SCC(US:SCCO)2024-07-19 20:41Financial Performance - 2Q24 net sales reached $3,118.3 million, a 35.5% increase compared to 2Q23, driven by higher sales volumes of copper (+5.5%), molybdenum (+21.4%), silver (+31.6%), and zinc (+78.1%) as well as increased metal prices[2]. - Net income for 2Q24 was $950.2 million, representing a 73.6% increase from $547.5 million in 2Q23, with a net income margin of 30.5% compared to 23.8% in 2Q23[3]. - Adjusted EBITDA for 2Q24 was $1,797.0 million, a 61.1% increase from $1,115.5 million in 2Q23, with an adjusted EBITDA margin of 57.6% versus 48.5% in 2Q23[8]. - Operating income for the first half of 2024 was $2,797.0 million, up 24.1% from $2,254.4 million in the same period last year[69]. - Year-to-date net income attributable to Southern Copper for 2024 was $1,686.2 million, compared to $1,360.7 million for the same period in 2023, representing a 24.0% increase[78]. Production and Costs - Copper production increased by 6.6% in 2Q24 to 242,474 tons, with a year-on-year increase of 7.1% to 482,744 tons, driven by higher ore grades[9]. - Operating cash cost per pound of copper in 2Q24 was $0.76, a 29% decrease from $1.07 in 1Q24, while the 6M24 cash cost was $0.91, down 2.7% from $0.94 in 6M23[10][11]. - Mined copper production for 2Q24 was 242,474 tons, a 6.6% increase from 2Q23, while total production reached 243,623 tons, up 6.8% year-over-year[56]. - Total pounds of copper produced in Q2 2024 reached 513.1 million, an increase of 5.0% from 484.4 million in Q2 2023[80]. - Operating cash cost net of by-products revenue for Q2 2024 was $75.8 million, a decrease of 32.5% from $111.9 million in Q2 2023[80]. Capital Investments - Capital investments in 2Q24 totaled $331.8 million, a 31.4% increase from $252.5 million in 2Q23, with year-to-date investments reaching $545.6 million[16]. - The current capital investment program exceeds $15 billion, including projects in Tía María, Los Chancas, and Michiquillay in Peru, and various projects in Mexico[44]. - The Los Chancas project is estimated to require a capital investment of $2,600 million and is expected to begin operations in 2031, producing 130,000 tons of copper annually[22]. Projects and Future Outlook - The Tia Maria project is expected to generate $17.5 billion in exports and contribute $3.4 billion in taxes and royalties over 20 years, with a focus on improving local economic activities[14]. - The Tía María project is expected to create 9,000 jobs during the construction phase and generate 600 direct and 4,800 indirect jobs once operations begin in 2027[41]. - The company will start receiving wind energy from the Fenicias wind park on August 1, 2024, reducing CO2 emissions by approximately 250,000 tons per year, equivalent to 7% of the company's carbon footprint[24]. - The company anticipates continued growth in net sales and operating income driven by increased production and market demand[75]. Cash Flow and Debt - Cash flow from operating activities in 6M24 was $1,621.8 million, an 18.2% decrease from $1,982.2 million in 6M23, primarily due to a significant increase in working capital[4]. - Cash and cash equivalents increased to $1,875.3 million as of June 30, 2024, compared to $1,151.5 million at the end of 2023[70]. - The company reported a decrease in long-term debt to $5,757.0 million from $6,254.6 million at the end of 2023[70]. - The company paid dividends of $618.5 million in the first half of 2024, down from $1,546.2 million in the same period last year[71]. By-Products and Revenue - The company reported a 14.8% increase in by-product revenue credits due to higher prices and volumes, alongside an increase in copper production[38]. - By-products revenue for Q2 2024 was $139.6 million, up from $106.8 million in Q2 2023, indicating a growth of 30.7%[80].