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Southern Copper net income surges 259% in Q2 2021 despite production decline

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(Kitco News) - Southern Copper (NYSE and BVL: SCCO), one of the largest copper producers globally, today announced that in Q2 2021, its copper production decreased 6.3% in quarter-on-quarter terms to 237,110 tons.

The company said that this result was driven by a drop in ore grades due to stripping and maintenance works that were rescheduled to this year after having been postponed in 2020 due the COVID 19 pandemic. Copper production fell 3.9% YoY to 475,512 tons.

However, the company added that its Q2 2021 net sales were $2,897.0 million, 62.3% higher than in Q2 2020, mainly due to higher market metal prices for all its products. The company’s Q2 2021 net income was $932.7 million, which represented a 259.4% increase with regard to the $259.5 million registered in Q2 2020.

Additionally, the company noted that its mined zinc production increased 8.9% this quarter due to an uptick in production at both the Charcas mine and the San Martin mine. Molybdenum production decreased (-10.8%) in Q2 2021 compared to Q2 2020 due to a decrease in production at both the Toquepala and Buenavista mines. Mined silver production decreased by 16.1% in Q2 2021 after production fell at the company’s IMMSA, Buenavista and Toquepala operations.

Southern Copper's operating cash cost per pound of copper, including by-product revenue credits, was $0.59 in Q2 2021, which represented an improvement of 11.5% compared to the $0.66 reported in Q2 2020. The company said that these results were mainly due to an increase in by-product revenue credits, which was partially offset by an uptick in production costs. The company expects copper production in 2021 to total 960,000 tons.

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