Oct 22, 2026 earnings call — Record results and project updates
Southern Copper reported record sales of $4.7 billion in Q3 2026, $1.3 billion above Q3 2025.
Revenue $4.7B (est $4.5B) · EPS $2.15 (est $2.02)
Key quotes
"we're very pleased to report strong third quarter performance as we hit record highs for net sales, adjusted EBITDA and net income for the second consecutive quarter."
"Copper production registered a decrease of 1% compared to the third quarter of 2025 and stood at 232,396 tons in this past quarter."
"Tia Maria is expected to produce 120,000 tons of SX-EW copper cathodes per annum in the early years of operations. Operations are scheduled to begin in the first half of 2028."
Analyst Q&A 9
Tia Maria delay and CapEx
Q (Carlos de Alba · Morgan Stanley): Why was Tia Maria moved from Q4 to 1H 2027 and could CapEx rise? Also, what are your production and cash-cost expectations for Q4 2026 and 2027?
A: Management said the start-up was pushed back because mechanical assembly and some engineering works are taking longer, so the timeline moved to the first half of 2027. They are not reporting any CapEx change now and will address production forecasts and CapEx in the January call. For production they said this year should be a little bit less than 920,000 tons and that cash cost should be about where it is now or slightly better, with Q4 cost improvement contingent on hitting production and by-product outcomes.
"I think that's why we -- when we review the expected time line, we pass it from the fourth quarter of this year to the first half of 2027." — Raul Jacob (CFO)
cash build, dividends, and CapEx risk
Q (Matheus Moreira · Bradesco BBI): With cash building and CapEx high in 2027, are you considering bigger shareholder distributions? And how worried are you about CapEx rising from inflation, especially the remaining Tia Maria spend?
A: They said they are reviewing CapEx and will give more color at year end and for 2027, so no specific changes were reported yet. Dividend policy is a Board decision; the company has been returning cash and stock (stock bought at $26) and management called the company's position favorable.
"Well, on the -- well, on potential inflationary impact, we are looking." — Raul Jacob (CFO)
Cuajone timing and cash-cost drivers
Q (Emerson Vieira · Goldman Sachs): When will Cuajone go to the Board and when would extra copper production come online? What must happen to choose a larger expansion? Also, are energy and gas cost pressures structural and can you offset them?
A: They said technical studies for Cuajone must be finished; the studies are very well advanced and the Board has authorized mentioning the project, so a decision is close though not final. On costs, they said Mexican operations import gas from the Permian at competitive cost and they consume their own sulfuric acid at competitive cost, which helps cash costs; they expect costs to hold or improve slightly but are still reviewing CapEx details.
"On the Cuajone expansion, we have to finish the technical studies that are very well advanced." — Raul Jacob (CFO)
Cuajone size decision and Los Chancas miners
Q (Myles Allsop · UBS): If you go to 150,000 tpd is CapEx roughly double? When will you decide between 120,000 and 150,000? And when will illegal miners be removed at Los Chancas and what is pathway to FID?
A: They would not give a CapEx number until studies finish; the most likely near-term option is 120,000 tpd but studies for 150,000 are underway and if feasible will be presented to the Board. For Los Chancas they said there are a little north of 200 illegal miners, they are in talks with authorities to remove them, and once removed the company can move quickly with environmental assessment and expects production by 2031.
"Well, we have a little bit north of 200 illegal miners." — Raul Jacob (CFO)
illegal mining and permit improvements
Q (Tingshuai Feng · CICC): Does the government's new REINFO proposal help address illegal mining around Los Chancas? Are you seeing signs that it or permit-streamlining could speed projects like Michiquillay?
A: They said the illegal miners must leave the company's concession and that the government's proposal is a step in the right direction but needs to be discussed in Congress. They also said the government has appointed technical personnel and is working to replace or remove some procedures, which should help the permitting process, though specifics remain to be seen.
"That should improve the process of moving forward of projects." — Raul Jacob (CFO)
Coimolache update and options
Q (Far Hills Fitness): Can you update Coimolache status and potential integration or expansion at that deposit in Peru?
A: They said they are doing technical work and that the project is a joint venture with Buenaventura and another partner. Management said they are working on developing a sulfur deposit for copper with different options under review, it is moving forward but there is nothing specific to report now.
"This is an operation where we have -- we are in a joint venture with Buenaventura and some other partner." — Raul Jacob (CFO)
El Pilar CapEx and Cuajone water
Q (Alfonso Salazar · Scotiabank): Is El Pilar's CapEx rise from extra infrastructure like transmission lines? And what caused Cuajone delays and do you have enough water for 120k or 150k tpd?
A: They said El Pilar's higher CapEx reflects work to improve recoveries and inflation on equipment versus an older budget prepared over 5 years ago. For Cuajone they said sourcing water took longer than expected but they have identified good sources and for 120,000 tpd they believe they have the water required; additional technical work remains. When asked if transmission lines are included in the El Pilar budget, management said they did not have a specific answer.
"I don't have a specific answer for that question, Alfonso." — Raul Jacob (CFO)
cost outlook and El Niño preparation
Q (Matthew Dushkin · Wells Fargo): Are you guiding to flat sequential cash costs for Q4 and flat-to-lower in 2027 versus Q3 or full-year 2026? And how are you preparing for a possible strong El Niño in early 2027?
A: They said the reference is sequential versus the current quarter and that cash cost is hard to predict; they reported a competitive cash cost of $0.09 per pound this past quarter if by-product prices hold and expect Q4 costs in line or slightly better. Regarding El Niño, they said impacts vary by region, southern Peru usually faces drought, and they have evaluated water sources and taken actions so the balance shows a reasonable supply to address the expected drought.
"We are at a very competitive cash cost of $0.09 per pound this past quarter if prices of our by-products hold." — Raul Jacob (CFO)
project timelines and smelter economics
Q (Jonathan Brandt · HSBC): What timing is needed to remove illegal miners to hit Los Chancas' 2031 start and how confident are you about 2031/2032 timelines for Los Chancas and Michiquillay? Also, how do negative TC/RCs in China affect potential smelter investments and concentrate flows?
A: They would not set a specific deadline but said miners must be removed in a relatively short term; they consider construction could begin in the second half of 2028 and finish by 2031 for Los Chancas. For Michiquillay they said there are social agreements in place and the project timeline goes to 2032; on smelters they said negative TC/RCs make building a new smelter difficult, sulfuric acid prices help revenues, and any new smelter decision is contingent on market conditions though producing refined copper remains a long-term company goal and will increase with Tia Maria and El Pilar.
"I don't want to put a specific deadline for removing them, but obviously, it has to be in a relatively short term." — Raul Jacob (CFO)