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Mar 31, 2023
Southern Copper Q1 2023 Earnings Report
Southern Copper's financial performance was marked by increased sales volumes and net income, despite some challenges.
Key Takeaways
Southern Copper Corp. reported a 1.1% increase in net sales to $2,793.9 million, driven by higher sales volumes of copper, silver, and zinc. Net income rose by 3.6% to $813.2 million. The company is progressing with expansion projects, including Pilares mine and Buenavista zinc concentrator, and is optimistic about long-term copper demand.
Net sales increased by 1.1% compared to 1Q22, reaching $2,793.9 million.
Net income grew by 3.6% year-over-year to $813.2 million, with a net income margin of 29.1%.
Operating cash flow increased by 44.4% to $1,185.2 million, driven by strong cash generation and cost-control efficiencies.
Capital investments for 1Q23 were $238.1 million, up 16.0% compared to 1Q22.
Revenue by Segment
Forward Guidance
Southern Copper is focused on expansion projects and believes that current copper prices will be supported by low worldwide inventories. In the long term, the company expects strong demand due to copper's role in the global shift to clean energy.
Positive Outlook
- Pilares mine is operating since 4Q22, increasing annual copper production capacity by 35,000 tons.
- New zinc concentrator at Buenavista is projected to initiate ramp up in 3Q23, expected to elevate yearly production by 100,000 tons of zinc and 20,000 tons of copper.
- El Pilar project (+36,000 tons of copper) is under development, with ongoing onsite environmental activities.
- Experimental pads in the leaching process have confirmed adequate levels of copper recovery.
- Company believes current copper prices will be supported by the fact that available inventories are low worldwide.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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