Summary
Southern Copper Corporation (SCCO) reported its second quarter and first half 2019 financial results, showing a slight decline in net sales and net income compared to the same periods in 2018, primarily driven by lower commodity prices, particularly for copper. Despite the price pressures, the company saw an increase in copper sales volume due to higher production from the newly expanded Toquepala concentrator. The company maintained a focus on operational efficiency and cost control, with operating cash costs per pound of copper remaining competitive. Significant capital expenditures were directed towards growth projects in both Peru and Mexico, aimed at increasing future production capacity. SCCO also continued its commitment to social and environmental initiatives, underscoring its long-term sustainability strategy. Looking ahead, SCCO anticipates a potential deficit in the refined copper market, which could support prices in the latter half of 2019. The company's strategic investments in expanding production capacity position it to benefit from any market improvements, while its diversified product portfolio and cost management strategies provide resilience.
Financial Highlights
48 data points| Revenue | $1.82B |
| Cost of Revenue | $867.30M |
| Gross Profit | $751.90M |
| SG&A Expenses | $30.90M |
| Operating Expenses | $1.10B |
| Operating Income | $713.60M |
| Net Income | $402.40M |
| EPS (Basic) | $0.52 |
| Shares Outstanding (Basic) | 773.00M |
Key Highlights
- 1Net sales for the six months ended June 30, 2019, were $3,571.4 million, a 2.9% decrease from $3,678.4 million in the same period of 2018, primarily due to lower metal prices.
- 2Net income attributable to SCCO for the six months ended June 30, 2019, decreased by 10.2% to $790.6 million, compared to $880.3 million in the prior year, largely due to lower copper prices.
- 3Mined copper production increased by 14.2% to 1,069.2 million pounds in the first six months of 2019 compared to 936.5 million pounds in the same period of 2018, driven by higher production at Toquepala and Buenavista mines.
- 4Capital expenditures for the first six months of 2019 were $353.5 million, a 35.7% decrease from $549.6 million in the first six months of 2018, reflecting continued investment in growth projects.
- 5The company declared and paid dividends of $0.80 per share for the first six months of 2019, an increase from $0.60 per share in the same period of 2018.
- 6As of June 30, 2019, the company's cash and cash equivalents were $752.2 million.
- 7SCCO is undertaking significant capital projects, including the Toquepala Expansion Project and potential developments like Tia Maria and Michiquillay, aimed at increasing copper production capacity.