What was the primary driver of Southern Copper's increased revenue in the second quarter of 2017?

The primary drivers of Southern Copper's increased revenue in the second quarter of 2017 were higher metal prices, particularly for copper, and an increase in sales volumes of copper, silver, and molybdenum compared to the same period in the prior year. Copper prices on the LME increased by 19.5%.

How did Southern Copper's operational costs change during the first half of 2017?

Operating costs and expenses increased by 9.1% to $2,017.4 million in the first six months of 2017 compared to the same period in 2016. This increase was mainly due to higher cost of sales across all operating segments and increased depreciation, amortization, and depletion, partially offset by lower exploration expenses and a credit related to environmental remediation costs.

What are Southern Copper's key capital investment projects and their objectives?

Southern Copper is undertaking significant capital investments primarily focused on increasing copper production capacity. Key projects include the Toquepala Concentrator Expansion in Peru, which aims to increase annual copper production by 100,000 tons, and various projects in Mexico, such as the Buenavista Projects aimed at increasing copper production. The overall objective is to exceed one million tons of copper production by mid-2018 and reach 1.5 million tons by 2023, while also focusing on operational efficiencies and environmental standards.

What is Southern Copper's outlook on the copper market for the remainder of 2017 and beyond?

The company's outlook for the copper market is positive. They expect refined copper demand to grow about 2.0% in 2017. Supply growth is anticipated to be weak due to declining investments and production challenges, leading to conditions for a market deficit after 2018, which is expected to support higher prices. They project copper growth in the range of 1% per year in 2017 and 2018.

SCCO 10-Q Quarterly Report Q2 FY2017 — Revenue, Net Income, EPS

Summary

Southern Copper Corporation (SCCO) reported a strong second quarter and first half of 2017, driven by increased metal prices and sales volumes. Net sales rose by 14.6% in the quarter and 20.7% year-to-date. Net income attributable to SCC saw a significant increase of 35.1% for the quarter and 50.9% for the first half, reflecting improved operational performance and favorable market conditions. The company is strategically investing in capital projects aimed at increasing copper production capacity to over one million tons by mid-2018, with further expansion plans through 2023. The company's operational segments in Peru and Mexico performed well, with Peruvian operations showing a notable 91.4% increase in operating income for the quarter. Despite some production decreases in copper, molybdenum, silver, and zinc year-over-year, the overall financial results were bolstered by higher commodity prices for copper, molybdenum, zinc, and silver. SCCO maintains a focus on cost control and operational efficiency to navigate market volatility and maximize profitability.

Financial Highlights

46 data points

Beta

Revenue

$1.53B

0.4% Gross Margin

Net Income

$299.70M

0.2% Net Margin

EPS (Diluted)

$0.39

Total Assets

$13.52B

Cash & Equivalents

$688.70M

Free Cash Flow

$101.70M

Financial Statements

Beta

Revenue	$1.53B
Cost of Revenue	$804.80M
Gross Profit	$553.80M
SG&A Expenses	$22.20M
Operating Expenses	$1.00B
Operating Income	$525.90M
Net Income	$299.70M
EPS (Basic)	$0.39
Shares Outstanding (Basic)	773.00M

Key Highlights

1Significant revenue growth: Net sales increased by 14.6% in Q2 2017 and 20.7% in the first six months of 2017 compared to the prior year periods, driven by higher metal prices and sales volumes.
2Strong profitability improvement: Net income attributable to SCC grew by 35.1% in Q2 2017 and 50.9% in the first six months of 2017, reflecting robust operational performance.
3Higher commodity prices: Average LME and COMEX copper prices increased by 19.5% and 22.5% respectively in Q2 and the first half of 2017 compared to the same periods in 2016. Molybdenum, zinc, and silver prices also saw notable increases.
4Strategic capital investments: The company is investing heavily in capital projects, with $497.7 million spent in the first half of 2017, targeting a significant increase in copper production capacity.
5Improved operating income: Overall operating income increased by 36.6% in Q2 2017 and 49.9% in the first six months of 2017, highlighting operational efficiency gains.
6Positive outlook: Management anticipates continued growth in refined copper demand and expects a market deficit after 2018, supporting higher prices. The company is on track to exceed one million tons of copper production by mid-2018.
7Dividend increase: The company paid a dividend of $0.12 per share in Q2 2017 and authorized a $0.14 per share dividend for Q3 2017, indicating confidence in financial performance and commitment to shareholder returns.

SOUTHERN COPPER CORP/ Quarterly Report for Q2 Ended Jun 30, 2017

Summary

Financial Highlights

Key Highlights

Frequently Asked Questions