8-K: Southern Copper Achieves Record 3Q25 Sales, Profit, EBITDA

Southern Copper Corporation reported record net sales, net income, and adjusted EBITDA in Q3 2025, driven by strong by-product production and higher metal prices, despite a decrease in copper sales volume.

Summary

• Net sales for 3Q25 reached a new quarterly record of $3,377.3 million, marking a 15.2% increase over 3Q24.
• Net income for 3Q25 was a record $1,107.6 million, up 23.5% from $896.7 million in 3Q24.
• Adjusted EBITDA for 3Q25 set a new quarterly record at $1,975.4 million, an increase of 17.3% compared to $1,684.6 million in 3Q24.
• Operating cash cost per pound of copper, net of by-product revenue credits, decreased by 44.7% to $0.42 in 3Q25 from $0.76 in 3Q24.
• Copper production in 3Q25 was 234,892 tonnes, a 6.9% decrease quarter-on-quarter, primarily due to lower ore grades in Peruvian and Mexican operations.
• By-product production saw significant increases in 3Q25: mined zinc production rose 46.3% to 45,482 tonnes, total mined silver production increased 16.4%, and molybdenum production grew 8.3%.
• The Board of Directors authorized a quarterly cash dividend of $0.90 per share and a stock dividend of 0.0085 shares of common stock per share, payable on November 28, 2025, to shareholders of record on November 12, 2025.
• Capital investments in 3Q25 totaled $349.2 million, a 41.7% increase over 3Q24.

Sentiment

Score: 9

Explanation: The company reported exceptionally strong financial results with new quarterly records for net sales, net income, and adjusted EBITDA. A significant reduction in cash costs, robust by-product production, and favorable metal prices underscore strong operational efficiency. The advancement of major capital projects and strong ESG performance further contribute to a highly positive outlook, despite a minor dip in copper production.

Positives

• Achieved record 3Q25 net sales of $3,377.3 million, a 15.2% increase over 3Q24.
• Reported record 3Q25 net income of $1,107.6 million, up 23.5% from 3Q24, with the net income margin improving to 32.8%.
• Delivered record 3Q25 adjusted EBITDA of $1,975.4 million, a 17.3% increase over 3Q24, with the adjusted EBITDA margin at 58.5%.
• Significantly reduced operating cash cost per pound of copper, net of by-product revenue credits, to $0.42 in 3Q25, a 44.7% decrease from 3Q24, positioning it as one of the industry's lowest.
• Experienced strong growth in by-product production: zinc (+46.3%), silver (+16.4%), and molybdenum (+8.3%) in 3Q25.
• Benefited from higher metal prices for copper (COMEX, +14.2%; LME, +6.5%), molybdenum (+12.1%), silver (+34.4%), and zinc (+1.6%) in 3Q25.
• Cash flow from operating activities increased by 8.4% to $1,559.6 million in 3Q25.
• Received authorization for the commencement of exploitation activities for the Tia Maria project as of October 14, 2025.
• Improved sustainability ratings from S&P Global, placing the company among leaders in the mining sector with a rating more than twice the industry average.
• Reduced greenhouse gas emissions by 180 thousand carbon tons in 2025 through the use of wind farm electricity.
• Engaged in ecosystem restoration efforts, advancing work on 67 hectares in Sonora, Mexico, and nearly 10 hectares in the Ite wetlands, Peru.
• Supported local communities through education financing for a secondary school and a biomedical sciences laboratory in Arequipa, Peru, and provided over 20,000 free medical consultations in Sonora, Mexico, via the Dr. Vagn Health Train.

Negatives

• Copper sales volume dropped by 3.6% in 3Q25.
• Copper production decreased by 6.9% in 3Q25 to 234,892 tonnes, primarily due to lower ore grades at Toquepala, Cuajone, and Buenavista mines in Peru and Mexico.
• The Buenavista concentrator was fully dedicated to maximizing zinc and silver production, which impacted copper output.
• The Los Chancas project is experiencing the presence of illegal miners, requiring actions to regain control to advance development.

Risks

• The presence of illegal miners at the Los Chancas project poses a challenge to advancing its development, requiring actions to regain control.
• Results could differ materially from forward-looking statements due to various factors, as detailed in the company's most recently filed quarterly reports on Form 10-Q and annual report on Form 10-K.

Future Outlook

The company's current capital investment program for this decade exceeds $15 billion, with over $10.3 billion allocated to Peruvian projects. Management is committed to a long-term goal of producing 1.6 million tonnes of copper at the lowest possible, most competitive cost per pound. The company expresses confidence that the long-term fundamentals for copper and other metal prices will remain very positive, noting that recent US tariff policy changes have had a limited impact. Discussions are ongoing with the Mexican administration to advance $10.2 billion in Mexican investments.

Management Comments

• "We are very pleased with our third-quarter results, where our performance delivered new Company records for net sales, adjusted EBITDA and net income." Mr. German Larrea, Chairman of the Board.
• "These milestones are a testament to the strength of our strategy, execution and commitment to sustainable growth." Mr. German Larrea.
• "This strong performance was primarily driven by a rise in by-product production and improved metal prices across all our products." Mr. German Larrea.
• "The combination of higher production volumes and better copper and by-product prices enabled us to achieve a cash cost of $0.42 per pound of copper in 3Q25, one of the industry’s lowest." Mr. German Larrea.
• "We remain firmly committed to enhancing productivity and cost efficiency, driven by a strategy anchored in discipline and focused on achieving a long-term goal to produce 1.6 million tonnes of copper at the lowest possible, most competitive cost per pound." Mr. German Larrea.
• "SCC is very confident that the long-term fundamentals of prices for copper and other metals will remain very positive." Mr. German Larrea.

Industry Context

The company's strong financial and operational performance in Q3 2025 is largely aligned with a favorable market for base and precious metals, as evidenced by improved metal prices for copper, molybdenum, silver, and zinc. The strategic focus on maximizing by-product production to offset lower copper volumes and reduce cash costs reflects an industry-wide trend to enhance value extraction from multi-metal deposits, particularly when primary metal grades decline. The substantial capital investment program in Peru and Mexico underscores a long-term bullish outlook on copper demand, driven by global electrification and infrastructure development trends, positioning the company to capitalize on future market growth.

Comparison to Industry Standards

• The operating cash cost of $0.42 per pound of copper in 3Q25 is highlighted by management as "one of the industry's lowest."
• S&P Global's Corporate Sustainability Assessment 2025 increased the company's rating by 4 points, positioning it among the leaders in the mining sector's performance ranking, with a rating more than twice the industry's average.
• The company's disaggregated ratings for transparency and reporting, environmental management, biodiversity, cybersecurity, labor practices, human rights, and community relations were reported as the highest in the sector.

Stakeholder Impact

• Shareholders: Benefit from record financial performance, an increased quarterly cash dividend of $0.90 per share, and a stock dividend of 0.0085 shares per share, indicating strong returns and confidence.
• Employees: Creation of 3,500 jobs during the Tia Maria construction phase (with 809 local hires already), and an estimated 764 direct and 5,900 indirect jobs during its operations, along with new job opportunities from other projects.
• Local Communities (Peru & Mexico): Significant economic benefits for the Arequipa region from Tia Maria, including an expected $3.8 billion in taxes and royalties over 20 years. New development poles, job creation, and increased tax revenues at national and regional levels. Continued social and environmental management programs, education financing, and free health services.
• Regulatory Authorities: The company is actively working with Peruvian authorities to secure administrative permits and licenses for its investment programs, demonstrating compliance and collaboration.
• Environment: Positive impact through greenhouse gas emission reductions (180 thousand carbon tons in 2025) and ongoing ecosystem restoration efforts in Mexico and Peru (67 hectares in Sonora, 10 hectares in Ite wetlands).

Next Steps

• Initiate pre-stripping activities in La Tapada and begin building main project components for the Tia Maria project.
• Continue social and environmental management programs in the communities directly influenced by the Los Chancas project.
• Undertake necessary actions to regain control of the Los Chancas project in response to the presence of illegal miners.
• Continue auditing the Michiquillay project's mineral resource models by a third party under SEC's S-K 1300 standards.
• Conduct a conceptual study to determine the best location for a conventional and/or filtered tailings storage facility for Michiquillay, along with hydrological, hydrogeological, and geotechnical studies.
• Continue detailed engineering for the El Arco concentrator, SX-EW plant, water desalination, logistics infrastructure, and power delivery.
• Continue talks with the Mexican administration to roll out $10.2 billion in Mexican investments.
• Prepare stocks and terraces and install assisted irrigation systems on approximately 200 hectares in Sonora for reforestation in 2025.

Key Dates

Recommendation

Southern Copper Corporation delivered an outstanding Q3 2025, achieving new quarterly records in net sales, net income, and adjusted EBITDA. The substantial reduction in operating cash costs to an industry-leading $0.42 per pound of copper, driven by robust by-product production and favorable metal prices, highlights exceptional operational efficiency and profitability. Despite a minor decrease in copper production, the company's financial health is robust, supported by strong cash flow and a significant, well-funded capital investment program exceeding $15 billion. The recent authorization for exploitation activities at the Tia Maria project and continued progress on other major projects provide a clear and compelling growth trajectory. The increased dividend further reinforces management's confidence and commitment to shareholder value. These factors, combined with a positive long-term outlook for metal prices, position Southern Copper as a highly attractive investment.

Keywords

Copper, Mining, Southern Copper, SCC, Financial Results, Q3 2025, Molybdenum, Zinc, Silver, Dividends, Capital Investments, Tia Maria, Los Chancas, Michiquillay, El Arco, ESG, Peru, Mexico, Earnings