NEW YORK - Southern Copper Corporation (NYSE:SCCO) reported a notable first quarter, surpassing analyst estimates with an earnings per share (EPS) of $0.95, $0.20 higher than the expected $0.75. The company's stock rose by 1.71% following the earnings release.
The company's revenue reached $2.6 billion, exceeding the consensus estimate of $2.51 billion and demonstrating a 13.3% increase from the previous quarter. Despite this quarterly growth, revenue was down 6.9% compared to the same period last year, primarily due to lower metal prices, particularly for copper, molybdenum, and zinc.
The mining giant's net income soared to $736 million, a significant 65.4% improvement from the fourth quarter of 2023, but a 9.5% decrease from the first quarter of the previous year. Adjusted EBITDA also saw a substantial rise, increasing by 34.3% quarter-over-quarter to $1,417.7 million. However, it too faced a 9.6% decline year-over-year (YoY).
Southern Copper's operational success in the first quarter was attributed to a 2.6% increase in copper production, with the Buenavista mine contributing significantly to the growth. The company also managed to reduce its cash cost per pound of copper by 14.2% compared to the previous quarter, thanks to lower operating costs and increased by-product revenue credits. Despite challenges in the previous quarter with water supply at the Buenavista operation, the company took action to secure sufficient supplies to meet its annual plan.
Chairman of the Board, Mr. German Larrea, provided insight into the company's performance, stating, "This quarter our strengths are once again at the forefront as we report a 65% increase in net earnings compared to 4Q23." He highlighted the company's focus on organic growth and maintaining competitive cost levels. Larrea also noted the positive market dynamics, including strong demand driven by a resilient US economy and emerging technologies, which he believes will support long-term copper demand and prices.
Looking ahead, Southern Copper's focus remains on organic growth and cost competitiveness, with the backdrop of a strong market demand that is expected to support copper prices in the long term.
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