Southern Copper (SCCO) Q2 EPS Beats 9%

Southern Copper (SCCO -6.33%), one of many world’s largest built-in copper producers, reported its newest quarterly outcomes on July 29, 2025, masking the second quarter of calendar yr 2025. Essentially the most notable headline from the discharge was the corporate’s means to surpass each GAAP earnings per share and income expectations, regardless of a 3.0% drop in copper gross sales volumes and a year-over-year decline in GAAP income. Southern Copper delivered $1.22 in GAAP earnings per share towards an analyst estimate of $1.12 and reported $3,051.0 million in GAAP income, additionally modestly outpacing expectations. Profitability improved because of robust price management and by-product income, at the same time as copper manufacturing in Mexico declined. Total, the quarter confirmed strong price administration and disciplined capital allocation amid ongoing exterior challenges.

Supply: Analyst estimates for the quarter offered by FactSet.

Firm Overview, Focuses, and Success Elements

Southern Copper focuses on mining, smelting, and refining copper and varied by-products corresponding to zinc, molybdenum, and silver. Its principal property are positioned in Peru and Mexico, two areas with huge ore deposits. The corporate’s mines—like Toquepala and Cuajone in Peru, and Buenavista and La Caridad in Mexico—anchor its international place in copper manufacturing.

Lately, Southern Copper has centered on increasing its reserves, driving down prices, and enhancing operational effectivity to offset commodity value swings. Key measures embrace funding in superior mining strategies, venture growth in Peru and Mexico, and a rising emphasis on sustainable practices. The power to handle regulatory dangers and preserve neighborhood relations are additionally necessary to its continued success.

Quarterly Efficiency and Notable Developments

Southern Copper’s income for the interval fell 2.2% in comparison with the identical quarter final yr, primarily because of a 3.0% drop in copper gross sales quantity. Regardless of decrease gross sales, it managed to ship a GAAP internet revenue margin of 31.9%, an enchancment from 30.5% a yr earlier. Web revenue (GAAP) elevated 2.4% yr over yr, supported by a 3% lower in working prices and positive factors from by-product credit. Adjusted EBITDA was $1,790.9 million, a slight lower from the prior yr, primarily unchanged from a yr in the past, whereas the adjusted EBITDA margin rose to 58.7%.

mined copper output was 238,980 tonnes, with many of the decline concentrated in Mexico. Buenavista mine’s manufacturing dropped 2.9%, and La Caridad slipped 1.7%. In distinction, mined zinc manufacturing surged by 56%, aided by the ramp-up on the Buenavista concentrator, whereas silver output jumped 15.4%. These by-product positive factors helped working money prices fall to $0.63 per pound of copper.

Commodity costs had a blended impression through the quarter. The London Steel Alternate (LME) value of copper decreased 2.3%, whereas the COMEX value rose 3.7%. Costs for different metals different: silver costs elevated 16.6%, supporting by-product income, however zinc and molybdenum costs each fell. This divergence in pricing stored general income and earnings resilient however highlighted ongoing publicity to international metals market volatility.

Capital funding dropped sharply, with $235.7 million invested, down 29.0% from the prior-year interval, whereas persevering with growth of key initiatives in each Peru and Mexico. On the sustainability entrance, Southern Copper achieved exterior verification of its ESG (Environmental, Social, and Governance) report for the primary time and improved metrics, corresponding to lowering misplaced time accidents by 24% since 2023 and growing renewable power use to 39% in 2024. These enhancements had been acknowledged by way of inclusion within the FTSE4Good Developed and US 100 indices.

For income-seeking shareholders, the quarterly dividend rose to $1.40 per share (money and inventory), a 16.7% enhance from the prior yr. This payout marks a continuation of Southern Copper’s observe of returning substantial capital to shareholders even amid funding in new progress initiatives.

Trying Forward

Administration didn’t present particular monetary steerage for the following quarter or the total fiscal yr. Nonetheless, its commentary pointed to robust operational and monetary efficiency as the inspiration for continued resilience. The corporate stays centered on progressing main Peru initiatives corresponding to Tia Maria, Los Chancas, and Michiquillay, in addition to looking for regulatory advances on stalled Mexican initiatives.

Traders ought to carefully monitor traits in copper costs, regulatory developments—particularly in Mexico, the place vital capital is “on maintain”—and additional progress on venture execution. The corporate highlighted its ongoing dedication to price controls and sustainable progress methods, however dangers stay from copper manufacturing declines and uncertainty in venture allowing timelines.

The quarterly dividend was raised 16.7% to $1.40 per share (money and inventory).

Income and internet revenue offered utilizing U.S. usually accepted accounting rules (GAAP) except in any other case famous.