Summary
Southern Copper Corporation (SCCO) reported its 2016 annual results, highlighting a robust operational performance with significant increases in copper production, driven largely by expansions at its Mexican operations, particularly Buenavista. Despite a challenging market environment characterized by lower copper and molybdenum prices compared to prior years, the company maintained strong net sales and operating income, demonstrating effective cost management and operational efficiency. Financially, SCCO showed a slight increase in net income attributable to the company, reaching $776.5 million, up from $736.4 million in 2015. The company's significant capital investment program continued, with $1,118.5 million invested in 2016, primarily focused on expanding production capacity and improving operational efficiency across its Peruvian and Mexican assets. SCCO also highlighted its substantial copper reserves, reinforcing its position as a leading global copper producer. The company's outlook for 2017 was cautiously optimistic, anticipating a structural supply deficit in the copper market due to underinvestment and growing demand.
Financial Highlights
49 data points| Revenue | $5.38B |
| Cost of Revenue | $3.03B |
| Gross Profit | $1.70B |
| SG&A Expenses | $94.30M |
| Operating Expenses | $3.82B |
| Operating Income | $1.56B |
| Net Income | $776.50M |
| EPS (Basic) | $1.00 |
| Shares Outstanding (Basic) | 773.60M |
Key Highlights
- 1Increased total copper production by 21.1% to 1,984.1 million pounds in 2016, a new company record, largely due to higher output from the Buenavista mine expansion in Mexico.
- 2Reported net income attributable to SCCO of $776.5 million, an increase from $736.4 million in 2015, driven by higher sales volumes and improved cost efficiencies.
- 3Invested $1,118.5 million in capital programs in 2016, focusing on expanding production capacity and improving operations, with $1,105.2 million planned for 2017.
- 4Maintained strong cost control, with operating cash cost per pound of copper without by-product revenues decreasing by 12.1% to $1.45 in 2016.
- 5Ended 2016 with substantial cash and cash equivalents of $546.0 million, providing liquidity for operations and future investments.
- 6Held significant copper ore reserves, estimated at 71.4 million tons of contained copper as of December 31, 2016, positioning the company favorably for long-term growth.
- 7Navigated a challenging commodity price environment, with copper prices lower than prior years, but saw increased prices for silver and zinc.