Summary
Southern Copper Corporation (SCCO) reported its third-quarter and nine-month results for the period ending September 30, 2020. The company demonstrated resilience in a challenging environment, with net sales increasing by 14.5% in the third quarter and 3.7% year-to-date compared to the prior year, driven by higher sales volumes and improved copper and silver prices. Despite increased operating costs, particularly due to COVID-19 related expenses and higher third-party metal purchases, operating income saw a significant increase of 32.2% in the third quarter, though it decreased by 3.2% year-to-date. Net income attributable to SCC for the nine months decreased by 16.9%, impacted by rising costs. The company maintained a strong balance sheet with healthy cash reserves of $2.15 billion. Capital expenditures were reduced year-over-year, reflecting a prudent approach to investment during the period. SCCO continues to advance its key development projects, including Buenavista Zinc and Pilares in Mexico, and Quebrada Honda dam expansion in Peru, while maintaining exploration activities. The company also highlighted its proactive management of the COVID-19 pandemic, with production facilities operating at high capacity and robust safety protocols in place.
Financial Highlights
47 data points| Revenue | $2.13B |
| Cost of Revenue | $948.90M |
| Gross Profit | $1.18B |
| SG&A Expenses | $33.40M |
| Operating Expenses | $1.19B |
| Operating Income | $943.90M |
| Net Income | $506.00M |
| EPS (Basic) | $0.65 |
| Shares Outstanding (Basic) | 773.10M |
Key Highlights
- 1Net sales increased by 14.5% to $2.13 billion in Q3 2020 and by 3.7% to $5.63 billion for the nine months ended September 30, 2020, compared to the prior year periods.
- 2Operating income significantly increased by 32.2% to $943.9 million in Q3 2020, although it decreased by 3.2% to $2.05 billion year-to-date.
- 3Net income attributable to SCC decreased by 16.9% to $980.3 million for the nine months ended September 30, 2020, compared to $1.18 billion in the prior year period.
- 4Copper prices (LME) increased by 12.5% in Q3 2020 year-over-year, while silver prices saw a substantial increase of 44.8%. Molybdenum prices declined significantly by 35.6%.
- 5Operating cash costs per pound of copper, net of by-product revenues, decreased by 21.7% in Q3 2020 and 17.8% year-to-date, demonstrating improved cost efficiency.
- 6The company maintained a strong liquidity position with cash and cash equivalents of $2.15 billion as of September 30, 2020.
- 7Capital expenditures were reduced by 34.9% to $348.8 million for the nine months ended September 30, 2020, compared to $536.1 million in the same period of 2019.