Southern Copper Corp. on Jan. 31 said its net income for the fourth quarter of 2016 jumped 182.7% year over year to US$171.9 million thanks to higher sales and lower operating costs.
Net sales in the final quarter of 2016 improved 11.5% to US$1.40 billion, attributed primarily to an 8.1% increase in copper prices and 0.9% sales volume growth. EBITDA for the three-month period increased 90.6% to US$629.3 million.
For the full year 2016, the NYSE-listed miner posted a 5.4% increase in net income year over year to US$776.5 million, while sales rose 6.6% to US$5.38 billion, and annual EBITDA increased 13.8% to US$2.21 billion.
CapEx for the 2016 fourth quarter totaled US$277.9 million, 8.5% lower compared to the same period of 2015, with full year CapEx decreased 2.7% year over year to US$1.12 billion.
During the fourth quarter of 2016, copper production totaled 227,733 tonnes, up 2.6% year over year, while sales increased 0.9% to 210,428 tonnes.
Molybdenum production decreased 11.9% year over year to 5,279 tonnes, while mined zinc increased 4.1% to 17,110 tonnes, and refined zinc dropped 5.7% to 27,436 tonnes.
Mined silver production increased 14.5% to 4.1 million ounces, while refined silver fell 2.2% to 3.8 million ounces.
The company mined 899,955 tonnes of copper in 2016, which is a new company record and 21.1% more than the 742,993 tonnes mined the year before. Total copper production came in at 917,790 tonnes, a 19.3% improvement year over year. The increase in copper production resulted from increased production at the expanded Buenavista mine in Sonora, Mexico.
Operating cash costs were 95 cents per pound of copper in 2016, decreasing 14.2% on a yearly basis, due primarily to improved efficiency and lower unit costs of new production.
Southern Copper is kicking off a new strategy this year, aiming to increase its copper production capacity to more than 1 million tonnes by mid-2018 and to 1.5 million tonnes by 2023.
The company is working on five copper projects in Peru with total CapEx budgeted at US$2.90 billion. The projects include a US$1.2 billion expansion and a US$40 million, high-pressure grinding roll system at Toquepala, various optimizations of the Cuajone operation, and the US$1.40 billion Tia Maria property, where the miner is working to secure a construction license.
Southern Copper recently proposed a quarterly dividend of 8 cents per share, payable Feb. 28 to shareholders on record as of Feb. 14. This compares to the year-ago dividend of 3 cents per share.