SCCO also purchased used haulage trucks from Asarco.

According to the filing for the fiscal year ended December 31, 2001, no stock options were granted or exercised by executives in 2001. Furthermore, no long-term incentive compensation, such as restricted stock or stock options, was awarded during that year. Directors who are not compensated as employees may receive shares of Common Stock through a Directors' Stock Award Plan.