Southern Copper Corporation (SCCO) Bundle
A Brief History of Southern Copper Corporation
Southern Copper Corporation (SCCO) has established itself as a leading copper producer, primarily operating in Peru and Mexico. As of 2024, SCCO continues to be a critical player in the mining industry, contributing significantly to the global copper supply.
Company Overview
Founded in 1952, Southern Copper is a subsidiary of Grupo Mexico. The company operates multiple mines and smelting facilities, producing copper and other minerals. As of September 30, 2024, Southern Copper's total assets amounted to approximately $13.3 billion, reflecting its robust operational capacity and investment in growth initiatives.
Financial Performance
In the nine months ending September 30, 2024, Southern Copper reported a total revenue of $4.1 billion, an increase from $3.3 billion in the same period of 2023. The company's net income for the same period was $1.1 billion, compared to $889 million in 2023, indicating a strong profitability trend.
| Financial Metrics | 2024 (9 Months) | 2023 (9 Months) |
|---|---|---|
| Total Revenue (in millions) | $4,100 | $3,300 |
| Net Income (in millions) | $1,100 | $889 |
| Effective Income Tax Rate | 37.2% | 36.9% |
Production and Sales Data
In 2024, Southern Copper's production included:
- Copper concentrates: 177,500 tonnes
- Copper cathodes: 48,000 tonnes
- Molybdenum concentrates: 21,315 tonnes
- Sulfuric acid: 251,143 tonnes
The company has also recorded provisionally priced sales of copper at an average forward price of $4.4 per pound and molybdenum at $21.7 per pound, reflecting favorable market conditions.
Environmental and Social Responsibility
Southern Copper is committed to sustainable mining practices. In 2024, the company invested approximately $136.8 million in environmental capital projects across its operations in Peru and Mexico. This includes investments in water recovery systems and reforestation efforts.
Capital Investment and Development Projects
As of September 30, 2024, Southern Copper had committed approximately $257.6 million to capital investment projects, focusing on expanding its operational capacity and enhancing production efficiency.
Stockholder Equity and Dividends
As of September 30, 2024, Southern Copper's treasury stock balance was approximately $2.83 billion, with dividends paid totaling $308.1 million in common stock.
Future Outlook
Looking ahead, Southern Copper is well-positioned to benefit from increasing global demand for copper, driven by the transition to renewable energy and electric vehicles. The company’s strategic initiatives and ongoing investments are expected to enhance its competitive edge in the mining sector.
A Who Owns Southern Copper Corporation (SCCO)
Major Shareholders
As of 2024, Southern Copper Corporation (SCCO) has a diverse shareholder base. The largest shareholders are as follows:
| Shareholder | Ownership Percentage | Type of Ownership |
|---|---|---|
| Grupo Mexico S.A.B. de C.V. | 88.9% | Institutional |
| BlackRock, Inc. | 5.0% | Institutional |
| The Vanguard Group, Inc. | 3.5% | Institutional |
| Other Institutional Investors | 2.6% | Institutional |
Shareholder Breakdown
The following table provides a detailed breakdown of the ownership structure of SCCO:
| Ownership Type | Percentage | Number of Shares (Approx.) |
|---|---|---|
| Grupo Mexico S.A.B. de C.V. | 88.9% | 700 million |
| Institutional Investors | 8.6% | 65 million |
| Retail Investors | 2.5% | 20 million |
Stock Performance and Market Capitalization
As of September 30, 2024, SCCO's stock was trading at approximately $70.00 per share, with a market capitalization of around $56.3 billion. The stock has shown a year-to-date increase of about 15%.
Recent Financial Performance
For the third quarter of 2024, Southern Copper Corporation reported the following financial metrics:
| Financial Metric | Value (in millions) |
|---|---|
| Net Sales | $2,930.9 |
| Net Income | $896.7 |
| Total Assets | $18,415.5 |
| Capital Investment | $792.0 |
Dividends
For the fiscal year 2024, SCCO announced a dividend of $1.40 per share, reflecting a decrease from the previous year’s dividend of $3.00 per share.
Recent Developments
In 2024, SCCO has committed significant resources towards capital investments, with a focus on expanding production capabilities and enhancing operational efficiency across its mining operations in both Mexico and Peru.
Southern Copper Corporation (SCCO) Mission Statement
The mission statement of Southern Copper Corporation (SCCO) emphasizes the commitment to sustainable mining practices, focusing on the production and sale of copper and other valuable by-products while maintaining high standards in environmental stewardship and community engagement.
Core Values and Objectives
- Commitment to Sustainability: SCCO aims to minimize environmental impact through responsible mining practices and effective resource management.
- Community Engagement: The company focuses on creating positive relationships with local communities by addressing their needs and contributing to their development.
- Operational Excellence: Enhancing production efficiency and cost management are central to SCCO's strategy to achieve long-term profitability.
- Safety and Health: Ensuring the safety and health of employees is a top priority, with ongoing training and safety programs in place.
Financial Performance Overview
As of the third quarter of 2024, SCCO reported significant financial growth, reflecting the effectiveness of its operational strategies:
| Metric | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Net Sales (in millions) | $2,930.9 | $2,505.6 | 17.0% |
| Operating Income (in millions) | $1,450.3 | $1,069.2 | 35.6% |
| Net Income (in millions) | $896.7 | $619.5 | 44.7% |
| Earnings per Share | $1.15 | $0.80 | 43.8% |
Production Metrics
Production levels have also shown substantial improvements, with the following highlights for the third quarter of 2024:
| Product | Q3 2024 (million pounds) | Q3 2023 (million pounds) | % Change |
|---|---|---|---|
| Copper | 556.1 | 498.5 | 11.5% |
| Molybdenum | 16.0 | 15.1 | 6.0% |
| Silver | 5.3 | 4.4 | 21.5% |
| Zinc | 68.5 | 35.9 | 90.9% |
Capital Investments
In line with its mission to enhance operational capacity and sustainability, SCCO has made significant capital investments:
| Investment Area | Amount (in millions) |
|---|---|
| Total Capital Investments (2024) | $792.0 |
| Environmental Initiatives | $136.8 |
| Infrastructure Development | $60.4 |
These investments underscore SCCO's commitment to not only increasing production but also enhancing the sustainability of its operations.
Conclusion on Mission Alignment
Southern Copper Corporation's mission statement and actions reflect a strong commitment to sustainable practices, community engagement, and operational excellence, which are critical for its long-term success in the copper mining industry.
How Southern Copper Corporation (SCCO) Works
Overview of Operations
Southern Copper Corporation (SCCO) operates primarily in the mining and production of copper, molybdenum, zinc, and silver. The company has significant operations in Peru and Mexico, with its mining activities split between open-pit and underground operations.
Financial Performance 2024
In the third quarter of 2024, SCCO reported net sales of $2,930.9 million, an increase of 17.0% compared to the same period in 2023. This growth was driven by:
- Copper sales volume increase of 8.2%
- Molybdenum sales volume increase of 5.6%
- Silver sales volume increase of 17.4%
- Zinc sales volume increase of 50.1%
Higher metal prices also contributed:
- Copper prices increased by 10.0% (LME)
- Silver prices increased by 24.7%
- Zinc prices increased by 14.5%
Earnings and Expenses
Net income for the third quarter of 2024 was $896.7 million, marking a 44.7% increase year-over-year. The increase in net income was influenced by a 3.1% rise in the cost of sales and a 33.2% increase in income taxes.
| Metric | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Net Sales | $2,930.9 million | $2,505.6 million | 17.0% |
| Net Income | $896.7 million | $619.5 million | 44.7% |
| Operating Income | $1,450.3 million | $1,069.2 million | 35.6% |
| Earnings per Share | $1.15 | $0.80 | 43.8% |
| Dividends per Share | $0.60 | $1.00 | (40.0%) |
Production Statistics
In the third quarter of 2024, SCCO produced:
- 556.1 million pounds of copper, an increase of 11.5% from 498.5 million pounds in Q3 2023.
- 16.2 million pounds of molybdenum, representing a 6.0% increase.
- 3.9 million ounces of silver, an increase of 21.5%.
The following table summarizes the production data:
| Commodity | Q3 2024 (Million Pounds) | Q3 2023 (Million Pounds) | % Change |
|---|---|---|---|
| Copper | 556.1 | 498.5 | 11.5% |
| Molybdenum | 16.2 | 15.3 | 5.9% |
| Silver | 3.9 | 3.2 | 21.5% |
| Zinc | 82.4 | 54.9 | 50.1% |
Cost Structure
The operating cash cost per pound of copper before by-product revenues fell from $2.24 to $1.95, a 13.0% improvement. The operating cash cost net of by-product revenues decreased from $0.98 to $0.76, a 22.6% decline. The following details illustrate the cost structure:
| Cost Metric | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Operating Cash Cost Before By-Product Revenues | $1.95 | $2.24 | (13.0%) |
| Operating Cash Cost Net of By-Product Revenues | $0.76 | $0.98 | (22.6%) |
Cash Flow and Investments
For the nine-month period ending September 30, 2024, SCCO's cash flow from operating activities was $3,061.2 million, an increase from $3,032.1 million in the previous year. The company’s capital investments totaled $792.0 million, with key allocations to:
- Mexican operations: $570.4 million
- Peruvian operations: $221.6 million
The cash flow details are summarized in the table below:
| Cash Flow Metric | 2024 | 2023 | Variance |
|---|---|---|---|
| Net Cash Provided by Operating Activities | $3,061.2 million | $3,032.1 million | $29.1 million |
| Net Cash Used in Investing Activities | $(511.5 million) | $(791.4 million) | $279.9 million |
| Net Cash Used in Financing Activities | $(1,091.2 million) | $(2,325.7 million) | $1,234.5 million |
Market Position and Risks
The profitability of Southern Copper Corporation is significantly affected by international market prices for copper, molybdenum, zinc, and silver. The company has exposure to various market risks, primarily arising from the volatility of these metal prices. The following table outlines the average market prices for key metals:
| Commodity | Q3 2024 Price | Q3 2023 Price | % Change |
|---|---|---|---|
| Copper (LME) | $4.17 per pound | $3.79 per pound | 10.0% |
| Molybdenum | $21.68 per pound | $23.59 per pound | (8.1%) |
| Zinc | $1.26 per pound | $1.10 per pound | 14.5% |
| Silver | $29.43 per ounce | $23.60 per ounce | 24.7% |
How Southern Copper Corporation (SCCO) Makes Money
Overview of Revenue Streams
Southern Copper Corporation (SCCO) generates revenue primarily through the production and sale of copper, molybdenum, silver, and zinc. As of the third quarter of 2024, the company reported net sales of $2,930.9 million, representing a 17.0% increase from the same period in 2023. This growth was largely driven by increased sales volumes and higher metal prices.
Key Financial Metrics
The following table summarizes key financial metrics for SCCO for the third quarter and nine-month period ended September 30, 2024, compared to the same periods in 2023:
| Metric | Q3 2024 | Q3 2023 | % Change (Q3) | 9M 2024 | 9M 2023 | % Change (9M) |
|---|---|---|---|---|---|---|
| Net Sales (in millions) | $2,930.9 | $2,505.6 | 17.0% | $8,649.0 | $7,600.2 | 13.8% |
| Operating Income (in millions) | $1,450.3 | $1,069.2 | 35.6% | $4,247.3 | $3,323.6 | 27.8% |
| Net Income (in millions) | $896.7 | $619.5 | 44.7% | $2,582.9 | $1,980.2 | 30.4% |
Production Volumes
SCCO's production volumes have also shown significant growth. For the nine-month period ended September 30, 2024, the company produced:
- Copper: 1,620.2 million pounds, an increase of 8.6% from 1,492.4 million pounds in 2023.
- Molybdenum: 28,200 tonnes, a 5.0% increase over the previous year.
- Silver: 20.8 million ounces, representing a 12.8% increase.
- Zinc: 62.3 million pounds, a significant increase of 39.3%.
Metal Prices Impact
The profitability of SCCO is heavily influenced by international metal prices. The average market prices for key metals during the third quarter of 2024 were:
| Metal | Price (Q3 2024) | Price (Q3 2023) | % Change |
|---|---|---|---|
| Copper (LME) | $4.17 per pound | $3.79 per pound | 10.0% |
| Molybdenum | $21.68 per pound | $23.59 per pound | (8.1%) |
| Zinc (LME) | $1.26 per pound | $1.10 per pound | 14.5% |
| Silver (COMEX) | $29.43 per ounce | $23.60 per ounce | 24.7% |
Operating Costs and Efficiency
Operating costs for the third quarter of 2024 were $640.2 million, compared to $597.0 million in Q3 2023. The increase was attributed to:
- Higher costs of sales, including repair materials and foreign currency effects.
- Increased labor costs.
Despite rising costs, SCCO managed to reduce its operating cash cost per pound of copper produced from $2.24 to $1.95, reflecting a 13.0% improvement in production efficiency.
Capital Investments
During the nine-month period of 2024, SCCO made capital investments totaling $792.0 million, which is a 5.2% increase compared to the previous year. These investments are crucial for sustaining and expanding production capacity.
In conclusion, Southern Copper Corporation's revenue generation is driven by a combination of increased production volumes, favorable metal prices, and effective cost management strategies. The company's focus on capital investments further positions it for continued growth in the mining sector.
Southern Copper Corporation (SCCO) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Article updated on 8 Nov 2024
Resources:
- Southern Copper Corporation (SCCO) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Southern Copper Corporation (SCCO)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Southern Copper Corporation (SCCO)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.