Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 03, 2022 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2022 | |
Document Transition Report | false | |
Entity File Number | 1-14066 | |
Entity Registrant Name | SOUTHERN COPPER CORP/ | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 13-3849074 | |
Entity Address, Address Line One | 1440 East Missouri Avenue SuiteĀ 160 | |
Entity Address, City or Town | Phoenix | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85014 | |
City Area Code | 602 | |
Local Phone Number | 264-1375 | |
Title of 12(b) Security | Common stock | |
Trading Symbol | SCCO | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 773,090,069 | |
Entity Central Index Key | 0001001838 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS | ||
Net sales (including sales to related parties, see note 5) | $ 2,763.8 | $ 2,532.5 |
Operating cost and expenses: | ||
Cost of sales (exclusive of depreciation, amortization and depletion shown separately below) | 1,057.7 | 943.8 |
Selling, general and administrative | 30.3 | 30.1 |
Depreciation, amortization and depletion | 196.6 | 200.6 |
Exploration | 9.1 | 6.4 |
Total operating costs and expenses | 1,293.7 | 1,180.9 |
Operating income | 1,470.1 | 1,351.6 |
Interest expense | (98.4) | (96.8) |
Capitalized interest | 10.7 | 7.2 |
Other income (expense) | 11.7 | 2.3 |
Interest income | 4.6 | 2.4 |
Income before income taxes | 1,398.7 | 1,266.7 |
Income taxes (including royalty taxes, see Note 4) | 612.1 | 507.5 |
Net income before equity earnings of affiliate | 786.6 | 759.2 |
Equity earnings (loss) of affiliate, net of income tax | 1.2 | 7.9 |
Net income | 787.8 | 767.1 |
Less: Net income attributable to the non-controlling interest | 3.1 | 3.3 |
Net income attributable to SCC | $ 784.7 | $ 763.8 |
Per common share amounts attributable to SCC: | ||
Net earnings-basic | $ 1.02 | $ 0.99 |
Net earnings-diluted | $ 1.02 | $ 0.99 |
Weighted average shares outstanding-basic | 773.1 | 773.1 |
Weighted average shares outstanding-diluted | 773.1 | 773.1 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Net income and comprehensive income | $ 787.8 | $ 767.1 |
-Derivative instruments classified as cash flow hedge: | ||
Unrealized gain (loss) of the period (net of income tax of $0.2 million in 2022) | (0.6) | |
Total other comprehensive income (loss) | (0.6) | |
Total comprehensive income | 787.2 | 767.1 |
Comprehensive income attributable to the non-controlling interest | 3.1 | 3.3 |
Comprehensive income attributable to SCC | $ 784.1 | $ 763.8 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |
Unrealized gain of the period tax | $ 0.2 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 2,847.2 | $ 3,002 |
Short-term investments | 406.5 | 486.9 |
Accounts receivable trade | 1,185.8 | 1,358.7 |
Accounts receivable other (including related parties 2022- $29.9 and 2021 - $49.1) | 69.4 | 87.9 |
Inventories | 1,029.9 | 972.9 |
Prepaid taxes | 165.2 | 197.7 |
Other current assets | 64.5 | 33.5 |
Total current assets | 5,768.5 | 6,139.6 |
Property and mine development, net | 9,492.9 | 9,464.4 |
Ore stockpiles on leach pads | 1,082 | 1,097.6 |
Intangible assets, net | 136.8 | 138.1 |
Right-of-use assets | 900.8 | 916.3 |
Deferred income tax | 298.6 | 316.2 |
Equity method investment | 116.7 | 115.4 |
Other non-current assets | 102.6 | 110 |
Total assets | 17,898.9 | 18,297.6 |
Current liabilities: | ||
Current portion of long-term debt | 299.8 | 299.7 |
Accounts payable (including related parties 2022- $114.3 and 2021- $103.3) | 693.7 | 591.9 |
Accrued income taxes | 237 | 832.6 |
Accrued workers' participation | 243.4 | 325.7 |
Accrued interest | 131.2 | 98.6 |
Lease liabilities current | 74.6 | 73.9 |
Other accrued liabilities | 46.1 | 27.6 |
Total current liabilities | 1,725.8 | 2,250 |
Long-term debt, net of current portion | 6,248.7 | 6,247.9 |
Lease liabilities | 826.2 | 842.4 |
Deferred income taxes | 144.9 | 118.3 |
Non-current taxes payable | 56 | |
Other liabilities and reserves | 66 | 68.3 |
Asset retirement obligation | 610.7 | 562.9 |
Total non-current liabilities | 7,952.5 | 7,839.8 |
Commitments and contingencies (Note 10) | ||
STOCKHOLDERS' EQUITY (NOTE 11) | ||
Common stock par value $0.01; shares authorized, 2022 and 2021-2,000; shares issued, 2022 and 2021-884.6 | 8.8 | 8.8 |
Additional paid-in capital | 3,468.3 | 3,454.1 |
Retained earnings | 7,781.3 | 7,769.7 |
Accumulated other comprehensive income | (10) | (9.4) |
Treasury stock, at cost, common shares | (3,087.7) | (3,074) |
Total Southern Copper Corporation stockholders' equity | 8,160.7 | 8,149.2 |
Non-controlling interest | 59.9 | 58.6 |
Total equity | 8,220.6 | 8,207.8 |
Total liabilities and equity | $ 17,898.9 | $ 18,297.6 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Millions, $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable other, related parties | $ 29.9 | $ 49.1 |
Accounts payable, related parties | $ 114.3 | $ 103.3 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 2,000 | 2,000 |
Common stock, shares issued | 884.6 | 884.6 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
OPERATING ACTIVITIES | ||
Net income | $ 787.8 | $ 767.1 |
Adjustments to reconcile net earnings to net cash provided from operating activities: | ||
Depreciation, amortization and depletion | 196.6 | 200.6 |
Equity earnings of affiliate, net of dividends received | (1.3) | (4) |
Loss on foreign currency transaction effect | 55.7 | (19.7) |
(Benefit) provision for deferred income taxes | 43.7 | (38.9) |
Other, net | 9.6 | 6.7 |
Change in operating assets and liabilities: | ||
Decrease (increase) in accounts receivable | 172.9 | (163.3) |
(Increase) decrease in inventories | (41.5) | 38.2 |
Decrease in accounts payable and accrued liabilities | (525) | (1.3) |
Decrease (increase) in other operating assets and liabilities | 122.2 | (2.8) |
Net cash provided by operating activities | 820.7 | 782.6 |
INVESTING ACTIVITIES | ||
Capital expenditures | (205.2) | (232.6) |
Proceeds from (purchase) sale of short-term investments, net | 80.4 | (5.2) |
Other | (0.1) | |
Net cash used in investing activities | (124.9) | (237.8) |
FINANCING ACTIVITIES | ||
Cash dividends paid to common stockholders | (773.1) | (463.8) |
Other, net | (1.7) | (1.3) |
Net cash used in financing activities | (774.8) | (465.1) |
Effect of exchange rate changes on cash and cash equivalents | (75.8) | 4 |
Increase in cash and cash equivalents | (154.8) | 83.7 |
Cash and cash equivalents, at beginning of period | 3,002 | 2,183.6 |
Cash and cash equivalents, at end of period | $ 2,847.2 | $ 2,267.3 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Millions | CAPITAL STOCK | ADDITIONAL PAID-IN CAPITAL: | TREASURY STOCK:Parent Company (Grupo Mexico) common shares | TREASURY STOCK:Parent Company (Grupo Mexico) | TREASURY STOCK: | RETAINED EARNINGS: | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS): | STOCKHOLDERS' EQUITY | NON-CONTROLLING INTEREST | Total |
Balance at beginning of year at Dec. 31, 2020 | $ 8.8 | $ 3,441.5 | $ (2,767.5) | $ (296) | $ 6,846.4 | $ (8.4) | $ 7,224.8 | $ 51.2 | $ 7,276 | |
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net earnings | 763.8 | 3.3 | 763.8 | |||||||
Dividends declared and paid, common stock, per share, 2022- $1, 2021- $0.6 | (463.8) | (1.3) | ||||||||
Other activity, including dividend, interest and foreign currency transaction effect | 2.3 | |||||||||
Other activity of the period | (2) | |||||||||
Balance at end of year at Mar. 31, 2021 | 3,439.5 | (2,767.5) | (293.7) | $ (3,061.2) | 7,146.4 | (8.4) | 7,525.1 | 53.2 | 7,578.3 | |
Balance at beginning of year at Dec. 31, 2021 | $ 8.8 | 3,454.1 | (2,767.2) | (306.8) | 7,769.7 | (9.4) | 8,149.1 | 58.6 | 8,207.8 | |
Increase (Decrease) in Stockholders' Equity | ||||||||||
Net earnings | 784.7 | 3.1 | 784.7 | |||||||
Dividends declared and paid, common stock, per share, 2022- $1, 2021- $0.6 | (773.1) | (1.8) | ||||||||
Used for corporate purposes | 0.1 | |||||||||
Other activity, including dividend, interest and foreign currency transaction effect | (13.8) | |||||||||
Other activity of the period | 14.2 | |||||||||
Other comprehensive income (loss) | (0.6) | (0.6) | ||||||||
Balance at end of year at Mar. 31, 2022 | $ 3,468.3 | $ (2,767.1) | $ (320.6) | $ (3,087.7) | $ 7,781.3 | $ (10) | $ 8,160.7 | $ 59.9 | $ 8,220.6 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||
Dividends paid as cash dividend (in dollars per share) | $ 1 | $ 0.6 |
DESCRIPTION OF THE BUSINESS_
DESCRIPTION OF THE BUSINESS: | 3 Months Ended |
Mar. 31, 2022 | |
DESCRIPTION OF THE BUSINESS: | |
DESCRIPTION OF THE BUSINESS: | Southern Copper Corporation ā NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) ā NOTE 1ā DESCRIPTION OF THE BUSINESS: ā The Company is a majority-owned, indirect subsidiary of Grupo Mexico S.A.B. de C.V. (āGrupo Mexicoā). As of March 31, 2022, Grupo Mexico, through its wholly-owned subsidiary Americas Mining Corporation (āAMCā) owned 88.9% of the Companyās capital stock. The condensed consolidated financial statements presented herein consist of the accounts of Southern Copper Corporation (āSouthern Copperā, "SCC" or the āCompanyā), a Delaware corporation, and its subsidiaries. The Company is an integrated producer of copper and other minerals, and operates mining, smelting and refining facilities in Peru and Mexico. The Company conducts its primary operations in Peru through a registered branch (the "Peruvian Branch" or āBranchā or āSPCC Peru Branchā). The Peruvian Branch is not a corporation separate from the Company. The Company's Mexican operations are conducted through subsidiaries. The Company also conducts exploration activities in Argentina, Chile, Ecuador, Mexico and Peru. ā In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary to fairly state the Companyās financial position as of March 31, 2022 and the results of operations, comprehensive income, cash flows and changes in equity for the three months ended March 31, 2022 and 2021. The results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the full year. The December 31, 2021 balance sheet data was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America (āGAAPā). The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements at December 31, 2021 and notes included in the Companyās 2021 annual report on Form 10-K. ā ā CUAJONE STOPPAGE OF OPERATIONS ā On February 28, 2022 a small group of protesters from the community of Tumilaca, Pocata, Coscore and Tala, which have 472 residents in total, seized the facilities at the ViƱa Blanca water reservoir and cut off the water supply to the homes of the approximately 5,000 people who live in Cuajone. Prior to this illegal action, on February 18, 2022, the railway between Cuajone and Ilo was also blocked by a group of community members. They claim the Company usurped their land and demand compensation of $5.0 billion, in addition to the permanent payment of 5% of net profits. ā As of March 31, 2022, the Cuajone operations remained closed with an estimate production loss of 12,869 tonnes of copper content and 296 tonnes of molybdenum, which translates into a reduction in sales of $117 million. The Company also recorded $7.9 million of unabsorbed fixed costs, which directly impacted the cost of sales. ā The effect on the CompanyĀ“s net income and financial position was not material as of March 31, 2022. Sales contracts were not significantly affected and measures were taken to acquire concentrates from the CompanyĀ“s Mexican Operations and third parties to maintain and adequate supply to the smelter. This prevented a force majeure event from delays in fulfilling the CompanyĀ“s sales commitments. ā As of March 31, 2022, the Company was expecting to enter into a dialogue with the protesters and the Peruvian authorities to secure an agreement to address reasonable social demands; restore the water supply to workers and their families, and resume operations at the Company Cuajone facilities. However, if this situation continues indefinitely, the Company may be forced to consider cost reduction measures, including the relocation or furlough of workers. |
SHORT-TERM INVESTMENTS_
SHORT-TERM INVESTMENTS: | 3 Months Ended |
Mar. 31, 2022 | |
SHORT-TERM INVESTMENTS: | |
SHORT-TERM INVESTMENTS: | NOTE 2 ā SHORT-TERM INVESTMENTS: ā Short-term investments were as follows (in millions): ā ā ā ā ā ā ā ā ā ā ā At March 31, ā At December 31, ā ā ā 2022 2021 ā ā Trading securities ā $ 406.1 ā $ 486.5 ā ā Weighted average interest rate ā 0.4 % 0.3 % ā ā ā ā ā ā ā ā ā ā Available-for-sale ā $ 0.4 ā $ 0.4 ā ā Weighted average interest rate ā 0.7 % 0.7 % ā Total ā $ 406.5 ā $ 486.9 ā ā ā Trading securities consist of bonds issued by public companies and are publicly traded. Each financial instrument is independent of the others. The Company has the intention to sell these bonds in the short-term. ā Available-for-sale investments consist of securities issued by public companies. Each security is independent of the others and as of March 31, 2022 and December 31, 2021, included asset and mortgage backed obligations. As of March 31, 2022 and December 31, 2021, gross unrealized gains and losses on available-for-sale securities were not material. ā The Company earned interest related to these investments, which was recorded as interest income in the condensed consolidated statement of earnings. Also, the Company redeemed some of these securities and recognized gains (losses) due to changes in fair value, which were recorded as other income (expense) in the condensed consolidated statement of earnings. ā The following table summarizes the activity of these investments by category (in millions): ā ā ā ā ā ā ā ā ā ā ā ā Three months ended ā ā ā March 31, ā ā ā 2022 2021 ā Trading: ā ā ā ā ā ā ā ā Interest earned ā $ 0.8 ā $ 0.4 ā ā Unrealized gain (loss) at the end of the period ā $ (0.1) ā $ 0.1 ā ā ā ā ā ā ā ā ā ā ā Available-for-sale: ā ā ā ā ā ā ā ā Interest earned ā (*) ā ā (*) ā ā Investment redeemed ā $ (*) ā $ 0.1 ā ā (*) Less than $0.1 million. |
INVENTORIES_
INVENTORIES: | 3 Months Ended |
Mar. 31, 2022 | |
INVENTORIES: | |
INVENTORIES: | ā ā NOTE 3 ā INVENTORIES: ā Inventories were as follows: ā ā ā ā ā ā ā ā ā ā ā At March 31, ā At December 31, ā (in millions) 2022 2021 ā Inventory, current: ā ā ā ā ā ā ā Metals at average cost: ā ā ā ā ā ā ā Finished goods ā $ 79.1 ā $ 58.6 ā Work-in-process ā 381.8 ā 340.7 ā Ore stockpiles on leach pads ā ā 260.7 ā ā 259.7 ā Supplies at average cost ā 308.3 ā 313.9 ā Total current inventory ā $ 1,029.9 ā $ 972.9 ā Inventory, long-term: ā ā ā ā ā ā ā Ore stockpiles on leach pads ā $ 1,082.0 ā $ 1,097.6 ā ā ā During the three months ended March 31, 2022 and 2021, total leaching costs capitalized as non-current inventory of ore stockpiles on leach pads amounted to $61.5 million and $54.8 million, respectively. Leaching inventories recognized in cost of sales amounted to $76.0 million and $71.6 million for the three months ended March 31, 2022 and 2021, respectively. |
INCOME TAXES_
INCOME TAXES: | 3 Months Ended |
Mar. 31, 2022 | |
INCOME TAXES: | |
INCOME TAXES: | NOTE 4 ā INCOME TAXES: ā The income tax provision and the effective income tax rate for the first three months of 2022 and 2021 consisted of (in millions): ā ā ā ā ā ā ā ā ā 2022 2021 ā Statutory income tax provision ā $ 511.6 ā $ 427.3 ā Peruvian royalty ā 17.0 ā 11.6 ā Mexican royalty ā 58.0 ā 47.4 ā Peruvian special mining tax ā 25.5 ā 21.2 ā Total income tax provision ā $ 612.1 ā $ 507.5 ā ā ā ā ā ā ā ā ā Effective income tax rate ā ā 43.8 % ā 40.1 % ā These provisions include income taxes for Peru, Mexico and the United States. The Mexican royalty, the Peruvian royalty and the Peruvian special mining tax are included in the income tax provision. The increase in the effective income tax rate in 2022 compared to the same period in 2021 was primarily attributable to the fact that the Company registered uncertain tax provisions in the Peruvian jurisdiction. ā Peruvian royalty and special mining tax ā Mexican mining royalty ā Accounting for uncertainty in income taxes: ā Tax Law Changes: On December 28, 2021, the U.S. Treasury and the IRS released final regulations addressing various aspects of the foreign tax credit regime. The regulations apply to years beginning after December 28, 2021 and they are not expected to have a material impact on the Companyās financial statements. |
RELATED PARTY TRANSACTIONS_
RELATED PARTY TRANSACTIONS: | 3 Months Ended |
Mar. 31, 2022 | |
RELATED PARTY TRANSACTIONS: | |
RELATED PARTY TRANSACTIONS: | ā NOTE 5 ā RELATED PARTY TRANSACTIONS: ā The Company has entered into certain transactions in the ordinary course of business with parties that are controlling shareholders or their affiliates. These transactions include the lease of office space, air and railroad transportation, construction services, energy supply, and other products and services related to mining and refining. The Company lends and borrows funds among affiliates for acquisitions and other corporate purposes. These financial transactions bear interest and are subject to review and approval by senior management, as are all related party transactions. Article Nine of the Amended and Restated Certificate of Incorporation of the Company prohibits the Company from engaging in a Material Affiliate Transaction that was not the subject of prior review by a committee of the Board of Directors with at least three members, each of whom is independent, and defines a Material Affiliate Transaction as a transaction or series of related transactions between Grupo Mexico or one of its affiliates (other than the Company or its subsidiaries), on the one hand, and the Company or one of its subsidiaries, on the other hand, that involves consideration of more than $10.0 million in the aggregate. It is the Companyās policy that (i) a Material Affiliate Transaction not be entered into or continued without the review and approval by the Audit Committee or its subcommittee of related party transactions comprised of independent directors,(ii) any potential related party transaction process with aggregate consideration between $8.0 million and $10.0 million be authorized by the General Counsel and Chief Financial Officer of the Company and (iii) that all related party transactions, including any Material Affiliate Transaction, be reported to the Audit Committee of the Board of Directors or to its subcommittee of related party transactions. ā Receivable and payable balances with related parties are shown below (in millions): ā ā ā ā ā ā ā ā ā ā ā At March 31, ā At December 31, ā ā 2022 2021 ā Related parties receivable current: ā ā ā ā ā ā ā Grupo Mexico and affiliates: ā ā ā ā ā ā ā Asarco LLC ā $ 7.0 ā $ 10.0 ā Americas Mining Corporation (āAMCā) ā ā 0.1 ā ā 0.1 ā Compania Perforadora Mexico S.A.P.I. de C.V. and affiliates ā 0.3 ā 0.3 ā Mexico Generadora de Energia S. de R.L. ("MGE") ā ā 21.8 ā ā 38.4 ā Grupo Mexico Servicios de Ingenieria, S.A. de C.V. ā ā 0.2 ā ā 0.2 ā Related to the controlling group: ā ā ā ā ā ā ā Boutique Bowling de Mexico, S.A. de C.V. ā ā 0.1 ā ā 0.1 ā Mexico Transportes Aereos, S.A. de C.V. ("Mextransport") ā ā 0.4 ā ā ā ā Operadora de Cinemas, S.A. de C.V. ā ā (*) ā ā (*) ā ā ā $ 29.9 ā $ 49.1 ā ā ā ā ā ā ā ā ā Related parties payable: ā ā ā ā ā ā ā Grupo Mexico and affiliates: ā ā ā ā ā ā ā AMMINCO Apoyo Administrativo, S.A. de C.V. (āAMMINCOā) ā $ 4.2 ā $ 9.5 ā Asarco LLC ā ā 29.6 ā ā 14.9 ā Eolica El Retiro, S.A.P.I. de C.V. ā 0.4 ā 2.7 ā Ferrocarril Mexicano, S.A. de C.V. ā 9.3 ā 4.0 ā Grupo Mexico Servicios ā ā 13.6 ā ā 11.1 ā MGE ā ā 51.3 ā ā 57.2 ā Mexico Compania Constructora S.A de C.V. ā ā 3.5 ā ā 2.0 ā Grupo Mexico Servicios de Ingenieria, S.A. de C.V. ā ā 1.1 ā ā 0.9 ā Controladora de Infraestructura EnergĆ©tica MĆ©xico S.A. de C.V. ā ā 0.9 ā ā ā ā Related to the controlling group: ā ā ā ā ā ā ā Boutique Bowling de Mexico, S.A. de C.V. ā 0.1 ā 0.3 ā Mexico Transportes Aereos, S.A. de C.V. (āMextransportā) ā 0.3 ā 0.5 ā Operadora de Cinemas, S.A. de C.V. ā ā (*) ā ā 0.2 ā ā ā $ 114.3 ā $ 103.3 ā (*) Less than $0.1 million. Purchase and sale activity: ā Grupo Mexico and affiliates: ā The following table summarizes the purchase and sale activities with Grupo Mexico and its affiliates in the first three months of 2022 and 2021 (in millions): ā ā ā ā ā ā ā ā 2022 2021 Purchase activity ā ā ā ā ā ā Asarco LLC ā $ 14.6 ā $ 3.7 Eolica El Retiro, S.A.P.I. de C.V. ā 0.9 ā 0.2 Ferrocarril Mexicano, S.A. de C.V. ā 5.2 ā 10.9 Grupo Mexico Servicios ā ā 5.0 ā ā 2.5 AMMINCO ā ā 2.2 ā ā 4.6 MGE ā 70.1 ā 77.7 Mexico Compania Constructora S.A. de C.V. ā ā 5.1 ā ā 13.0 Controladora de Infraestructura energĆ©tica S.A. de C.V. ā ā 0.8 ā ā ā Grupo Mexico Servicios de Ingenieria S. A. de C.V. ā 1.3 ā 1.4 Total purchases ā $ 105.2 ā $ 114.0 Sales activity ā ā ā ā ā ā Asarco LLC ā $ 11.4 ā $ 6.9 MGE ā ā 34.5 ā ā 37.9 Total sales ā $ 45.9 ā $ 44.8 ā Grupo Mexico, the parent and the majority indirect stockholder of the Company, and its affiliates provide various services to the Company. These services are primarily related to accounting, legal, tax, financial, treasury, human resources, price risk assessment and hedging, purchasing, procurement and logistics, sales and administrative and other support services. The Company pays Grupo Mexico, AMMINCO and Grupo Mexico Servicios, subsidiaries of Grupo Mexico, for these services and expects to continue requiring these services in the future. ā In the first quarter of 2022, the Company did not make donations to Fundacion Grupo Mexico, A.C., an organization dedicated to promoting the social and economic development of the communities close to the Companyās Mexican operations. In the same period of 2021, the Company made donations of $0.5 million to this organization. ā The Companyās Mexican operations paid fees for freight services provided by Ferrocarril Mexicano, S.A de C.V., which is a subsidiary of Grupo Mexico. Additionally, the CompanyĀ“s Mexican operations paid fees for specialized technical and environmental services to obtain the energy license for El Arco project provided by Controladora de Infraestructura energetica S.A. de C.V., a subsidiary of Infraestructura y transportes Mexico S.A. de C.V., which is a subsidiary of Grupo Mexico. ā The CompanyĀ“s Peruvian and Mexican operations paid fees for engineering services provided by Grupo Mexico Servicios de Ingenieria, S.A. de C.V., and the Companyās Mexican operations paid fees for construction services provided by Mexico Compania Constructora S.A. de C.V. Both companies are subsidiaries of Mexico Proyectos y Desarrollos, S.A. de C.V., which is a subsidiary of Grupo Mexico. ā The Companyās Mexican operations purchased copper concentrates and rod from Asarco LLC and also paid fees for tolling services. Additionally, the CompanyĀ“s Mexican operations purchased power from MGE. Both companies are subsidiaries of Grupo Mexico. ā In 2012, the Company signed a power purchase agreement with MGE, whereby MGE will supply some of the Companyās Mexican operations with power through 2032. MGE has two natural gas-fired combined cycle power generating units, with a net total capacity of 516.2 megawatts and has been supplying power to the Company since December 2013. Currently, MGE is supplying 0.2% of its power output to third-party energy users, compared to 2.7% as of March 31, 2021. ā In 2014, Mexico Generadora de Energia Eolica, S. de R.L. de C.V, an indirect subsidiary of Grupo Mexico, located in Oaxaca, Mexico, acquired Eolica el Retiro. Eolica el Retiro is a windfarm with 37 wind turbines. This company started operations in January 2014 and began to sell power to Industrial Minera Mexico, S.A. de C.V. and subsidiaries (IMMSA) and other subsidiaries of Grupo Mexico in the third quarter of 2014. Currently, Eolica el Retiro supplies approximately 46.6% of its power output to IMMSA and Mexcobre, compared to 9.3% as of March 31, 2021. ā The Company sold starter sheets, copper concentrate, sulfuric acid, silver and gold to Asarco LLC. The Company also received fees for natural gas and services provided to MGE, a subsidiary of Grupo Mexico. ā Companies with relationships to the controlling group: ā The following table summarizes the purchase and sales activities with other Larrea family companies in the first three months of 2022 and 2021 (in millions): ā ā ā ā ā ā ā ā 2022 2021 Purchase activity ā ā ā ā ā ā Boutique Bowling de Mexico S.A. de C.V. ā $ 0.1 ā $ 0.1 Mextransport ā ā 0.4 ā ā 0.4 Operadora de Cinemas S.A. de C.V. ā ā (*) ā ā 0.1 Total purchases ā $ 0.5 ā $ 0.6 ā ā ā ā ā ā ā Sales activity ā ā ā ā ā ā Boutique Bowling de Mexico S.A. de C.V. ā $ (*) ā $ (*) Mextransport ā ā 0.5 ā ā 0.4 Operadora de Cinemas S.A. de C.V. ā ā (*) ā ā (*) Total sales ā $ 0.5 ā $ 0.4 (*) amount is lower than $0.1 million ā The Larrea family controls a majority of the capital stock of Grupo Mexico and has extensive interests in other businesses, including transportation, real estate and entertainment. The Company engages in certain transactions in the ordinary course of business with other entities controlled by the Larrea family relating to the lease of office space, air transportation and entertainment. ā The Companyās Mexican operations paid fees for entertainment services provided by Boutique Bowling de Mexico, S.A de C.V. and Operadora de Cinemas, S.A. de C.V. Both companies are controlled by the Larrea family. Mextransport provides aviation services to the CompanyĀ“s Mexican operations. This is a company controlled by the Larrea family. ā In addition, the Company received fees for building rental and maintenance provided to Boutique Bowling de Mexico, S.A. de C.V. and Operadora de Cinemas, S.A. de C.V. The CompanyĀ“s Mexican operations received fees from Mextransport for reimbursement of maintenance expenses and for rental services. ā Equity Investment in Affiliate: ā In addition, the Company has a 30.0% participation in Apu Coropuna S.R.L. (āApu Coropunaā), which it accounts for on the equity method. Apu Coropuna is a company that performs exploration activities in the Pucay prospect, located in Arequipa, Peru. ā It is anticipated that in the future the Company will enter into similar transactions with these same parties. |
DERIVATIVE INSTRUMENTS_
DERIVATIVE INSTRUMENTS: | 3 Months Ended |
Mar. 31, 2022 | |
DERIVATIVE INSTRUMENTS: | |
DERIVATIVE INSTRUMENTS: | NOTE 6 ā DERIVATIVE INSTRUMENTS: ā From time to time, the Company uses derivative instruments to manage its cash flows exposure to changes in commodity prices. The Company does not enter into derivative contracts unless it anticipates that the possibility exists that future activity will expose the Companyās future cash flows to deterioration. Derivative contracts for commodities are entered into to manage the price risk associated with forecasted purchases of the commodities that the Company uses in its manufacturing process. ā Cash Flow Hedges of Natural Gas ā The Companyās objective in using natural gas derivatives is to protect the stability of natural gas costs and manage exposure to natural gas price increases. To protect natural gas costs from estimated price increases in the past winter season, the Company acquired two derivative instruments that began in November 2021 and ended in March 2022. ā Derivative instruments and its effects as of March 31, 2022, were as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Derivatives designated as hedging instruments under ASC 815 ā Call Option ā Financial Swap Cash Settlement ā Commodity contracts ā Natural gas ā Natural gas ā Gas volume (MMBTUs) ā 5,285,000 ā 5,285,000 ā Hedge premium ($per MMBTU) ā 0.55 ā - ā Reference price (swap: $per MMBTU)) ā Prior month average IFREC price ā 3.75 ā Hedge ā Daily fluctuation range ā Monthly average price ā ā ā 1Q 2022 November 2021 - March 2022 ā 1Q 2022 November 2021 - March 2022 ā Cost (million $) ā (1.7) (2.9) ā - - ā Profit (million $) ā 0.5 0.5 ā 1.7 4.7 ā Net favorable/unfavorable effect (million $) ā (1.2) (2.4) ā 1.7 4.7 ā ā ā 1Q 2022 ā November 2021 - March 2022 ā Combined profit (million $) ā 0.5 ā 2.3 ā ā ā The Company assessed these derivative instruments as Cash Flow Hedges. As such, the effective portions of said hedges were initially reported in Other Comprehensive Income (OCI) and were reclassified as earnings in the same line item associated with the forecasted transaction and in the same period or periods during which the hedged transaction affected earnings. The Company did not identify any ineffective portions of these derivatives. ā As of March 31, 2022 and the same period of 2021, the Company did not hold any derivative instruments. |
LEASES_
LEASES: | 3 Months Ended |
Mar. 31, 2022 | |
LEASES: | |
LEASES: | NOTE 7 ā LEASES: ā The Company has operating leases for power generating facilities, vehicles and properties. The Company recognizes leasing expenses for these leases on a straight-line basis over the lease term. Some of the Companyās leases include both lease and non-lease components which are accounted for separately. The Companyās leases have remaining lease terms of one year to 11 years, and do not include options to extend the leases. The Companyās lease agreements do not contain options to purchase the leased assets or to terminate the leases before the expiration date. In addition, the Companyās lease contracts have no material residual value guarantees or material restrictive covenants. As none of the Companyās leases stipulates an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The weighted average remaining lease term for the Companyās leases is eight years, and the weighted average discount rate for these leases is 3.71%. ā The operating lease expense recognized in the first three months of 2022 and 2021 was classified as follows (in millions): ā ā ā ā ā ā ā ā Classification 2022 2021 Cost of sales (exclusive of depreciation, amortization and depletion) $ 28.8 ā $ 28.6 Selling, general and administrative ā (*) ā (*) Exploration ā (*) ā (*) Total lease expense $ 28.8 ā $ 28.6 ā Maturities of lease liabilities are as follows: ā ā ā ā ā ā ā Lease liabilities Year (in millions) 2022 $ 86.1 2023 ā 113.9 2024 ā 106.3 2025 ā 105.3 2026 ā 105.1 After 2026 ā 624.2 Total lease payments $ 1,140.9 Less: interest on lease liabilities ā (240.1) Present value of lease payments $ 900.8 ā |
ASSET RETIREMENT OBLIGATION_
ASSET RETIREMENT OBLIGATION: | 3 Months Ended |
Mar. 31, 2022 | |
ASSET RETIREMENT OBLIGATION: | |
ASSET RETIREMENT OBLIGATION: | ā ā NOTE 8 ā ASSET RETIREMENT OBLIGATION: ā Peruvian operations: ā The Company maintains an asset retirement obligation for its mining properties in Peru, as required by the Peruvian Mine Closure Law. In accordance with the requirements of this law, the Companyās closure plans were approved by the Peruvian Ministry of Energy and Mines (āMINEMā). As part of the closure plans, the Company is required to provide annual guarantees over the estimated life of the mines, based on a present value approach, and to furnish the funds for the asset retirement obligation. This law requires a review of closing plans every five years . ā On June 24, 2019, MINEM approved a change to the guarantees required for the mining closure plans. The new regulation specifies that annual guarantees can be secured with real estate up to a maximum of 50% and the remaining amount with credit instruments. Currently, the Company has pledged the value of its Lima office complex for the 50% of the guarantee and with a stand-by letter of credit for the other 50% as a security for this obligation.Through January 2022, the Company has provided total guarantees of $66.3 million. ā The closure cost recognized for this liability includes the cost, as outlined in its closure plans, of dismantling the Toquepala and Cuajone concentrators, the Ilo smelter and refinery, and the shops and auxiliary facilities at the three units. In March 2016, MINEM approved the Mining Closure Plan for the Toquepala expansion project and the revised closure plans for the Cuajone mine and the Ilo facilities were approved in January and October 2019 respectively. Based on these new estimates, the Company increased the asset retirement obligation by $28.1 million in 2019. The closure plan for the Tia Maria project was approved in February 2017. However, the Company has not recorded a retirement obligation for the Tia Maria project because work on the project is still on hold. The Company believes that under these circumstances, the recording of a retirement obligation is not appropriate. ā ā Mexican operations: ā The Company has recognized an estimated asset retirement obligation for its mining properties in Mexico as part of its environmental commitment. Even though there is currently no enacted law, statute, ordinance, written or oral contract requiring the Company to carry out mine closure and environmental remediation activities, the Company believes that a constructive obligation presently exists based on the remediation requirements caused by the closure of any facility. The overall cost recognized for mining closure in Mexico includes the estimated costs of dismantling concentrators, smelter and refinery plants, shops and other facilities. ā In the first quarter of 2022, the Company adjusted its estimate for the asset retirement obligation for its Mexican operations following a detailed review of the closing activities required. The effect was an increase in the asset retirement obligation to the order of $43.3 million. ā The following table summarizes the asset retirement obligation activity for the first three months of 2022 and 2021 (in millions): ā ā ā ā ā ā ā ā 2022 2021 Balance as of January 1 ā $ 562.9 ā $ 545.0 Changes in estimates ā 43.3 ā ā Closure payments ā (2.0) ā (0.2) Accretion expense ā 6.5 ā 6.1 Balance as of March 31, ā $ 610.7 ā $ 550.9 ā |
BENEFIT PLANS_
BENEFIT PLANS: | 3 Months Ended |
Mar. 31, 2022 | |
BENEFIT PLANS: | |
BENEFIT PLANS: | ā NOTE 9 ā BENEFIT PLANS: ā Post retirement defined benefit plans: ā The Company has two non-contributory defined benefit pension plans to cover former salaried employees in the United States and certain former expatriate employees in Peru. Effective October 31, 2000, the Board of Directors amended the qualified pension plan to suspend the accrual of benefits. ā In addition, the Companyās Mexican subsidiaries have a defined contribution pension plan for salaried employees and a non-contributory defined benefit pension plan for union employees. ā The components of net periodic benefit costs for the first three months of 2022 and 2021 are as follows (in millions): ā ā ā ā ā ā ā ā (in millions) 2022 2021 Service cost ā $ 0.4 ā $ 0.4 Interest cost ā 0.5 ā 0.3 Expected return on plan assets ā (1.0) ā (0.8) Amortization of net loss/(gain) ā 0.1 ā 0.1 Net periodic benefit cost ā $ ā ā $ ā ā Post-retirement health care plans: ā United States: The Company adopted a post-retirement health care plan for retired salaried employees eligible for Medicare in 1996. The Company manages the plan and is currently providing health benefits to retirees. The plan is accounted for in accordance with ASC 715 āCompensation retirement benefitsā. As of December 31, 2021, because there has been a significant reduction in participants and in the amount of liability, the Company considered that this plan was not material enough to run a valuation. ā In Mexico, health services are provided by the Mexican Social Security Institute. ā The components of net periodic benefit cost for the first three months of 2022 and 2021 are as follows (in millions): ā ā ā ā ā ā ā ā (in millions) 2022 2021 Interest cost ā $ 0.4 ā $ 0.4 Amortization of net loss (gain) ā (*) ā (*) Amortization of prior service cost/ (credit) ā (*) ā 0.1 Net periodic benefit cost ā $ 0.4 ā $ 0.5 ā |
COMMITMENTS AND CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES: | 3 Months Ended |
Mar. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES: | |
COMMITMENTS AND CONTINGENCIES: | NOTE 10 ā COMMITMENTS AND CONTINGENCIES: ā Environmental matters: ā The Company has established comprehensive environmental conservation programs at its mining facilities in Peru and Mexico. The Companyās environmental programs include, water recovery systems to conserve water and minimize the impact on nearby streams, reforestation programs to stabilize the surface of the tailings dams and the implementation of scrubbing technology in the mines to reduce dust emissions, among others. ā Environmental capital investments in the first quarter of 2022 and 2021 were as follows (in millions): ā ā ā ā ā ā ā ā ā 2022 2021 Peruvian operations ā $ 1.4 ā $ 0.1 Mexican operations ā 12.6 ā 5.4 ā ā $ 14.0 ā $ 5.5 ā Peruvian operations ā Air Quality Standards (āAQSā): ā Soil Environmental Quality Standards (āSQSā) ā Climate change: Framework. This law establishes that it is in the national interest to promote public and private investments in climate change management. The law proposes creating an institutional framework to address climate change in Peru, and outlines new measures, particularly with respect to climate change mitigation. For example, it includes provisions addressing an increase in carbon capture and use of carbon sinks, afforestation and reforestation practices; land use changes; and sustainable systems of transportation, solid waste management, and energy systems. This is the first Latin American climate change framework law to incorporate obligations from the Paris Agreement. Regulations to this law were enacted by Supreme Decree 013-2019 published on December 31, 2019, and are applicable to all Peruvian institutions and agencies. It is expected that further Peruvian regulations will be applicable to non-governmental entities. However, no carbon pricing mechanism is currently applicable to the Companyās operations in Peru. Mexican operations ā The principal legislation applicable to the Companyās Mexican operations is the Federal General Law of Ecological Balance and Environmental Protection (the āGeneral Lawā), which is enforced by the Federal Bureau of Environmental Protection (āPROFEPAā). PROFEPA monitors compliance with environmental legislation and enforces Mexican environmental laws, regulations and official standards. It may also initiate administrative proceedings against companies that violate environmental laws, which in the most extreme cases may result in the temporary or permanent shutdown of non-complying facilities, the revocation of operating licenses and/or other sanctions or fines. ā In 2011, the General Law was amended to provide an individual or entity the ability to challenge administrative acts, including environmental authorizations, permits or concessions granted, without the need to demonstrate the actual existence of harm to the environment as long as it can be argued that the harm may be caused. Additionally, amendments to the Civil Federal Procedures Code (āCFPCā) were enacted in 2011, and established ā In 2013, the Environmental Liability Federal Law was enacted. This law establishes general guidelines for actions to be considered likely to cause environmental harm. If a possible determination regarding harm occurs, environmental clean-up and remedial actions sufficient to restore environment to a pre-existing condition should be taken. If restoration is not possible, compensation measures must be provided. Criminal penalties and monetary fines may be imposed under this law. ā On February 2019, the Mexican Supreme Court confirmed the constitutionality of an ecological tax on extractive activities conducted in the state of Zacatecas, which taxes environmental remediation actions, emissions of certain gases to the atmosphere, emissions of polluting substances to the soil or water, and waste storage within the state. The Company has determined that this new environmental regulation will have no impact on its financial position. ā Guaymas sulfuric acid spill: ā The Guaymas bay has an estimated water volume of 340 million cubic meters. The spill, upon entering in contact with the seaās alkaline conditions, led to quick dilution of the discharge. Thus, the sulfuric acid was naturally and immediately neutralized. As a result, the discharge was considered harmless; the report from the Ministry of Navy found that neither the flora nor fauna of the port area were affected. ā On July 10, 2019, PROFEPA made a first inspection of the area, concluding that the Company executed all the appropiate procedures in order to contain the discharge, and no reference was made to the existence of negative impacts on the environment resulting from the incident. ā On Friday, July 19, 2019, PROFEPA revisited the facilities to carry out a second inspection and declared a partial temporary shutdown that only affected the storage process and transportation of sulfuric acid at the terminal, arguing the absence of an authorization of environmental impact. It is important to note that these facilities have been in operation since 1979, prior to the 1988 Mexican General Law of Ecological Balance and the Protection of the Environment. Companies that were operating before the aforementioned law are exempt from the permit requirement. In addition, in 2009, PROFEPA awarded a certification of āClean Industry and Environmental Qualityā to the facility which was subsequently renewed four times (for a two-year period each time). ā The Company filed a lawsuit against the closure, which was dismissed by a ruling on August 25, 2021. This ruling has been challenged through a motion to reopen the case, which was submitted on September 28, 2021. On January 4, 2022, the challenge was resolved. The authority imposed two fines and ruled that the temporary closure would remain in place until the environmental impact statement is obtained. The Company intends to appeal this ruling ā The Company is not aware of the reasons or causes for this partial and temporary closure, but will continue working with the environmental authorities to provide assurance that the operation is in strict compliance with environmental regulations. The Company expects the environmental authorities to suspend the partial temporary shutdown, once their concerns are resolved. Currently, the Company does not expect any impact on its operations. As of March 31, 2022, the matter is pending resolution. ā Climate change: ā The Company has also been participating in Mexicoās āGHG Programā since its inception in 2005, which is a voluntary initiative for the registry and reporting of greenhouse gases emissions. ā The Company believes that all of its facilities in Peru and Mexico are in material compliance with environmental, mining and other applicable laws and regulations. The Company also believes that continued compliance with environmental laws of Mexico and Peru will have no material adverse effects on the Companyās business, properties, or operating results. ā Litigation matters ā Peruvian operations: ā The Tia Maria Mining Project ā There are five lawsuits filed against the Peruvian Branch of the Company related to the Tia Maria project. The lawsuits seek (i) to declare null and void the resolution that approved the Environmental Impact Assessment of the project; (ii) the cancellation of the project and the withdrawal of mining activities in the area; (iii) to declare null and void the mining concession application for the Tia Maria project; and (iv) to declare null and void the resolution that approved the construction license. The lawsuits were filed by Messrs. Jorge Isaac del Carpio Lazo (filed May 22, 2015), Ernesto Mendoza Padilla (filed May 26, 2015), Juan Alberto Guillen Lopez (filed June 18, 2015), Junta de Usuarios del Valle del Tambo (filed April 30, 2015), and Gobierno Regional de Arequipa (filed December 16, 2019). ā The del Carpio Lazo case was rejected by the court of first instance on November 14, 2016. The plaintiff filed an appeal before the Superior Court on January 3, 2017. On January 9, 2018, the lawyers of both parties presented their respective positions before the Appellate Court. On March 8, 2018, the Appellate Court issued its final decision, which upheld the first instance courtĀ“s ruling. On April 27, 2018, the plaintiff filed an extraordinary appeal before the Supreme Court. On January 21, 2022, the Supreme Court rejected the extraordinary appeal filed by the plaintiff. Therefore, the case has concluded in favor of SCCās Peruvian Branch. ā The Mendoza Padilla case was initially rejected by the lower court on July 8, 2015. This ruling was confirmed by the Superior Court on June 14, 2016. On July 12, 2016, the case was appealed before the Constitutional Court. On November 20, 2018, the Constitutional Court reversed the previous decisions and remanded the case to the lower court for further action. In the third quarter of 2020, the Company was notified that the complaint had been reinstated. The Company answered the complaint on September 15, 2020. On December 2, 2020, the lower court issued a resolution, considering the complaint answered. On September 27, 2021, the Court ordered to temporarily archive the case. As of March 31, 2022, the case remains pending resolution. ā The Guillen Lopez case is currently before the lower court. Oral arguments took place on July 19, 2019,. On January 7, 2020, the Judge decided to suspend the proceeding until the del Carpio Lazo case is concluded. On March 3, 2022, SCCās Peruvian Branch informed the Court that the del Carpio Lazo case had concluded. As of March 31, 2022, the case remains pending resolution. ā The Junta de Usuarios del Valle del Tambo case is currently before the lower court. On May 2016, the Company was included in the process, after the Ministry of Energy and Mines filed a civil complaint. On March 6, 2019, the Company was formally notified of the lawsuit and answered the complaint on March 20, 2019. On July 8, 2019, the Company requested the suspension of the proceeding until the del Carpio Lazo case is concluded. On March 3, 2022, SCCās Peruvian Branch informed the Court that the del Carpio Lazo case had concluded. As of March 31, 2022, the case remains pending resolution. ā The Gobierno Regional de Arequipa case is currently before the lower court. The Company answered the complaint on September 15, 2020. On February 8, 2021, the Judge decided to suspend the proceeding until the del Carpio Lazo case is concluded. On March 24, 2022, SCCās Peruvian Branch informed the Court that the del Carpio Lazo case had concluded. As of March 31, 2022, the case remains pending resolution. ā The Company asserts that these lawsuits are without merit and is vigorously defending against them. The potential contingency amount for these cases cannot be reasonably estimated by management at this time. ā Special Regional Pasto Grande Project (āPasto Grande Projectā) ā In 2012, the Pasto Grande Project, an entity of the Regional Government of Moquegua, filed a lawsuit against SCCās Peruvian Branch alleging property rights over a certain area used by the Peruvian Branch and seeking the demolition of the tailings dam where SCCās Peruvian Branch has deposited its tailings from the Toquepala and Cuajone operations since 1995. The Peruvian Branch has had title to use the area in question since 1960 and has, since 1995, constructed and operated the tailings dams with proper governmental authorization. Following a motion filed by the Peruvian Branch, the lower court included MINEM as a defendant in this lawsuit. MINEM has answered the complaint and denied the validity of the claim. As of March 31, 2022, the case was pending resolution without further developments. ā SCCās Peruvian Branch asserts that the lawsuit is without merit and is vigorously defending against it. The amount of this contingency cannot be reasonably estimated by management at this time. ā Mexican operations: ā The Accidental Spill at Buenavista Mine of 2014 ā In relation to the 2014 accidental spill of copper sulfate solution at a leaching pond in the Buenavista mine, the following legal procedures are pending against the Company: ā On August 19, 2014, PROFEPA, as part of the administrative proceeding initiated after the spill, announced the filing of a criminal complaint against Buenavista del Cobre S.A. de C.V. (āBVCā), a subsidiary of the Company, in order to determine those responsible for environmental damages. During the second quarter of 2018, the criminal complaint was dismissed. This decision was appealed and was pending resolution as of March 31, 2022. ā Through the first half of 2015, six collective action lawsuits were filed in federal courts in Mexico City and Sonora against two subsidiaries of the Company seeking economic compensation, clean up and remedial activities in order to restore the environment to its pre-existing conditions. Three of the collective action lawsuits have been dismissed by the court. As of March 31, 2022, ā Similarly, during 2015, eight civil action lawsuits were filed against BVC in the state courts of Sonora seeking damages for alleged injuries and for moral damages as a consequence of the spill. The plaintiffs in the state court lawsuits are: Jose Vicente Arriola Nunez et al; Santana Ruiz Molina et al; Andres Nogales Romero et al; Teodoro Javier Robles et al; Gildardo Vasquez Carvajal et al; Rafael Noriega Souffle et al; Grupo Banamichi Unido de Sonora El Dorado, S.C. de R.L. de C.V; and Marcelino Mercado Cruz. In 2016, three additional civil action lawsuits, claiming similar damages, were filed by Juan Melquicedec Lebaron; Blanca Lidia Valenzuela Rivera et al and Ramona Franco Quijada et al. In 2017, BVC was served with thirty-three additional civil action lawsuits, claiming similar damages. The lawsuits were filed by Francisco Javier Molina Peralta et al; Anacleto Cohen Machini et al; Francisco Rafael Alvarez Ruiz et al; Jose Alberto Martinez Bracamonte et al; Gloria del Carmen Ramirez Duarte et al; Flor Margarita Sabori et al; Blanca Esthela Ruiz Toledo et al; Julio Alfonso Corral Dominguez et al; Maria Eduwiges Bracamonte Villa et al; Francisca Marquez Dominguez et al; Jose Juan Romo Bravo et al; Jose Alfredo Garcia Leyva et al; Gloria Irma Dominguez Perez et al; Maria del Refugio Romero et al; Miguel Rivas Medina et al; Yolanda Valenzuela Garrobo et al; Maria Elena Garcia Leyva et al; Manuel Alfonso Ortiz Valenzuela et al; Francisco Alberto Arvayo Romero et al; Maria del Carmen Villanueva Lopez et al; Manuel Martin Garcia Salazar; Miguel Garcia Arguelles et al; Dora Elena Rodriguez Ochoa et al; Honora Eduwiges Ortiz Rodriguez et al; Francisco Jose Martinez Lopez et al; Maria Eduwiges Lopez Bustamante; Rodolfo Barron Villa et al, Jose Carlos Martinez Fernandez et al, Maria de los Angeles Fabela et al; Rafaela Edith Haro et al; Luz Mercedes Cruz et al; Juan Pedro MontaƱo et al; and Juana Irma Alday Villa. In the first quarter of 2018, BVC was served with another civil action lawsuit, claiming similar damages. The lawsuit was filed by Alma Angelina Del Cid Rivera et al. In the last quarter of 2018, BVC was served with other three civil action lawsuits, claiming similar damages. These lawsuits were filed by Los Corrales de la Estancia, S.C. de R.L.; Jose Antonio Navarro; Jesus Maria PeƱa Molina, et al; these actions were dismissed by the court, because they have expired. As of March 31, 2022, forty-five cases remain pending resolution. ā In 2015, four constitutional lawsuits (juicios de amparo) were filed before Federal Courts against various authorities and against a subsidiary of the Company, arguing; (i) the alleged lack of a waste management program approved by SEMARNAT; (ii) the alleged lack of a remediation plan approved by SEMARNAT with regard to the August 2014 spill; (iii) the alleged lack of community approval regarding the environmental impact authorizations granted by SEMARNAT to one subsidiary of the Company; and (iv) the alleged inactivity of the authorities with regard to the spill in August 2014. The plaintiffs in these lawsuits are: Francisca Garcia Enriquez, et al filed two lawsuits, Francisco Ramon Miranda, et al and Jesus David Lopez Peralta et al. In the third quarter of 2016, four additional constitutional lawsuits, claiming similar damages were filed by Mario Alberto Salcido et al; Maria Elena Heredia Bustamante et al; Martin Eligio Ortiz Gamez et al; and Maria de los Angeles Enriquez Bacame et al. In the third quarter of 2017, BVC was served with another constitutional lawsuit filed by Francisca GarcĆa Enriquez et al. In 2018, BVC was served with two additional constitutional lawsuits that were filed against SEMARNAT by Norberto Bustamante et al. With regard to the constitutional lawsuit filed by Maria Elena Heredia Bustamante et al; in which it was claimed the lack of community approval regarding the authorization granted by SEMARNAT to build the new BVC tailings dam, on September 5, 2018, the Supreme Court of Justice issued a resolution establishing that such authorization was granted to BVC in compliance with the applicable legislation. However, SEMARNAT must carry out a public meeting to inform the community of the technical aspects required to build the dam, potential impacts and prevention measures. This public meeting will have no material effects to BVCās operations. SEMARNAT has carried out the consultation ordered by the Supreme Court. As a result, it has informed the corresponding Judge its compliance with the resolution, in which BVC was required to implement additional measures of environmental impact prevention, such as: (i) the building of at least three monitoring wells downstream from the curtain of the contingency dam in a period of six months; (ii) monitoring of the groundwater level and water quality every six months; (iii) carrying out rain collection work in order to restore water to the Sonora River basin, with six months granted to present the execution program; (iv) determine the location of wildlife conservation and protection areas and define the need to establish biological corridors; (v) obtain photographic or videographic evidence every six months; (vi) submitting to SEMARNAT two years before the closure and abandonment of the site, or earlier if necessary, the closure program that includes the cleaning and restoration of the soil including Mexican regulation NOM-141; (vii) include the measures in the Environmental Monitoring Program according to the environmental components impacted; and (viii) hiring an external environmental consultant to validate compliance with the current and new conditions imposed. The foregoing does not impact BVCās operations. Additionally, the lawsuits filed by Maria de los Angeles Enriquez Bacame and Norberto Bustamante have been dismissed and closed without prejudice to the Company. As of March 31, 2022, the remaining cases were still pending resolution. ā It is currently not possible to determine the extent of the damages sought in these state and federal lawsuits but the Company believes that these lawsuits are without merit. Accordingly, the Company is vigorously defending against them. Nevertheless, the Company believes that none of the legal proceedings resulting from the spill, individually or in the aggregate, would have a material effect on its financial position or results of operations. ā Corporate operations: ā Carla Lacey, on behalf of herself and all other similarly situated stockholders of Southern Copper Corporation, and derivatively on behalf of Southern Copper Corporation ā In April 2019, a derivative lawsuit was filed against the Company, certain current and former Directors, and Grupo Mexico in the Delaware Court of Chancery relating to certain construction contracts, contracts for the purchase and sale of minerals, and transportation contracts entered into between the Companyās subsidiaries and subsidiaries of Grupo Mexico. ā In October 2019, the plaintiff amended the complaint to include claims related to certain administrative services contracts between the Companyās subsidiaries and Grupo Mexico. The amended complaint alleges, among other things, that the construction, mineral, transportation, and administrative services contracts were unfair as a result of breaches of fiduciary duties and the Companyās charter. The amended complaint also added Americas Mining Corporation (āAMCā) as a defendant, alleging that AMC breached its fiduciary duties as a controlling stockholder of the Company. The amended complaint seeks, among other things, unspecified monetary damages. In January 2020, the Company, the current and former Directors, and Grupo Mexico responded to the complaint by filing motions to dismiss. The Plaintiff filed a brief in response to the motions on March 13, 2020. On July 16, 2020, the Court denied the motions to dismiss the breach of fiduciary duty claims against the Directors. On October 6, 2020, the Court dismissed the Plaintiffās claims against Grupo Mexico for lack of personal jurisdiction. On February 11, 2021, the Court granted the Directorsā motion to dismiss plaintiffās breach of contract claim. The Court also granted AMCās motion to dismiss all claims against AMC other than those related to the mineral contracts. ā On July 12, 2021, the parties reached an agreement-in-principle to settle the lawsuit, subject to Court approval. On September 29, 2021, the parties filed a Stipulation and Agreement of Compromise, Settlement and Release with the Court. On February 1, 2022, the Judge approved the settlement and awarded certain fees to the plaintiffās attorneys. The Judgeās order for this decision was registered on February 2, 2022. Under applicable law, there was a 30-day period for parties to appeal the Judge's order. This period expired on March 4, 2022, and therefore the Judge's order is considered final. ā ā Labor matters ā Peruvian operations: ā During 2021, the Company decided to hold talks with the six unions to sign collective agreements prior to their effective dates. As a result, between June and December 2021, the Company signed collective agreements with the six unions with durations between three to six years . All of them granted annual salary increases of 5%. Additionally, each agreement granted, among other things, a signing bonus of between S/45,000 (approximately $12,159) and S/90,000 (approximately $22,318), depending on the duration of the agreement. A long-term agreement bonus of S/10,000 (approximately $2,702) was granted to the union that signed a six-year extension of the collective bargaining agreement. All these concepts were recorded as labor expense. ā As of March 31, 2022, the Company has no pending negotiations with Peruvian unions. ā Mexican operations : The workers of the San Martin mine were on strike since July 2007. On February 28, 2018, the striking workers of the San MartĆn mine of IMMSA held an election to vote on the union that would hold the collective bargaining agreement at the San MartĆn mine. The Federacion Nacional de Sindicatos Independientes (the National Federation of Independent Unions) won the vote by a majority. Nevertheless, the vote was challenged by the National Mining Union. On June 26, 2018, the Federal Mediation and Arbitration Board issued a ruling recognizing the election results. Due to the agreement between workers and the Company to end the protracted strike, on August 22, 2018, the Federal Mediation and Arbitration Board authorized the restart of operations of the San MartĆn mine. Such authorization was challenged by the National Mining Union. On April 4, 2019, the Federal Mediation and Arbitration Board recognized, once again, the election results from February 28, 2018, by which the National Federation of Independent Unions won by a majority. In the last quarter of 2019, a Federal Court issued a resolution that established that the Labor Court should analyze the list of workers with the right to vote in the union election. The Company and the National Federation of Independent Unions challenged such determination before the Supreme Court of Justice. Such challenges were dismissed by the Supreme Court. As a consequence, on September 6, 2021, the Federal Mediation and Arbitration Board issued a new resolution determining that, based on the documents submitted by the National Federation of Independent Unions and given the status of the strike until 2018, it was not possible to create a registry of workers holding a right to vote. Therefore, in case of a strike, any economic collective proceedings shall remain suspended. The Federal Mediation and Arbitration Board shall decide on the request of the majority of workers to end the strike, despite the opposition of the National Mining Union. The Company expects that the conflict will be solved in accordance with the legal framework set by labor authorities and that any actions taken will respect the workersā will. ā As of March 31, 2022, the Company had completed most of the rehabilitation plan to restore operations at the San Martin mine, at a total expense of approximately $90.5 million; the mine has since reached full operating capacity. ā In the case of the Taxco mine, its workers have been on strike since July 2007. After several legal procedures, in August 2015, the Supreme Court decided to assert jurisdiction over the case and to rule on it directly. As of March 31, 2022, the case was pending resolution without further developments. ā It is expected that operations at the Taxco mine will remain suspended until the labor issues are resolved. In view of the lengthy strike, the Company has reviewed the carrying value of the Taxco mine to ascertain whether impairment exists. The Company concluded that there is a non-material impairment of the assets located at this mine. ā In 2020, a small group of workers at the Charcas mine claimed an additional workersā participation payment and a minor incident was reported. This claim lacked legal basis given that the Company had already completely fulfilled said obligation with the workers in question. Consequently, the Company took legal action and through conciliation and mediation with labor authorities, the incident concluded with no further repercussions for the Company. ā Other legal matters ā The Company is involved in various other legal proceedings incidental to its operations, but the Company does not believe that decisions adverse to it in any such proceedings, individually or in the aggregate, would have a material effect on its financial position or results of operations. ā ā Other commitments: ā Peruvian Operations: ā Tia Maria ā On August 1, 2014, the Company received final approval for Tia MariaĀ“s Environmental Impact Assessment (āEIAā). On July 8, 2019, the Company received the construction permit for this 120,000 ton annual SX-EW copper greenfield project with a total capital budget of $1,400 million. This permit was obtained after completing an exhaustive review process, complying with all established regulatory requirements and addressing all observations raised. ā On July 15, 2019, anti-mining groups staged a violent demonstration affecting economic as well as other activities in the Islay province. These actions were followed by the filing of three complaints, sponsored by groups opposing the Tia Maria project, with the Mining Council, which is the Peruvian administrative authority responsible for ruling on these complaints. The Mining Council temporarily suspended the construction permit on August 8, 2019. On October 7, 2019, as part of the process, the Mining Council conducted a hearing to hear the complaints and the CompanyĀ“s position. On October 30, 2019, the Mining Council of the Peruvian Ministry of Energy and Mines ratified the construction permit for the Tia Maria project. ā The Company has been working to promote the welfare of the Islay province population. As part of these efforts, the Company has implemented social programs in education, healthcare and productive development to improve the quality-of-life in the region. The Company also has promoted agricultural and livestock activities in the Tambo Valley and supported growth in manufacturing, fishing and tourism in Islay. ā During the construction and operation phase, the Company will make it a priority to hire local labor to fill the 9,000 jobs (3,600 direct and 5,400 indirect) that the Company expects to generate during Tia Mariaās construction phase. When operating, the Company expects Tia Maria to directly employ 600 workers and indirectly provide jobs for another 4,200. Additionally, from day one of its operations, the Company will generate significant contributions to revenues in the Arequipa region via royalties and taxes. ā Tia MariaĀ“s project budget is approximately $1.4 billion, of which $332.3 million had been invested as of March 31, 2022. This project will use state-of-the-art SX-EW technology with the highest international environmental standards. SX-EW facilities are the most environmentally friendly in the industry as they do not require a smelting process and therefore, do not release any emissions into the atmosphere. ā Michiquillay ā In June 2018, the Company signed a contract for the acquisition of the Michiquillay copper project in Cajamarca, Peru, at a purchase price of $400 million. Michiquillay is a world-class mining project with estimated inferred mineral resources of 2,288 million tonnes with an estimated copper grade of 0.43%. It is expected to produce 225,000 tonnes of copper per year (along with by-products of molybdenum, gold and silver) for an initial mine life of more than 25 years. ā On September 3, 2021, the Company signed a social agreement with the Michiquillay community. On October 1, 2021, the Peruvian Ministry of Energy and Mines approved the semi-detailed environmental impact study for the project. Additionally, on November 12, 2021, the Company signed a Social Agreement with the EncaƱada Community. These events will allow the Company to initiate an in-depth exploration program in the second quarter of 2022. ā The main commitments signed by the Company in the social agreements with the Michiquillay project communities are related to providing support for agricultural and livestock activities, economic development of local initiatives, and social programs in favor of education, water management, waste disposal, and healthcare for vulnerable groups. ā The Company paid $12.5 million at the signing of the contract. In June 2021, the Company made an additional payment of $12.5 million. The balance of $375.0 million will be paid if the Company decides to develop the project, which is not a present obligation. Corporate Social Responsibility ā The Company has a corporate social responsibility policy to maintain and promote the continuity of its mining operations and obtain the best results. The main objective of this policy is to integrate the CompanyĀ“s operations with local communities in the areas of influence of its operations by creating permanent positive relationships to develop optimum social conditions and promote sustainable development in the area. Accordingly, the Company has made the following commitments: ā Tacna Region: ā As the Toquepala expansion project has been completed, the Company considers that these commitments constitute present obligations of the Company and consequently has recorded a liability of $34.6 million in its condensed consolidated financial statements as of March 31 2022. ā In addition, the Company has committed S/70.3 million (approximately $19.0 million) for the construction of a high-performance school in the Tacna region under the āsocial investment for taxesā (obras por impuestos) program, which allows the Company to use these amounts as an advance payment of taxes. ā Moquegua Region: ā In addition, the Company has committed S/100.4 million (approximately $27.1 million) to build two infrastructure projects in the Moquegua region under the āsocial investment for taxesā (obras por impuestos) program, which allows the Company to use these amounts as an advance payment of taxes. ā Power purchase agreements ā ā Electroperu S.A.: In June 2014, the Company entered into a power purchase agreement for 120 megawatts (āMWā) with the state power company Electroperu S.A., under which Electroperu S.A. began supplying energy for the Peruvian operations for twenty years starting on April 17, 2017. ā ā Kallpa Generacion S.A. (āKallpaā): In July 2014, the Company entered into a power purchase agreement for 120MW with Kallpa, an independent Israeli owned power company, under which Kallpa will supply energy for the Peruvian operations for ten years starting on April 17, 2017 and ending on April 30, 2027. In May 2 |
STOCKHOLDERS' EQUITY_
STOCKHOLDERS' EQUITY: | 3 Months Ended |
Mar. 31, 2022 | |
STOCKHOLDERS' EQUITY: | |
STOCKHOLDERS' EQUITY: | ā NOTE 11 ā STOCKHOLDERSāEQUITY: ā Treasury Stock: ā Activity in treasury stock in the three-month period ended March 31, 2022 and 2021 is as follows (in millions): ā ā ā ā ā ā ā ā ā 2022 2021 Southern Copper common shares ā ā ā ā ā ā Balance as of January 1, ā $ 2,767.2 ā $ 2,767.5 Used for corporate purposes ā (0.1) ā ā Balance as of March 31, ā 2,767.1 ā 2,767.5 ā ā ā ā ā ā ā Parent Company (Grupo Mexico) common shares ā ā ā ā ā ā Balance as of January 1, ā 306.8 ā 296.0 Other activity, including dividend, interest and foreign currency translation effect ā 13.8 ā (2.3) Balance as of March 31, ā 320.6 ā 293.7 Treasury stock balance as of March 31, ā $ 3,087.7 ā $ 3,061.2 ā Southern Copper Common Shares: ā At March 31, 2022 and at December 31, 2021, there were in treasury 111,506,017 and 111,509,217 shares of SCCās common stock, respectively. ā SCC share repurchase program: ā In 2008, the Companyās Board of Directors (āBODā) authorized a $500 million share repurchase program that has since been increased by the BOD and is currently authorized to $3 billion. Pursuant to this program, the Company has purchased 119.5 million shares of common stock at a cost of $2.9 billion. These shares are available for general corporate purposes. The Company may purchase additional shares of its common stock from time to time, based on market conditions and other factors. This repurchase program has no expiration date and may be modified or discontinued at any time. ā There has been no activity in the SCC share repurchase program since the third quarter of 2016. The NYSE closing price for SCC common shares as of March 31, 2022 was $75.90 and the maximum number of shares that the Company could purchase at that price was 1.1 million. ā As a result of the repurchase of shares of SCCās common stock, Grupo Mexicoās direct and indirect ownership was 88.9% as of March 31, 2022. ā Directorsā Stock Award Plan: ā The Company established a stock award compensation plan for certain directors who are not compensated as employees of the Company. Under this plan, participants received 1,200 shares of common stock upon election and 1,200 additional shares following each annual meeting of stockholders thereafter. 600,000 shares of Southern Copper common stock have been reserved for this plan. On April 26, 2018, the Company's stockholders approved a five-year extension of the Plan until January 29, 2023 and an increase of the shares award from 1,200 to 1,600. The fair value of the award is measured each year at the date of the grant. Commencing with the 2021 grant, the 1,600 shares shall be granted quarterly and conditioned upon the attendance of each director to each Board meeting. The award is not subject to vesting requirements. ā ā ā ā ā ā ā 2022 2021 Total SCC shares reserved for the plan 600,000 600,000 Total shares granted at January 1, (405,200) (391,600) Granted in the period (3,200) ā Total shares granted at March 31, (408,400) (391,600) Remaining shares reserved 191,600 208,400 ā Parent Company common shares: ā At March 31, 2022 and at December 31, 2021 there were in treasury 79,728,356 and 79,800,655 of Grupo Mexicoās common shares, respectively. ā Employee Stock Purchase Plan: ā 2015 Plan 10 ā If Grupo Mexico pays dividends on shares during the eight year period, the participants will be entitled to receive the dividend in cash for all shares that have been fully purchased and paid as of the date that the dividend is paid. If the participant has only partially paid for shares, the entitled dividends will be used to reduce the remaining liability owed for purchased shares. ā In the case of voluntary or involuntary resignation/termination of the employee, the Company will pay to the employee the fair market sales price at the date of resignation of the fully paid shares, net of costs and taxes. When the fair market sales value of the shares is higher than the purchase price, the Company will apply a deduction over the amount to be paid to the employee based on a decreasing schedule specified in the plan. ā In case of retirement or death of the employee, the Company will render the buyer or his legal beneficiary, the fair market sales value as of the date of retirement or death of the shares effectively paid, net of costs and taxes. ā The stock based compensation expense for the first three months of 2022 and 2021 and the unrecognized compensation expense under this plan were as follows (in millions): ā ā ā ā ā ā ā ā 2022 2021 Stock based compensation expense ā $ 0.2 ā $ 0.2 Unrecognized compensation expense ā $ 0.6 ā $ 1.2 ā The following table presents the activity of this plan for the three months ended March 30, 2022 and 2021: ā ā ā ā ā ā ā ā ā ā ā Unit Weighted Average ā ā Shares ā ā Grant Date Fair Value Outstanding shares at January 1, 2022 867,234 ā ā $ 2.63 Granted ā ā ā ā Exercised (16,394) ā ā $ 2.63 Forfeited ā ā ā ā Outstanding shares at March 31, 2022 850,840 ā ā $ 2.63 Outstanding shares at January 1, 2021 1,264,410 ā ā $ 2.63 Granted ā ā ā ā Exercised (293,041) ā ā $ 2.63 Forfeited ā ā ā ā Outstanding shares at March 31, 2021 971,369 ā ā $ 2.63 ā 2018 Plan: 10 ā If Grupo Mexico pays dividends on shares during the eight-year period, the participants will be entitled to receive the dividend in cash for all shares that have been fully purchased and paid as of the date that the dividend is paid. If the participant has only partially paid for shares, the entitled dividends will be used to reduce the remaining liability owed for purchased shares. ā In the case of voluntary or involuntary resignation/termination of the employee, the Company will pay to the employee the fair market sales price on the date of resignation of the fully paid shares, net of costs and taxes. When the fair market sales value of the shares is higher than the purchase price, the Company will apply a deduction over the amount to be paid to the employee based on a decreasing schedule specified in the plan. ā In case of retirement or death of the employee, the Company will render the buyer or his legal beneficiary, the fair market sales value as of the date of retirement or death of the shares effectively paid, net of costs and taxes. ā The stock based compensation expense for the three months ended March 31, 2022 and 2021 and the unrecognized compensation expense under this plan were as follows (in millions): ā ā ā ā ā ā ā ā 2022 ā 2021 Stock based compensation expense ā $ 0.2 $ 0.2 Unrecognized compensation expense ā $ 2.9 $ 3.6 ā The following table presents the stock award activity of this plan for the three months ended March 31, 2022 and 2021: ā ā ā ā ā ā ā ā ā ā Unit Weighted Average ā Shares Grant Date Fair Value Outstanding shares at January 1, 2022 3,173,924 $ 1.86 Granted ā $ ā Exercised (115,903) 1.86 Forfeited ā ā ā Outstanding shares at March 31, 2022 3,058,021 $ 1.86 Outstanding shares at January 1, 2021 ā 3,918,458 $ 1.86 Granted ā ā ā ā Exercised ā (592,768) ā ā Forfeited ā ā ā ā Outstanding shares at March 31, 2021 3,325,690 $ 1.86 ā Non-controlling interest: ā The following table presents the non-controlling interest activity for the three months ended March 31, 2022 and 2021 (in millions): ā ā ā ā ā ā ā ā 2022 2021 Balance as of January 1, $ 58.6 $ 51.2 Net earnings ā 3.1 ā 3.3 Dividend paid ā (1.8) ā (1.3) Balance as of March 31, $ 59.9 $ 53.2 ā |
FAIR VALUE MEASUREMENT_
FAIR VALUE MEASUREMENT: | 3 Months Ended |
Mar. 31, 2022 | |
FAIR VALUE MEASUREMENT: | |
FAIR VALUE MEASUREMENT: | ā NOTE 12 ā FAIR VALUE MEASUREMENT: ā Subtopic 820-10 of ASC āFair value measurement and disclosures ā Overallā establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under Subtopic 820-10 are described below: ā Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. ā Level 2 - Inputs that are observable, either directly or indirectly, but do not qualify as Level 1 inputs. (i.e., quoted prices for similar assets or liabilities). ā Level 3 - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). ā The carrying amounts of certain financial instruments, including cash and cash equivalents, accounts receivable (other than accounts receivable associated with provisionally priced sales) and accounts payable approximate fair value due to their short maturities. Consequently, such financial instruments are not included in the following table, which provides information about the carrying amounts and estimated fair values of other financial instruments that are not measured at fair value in the condensed consolidated balance sheet as of March 31, 2022 and December 31, 2021 (in millions): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā At March 31, 2022 ā At December 31, 2021 ā Carrying Value Fair Value Carrying Value Fair Value Liabilities: ā ā ā ā ā ā ā ā ā ā ā ā Long-term debt level 1 ā ā 6,497.3 ā ā 7,657.2 ā ā 6,496.4 ā $ 8,506.0 Long-term debt level 2 ā ā 51.2 ā ā 64.4 ā ā 51.2 ā ā 67.2 Total long-term debt ā $ 6,548.5 ā $ 7,721.6 ā $ 6,547.6 ā $ 8,573.2 ā Long-term debt is carried at amortized cost and its estimated fair value is based on quoted market prices classified as Level 1 in the fair value hierarchy except for the case of the Yankee bonds, which qualify as Level 2 in the fair value hierarchy as they are based on quoted prices in markets that are not active. ā Fair values of assets and liabilities measured at fair value on a recurring basis were calculated as follows as of March 31, 2022 and December 31, 2021 (in millions): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Fair Value at Measurement Date Using: ā ā ā ā ā Significant ā ā ā ā Fair Value ā Quoted prices in ā other ā Significant ā ā as of ā active markets for ā observable ā unobservable ā ā March 31, ā identical assets ā inputs ā inputs Description ā 2022 ā (Level 1) ā (Level 2) ā (Level 3) Assets: ā ā ā ā ā ā ā ā ā ā ā ā Short term investment: ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ 406.1 ā $ 406.1 ā $ ā ā $ ā ā ā ā ā ā ā ā ā ā ā ā ā ā Corporate bonds ā ā ā ā ā ā ā ā ā ā ā Asset backed securities ā 0.2 ā ā ā ā ā 0.2 ā ā ā Mortgage backed securities ā 0.2 ā ā ā ā ā 0.2 ā ā ā Accounts receivable: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Provisionally priced sales: ā ā ā ā ā ā ā ā ā ā ā ā Copper ā 950.6 ā 950.6 ā ā ā ā ā ā Molybdenum ā 268.2 ā 268.2 ā ā ā ā ā Total ā $ 1,625.3 ā $ 1,624.9 ā $ 0.4 ā $ ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Fair Value at Measurement Date Using: ā ā ā ā ā Significant ā ā ā ā Fair Value ā Quoted prices in ā other ā Significant ā ā as of ā active markets for ā observable ā unobservable ā ā December 31, ā identical assets ā inputs ā inputs Description ā 2021 ā (Level 1) ā (Level 2) ā (Level 3) Assets: ā ā ā ā ā ā ā ā ā ā ā ā Short term investment: ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ 486.5 ā $ 486.5 ā $ ā ā $ ā ā ā ā ā ā ā ā ā ā ā ā ā ā Corporate bonds ā ā ā ā ā ā ā ā ā ā ā Asset backed securities ā 0.2 ā ā ā ā ā 0.2 ā ā ā Mortgage backed securities ā 0.2 ā ā ā ā ā 0.2 ā ā ā Accounts receivable: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Provisionally priced sales: ā ā ā ā ā ā ā ā ā ā ā ā Copper ā 876.2 ā 876.2 ā ā ā ā ā ā Molybdenum ā 288.3 ā 288.3 ā ā ā ā ā Total ā $ 1,651.4 ā $ 1,651.0 ā $ 0.4 ā $ ā ā The Companyās short-term trading securities investments are classified as Level 1 because they are valued using quoted prices of the same securities as they consist of bonds issued by public companies and are publicly traded. The Companyās short-term available-for-sale investments are classified as Level 2 because they are valued using quoted prices for similar investments. ā The Companyās accounts receivables associated with provisionally priced copper sales are valued using quoted market prices based on the forward price on the LME or on the COMEX. Such value is classified within Level 1 of the fair value hierarchy. Molybdenum prices are established by reference to the publication Platts Metals Week and are considered Level 1 in the fair value hierarchy. ā In addition, in the third quarter of 2021 the Company acquired two derivative instruments to protect natural gas costs from estimated price increases in the coming winter season. These derivative instruments will cover the period from November 2021 through March 2022. For further information please refer to Note 6 āDerivative instruments.ā |
REVENUE_
REVENUE: | 3 Months Ended |
Mar. 31, 2022 | |
REVENUE: | |
REVENUE: | ā NOTE 13 ā REVENUE: ā The Companyās net sales were $2,763.8 million in the three months ended March 31, 2022, compared to $2,532.5 million in the same period of 2021. The geographic breakdown of the Companyās sales is as follows (in millions): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2022 ā ā ā ā Mexican ā ā ā ā ā ā ā ā ā ā ā Mexican ā IMMSA ā Peruvian ā Corporate & ā ā ā ā Open-Pit Unit Operations Elimination Consolidated The Americas: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Mexico ā $ 533.8 ā $ 130.8 ā $ ā ā $ (40.0) ā $ 624.6 United States ā 455.6 ā 15.7 ā 90.8 ā ā ā 562.1 Peru ā 115.0 ā ā ā 177.5 ā (114.7) ā 177.8 Brazil ā ā ā 5.2 ā 119.1 ā ā ā 124.3 Chile ā ā ā ā ā 103.5 ā ā ā 103.5 Other American countries ā 6.5 ā ā ā 5.4 ā ā ā 11.9 Europe: ā ā ā ā ā ā ā ā ā ā Switzerland ā 227.4 ā 8.3 ā 191.1 ā ā ā 426.8 Italy ā 0.5 ā 4.0 ā 67.5 ā ā ā 72.0 Spain ā 93.2 ā ā ā 1.7 ā ā ā 94.9 Other European countries ā 30.8 ā 8.4 ā 86.1 ā ā ā 125.3 Asia: ā ā ā ā ā ā ā ā ā ā China ā ā 112.4 ā ā ā ā ā ā ā ā ā ā ā 112.4 Singapore ā 4.7 ā 4.9 ā 52.2 ā ā ā 61.8 Japan ā 22.0 ā ā ā 161.4 ā ā ā 183.4 Other Asian countries ā 44.3 ā 0.2 ā 38.5 ā 0 ā ā 83.0 Total ā $ 1,646.2 ā $ 177.5 ā $ 1,094.8 ā $ (154.7) ā $ 2,763.8 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2021 ā ā ā ā ā Mexican ā ā ā ā ā ā ā ā ā ā ā Mexican ā IMMSA ā Peruvian ā Corporate & ā ā ā ā Open-Pit Unit Operations Elimination Consolidated The Americas: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Mexico ā $ 453.4 ā $ 66.6 ā $ ā ā $ (26.1) ā $ 493.9 United States ā 389.4 ā 17.0 ā 19.1 ā ā ā ā 425.5 Peru ā ā ā ā ā 147.4 ā ā ā ā 147.4 Brazil ā ā ā 2.0 ā 97.0 ā ā ā ā 99.0 Chile ā 1.9 ā ā ā 56.1 ā ā ā ā 58.0 Other American countries ā 10.3 ā 0.7 ā 1.8 ā ā ā ā 12.8 Europe: ā ā ā ā ā ā ā ā ā ā ā ā Switzerland ā ā 294.5 ā 7.0 ā 92.3 ā ā ā ā 393.8 Italy ā ā ā ā 0.9 ā 73.2 ā ā ā ā 74.1 Spain ā ā 91.0 ā ā ā 19.9 ā ā ā ā 110.9 Other European countries ā ā 73.4 ā 26.5 ā 81.0 ā ā ā ā 180.9 Asia: ā ā ā ā ā ā ā ā ā ā ā ā China ā ā 55 ā ā ā ā ā 1.9 ā ā ā ā ā 56.6 Singapore ā ā 71.6 ā 3.6 ā 127.1 ā ā ā ā 202.3 Japan ā ā 21.4 ā ā ā 162.6 ā ā ā ā 184.0 Other Asian countries ā ā 16.9 ā ā ā 76.4 ā ā ā ā 93.3 Total ā $ 1,478.5 ā $ 124.3 ā $ 955.8 ā $ (26.1) ā $ 2,532.5 ā ā The following table presents information regarding the sales value by reporting segment of the Companyās significant products for the three months ended March 31, 2022 and 2021 (in millions): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2022 ā ā ā Mexican ā ā ā ā ā ā ā ā Mexican IMMSA Peruvian Corporate, Other & Total ā ā Open-pit ā Unit ā Operations ā Eliminations ā Consolidated Copper ā $ 1,368.4 ā $ 22.4 ā $ 893.9 ā $ (129.8) ā $ 2,154.9 Molybdenum ā 150.4 ā ā ā 125.4 ā ā ā 275.8 Silver ā 66.7 ā 37.0 ā 23.1 ā (21.6) ā 105.2 Zinc ā ā ā 98.6 ā ā ā (0.3) ā 98.3 Other ā 60.7 ā 19.5 ā 52.4 ā (3.0) ā 129.6 Total ā $ 1,646.2 ā $ 177.5 ā $ 1,094.8 ā $ (154.7) ā $ 2,763.8 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2021 ā ā ā Mexican ā ā ā ā ā ā ā ā Mexican IMMSA Peruvian Corporate, Other & Total ā ā Open-pit ā Unit ā Operations ā Eliminations ā Consolidated Copper ā $ 1,280.5 ā $ 23.8 ā $ 826.8 ā $ (13.7) ā $ 2,117.4 Molybdenum ā 91.1 ā ā ā 78.5 ā ā ā 169.6 Zinc ā 72.7 ā 48.5 ā 29.5 ā (11.7) ā 139.0 Silver ā ā ā 35.2 ā ā ā 0.5 ā 35.7 Other ā 34.2 ā 16.8 ā 21.0 ā (1.2) ā 70.8 Total ā $ 1,478.5 ā $ 124.3 ā $ 955.8 ā $ (26.1) ā $ 2,532.5 ā The opening and closing balances of receivables by reporting segment of the Company were as follows (in millions): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Mexican ā ā ā ā ā ā ā ā ā ā Mexican IMMSA Peruvian Corporate & ā ā ā ā Open-Pit ā Unit ā Operations ā Elimination ā Consolidated ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As of March 31, 2022: ā ā ā ā ā Trade receivables ā $ 728.6 ā $ 60.5 ā $ 510.3 ā $ (113.6) ā $ 1,185.8 Related parties, current ā 27.4 ā 0.2 ā 0.1 ā 2.2 ā 29.9 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As of December 31, 2021: ā ā ā ā ā Trade receivables ā $ 656.0 ā $ 51.2 ā $ 651.5 ā $ ā ā $ 1,358.7 Related parties, current ā 46.9 ā 0.2 ā ā ā 2.0 ā 49.1 ā As of March 31, 2022, the Company has long-term contracts with promises to deliver the following products in 2022: ā ā ā ā Copper concentrates (in tonnes) 118,000 Copper cathodes (in tonnes) ā 48,000 Molybdenum concentrates (in tonnes) 37,000 Sulfuric acid (in tonnes) 354,851 ā Provisionally priced sales ā Following are the provisionally priced copper and molybdenum sales outstanding at March 31, 2022: ā ā ā ā ā ā ā ā ā Sales volume Priced at ā ā ā (million lbs.) ā (per pound) ā Month of settlement Copper ā 201.9 ā 4.71 ā April 2022 through July 2022 Molybdenum ā 13.9 ā 19.30 ā April 2022 through June 2022 ā The provisional sales price adjustment included in accounts receivable and net sales as of March 31, 2022 includes positive adjustments of $29.4 ā Management believes that the final pricing of these sales will not have a material effect on the Companyās financial position or on operating results. |
SEGMENT AND RELATED INFORMATION
SEGMENT AND RELATED INFORMATION: | 3 Months Ended |
Mar. 31, 2022 | |
SEGMENT AND RELATED INFORMATION: | |
SEGMENT AND RELATED INFORMATION: | ā NOTE 14 ā SEGMENT AND RELATED INFORMATION: ā Company management views Southern Copper as having three reportable segments and manages it on the basis of these segments. The reportable segments identified by the Company are: the Peruvian operations, the Mexican open-pit operations and the Mexican underground mining operations segment identified as the IMMSA unit. ā The three reportable segments identified are groups of mines, each of which constitute an operating segment, with similar economic characteristics, types of products, processes and support facilities, similar regulatory environments, similar employee bargaining contracts and similar currency risks. In addition, each mine within the individual group earns revenues from similar types of customers for their products and services and each group incurs expenses independently, including commercial transactions between groups. ā Financial information is regularly prepared for each of the three segments and the results of the Companyās operations are regularly reported to the Chief Operating Decision Maker (āCODMā) on the segment basis. The CODM of the Company focuses on operating income and on total assets as measures of performance to evaluate different segments and to make decisions to allocate resources to the reported segments. These are common measures in the mining industry. ā Financial information relating to Southern Copperās segments is as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2022 ā ā (in millions) ā ā Mexican ā ā Corporate, other ā ā ā ā Mexican ā IMMSA ā Peruvian ā and ā ā ā ā ā Open-pit ā Unit ā Operations ā eliminations ā Consolidated Net sales outside of segments ā $ 1,646.2 ā $ 137.5 ā $ 1,094.8 ā $ (114.6) ā $ 2,763.8 Intersegment sales ā ā ā 40.0 ā ā ā (40.0) ā ā Cost of sales (exclusive of depreciation, amortization and depletion) ā 548.3 ā 131.7 ā 469.1 ā (91.4) ā 1,057.7 Selling, general and administrative ā 15.5 ā 2.4 ā 8.5 ā 3.9 ā 30.3 Depreciation, amortization and depletion ā 98.0 ā 11.3 ā 77.6 ā 9.7 ā 196.6 Exploration ā 0.5 ā 1.1 ā 6.8 ā 0.7 ā 9.1 Operating income ā $ 983.8 ā $ 31.0 ā $ 532.8 ā $ (77.5) ā ā 1,470.1 Less: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Interest, net ā ā ā ā ā ā ā ā ā ā ā ā ā (83.1) Other income (expense) ā ā ā ā ā ā ā ā ā ā ā ā ā 11.7 Income taxes ā ā ā ā ā ā ā ā ā ā ā ā ā (612.1) Equity earnings of affiliate ā ā ā ā ā ā ā ā ā ā ā ā ā 1.2 Non-controlling interest ā ā ā ā ā ā ā ā ā ā ā ā ā (3.1) Net income attributable to SCC ā ā ā ā ā ā ā ā ā ā ā ā ā $ 784.7 Capital investment ā $ 89.3 ā $ 31.7 ā $ 81.2 ā $ 3.0 ā $ 205.2 Property and mine development, net ā $ 4,662.5 ā $ 593.5 ā $ 3,685.8 ā $ 551.1 ā $ 9,492.9 Total assets ā $ 8,611.5 ā $ 1,080.9 ā $ 4,792.3 ā $ 3,414.2 ā $ 17,898.9 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2021 ā ā (in millions) ā ā Mexican ā ā Corporate, other ā ā ā ā Mexican ā IMMSA ā Peruvian ā and ā ā ā ā Open-pit ā Unit ā Operations ā eliminations ā Consolidated Net sales outside of segments ā $ 1,478.5 ā $ 98.2 ā $ 955.8 ā $ ā ā $ 2,532.5 Intersegment sales ā ā ā 26.1 ā ā ā (26.1) ā ā Cost of sales (exclusive of depreciation, amortization and depletion) ā 509.9 ā 80.4 ā 385.0 ā (31.5) ā 943.8 Selling, general and administrative ā 15.9 ā 2.1 ā 9.4 ā 2.7 ā 30.1 Depreciation, amortization and depletion ā 95.6 ā 13.9 ā 81.4 ā 9.7 ā 200.6 Exploration ā 0.5 ā 1.3 ā 4.0 ā 0.6 ā 6.4 Operating income ā $ 856.6 ā $ 26.6 ā $ 476.0 ā $ (7.6) ā ā 1,351.6 Less: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Interest, net ā ā ā ā ā ā ā ā ā ā ā ā ā (87.2) Other income (expense) ā ā ā ā ā ā ā ā ā ā ā ā ā 2.3 Income taxes ā ā ā ā ā ā ā ā ā ā ā ā ā (507.5) Equity earnings of affiliate ā ā ā ā ā ā ā ā ā ā ā ā ā 7.9 Non-controlling interest ā ā ā ā ā ā ā ā ā ā ā ā ā (3.3) Net income attributable to SCC ā ā ā ā ā ā ā ā ā ā ā ā ā $ 763.8 Capital investment ā $ 149.6 ā $ 14.3 ā $ 66.5 ā $ 2.2 ā $ 232.6 Property and mine development, net ā $ 4,653.8 ā $ 548.4 ā $ 3,707.3 ā $ 544.9 ā $ 9,454.4 Total assets ā $ 7,698.0 ā $ 965.1 ā $ 4,915.5 ā $ 3,639.2 ā $ 17,217.8 ā |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2022 | |
SUBSEQUENT EVENTS: | |
SUBSEQUENT EVENTS: | ā ā NOTE 15 ā SUBSEQUENT EVENTS: ā Dividends ā On April 28, 2022, the Board of Directors authorized a dividend of $1.25 per share payable on May 31, 2022 to shareholders of record at the close of business on May 17, 2022. ā ā Peruvian income tax refund: ā On April 12, 2022, the Peruvian branch of the Company received a tax refund of S/124.8 million (approximately $33.6 million) from SUNAT as a reimbursement of a 2015 claim of taxes related to the exchange difference of a loan with Southern Copper Corporation at that year. ā ā Cuajone mine restore of operations: ā After several unsuccessful attempts by the authorities to restore order through dialogue, on April 20, 2022, the Peruvian government declared a state of emergency in the Moquegua region. On April 21, 2022, the protesters returned the installations of the ViƱa Blanca water reservoir and the railway to the Company. The Companyās personnel immediately evaluated the damage caused to the facilities by acts of vandalism and took the necessary steps to resume production at the Cuajone mining unit. As of today, the industrial railroad and the Cuajone mine, concentrator and related facilities are operating at full capacity. ā On April 30, 2022, the Peruvian government issued a Ministerial Resolution to set up a three-party-round-table for dialogue with members of the community, government and Company officers to better understand all partiesā concerns. |
SHORT-TERM INVESTMENTS_ (Tables
SHORT-TERM INVESTMENTS: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
SHORT-TERM INVESTMENTS: | |
Schedule of short-term investments | ā Short-term investments were as follows (in millions): ā ā ā ā ā ā ā ā ā ā ā At March 31, ā At December 31, ā ā ā 2022 2021 ā ā Trading securities ā $ 406.1 ā $ 486.5 ā ā Weighted average interest rate ā 0.4 % 0.3 % ā ā ā ā ā ā ā ā ā ā Available-for-sale ā $ 0.4 ā $ 0.4 ā ā Weighted average interest rate ā 0.7 % 0.7 % ā Total ā $ 406.5 ā $ 486.9 ā ā |
Summary of activity investments | The following table summarizes the activity of these investments by category (in millions): ā ā ā ā ā ā ā ā ā ā ā ā Three months ended ā ā ā March 31, ā ā ā 2022 2021 ā Trading: ā ā ā ā ā ā ā ā Interest earned ā $ 0.8 ā $ 0.4 ā ā Unrealized gain (loss) at the end of the period ā $ (0.1) ā $ 0.1 ā ā ā ā ā ā ā ā ā ā ā Available-for-sale: ā ā ā ā ā ā ā ā Interest earned ā (*) ā ā (*) ā ā Investment redeemed ā $ (*) ā $ 0.1 ā ā (*) Less than $0.1 million. |
INVENTORIES_ (Tables)
INVENTORIES: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
INVENTORIES: | |
Schedule of inventories | ā ā ā ā ā ā ā ā ā ā ā At March 31, ā At December 31, ā (in millions) 2022 2021 ā Inventory, current: ā ā ā ā ā ā ā Metals at average cost: ā ā ā ā ā ā ā Finished goods ā $ 79.1 ā $ 58.6 ā Work-in-process ā 381.8 ā 340.7 ā Ore stockpiles on leach pads ā ā 260.7 ā ā 259.7 ā Supplies at average cost ā 308.3 ā 313.9 ā Total current inventory ā $ 1,029.9 ā $ 972.9 ā Inventory, long-term: ā ā ā ā ā ā ā Ore stockpiles on leach pads ā $ 1,082.0 ā $ 1,097.6 ā |
INCOME TAXES_ (Tables)
INCOME TAXES: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
INCOME TAXES: | |
Schedule of income tax provision and effective income tax rate | ā The income tax provision and the effective income tax rate for the first three months of 2022 and 2021 consisted of (in millions): ā ā ā ā ā ā ā ā ā 2022 2021 ā Statutory income tax provision ā $ 511.6 ā $ 427.3 ā Peruvian royalty ā 17.0 ā 11.6 ā Mexican royalty ā 58.0 ā 47.4 ā Peruvian special mining tax ā 25.5 ā 21.2 ā Total income tax provision ā $ 612.1 ā $ 507.5 ā ā ā ā ā ā ā ā ā Effective income tax rate ā ā 43.8 % ā 40.1 % |
RELATED PARTY TRANSACTIONS_ (Ta
RELATED PARTY TRANSACTIONS: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
RELATED PARTY TRANSACTIONS: | |
Schedule of receivable and payable balances with related parties | ā Receivable and payable balances with related parties are shown below (in millions): ā ā ā ā ā ā ā ā ā ā ā At March 31, ā At December 31, ā ā 2022 2021 ā Related parties receivable current: ā ā ā ā ā ā ā Grupo Mexico and affiliates: ā ā ā ā ā ā ā Asarco LLC ā $ 7.0 ā $ 10.0 ā Americas Mining Corporation (āAMCā) ā ā 0.1 ā ā 0.1 ā Compania Perforadora Mexico S.A.P.I. de C.V. and affiliates ā 0.3 ā 0.3 ā Mexico Generadora de Energia S. de R.L. ("MGE") ā ā 21.8 ā ā 38.4 ā Grupo Mexico Servicios de Ingenieria, S.A. de C.V. ā ā 0.2 ā ā 0.2 ā Related to the controlling group: ā ā ā ā ā ā ā Boutique Bowling de Mexico, S.A. de C.V. ā ā 0.1 ā ā 0.1 ā Mexico Transportes Aereos, S.A. de C.V. ("Mextransport") ā ā 0.4 ā ā ā ā Operadora de Cinemas, S.A. de C.V. ā ā (*) ā ā (*) ā ā ā $ 29.9 ā $ 49.1 ā ā ā ā ā ā ā ā ā Related parties payable: ā ā ā ā ā ā ā Grupo Mexico and affiliates: ā ā ā ā ā ā ā AMMINCO Apoyo Administrativo, S.A. de C.V. (āAMMINCOā) ā $ 4.2 ā $ 9.5 ā Asarco LLC ā ā 29.6 ā ā 14.9 ā Eolica El Retiro, S.A.P.I. de C.V. ā 0.4 ā 2.7 ā Ferrocarril Mexicano, S.A. de C.V. ā 9.3 ā 4.0 ā Grupo Mexico Servicios ā ā 13.6 ā ā 11.1 ā MGE ā ā 51.3 ā ā 57.2 ā Mexico Compania Constructora S.A de C.V. ā ā 3.5 ā ā 2.0 ā Grupo Mexico Servicios de Ingenieria, S.A. de C.V. ā ā 1.1 ā ā 0.9 ā Controladora de Infraestructura EnergĆ©tica MĆ©xico S.A. de C.V. ā ā 0.9 ā ā ā ā Related to the controlling group: ā ā ā ā ā ā ā Boutique Bowling de Mexico, S.A. de C.V. ā 0.1 ā 0.3 ā Mexico Transportes Aereos, S.A. de C.V. (āMextransportā) ā 0.3 ā 0.5 ā Operadora de Cinemas, S.A. de C.V. ā ā (*) ā ā 0.2 ā ā ā $ 114.3 ā $ 103.3 ā (*) Less than $0.1 million. |
Grupo Mexico and affiliates | |
RELATED PARTY TRANSACTIONS: | |
Schedule of purchase and sales activities with related parties | The following table summarizes the purchase and sale activities with Grupo Mexico and its affiliates in the first three months of 2022 and 2021 (in millions): ā ā ā ā ā ā ā ā 2022 2021 Purchase activity ā ā ā ā ā ā Asarco LLC ā $ 14.6 ā $ 3.7 Eolica El Retiro, S.A.P.I. de C.V. ā 0.9 ā 0.2 Ferrocarril Mexicano, S.A. de C.V. ā 5.2 ā 10.9 Grupo Mexico Servicios ā ā 5.0 ā ā 2.5 AMMINCO ā ā 2.2 ā ā 4.6 MGE ā 70.1 ā 77.7 Mexico Compania Constructora S.A. de C.V. ā ā 5.1 ā ā 13.0 Controladora de Infraestructura energĆ©tica S.A. de C.V. ā ā 0.8 ā ā ā Grupo Mexico Servicios de Ingenieria S. A. de C.V. ā 1.3 ā 1.4 Total purchases ā $ 105.2 ā $ 114.0 Sales activity ā ā ā ā ā ā Asarco LLC ā $ 11.4 ā $ 6.9 MGE ā ā 34.5 ā ā 37.9 Total sales ā $ 45.9 ā $ 44.8 |
Companies with relationship to the controlling group | |
RELATED PARTY TRANSACTIONS: | |
Schedule of purchase and sales activities with related parties | The following table summarizes the purchase and sales activities with other Larrea family companies in the first three months of 2022 and 2021 (in millions): ā ā ā ā ā ā ā ā 2022 2021 Purchase activity ā ā ā ā ā ā Boutique Bowling de Mexico S.A. de C.V. ā $ 0.1 ā $ 0.1 Mextransport ā ā 0.4 ā ā 0.4 Operadora de Cinemas S.A. de C.V. ā ā (*) ā ā 0.1 Total purchases ā $ 0.5 ā $ 0.6 ā ā ā ā ā ā ā Sales activity ā ā ā ā ā ā Boutique Bowling de Mexico S.A. de C.V. ā $ (*) ā $ (*) Mextransport ā ā 0.5 ā ā 0.4 Operadora de Cinemas S.A. de C.V. ā ā (*) ā ā (*) Total sales ā $ 0.5 ā $ 0.4 (*) amount is lower than $0.1 million |
DERIVATIVE INSTRUMENTS_ (Tables
DERIVATIVE INSTRUMENTS: (Tables) | 1 Months Ended |
Jan. 31, 2022 | |
DERIVATIVE INSTRUMENTS: | |
Schedule of derivative instruments | Derivative instruments and its effects as of March 31, 2022, were as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Derivatives designated as hedging instruments under ASC 815 ā Call Option ā Financial Swap Cash Settlement ā Commodity contracts ā Natural gas ā Natural gas ā Gas volume (MMBTUs) ā 5,285,000 ā 5,285,000 ā Hedge premium ($per MMBTU) ā 0.55 ā - ā Reference price (swap: $per MMBTU)) ā Prior month average IFREC price ā 3.75 ā Hedge ā Daily fluctuation range ā Monthly average price ā ā ā 1Q 2022 November 2021 - March 2022 ā 1Q 2022 November 2021 - March 2022 ā Cost (million $) ā (1.7) (2.9) ā - - ā Profit (million $) ā 0.5 0.5 ā 1.7 4.7 ā Net favorable/unfavorable effect (million $) ā (1.2) (2.4) ā 1.7 4.7 ā ā ā 1Q 2022 ā November 2021 - March 2022 ā Combined profit (million $) ā 0.5 ā 2.3 ā |
LEASES_ (Tables)
LEASES: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
LEASES: | |
Schedule of the operating lease expense recognized | The operating lease expense recognized in the first three months of 2022 and 2021 was classified as follows (in millions): ā ā ā ā ā ā ā ā Classification 2022 2021 Cost of sales (exclusive of depreciation, amortization and depletion) $ 28.8 ā $ 28.6 Selling, general and administrative ā (*) ā (*) Exploration ā (*) ā (*) Total lease expense $ 28.8 ā $ 28.6 |
Schedule of Maturities of lease liabilities | ā ā ā ā ā ā ā Lease liabilities Year (in millions) 2022 $ 86.1 2023 ā 113.9 2024 ā 106.3 2025 ā 105.3 2026 ā 105.1 After 2026 ā 624.2 Total lease payments $ 1,140.9 Less: interest on lease liabilities ā (240.1) Present value of lease payments $ 900.8 |
ASSET RETIREMENT OBLIGATION_ (T
ASSET RETIREMENT OBLIGATION: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
ASSET RETIREMENT OBLIGATION: | |
Summary of asset retirement obligation activity | ā The following table summarizes the asset retirement obligation activity for the first three months of 2022 and 2021 (in millions): ā ā ā ā ā ā ā ā 2022 2021 Balance as of January 1 ā $ 562.9 ā $ 545.0 Changes in estimates ā 43.3 ā ā Closure payments ā (2.0) ā (0.2) Accretion expense ā 6.5 ā 6.1 Balance as of March 31, ā $ 610.7 ā $ 550.9 |
BENEFIT PLANS_ (Tables)
BENEFIT PLANS: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Post retirement defined benefit plans and defined contribution plan | |
Components of net periodic benefit costs | |
Schedule of the components of net periodic benefit costs | The components of net periodic benefit costs for the first three months of 2022 and 2021 are as follows (in millions): ā ā ā ā ā ā ā ā (in millions) 2022 2021 Service cost ā $ 0.4 ā $ 0.4 Interest cost ā 0.5 ā 0.3 Expected return on plan assets ā (1.0) ā (0.8) Amortization of net loss/(gain) ā 0.1 ā 0.1 Net periodic benefit cost ā $ ā ā $ ā |
Post-retirement Health care plans | |
Components of net periodic benefit costs | |
Schedule of the components of net periodic benefit costs | ā The components of net periodic benefit cost for the first three months of 2022 and 2021 are as follows (in millions): ā ā ā ā ā ā ā ā (in millions) 2022 2021 Interest cost ā $ 0.4 ā $ 0.4 Amortization of net loss (gain) ā (*) ā (*) Amortization of prior service cost/ (credit) ā (*) ā 0.1 Net periodic benefit cost ā $ 0.4 ā $ 0.5 |
COMMITMENTS AND CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES: | |
Schedule of environmental capital investments | ā Environmental capital investments in the first quarter of 2022 and 2021 were as follows (in millions): ā ā ā ā ā ā ā ā ā 2022 2021 Peruvian operations ā $ 1.4 ā $ 0.1 Mexican operations ā 12.6 ā 5.4 ā ā $ 14.0 ā $ 5.5 ā |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Share based Compensation Plan | |
Schedule of activity in treasury stock | ā Activity in treasury stock in the three-month period ended March 31, 2022 and 2021 is as follows (in millions): ā ā ā ā ā ā ā ā ā 2022 2021 Southern Copper common shares ā ā ā ā ā ā Balance as of January 1, ā $ 2,767.2 ā $ 2,767.5 Used for corporate purposes ā (0.1) ā ā Balance as of March 31, ā 2,767.1 ā 2,767.5 ā ā ā ā ā ā ā Parent Company (Grupo Mexico) common shares ā ā ā ā ā ā Balance as of January 1, ā 306.8 ā 296.0 Other activity, including dividend, interest and foreign currency translation effect ā 13.8 ā (2.3) Balance as of March 31, ā 320.6 ā 293.7 Treasury stock balance as of March 31, ā $ 3,087.7 ā $ 3,061.2 |
Schedule of activity in Directors' Stock Award Plan | ā ā ā ā ā ā ā 2022 2021 Total SCC shares reserved for the plan 600,000 600,000 Total shares granted at January 1, (405,200) (391,600) Granted in the period (3,200) ā Total shares granted at March 31, (408,400) (391,600) Remaining shares reserved 191,600 208,400 |
Summary of non-controlling interest activity | The following table presents the non-controlling interest activity for the three months ended March 31, 2022 and 2021 (in millions): ā ā ā ā ā ā ā ā 2022 2021 Balance as of January 1, $ 58.6 $ 51.2 Net earnings ā 3.1 ā 3.3 Dividend paid ā (1.8) ā (1.3) Balance as of March 31, $ 59.9 $ 53.2 |
Employee Stock Purchase 2015 Plan | |
Share based Compensation Plan | |
Schedule of stock based compensation expense and unrecognized compensation expense | ā The stock based compensation expense for the first three months of 2022 and 2021 and the unrecognized compensation expense under this plan were as follows (in millions): ā ā ā ā ā ā ā ā 2022 2021 Stock based compensation expense ā $ 0.2 ā $ 0.2 Unrecognized compensation expense ā $ 0.6 ā $ 1.2 ā |
Schedule of stock award activity | ā ā ā ā ā ā ā ā ā ā ā Unit Weighted Average ā ā Shares ā ā Grant Date Fair Value Outstanding shares at January 1, 2022 867,234 ā ā $ 2.63 Granted ā ā ā ā Exercised (16,394) ā ā $ 2.63 Forfeited ā ā ā ā Outstanding shares at March 31, 2022 850,840 ā ā $ 2.63 Outstanding shares at January 1, 2021 1,264,410 ā ā $ 2.63 Granted ā ā ā ā Exercised (293,041) ā ā $ 2.63 Forfeited ā ā ā ā Outstanding shares at March 31, 2021 971,369 ā ā $ 2.63 ā |
Employee Stock Purchase 2018 Plan | |
Share based Compensation Plan | |
Schedule of stock based compensation expense and unrecognized compensation expense | The stock based compensation expense for the three months ended March 31, 2022 and 2021 and the unrecognized compensation expense under this plan were as follows (in millions): ā ā ā ā ā ā ā ā 2022 ā 2021 Stock based compensation expense ā $ 0.2 $ 0.2 Unrecognized compensation expense ā $ 2.9 $ 3.6 |
Schedule of stock award activity | ā ā ā ā ā ā ā ā ā ā Unit Weighted Average ā Shares Grant Date Fair Value Outstanding shares at January 1, 2022 3,173,924 $ 1.86 Granted ā $ ā Exercised (115,903) 1.86 Forfeited ā ā ā Outstanding shares at March 31, 2022 3,058,021 $ 1.86 Outstanding shares at January 1, 2021 ā 3,918,458 $ 1.86 Granted ā ā ā ā Exercised ā (592,768) ā ā Forfeited ā ā ā ā Outstanding shares at March 31, 2021 3,325,690 $ 1.86 |
FAIR VALUE MEASUREMENT_ (Tables
FAIR VALUE MEASUREMENT: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
FAIR VALUE MEASUREMENT: | |
Schedule of carrying amount and estimated fair values of the Company's financial instruments | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā At March 31, 2022 ā At December 31, 2021 ā Carrying Value Fair Value Carrying Value Fair Value Liabilities: ā ā ā ā ā ā ā ā ā ā ā ā Long-term debt level 1 ā ā 6,497.3 ā ā 7,657.2 ā ā 6,496.4 ā $ 8,506.0 Long-term debt level 2 ā ā 51.2 ā ā 64.4 ā ā 51.2 ā ā 67.2 Total long-term debt ā $ 6,548.5 ā $ 7,721.6 ā $ 6,547.6 ā $ 8,573.2 |
Schedule of fair values of assets and liabilities measured at fair value on a recurring basis | Fair values of assets and liabilities measured at fair value on a recurring basis were calculated as follows as of March 31, 2022 and December 31, 2021 (in millions): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Fair Value at Measurement Date Using: ā ā ā ā ā Significant ā ā ā ā Fair Value ā Quoted prices in ā other ā Significant ā ā as of ā active markets for ā observable ā unobservable ā ā March 31, ā identical assets ā inputs ā inputs Description ā 2022 ā (Level 1) ā (Level 2) ā (Level 3) Assets: ā ā ā ā ā ā ā ā ā ā ā ā Short term investment: ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ 406.1 ā $ 406.1 ā $ ā ā $ ā ā ā ā ā ā ā ā ā ā ā ā ā ā Corporate bonds ā ā ā ā ā ā ā ā ā ā ā Asset backed securities ā 0.2 ā ā ā ā ā 0.2 ā ā ā Mortgage backed securities ā 0.2 ā ā ā ā ā 0.2 ā ā ā Accounts receivable: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Provisionally priced sales: ā ā ā ā ā ā ā ā ā ā ā ā Copper ā 950.6 ā 950.6 ā ā ā ā ā ā Molybdenum ā 268.2 ā 268.2 ā ā ā ā ā Total ā $ 1,625.3 ā $ 1,624.9 ā $ 0.4 ā $ ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Fair Value at Measurement Date Using: ā ā ā ā ā Significant ā ā ā ā Fair Value ā Quoted prices in ā other ā Significant ā ā as of ā active markets for ā observable ā unobservable ā ā December 31, ā identical assets ā inputs ā inputs Description ā 2021 ā (Level 1) ā (Level 2) ā (Level 3) Assets: ā ā ā ā ā ā ā ā ā ā ā ā Short term investment: ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ 486.5 ā $ 486.5 ā $ ā ā $ ā ā ā ā ā ā ā ā ā ā ā ā ā ā Corporate bonds ā ā ā ā ā ā ā ā ā ā ā Asset backed securities ā 0.2 ā ā ā ā ā 0.2 ā ā ā Mortgage backed securities ā 0.2 ā ā ā ā ā 0.2 ā ā ā Accounts receivable: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Provisionally priced sales: ā ā ā ā ā ā ā ā ā ā ā ā Copper ā 876.2 ā 876.2 ā ā ā ā ā ā Molybdenum ā 288.3 ā 288.3 ā ā ā ā ā Total ā $ 1,651.4 ā $ 1,651.0 ā $ 0.4 ā $ ā |
REVENUE_ (Tables)
REVENUE: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
REVENUE: | |
Summary of company's sales by geographic wise and segment wise | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2022 ā ā ā ā Mexican ā ā ā ā ā ā ā ā ā ā ā Mexican ā IMMSA ā Peruvian ā Corporate & ā ā ā ā Open-Pit Unit Operations Elimination Consolidated The Americas: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Mexico ā $ 533.8 ā $ 130.8 ā $ ā ā $ (40.0) ā $ 624.6 United States ā 455.6 ā 15.7 ā 90.8 ā ā ā 562.1 Peru ā 115.0 ā ā ā 177.5 ā (114.7) ā 177.8 Brazil ā ā ā 5.2 ā 119.1 ā ā ā 124.3 Chile ā ā ā ā ā 103.5 ā ā ā 103.5 Other American countries ā 6.5 ā ā ā 5.4 ā ā ā 11.9 Europe: ā ā ā ā ā ā ā ā ā ā Switzerland ā 227.4 ā 8.3 ā 191.1 ā ā ā 426.8 Italy ā 0.5 ā 4.0 ā 67.5 ā ā ā 72.0 Spain ā 93.2 ā ā ā 1.7 ā ā ā 94.9 Other European countries ā 30.8 ā 8.4 ā 86.1 ā ā ā 125.3 Asia: ā ā ā ā ā ā ā ā ā ā China ā ā 112.4 ā ā ā ā ā ā ā ā ā ā ā 112.4 Singapore ā 4.7 ā 4.9 ā 52.2 ā ā ā 61.8 Japan ā 22.0 ā ā ā 161.4 ā ā ā 183.4 Other Asian countries ā 44.3 ā 0.2 ā 38.5 ā 0 ā ā 83.0 Total ā $ 1,646.2 ā $ 177.5 ā $ 1,094.8 ā $ (154.7) ā $ 2,763.8 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2021 ā ā ā ā ā Mexican ā ā ā ā ā ā ā ā ā ā ā Mexican ā IMMSA ā Peruvian ā Corporate & ā ā ā ā Open-Pit Unit Operations Elimination Consolidated The Americas: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Mexico ā $ 453.4 ā $ 66.6 ā $ ā ā $ (26.1) ā $ 493.9 United States ā 389.4 ā 17.0 ā 19.1 ā ā ā ā 425.5 Peru ā ā ā ā ā 147.4 ā ā ā ā 147.4 Brazil ā ā ā 2.0 ā 97.0 ā ā ā ā 99.0 Chile ā 1.9 ā ā ā 56.1 ā ā ā ā 58.0 Other American countries ā 10.3 ā 0.7 ā 1.8 ā ā ā ā 12.8 Europe: ā ā ā ā ā ā ā ā ā ā ā ā Switzerland ā ā 294.5 ā 7.0 ā 92.3 ā ā ā ā 393.8 Italy ā ā ā ā 0.9 ā 73.2 ā ā ā ā 74.1 Spain ā ā 91.0 ā ā ā 19.9 ā ā ā ā 110.9 Other European countries ā ā 73.4 ā 26.5 ā 81.0 ā ā ā ā 180.9 Asia: ā ā ā ā ā ā ā ā ā ā ā ā China ā ā 55 ā ā ā ā ā 1.9 ā ā ā ā ā 56.6 Singapore ā ā 71.6 ā 3.6 ā 127.1 ā ā ā ā 202.3 Japan ā ā 21.4 ā ā ā 162.6 ā ā ā ā 184.0 Other Asian countries ā ā 16.9 ā ā ā 76.4 ā ā ā ā 93.3 Total ā $ 1,478.5 ā $ 124.3 ā $ 955.8 ā $ (26.1) ā $ 2,532.5 ā ā The following table presents information regarding the sales value by reporting segment of the Companyās significant products for the three months ended March 31, 2022 and 2021 (in millions): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2022 ā ā ā Mexican ā ā ā ā ā ā ā ā Mexican IMMSA Peruvian Corporate, Other & Total ā ā Open-pit ā Unit ā Operations ā Eliminations ā Consolidated Copper ā $ 1,368.4 ā $ 22.4 ā $ 893.9 ā $ (129.8) ā $ 2,154.9 Molybdenum ā 150.4 ā ā ā 125.4 ā ā ā 275.8 Silver ā 66.7 ā 37.0 ā 23.1 ā (21.6) ā 105.2 Zinc ā ā ā 98.6 ā ā ā (0.3) ā 98.3 Other ā 60.7 ā 19.5 ā 52.4 ā (3.0) ā 129.6 Total ā $ 1,646.2 ā $ 177.5 ā $ 1,094.8 ā $ (154.7) ā $ 2,763.8 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2021 ā ā ā Mexican ā ā ā ā ā ā ā ā Mexican IMMSA Peruvian Corporate, Other & Total ā ā Open-pit ā Unit ā Operations ā Eliminations ā Consolidated Copper ā $ 1,280.5 ā $ 23.8 ā $ 826.8 ā $ (13.7) ā $ 2,117.4 Molybdenum ā 91.1 ā ā ā 78.5 ā ā ā 169.6 Zinc ā 72.7 ā 48.5 ā 29.5 ā (11.7) ā 139.0 Silver ā ā ā 35.2 ā ā ā 0.5 ā 35.7 Other ā 34.2 ā 16.8 ā 21.0 ā (1.2) ā 70.8 Total ā $ 1,478.5 ā $ 124.3 ā $ 955.8 ā $ (26.1) ā $ 2,532.5 ā |
Schedule of opening and closing balances of receivables by reporting segment | The opening and closing balances of receivables by reporting segment of the Company were as follows (in millions): ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Mexican ā ā ā ā ā ā ā ā ā ā Mexican IMMSA Peruvian Corporate & ā ā ā ā Open-Pit ā Unit ā Operations ā Elimination ā Consolidated ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As of March 31, 2022: ā ā ā ā ā Trade receivables ā $ 728.6 ā $ 60.5 ā $ 510.3 ā $ (113.6) ā $ 1,185.8 Related parties, current ā 27.4 ā 0.2 ā 0.1 ā 2.2 ā 29.9 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As of December 31, 2021: ā ā ā ā ā Trade receivables ā $ 656.0 ā $ 51.2 ā $ 651.5 ā $ ā ā $ 1,358.7 Related parties, current ā 46.9 ā 0.2 ā ā ā 2.0 ā 49.1 |
Schedule long term contracts by products | As of March 31, 2022, the Company has long-term contracts with promises to deliver the following products in 2022: ā ā ā ā Copper concentrates (in tonnes) 118,000 Copper cathodes (in tonnes) ā 48,000 Molybdenum concentrates (in tonnes) 37,000 Sulfuric acid (in tonnes) 354,851 ā |
Schedule of provisionally priced copper and molybdenum sales outstanding | Following are the provisionally priced copper and molybdenum sales outstanding at March 31, 2022: ā ā ā ā ā ā ā ā ā Sales volume Priced at ā ā ā (million lbs.) ā (per pound) ā Month of settlement Copper ā 201.9 ā 4.71 ā April 2022 through July 2022 Molybdenum ā 13.9 ā 19.30 ā April 2022 through June 2022 |
SEGMENT AND RELATED INFORMATI_2
SEGMENT AND RELATED INFORMATION: (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
SEGMENT AND RELATED INFORMATION: | |
Schedule of financial information relating to Company's segments | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2022 ā ā (in millions) ā ā Mexican ā ā Corporate, other ā ā ā ā Mexican ā IMMSA ā Peruvian ā and ā ā ā ā ā Open-pit ā Unit ā Operations ā eliminations ā Consolidated Net sales outside of segments ā $ 1,646.2 ā $ 137.5 ā $ 1,094.8 ā $ (114.6) ā $ 2,763.8 Intersegment sales ā ā ā 40.0 ā ā ā (40.0) ā ā Cost of sales (exclusive of depreciation, amortization and depletion) ā 548.3 ā 131.7 ā 469.1 ā (91.4) ā 1,057.7 Selling, general and administrative ā 15.5 ā 2.4 ā 8.5 ā 3.9 ā 30.3 Depreciation, amortization and depletion ā 98.0 ā 11.3 ā 77.6 ā 9.7 ā 196.6 Exploration ā 0.5 ā 1.1 ā 6.8 ā 0.7 ā 9.1 Operating income ā $ 983.8 ā $ 31.0 ā $ 532.8 ā $ (77.5) ā ā 1,470.1 Less: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Interest, net ā ā ā ā ā ā ā ā ā ā ā ā ā (83.1) Other income (expense) ā ā ā ā ā ā ā ā ā ā ā ā ā 11.7 Income taxes ā ā ā ā ā ā ā ā ā ā ā ā ā (612.1) Equity earnings of affiliate ā ā ā ā ā ā ā ā ā ā ā ā ā 1.2 Non-controlling interest ā ā ā ā ā ā ā ā ā ā ā ā ā (3.1) Net income attributable to SCC ā ā ā ā ā ā ā ā ā ā ā ā ā $ 784.7 Capital investment ā $ 89.3 ā $ 31.7 ā $ 81.2 ā $ 3.0 ā $ 205.2 Property and mine development, net ā $ 4,662.5 ā $ 593.5 ā $ 3,685.8 ā $ 551.1 ā $ 9,492.9 Total assets ā $ 8,611.5 ā $ 1,080.9 ā $ 4,792.3 ā $ 3,414.2 ā $ 17,898.9 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three Months Ended March 31, 2021 ā ā (in millions) ā ā Mexican ā ā Corporate, other ā ā ā ā Mexican ā IMMSA ā Peruvian ā and ā ā ā ā Open-pit ā Unit ā Operations ā eliminations ā Consolidated Net sales outside of segments ā $ 1,478.5 ā $ 98.2 ā $ 955.8 ā $ ā ā $ 2,532.5 Intersegment sales ā ā ā 26.1 ā ā ā (26.1) ā ā Cost of sales (exclusive of depreciation, amortization and depletion) ā 509.9 ā 80.4 ā 385.0 ā (31.5) ā 943.8 Selling, general and administrative ā 15.9 ā 2.1 ā 9.4 ā 2.7 ā 30.1 Depreciation, amortization and depletion ā 95.6 ā 13.9 ā 81.4 ā 9.7 ā 200.6 Exploration ā 0.5 ā 1.3 ā 4.0 ā 0.6 ā 6.4 Operating income ā $ 856.6 ā $ 26.6 ā $ 476.0 ā $ (7.6) ā ā 1,351.6 Less: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Interest, net ā ā ā ā ā ā ā ā ā ā ā ā ā (87.2) Other income (expense) ā ā ā ā ā ā ā ā ā ā ā ā ā 2.3 Income taxes ā ā ā ā ā ā ā ā ā ā ā ā ā (507.5) Equity earnings of affiliate ā ā ā ā ā ā ā ā ā ā ā ā ā 7.9 Non-controlling interest ā ā ā ā ā ā ā ā ā ā ā ā ā (3.3) Net income attributable to SCC ā ā ā ā ā ā ā ā ā ā ā ā ā $ 763.8 Capital investment ā $ 149.6 ā $ 14.3 ā $ 66.5 ā $ 2.2 ā $ 232.6 Property and mine development, net ā $ 4,653.8 ā $ 548.4 ā $ 3,707.3 ā $ 544.9 ā $ 9,454.4 Total assets ā $ 7,698.0 ā $ 965.1 ā $ 4,915.5 ā $ 3,639.2 ā $ 17,217.8 |
DESCRIPTION OF THE BUSINESS_ (D
DESCRIPTION OF THE BUSINESS: (Details) $ in Millions | Feb. 28, 2022USD ($)communityitem | Mar. 31, 2022USD ($)T |
Percentage of ownership interest held by the parent company | 88.90% | |
Ilo and Cuajone | ||
Number of members in group of protesters | item | 472 | |
Number of people in community. | community | 5,000 | |
Compensation for usurped land use | $ 5,000 | |
Percentage of net profits | 5.00% | |
Reduction in sales | $ 117 | |
Unabsorbed fixed costs | $ 7.9 | |
Copper | Ilo and Cuajone | ||
Production loss | T | 12,869 | |
Molybdenum | Ilo and Cuajone | ||
Production loss | T | 296 |
SHORT-TERM INVESTMENTS_ (Detail
SHORT-TERM INVESTMENTS: (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Short-term investment: | |||
Trading securities | $ 406.1 | $ 486.5 | |
Weighted average interest rate (as a percent) | 0.40% | 0.30% | |
Available-for-sale | $ 0.4 | $ 0.4 | |
Weighted average interest rate (as a percent) | 0.70% | 0.70% | |
Total | $ 406.5 | $ 486.9 | |
Trading: | |||
Interest earned | 0.8 | $ 0.4 | |
Unrealized gain (loss) at the end of the period | (0.1) | 0.1 | |
Available-for-sale: | |||
Interest earned | 4.6 | 2.4 | |
Investment redeemed | 0.1 | ||
Maximum | |||
Available-for-sale: | |||
Interest earned | $ 0.1 | $ 0.1 |
INVENTORIES_ (Details)
INVENTORIES: (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Metals at average cost: | |||
Finished goods | $ 79.1 | $ 58.6 | |
Work-in-process | 381.8 | 340.7 | |
Ore stockpiles on leach pads | 260.7 | 259.7 | |
Supplies at average cost | 308.3 | 313.9 | |
Total current inventory | 1,029.9 | 972.9 | |
Inventory, long-term: | |||
Ore stockpiles on leach pads | 1,082 | $ 1,097.6 | |
Total leaching costs added as long-term inventory of ore stockpiles in leach pads | 61.5 | $ 54.8 | |
Long-term leaching inventories recognized as cost of sales | $ 76 | $ 71.6 |
INCOME TAXES_ (Details)
INCOME TAXES: (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income Taxes | ||
Statutory income tax provision | $ 511.6 | $ 427.3 |
Peruvian royalty | 17 | 11.6 |
Mexican royalty | 58 | 47.4 |
Peruvian special mining tax | 25.5 | 21.2 |
Total income tax provision | $ 612.1 | $ 507.5 |
Effective income tax rate (as a percent) | 43.80% | 40.10% |
Unrecognized tax benefits | $ 22.1 | |
Peru | ||
Income Taxes | ||
Increase (Decrease) in Income tax expense (benefit) | 33.8 | |
Royalty charges | 42.5 | $ 32.8 |
Mexico | ||
Income Taxes | ||
Mexican royalty | $ 58 | $ 47.4 |
RELATED PARTY TRANSACTIONS_ (De
RELATED PARTY TRANSACTIONS: (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2022USD ($) | Mar. 31, 2021USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2012itemMW | Aug. 04, 2014item | |
RELATED PARTY TRANSACTIONS: | |||||
Related parties receivable current: | $ 29.9 | $ 49.1 | |||
Related parties payable: | 114.3 | 103.3 | |||
Total purchases | 0.5 | $ 0.6 | |||
Total sales | 0.5 | 0.4 | |||
Minimum | |||||
RELATED PARTY TRANSACTIONS: | |||||
Aggregate consideration of Material Affiliate Transaction to be be authorized by the General Counsel and CFO | 8 | ||||
Maximum | |||||
RELATED PARTY TRANSACTIONS: | |||||
Aggregate consideration of Material Affiliate Transaction to be be authorized by the General Counsel and CFO | 10 | ||||
Grupo Mexico and affiliates | |||||
RELATED PARTY TRANSACTIONS: | |||||
Total purchases | 105.2 | 114 | |||
Total sales | 45.9 | 44.8 | |||
Asarco LLC ("Asarco") | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties receivable current: | 7 | 10 | |||
Related parties payable: | 29.6 | 14.9 | |||
Total purchases | 14.6 | 3.7 | |||
Total sales | 11.4 | 6.9 | |||
AMMINCO | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties payable: | 4.2 | 9.5 | |||
Total purchases | 2.2 | 4.6 | |||
Americas Mining Corporation | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties receivable current: | 0.1 | 0.1 | |||
Compania Perforadora Mexico S.A.P.I. de C.V. | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties receivable current: | 0.3 | 0.3 | |||
Eolica El Retiro, S.A.P.I. de C.V. | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties payable: | 0.4 | 2.7 | |||
Total purchases | $ 0.9 | $ 0.2 | |||
Number of wind turbines | item | 37 | ||||
Percentage of supply to third-party energy users | 46.60% | 9.30% | |||
Ferrocarril Mexicano, S.A. de C.V. | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties payable: | $ 9.3 | 4 | |||
Total purchases | 5.2 | $ 10.9 | |||
Grupo Mexico | |||||
RELATED PARTY TRANSACTIONS: | |||||
Donations | 0 | 0.5 | |||
Grupo Mexico Servicios | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties payable: | 13.6 | 11.1 | |||
Total purchases | 5 | 2.5 | |||
MGE | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties receivable current: | 21.8 | 38.4 | |||
Related parties payable: | 51.3 | 57.2 | |||
Total purchases | 70.1 | 77.7 | |||
Total sales | $ 34.5 | $ 37.9 | |||
MGE | Mexico | |||||
RELATED PARTY TRANSACTIONS: | |||||
Number of natural gas-fired combined cycle power generating units | item | 2 | ||||
Net total capacity (in megawatts) | MW | 516.2 | ||||
Percentage of supply to third-party energy users | 0.20% | 2.70% | |||
Mexico Compania Constructora S.A de C.V. | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties payable: | $ 3.5 | 2 | |||
Total purchases | $ 5.1 | $ 13 | |||
Apu Coropuna S.R.L. | |||||
RELATED PARTY TRANSACTIONS: | |||||
Ownership percentage | 30.00% | ||||
Grupo Mexico Servicios de Ingenieria, S.A. de C.V. | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties receivable current: | $ 0.2 | 0.2 | |||
Related parties payable: | 1.1 | 0.9 | |||
Total purchases | 1.3 | 1.4 | |||
Controladora de Infraestructura Energetica Mexico, S. A. de C. V. | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties payable: | 0.9 | ||||
Total purchases | 0.8 | ||||
Boutique Bowling de Mexico, S.A. de C.V. | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties receivable current: | 0.1 | 0.1 | |||
Related parties payable: | 0.1 | 0.3 | |||
Total purchases | 0.1 | 0.1 | |||
Mexico Transportes Aereos S.A. de C.V. ("Mextransport") | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties receivable current: | 0.4 | ||||
Related parties payable: | 0.3 | 0.5 | |||
Total purchases | 0.4 | 0.4 | |||
Total sales | 0.5 | 0.4 | |||
Operadora de Cinemas S.A. de C.V. | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related parties payable: | 0.2 | ||||
Total purchases | $ 0.1 | ||||
Operadora de Cinemas S.A. de C.V. | Maximum | |||||
RELATED PARTY TRANSACTIONS: | |||||
Related party receivable and payable | 0.1 | 0.1 | |||
Total sales | $ 0.1 | $ 0.1 | |||
Equity investment in affiliate | |||||
RELATED PARTY TRANSACTIONS: | |||||
Ownership percentage | 44.20% |
DERIVATIVE INSTRUMENTS_ (Detail
DERIVATIVE INSTRUMENTS: (Details) | 3 Months Ended | 5 Months Ended |
Mar. 31, 2022USD ($)item$ / item | Mar. 31, 2022USD ($)item | |
Derivatives designated as hedging instruments under ASC 815 | ||
Number of derivative contracts entered | item | 2 | |
Derivative instruments held | item | 0 | 0 |
Call Option | Natural Gas | Derivatives designated as hedging instruments | ||
Derivatives designated as hedging instruments under ASC 815 | ||
Gas volume (MMBTUs) | 5,285,000 | 5,285,000 |
Hedge premium ($per MMBTU) | $ / item | 0.55 | |
Cost (million $) | $ (1,700,000) | $ (2,900,000) |
Profit (million $) | 500,000 | 500,000 |
Net favorable/unfavorable effect (million $) | $ (1,200,000) | $ (2,400,000) |
Derivative instruments held | 500,000 | 500,000 |
Swap contracts | Natural Gas | Derivatives designated as hedging instruments | ||
Derivatives designated as hedging instruments under ASC 815 | ||
Gas volume (MMBTUs) | 5,285,000 | 5,285,000 |
Reference price (swap: $per MMBTU)) | $ / item | 3.75 | |
Profit (million $) | $ 1,700,000 | $ 4,700,000 |
Net favorable/unfavorable effect (million $) | $ 1,700,000 | $ 4,700,000 |
Derivative instruments held | 2,300,000 | 2,300,000 |
LEASES_ (Details)
LEASES: (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Leases | ||
Lessee, operating lease, option to extend | false | |
Lessee, operating lease, option to terminate | false | |
The weighted average remaining lease term | 8 years | |
The weighted average discount rate | 3.71% | |
Total lease expense | $ 28.8 | $ 28.6 |
Maturities of lease liabilities | ||
2022 | 86.1 | |
2023 | 113.9 | |
2024 | 106.3 | |
2025 | 105.3 | |
2026 | 105.1 | |
After 2026 | 624.2 | |
Total lease payments | 1,140.9 | |
Less: interest on lease liabilities | (240.1) | |
Lease liabilities | 900.8 | |
Cost of sales (exclusive of depreciation, amortization and depletion) | ||
Leases | ||
Total lease expense | $ 28.8 | $ 28.6 |
Minimum | ||
Leases | ||
Remaining lease terms | 1 year | |
Maximum | ||
Leases | ||
Remaining lease terms | 11 years |
ASSET RETIREMENT OBLIGATION_ (D
ASSET RETIREMENT OBLIGATION: (Details) $ in Millions | Jun. 24, 2019 | Jan. 31, 2022USD ($) | Mar. 31, 2022USD ($)item | Mar. 31, 2021USD ($) | Dec. 31, 2019USD ($) |
ASSET RETIREMENT OBLIGATION: | |||||
Maximum annual guarantees secured | 50.00% | ||||
Percentage of guarantee for Lima complex | 50.00% | ||||
Percentage of security for LOC | 50.00% | ||||
Total guarantees | $ 66.3 | ||||
Asset retirement obligation activity | |||||
Balance at the beginning of the year | 562.9 | $ 562.9 | $ 545 | ||
Changes in estimates | 43.3 | ||||
Closure Payments | (2) | (0.2) | |||
Accretion expense | 6.5 | 6.1 | |||
Balance at the end of the year | $ 610.7 | $ 550.9 | |||
Peru | |||||
ASSET RETIREMENT OBLIGATION: | |||||
Period after which successive reviews are required by the law (in years) | 5 years | ||||
Number of units with future closure costs recognized as an asset retirement obligation | item | 3 | ||||
Asset retirement obligation activity | |||||
Changes in estimates | $ 28.1 | ||||
Mexico | |||||
Asset retirement obligation activity | |||||
Changes in estimates | $ 43.3 |
BENEFIT PLANS_ (Details)
BENEFIT PLANS: (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2022USD ($)plan | Mar. 31, 2021USD ($) | |
Benefit plans | ||
Number of noncontributory defined benefit pension plans | plan | 2 | |
Post retirement defined benefit plans and defined contribution plan | ||
Defined benefit plan, net periodic benefit costs | ||
Service cost | $ 0.4 | $ 0.4 |
Interest cost | 0.5 | 0.3 |
Expected return on plan assets | (1) | (0.8) |
Amortization of net loss/(gain) | 0.1 | 0.1 |
Post-retirement Health care plans | ||
Defined benefit plan, net periodic benefit costs | ||
Interest cost | 0.4 | 0.4 |
Amortization of prior service cost / (credit) | 0.1 | |
Net periodic benefit cost | $ 0.4 | $ 0.5 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES: - Environmental matters (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022USD ($) | Mar. 31, 2021USD ($) | Dec. 31, 2011personcategory | |
Environmental costs | |||
Environmental capital investment | $ 14 | $ 5.5 | |
Peru | |||
Environmental costs | |||
Environmental capital investment | 1.4 | 0.1 | |
Mexico | |||
Environmental costs | |||
Environmental capital investment | $ 12.6 | $ 5.4 | |
Number of categories of collective actions | category | 3 | ||
Minimum number of people claiming injury due to collective action initiative in Civil Federal Procedures Code (CFPC) | person | 30 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES: - Guaymas sulfuric acid spill (Details) | Jul. 19, 2019item | Jul. 09, 2019mĀ³ | Mar. 31, 2022USD ($)itemT$ / itemmĀ³ |
Climate change [Member] | |||
Number of business units | item | 2 | ||
Threshold annual greenhouse gas emissions | T | 100,000 | ||
Climate change [Member] | Minimum | |||
Tax rate per tonne Of Carbon dioxide | $ / item | 2.5 | ||
Threshold annual greenhouse gas emissions reporting to National emissions registry | T | 25,000 | ||
Climate change [Member] | Maximum | |||
Tax rate per tonne Of Carbon dioxide | $ / item | 12.5 | ||
Average cost per business unit | $ | $ 6,000 | ||
Marine Terminal in Guaymas | |||
Volume of sulfuric acid discharged in the incident at Guaymas | mĀ³ | 3 | ||
Water volume at Guaymas bay | mĀ³ | 340,000,000 | ||
Number of times of renewal | item | 4 | ||
Number of years of each renewal | 2 years |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES: - Litigation matters (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Mar. 31, 2022lawsuititem | Sep. 30, 2016lawsuit | Jun. 30, 2015lawsuititem | Dec. 31, 2018lawsuit | Dec. 31, 2015lawsuititem | Dec. 31, 2017lawsuit | Dec. 31, 2016lawsuit | |
Litigation Matter | |||||||
Number of collective action lawsuits | 6 | ||||||
Number of subsidiaries against which lawsuits were filed | item | 2 | ||||||
Number of collective action lawsuits dismissed | 3 | ||||||
Number of lawsuits in process | 3 | ||||||
Number of civil actions seeking damages | 33 | ||||||
Number Of Constitutional Action Lawsuits | 4 | ||||||
Number of subsidiaries to which environmental impact authorizations were granted | item | 1 | ||||||
Tia Maria | |||||||
Litigation Matter | |||||||
Number of lawsuits | 5 | ||||||
Buenavista del Cobre, S.A. de C.V | |||||||
Litigation Matter | |||||||
Number of civil actions seeking damages | 3 | 8 | 3 | ||||
Number of resolutions | 45 | ||||||
Francisca Garcia Enriquez | |||||||
Litigation Matter | |||||||
Number of additional constitutional lawsuits filed | 2 | ||||||
Mario Alberto Salcido et al; Maria Elena Heredia Bustamante et al; Martin Eligio Ortiz Gamez et al and Maria de los Angeles Enriquez Bacame et al | |||||||
Litigation Matter | |||||||
Number of additional constitutional lawsuits filed | 4 | ||||||
Mario Alberto Salcido et al; Maria Elena Heredia Bustamante et al; Martin Eligio Ortiz Gamez et al and Maria de los Angeles Enriquez Bacame et al | Mexico | |||||||
Litigation Matter | |||||||
Number of monitoring wells downstream from the dam | item | 3 | ||||||
Period to submit Semarnat | 2 years | ||||||
Norberto Bustamante et al | |||||||
Litigation Matter | |||||||
Number of additional constitutional lawsuits filed | 2 | ||||||
Acciones Colectivas de Sinaloa | |||||||
Litigation Matter | |||||||
Number of lawsuits in process | 2 | ||||||
Defensa Colectiva | |||||||
Litigation Matter | |||||||
Number of lawsuits in process | 1 |
COMMITMENTS AND CONTINGENCIES_5
COMMITMENTS AND CONTINGENCIES: - Labor matters (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2022USD ($)itememployee | Dec. 31, 2021PEN (S/)item | Dec. 31, 2021USD ($)item | |
Peru | Labor Matters | |||
Labor matters | |||
Percentage of labor unionized | 72.80% | ||
Total number of workers | employee | 4,675 | ||
Number of labor unions | 6 | ||
Number of labor unions represent majority of workers | 0 | ||
Extended term of agreement | 6 years | 6 years | |
Annual salary increase (as a percent) | 5.00% | 5.00% | |
Number of labor unions of collective agreement signed | 6 | 6 | |
Long term agreement bonus | S/ 10,000 | $ 2,702 | |
Peru | Labor Matters | Minimum | |||
Labor matters | |||
Term of agreement | 3 years | 3 years | |
Labor expense | S/ 45,000 | $ 12,159 | |
Peru | Labor Matters | Maximum | |||
Labor matters | |||
Term of agreement | 6 years | 6 years | |
Labor expense | S/ 90,000 | $ 22,318 | |
Mexico | San Martin | |||
Labor matters | |||
Budgeted cost for rehabilitation of mine | $ | $ 90,500,000 |
COMMITMENTS AND CONTINGENCIES_6
COMMITMENTS AND CONTINGENCIES: - Others (Details) S/ in Millions, $ in Millions | Feb. 20, 2020MW | Jul. 15, 2019complaint | Jul. 08, 2019USD ($)T | Jun. 30, 2021USD ($) | Jun. 30, 2018USD ($)T | May 31, 2016MW | Jul. 31, 2014MW | Jun. 30, 2014MW | Mar. 31, 2022USD ($)personitem | Mar. 31, 2022PEN (S/)personitem | Dec. 31, 2021USD ($) | Mar. 31, 2021USD ($) |
Other commitments: | ||||||||||||
Property net book value | $ 9,492.9 | $ 9,464.4 | $ 9,454.4 | |||||||||
Commitment for capital projects | 369.2 | |||||||||||
Tia Maria | Peru | ||||||||||||
Other commitments: | ||||||||||||
Project budget | $ 1,400 | 1,400 | ||||||||||
Number Of Complaints | complaint | 3 | |||||||||||
Amount spend as of the current date | $ 332.3 | |||||||||||
Annual production ( in tons) | T | 120,000 | |||||||||||
Number of workers expected to be directly employed | item | 600 | 600 | ||||||||||
Number of workers expected to be indirectly employed | item | 4,200 | 4,200 | ||||||||||
Toquepala Concentrator Expansion | Peru | ||||||||||||
Other commitments: | ||||||||||||
Amount committed to funding for social and infrastructure improvement projects | $ 120.2 | S/ 445.0 | ||||||||||
Commitment liability recorded in the balance sheet | 34.6 | |||||||||||
Development Fund Moquegua Region | Peru | ||||||||||||
Other commitments: | ||||||||||||
Amount committed to funding for social and infrastructure improvement projects | $ 270.2 | S/ 1,000.0 | ||||||||||
Number of schools agreed for construction. | item | 3 | 3 | ||||||||||
Amount committed to funding for school projects | $ 4.3 | S/ 15.9 | ||||||||||
Copper | Michiquillay | Peru | ||||||||||||
Other commitments: | ||||||||||||
Annual production ( in tons) | T | 225,000 | |||||||||||
Contingent contractual obligation | $ 400 | |||||||||||
Estimated mineralized material (in tons) | T | 2,288,000,000 | |||||||||||
Copper grade percentage | 0.43% | |||||||||||
Initial mine life | 25 years | |||||||||||
Contractual obligation paid on project | $ 12.5 | $ 12.5 | ||||||||||
Remaining amount to pay if project is developed | $ 375 | |||||||||||
Educational Project | Tia Maria | Peru | ||||||||||||
Other commitments: | ||||||||||||
Number of jobs expected to be generated | person | 9,000 | 9,000 | ||||||||||
Number of Direct Jobs Expected to be Generated | person | 3,600 | 3,600 | ||||||||||
Number of Indirect Jobs Expected to be Generated | person | 5,400 | 5,400 | ||||||||||
Educational Project | Toquepala Concentrator Expansion | Peru | ||||||||||||
Other commitments: | ||||||||||||
Amount committed to funding for social and infrastructure improvement projects | $ 5.1 | S/ 18.8 | ||||||||||
Educational Project | Development Fund Moquegua Region | Peru | ||||||||||||
Other commitments: | ||||||||||||
Amount committed to funding for social and infrastructure improvement projects | 29.3 | 108.4 | ||||||||||
Construction of Cularjahuira Dam | Toquepala Concentrator Expansion | Peru | ||||||||||||
Other commitments: | ||||||||||||
Amount committed to funding for social and infrastructure improvement projects | 4.2 | 15.6 | ||||||||||
Study Of Engineering For Collazas Dam | Toquepala Concentrator Expansion | Peru | ||||||||||||
Other commitments: | ||||||||||||
Amount committed to funding for social and infrastructure improvement projects | 0.7 | 2.6 | ||||||||||
Water Treatment | Development Fund Moquegua Region | Peru | ||||||||||||
Other commitments: | ||||||||||||
Amount committed to funding for social and infrastructure improvement projects | 21.6 | 79.9 | ||||||||||
Amount committed for funding social and infrastructure improvement projects, build tracks and sidewalks | 1.7 | 6.4 | ||||||||||
Social Investment For Taxes | Toquepala Concentrator Expansion | Peru | ||||||||||||
Other commitments: | ||||||||||||
Amount committed to funding for social and infrastructure improvement projects | 19 | 70.3 | ||||||||||
Social Investment For Taxes | Development Fund Moquegua Region | Peru | ||||||||||||
Other commitments: | ||||||||||||
Amount committed to funding for social and infrastructure improvement projects | $ 27.1 | S/ 100.4 | ||||||||||
Number of Infrastructure Projects Agreed for Construction | item | 2 | 2 | ||||||||||
Electroperu S.A | Power purchase agreements | Peru | ||||||||||||
Other commitments: | ||||||||||||
Purchase agreement, contracted power capacity (in megawatts) | MW | 120 | |||||||||||
Term of power purchase agreement related to sale of power plant | 20 years | |||||||||||
Parque Eolico de Fenicias, S. de R.L. de C.V | Power purchase agreements | Mexico | ||||||||||||
Other commitments: | ||||||||||||
Purchase agreement, contracted power capacity (in megawatts) | MW | 611,400 | |||||||||||
Term of power purchase agreement related to sale of power plant | 20 years | |||||||||||
Kallpa | Power purchase agreements | Peru | ||||||||||||
Other commitments: | ||||||||||||
Purchase agreement, contracted power capacity (in megawatts) | MW | 120 | |||||||||||
Term of power purchase agreement related to sale of power plant | 10 years | |||||||||||
Kallpa | Power purchase agreements | Peru | Maximum | ||||||||||||
Other commitments: | ||||||||||||
Purchase agreement, contracted power capacity (in megawatts) | MW | 80 |
STOCKHOLDERS' EQUITY - Treasury
STOCKHOLDERS' EQUITY - Treasury Stock (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Activity in treasury stock | |||
Balance at the beginning of the period | $ 3,074 | ||
Balance at the end of the period | $ 3,087.7 | $ 3,061.2 | |
Parent Company (Grupo Mexico) common shares | |||
Activity in treasury stock | |||
Treasury stock balance at the end of the period (in shares) | 111,506,017 | 111,509,217 | |
TREASURY STOCK: | Parent Company (Grupo Mexico) common shares | |||
Activity in treasury stock | |||
Balance at the beginning of the period | $ 2,767.2 | 2,767.5 | |
Used for corporate purposes | (0.1) | ||
Balance at the end of the period | 2,767.1 | 2,767.5 | |
TREASURY STOCK: | Parent Company (Grupo Mexico) | |||
Activity in treasury stock | |||
Balance at the beginning of the period | 306.8 | 296 | |
Other activity, including dividend, interest and foreign currency transaction effect | 13.8 | (2.3) | |
Other activity, including dividend, interest and foreign currency transaction effect | 13.8 | (2.3) | |
Balance at the end of the period | $ 320.6 | $ 293.7 | |
Treasury stock balance at the end of the period (in shares) | 79,728,356 | 79,800,655 |
STOCKHOLDERS' EQUITY - Repurcha
STOCKHOLDERS' EQUITY - Repurchase Program (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2008 | |
SCC share repurchase program: | ||
Amount authorized for share repurchase program | $ 3,000 | $ 500 |
Total Number of Shares Purchased | 119.5 | |
Cost of purchase of shares | $ 2,900 | |
Closing price of NYSE (in dollars per share) | $ 75.90 | |
Maximum Number of Shares that May Yet Be Purchased Under the Plan @ $39.68 | 1.1 | |
Percentage of Ownership by Parent | 88.90% |
STOCKHOLDERS EQUITY - Directors
STOCKHOLDERS EQUITY - Directors Stock Award Plan (Details) - shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Directors' Stock Award Plan | ||
Share based Compensation Plan | ||
Common shares received on election as director | 1,200 | |
Additional shares issued at each annual general meeting | 1,200 | |
Total SCC shares reserved for the plan | 600,000 | 600,000 |
Period of extension of plan | 5 years | |
Increased share awards issued to directors | 1,600 | |
Activity in directors' stock award plan | ||
Total shares granted at the beginning of the period (in shares) | (405,200) | (391,600) |
Granted (in shares) | 3,200 | |
Total shares granted at the end of the period (in shares) | (408,400) | (391,600) |
Remaining shares reserved | 191,600 | 208,400 |
New 2021 grant [Member] | ||
Share based Compensation Plan | ||
Numbers of shares shall be granted quarterly and conditioned upon the attendance of each director to each Board meeting | 1,600 |
STOCKHOLDERS' EQUITY - Employee
STOCKHOLDERS' EQUITY - Employee Stock Purchase Plan (Details) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | ||||
Nov. 30, 2018$ / shares | Nov. 30, 2018$ / shares | Jan. 31, 2015$ / shares | Jan. 31, 2015$ / shares | Mar. 31, 2022USD ($)$ / sharesshares | Mar. 31, 2021USD ($)$ / sharesshares | |
Unit Weighted Average Grant Date Fair Value | ||||||
Outstanding shares at the beginning of the period (in dollars per share) | $ 2.63 | $ 2.63 | ||||
Exercised (in dollars per share) | 2.63 | 2.63 | ||||
Forfeited (in dollars per share) | $ 2.63 | |||||
Outstanding shares at the end of the period (in dollars per share) | $ 2.63 | |||||
Employee Stock Purchase 2015 Plan | ||||||
Information related to compensation cost | ||||||
Purchase price for initial subscription (in dollars per share) | (per share) | $ 38.44 | $ 2.63 | ||||
Percentage of title acquired by employee in every two years on shares paid in previous two years | 50.00% | |||||
Period of plan | 8 years | |||||
Ratio of bonus shares granted to participant | 0.1 | |||||
Stock based compensation expense | $ | $ 0.2 | $ 0.2 | ||||
Unrecognized compensation expense | $ | $ 0.6 | $ 1.2 | ||||
Stock award activity, Shares | ||||||
Outstanding shares at the beginning of the period | shares | 867,234 | 1,264,410 | ||||
Exercised (in shares) | shares | (16,394) | (293,041) | ||||
Outstanding shares at the end of the period | shares | 850,840 | 971,369 | ||||
Employee Stock Purchase 2018 Plan | ||||||
Information related to compensation cost | ||||||
Purchase price for initial subscription (in dollars per share) | (per share) | $ 37.89 | $ 1.86 | ||||
Percentage of title acquired by employee in every two years on shares paid in previous two years | 50.00% | |||||
Period of plan | 8 years | |||||
Ratio of bonus shares granted to participant | 0.1 | |||||
Stock based compensation expense | $ | $ 0.2 | $ 0.2 | ||||
Unrecognized compensation expense | $ | $ 2.9 | $ 3.6 | ||||
Stock award activity, Shares | ||||||
Outstanding shares at the beginning of the period | shares | 3,173,924 | 3,918,458 | ||||
Exercised (in shares) | shares | (115,903) | (592,768) | ||||
Outstanding shares at the end of the period | shares | 3,058,021 | 3,325,690 | ||||
Unit Weighted Average Grant Date Fair Value | ||||||
Outstanding shares at the beginning of the period (in dollars per share) | $ 1.86 | $ 1.86 | ||||
Exercised (in dollars per share) | 1.86 | |||||
Outstanding shares at the end of the period (in dollars per share) | $ 1.86 | $ 1.86 |
STOCKHOLDERS' EQUITY_ - Non Con
STOCKHOLDERS' EQUITY: - Non Controlling Interest (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Non-controlling interest activity | ||
Balance at the beginning of the period | $ 58.6 | $ 51.2 |
Net earnings | 3.1 | 3.3 |
Dividend paid | (1.8) | (1.3) |
Balance at the end of the period | $ 59.9 | $ 53.2 |
FAIR VALUE MEASUREMENT (Details
FAIR VALUE MEASUREMENT (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Liabilities: | ||
Long-term debt, Carrying Value | $ 6,548.5 | $ 6,547.6 |
Long-term debt, Fair Value | 7,721.6 | 8,573.2 |
Short-term investment: | ||
Trading securities | 406.1 | 486.5 |
Available-for-sale: | ||
Available-for-sale Securities, Current, Total | 0.4 | 0.4 |
Quoted prices in active markets for identical assets (Level 1) | ||
Liabilities: | ||
Long-term debt, Carrying Value | 6,497.3 | 6,496.4 |
Long-term debt, Fair Value | 7,657.2 | 8,506 |
Significant other observable inputs (Level 2) | ||
Liabilities: | ||
Long-term debt, Carrying Value | 51.2 | 51.2 |
Long-term debt, Fair Value | 64.4 | 67.2 |
Fair value measurements recurring | Fair value as of the end of the period | ||
Short-term investment: | ||
Trading securities | 406.1 | 486.5 |
Derivative: | ||
Total assets, fair value | 1,625.3 | 1,651.4 |
Fair value measurements recurring | Fair value as of the end of the period | Copper | ||
Derivative: | ||
Provisionally priced sales | 950.6 | 876.2 |
Fair value measurements recurring | Fair value as of the end of the period | Molybdenum | ||
Derivative: | ||
Provisionally priced sales | 268.2 | 288.3 |
Fair value measurements recurring | Asset backed securities | Fair value as of the end of the period | ||
Available-for-sale: | ||
Available-for-sale debt securities | 0.2 | 0.2 |
Fair value measurements recurring | Mortgage backed securities | Fair value as of the end of the period | ||
Available-for-sale: | ||
Available-for-sale debt securities | 0.2 | 0.2 |
Fair value measurements recurring | Quoted prices in active markets for identical assets (Level 1) | ||
Short-term investment: | ||
Trading securities | 406.1 | 486.5 |
Derivative: | ||
Total assets, fair value | 1,624.9 | 1,651 |
Fair value measurements recurring | Quoted prices in active markets for identical assets (Level 1) | Copper | ||
Derivative: | ||
Provisionally priced sales | 950.6 | 876.2 |
Fair value measurements recurring | Quoted prices in active markets for identical assets (Level 1) | Molybdenum | ||
Derivative: | ||
Provisionally priced sales | 268.2 | 288.3 |
Fair value measurements recurring | Significant other observable inputs (Level 2) | ||
Available-for-sale: | ||
Available-for-sale Securities, Current, Total | 0.4 | 0.4 |
Fair value measurements recurring | Significant other observable inputs (Level 2) | Asset backed securities | ||
Available-for-sale: | ||
Available-for-sale debt securities | 0.2 | 0.2 |
Fair value measurements recurring | Significant other observable inputs (Level 2) | Mortgage backed securities | ||
Available-for-sale: | ||
Available-for-sale debt securities | $ 0.2 | $ 0.2 |
REVENUE_ - Revenue by Geographi
REVENUE: - Revenue by Geographical Areas (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenue Recognition | ||
Net sales | $ 2,763.8 | $ 2,532.5 |
Corporate, other and eliminations | ||
Revenue Recognition | ||
Net sales | (154.7) | (26.1) |
Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 1,646.2 | 1,478.5 |
Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 177.5 | 124.3 |
Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 1,094.8 | 955.8 |
Mexico | ||
Revenue Recognition | ||
Net sales | 624.6 | 493.9 |
Mexico | Corporate, other and eliminations | ||
Revenue Recognition | ||
Net sales | (40) | (26.1) |
Mexico | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 533.8 | 453.4 |
Mexico | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 130.8 | 66.6 |
United States | ||
Revenue Recognition | ||
Net sales | 562.1 | 425.5 |
United States | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 455.6 | 389.4 |
United States | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 15.7 | 17 |
United States | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 90.8 | 19.1 |
Peru | ||
Revenue Recognition | ||
Net sales | 177.8 | 147.4 |
Peru | Corporate, other and eliminations | ||
Revenue Recognition | ||
Net sales | (114.7) | |
Peru | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 115 | |
Peru | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 177.5 | 147.4 |
Brazil | ||
Revenue Recognition | ||
Net sales | 124.3 | 99 |
Brazil | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 5.2 | 2 |
Brazil | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 119.1 | 97 |
Chile | ||
Revenue Recognition | ||
Net sales | 103.5 | 58 |
Chile | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 1.9 | |
Chile | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 103.5 | 56.1 |
Other American countries | ||
Revenue Recognition | ||
Net sales | 11.9 | 12.8 |
Other American countries | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 6.5 | 10.3 |
Other American countries | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 0.7 | |
Other American countries | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 5.4 | 1.8 |
Switzerland | ||
Revenue Recognition | ||
Net sales | 426.8 | 393.8 |
Switzerland | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 227.4 | 294.5 |
Switzerland | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 8.3 | 7 |
Switzerland | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 191.1 | 92.3 |
Italy | ||
Revenue Recognition | ||
Net sales | 72 | 74.1 |
Italy | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 0.5 | |
Italy | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 4 | 0.9 |
Italy | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 67.5 | 73.2 |
Spain | ||
Revenue Recognition | ||
Net sales | 94.9 | 110.9 |
Spain | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 93.2 | 91 |
Spain | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 1.7 | 19.9 |
Other European Countries | ||
Revenue Recognition | ||
Net sales | 125.3 | 180.9 |
Other European Countries | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 30.8 | 73.4 |
Other European Countries | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 8.4 | 26.5 |
Other European Countries | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 86.1 | 81 |
China | ||
Revenue Recognition | ||
Net sales | 112.4 | 56.6 |
China | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 112.4 | 55 |
China | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 1.9 | |
Singapore | ||
Revenue Recognition | ||
Net sales | 61.8 | 202.3 |
Singapore | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 4.7 | 71.6 |
Singapore | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 4.9 | 3.6 |
Singapore | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 52.2 | 127.1 |
Japan | ||
Revenue Recognition | ||
Net sales | 183.4 | 184 |
Japan | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 22 | 21.4 |
Japan | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 161.4 | 162.6 |
Other Asian countries | ||
Revenue Recognition | ||
Net sales | 83 | 93.3 |
Other Asian countries | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 44.3 | 16.9 |
Other Asian countries | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 0.2 | |
Other Asian countries | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | $ 38.5 | $ 76.4 |
REVENUE_ - Revenue by Segment (
REVENUE: - Revenue by Segment (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenue Recognition | ||
Net sales | $ 2,763.8 | $ 2,532.5 |
Corporate, other and eliminations | ||
Revenue Recognition | ||
Net sales | (154.7) | (26.1) |
Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 1,646.2 | 1,478.5 |
Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 177.5 | 124.3 |
Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 1,094.8 | 955.8 |
Copper | ||
Revenue Recognition | ||
Net sales | 2,154.9 | 2,117.4 |
Copper | Corporate, other and eliminations | ||
Revenue Recognition | ||
Net sales | (129.8) | (13.7) |
Copper | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 1,368.4 | 1,280.5 |
Copper | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 22.4 | 23.8 |
Copper | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 893.9 | 826.8 |
Molybdenum | ||
Revenue Recognition | ||
Net sales | 275.8 | 169.6 |
Molybdenum | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 150.4 | 91.1 |
Molybdenum | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 125.4 | 78.5 |
Silver | ||
Revenue Recognition | ||
Net sales | 105.2 | 35.7 |
Silver | Corporate, other and eliminations | ||
Revenue Recognition | ||
Net sales | (21.6) | 0.5 |
Silver | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 66.7 | |
Silver | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 37 | 35.2 |
Silver | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 23.1 | |
Zinc | ||
Revenue Recognition | ||
Net sales | 98.3 | 139 |
Zinc | Corporate, other and eliminations | ||
Revenue Recognition | ||
Net sales | (0.3) | (11.7) |
Zinc | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 72.7 | |
Zinc | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 98.6 | 48.5 |
Zinc | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | 29.5 | |
Other | ||
Revenue Recognition | ||
Net sales | 129.6 | 70.8 |
Other | Corporate, other and eliminations | ||
Revenue Recognition | ||
Net sales | (3) | (1.2) |
Other | Mexican Open-Pit | Operating segment | ||
Revenue Recognition | ||
Net sales | 60.7 | 34.2 |
Other | Mexican IMMSA Unit | Operating segment | ||
Revenue Recognition | ||
Net sales | 19.5 | 16.8 |
Other | Peruvian Operations | Operating segment | ||
Revenue Recognition | ||
Net sales | $ 52.4 | $ 21 |
REVENUE_ - Receivables by repor
REVENUE: - Receivables by reporting segment (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2022USD ($)T | Dec. 31, 2021USD ($) | |
Opening and closing balances of receivables | ||
Trade receivables | $ 1,185.8 | $ 1,358.7 |
Related parties, current | 29.9 | 49.1 |
Corporate, other and eliminations | ||
Opening and closing balances of receivables | ||
Trade receivables | (113.6) | |
Related parties, current | $ 2.2 | 2 |
Copper concentrates | ||
Long Term Contracts | ||
Long term contracts | T | 118,000 | |
Copper cathodes | ||
Long Term Contracts | ||
Long term contracts | T | 48,000 | |
Molybdenum concentrates | ||
Long Term Contracts | ||
Long term contracts | T | 37,000 | |
Sulfuric acid | ||
Long Term Contracts | ||
Long term contracts | T | 354,851 | |
Mexican Open-Pit | Operating segment | ||
Opening and closing balances of receivables | ||
Trade receivables | $ 728.6 | 656 |
Related parties, current | 27.4 | 46.9 |
Mexican IMMSA Unit | Operating segment | ||
Opening and closing balances of receivables | ||
Trade receivables | 60.5 | 51.2 |
Related parties, current | 0.2 | 0.2 |
Peruvian Operations | Operating segment | ||
Opening and closing balances of receivables | ||
Trade receivables | 510.3 | $ 651.5 |
Related parties, current | $ 0.1 |
REVENUE_ - Provisionally prices
REVENUE: - Provisionally prices sales (Details) lb in Millions, $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($)lb$ / item | |
Copper | |
Provisionally priced sales: | |
Provisional price sales adjustment amounts included in accounts receivable and net sales | $ | $ 29.4 |
Copper | April 2022 through July 2022 | |
Provisionally priced sales: | |
Sales volume (in million lbs.) | lb | 201.9 |
Provisional price | $ / item | 4.71 |
Molybdenum | |
Provisionally priced sales: | |
Provisional price sales adjustment amounts included in accounts receivable and net sales | $ | $ 3.3 |
Molybdenum | April 2022 through July 2022 | |
Provisionally priced sales: | |
Sales volume (in million lbs.) | lb | 13.9 |
Provisional price | $ / item | 19.30 |
SEGMENT AND RELATED INFORMATI_3
SEGMENT AND RELATED INFORMATION: (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022USD ($)segment | Mar. 31, 2021USD ($) | Dec. 31, 2021USD ($) | |
Financial information related to segments | |||
Number of reportable segments | segment | 3 | ||
Financial information relating to segments | |||
Net sales | $ 2,763.8 | $ 2,532.5 | |
Cost of sales (exclusive of depreciation, amortization and depletion) | 1,057.7 | 943.8 | |
Selling, general and administrative | 30.3 | 30.1 | |
Depreciation, amortization and depletion | 196.6 | 200.6 | |
Exploration | 9.1 | 6.4 | |
Operating income | 1,470.1 | 1,351.6 | |
Interest, net | (83.1) | (87.2) | |
Other income (expense) | 11.7 | 2.3 | |
Income taxes | (612.1) | (507.5) | |
Equity earnings of affiliate | 1.2 | 7.9 | |
Non-controlling interest | (3.1) | (3.3) | |
Net income attributable to SCC | 784.7 | 763.8 | |
Capital investment | 205.2 | 232.6 | |
Property net book value | 9,492.9 | 9,454.4 | $ 9,464.4 |
Total assets | 17,898.9 | 17,217.8 | $ 18,297.6 |
Intersegment sales | |||
Financial information relating to segments | |||
Net sales | (40) | (26.1) | |
Corporate, other and eliminations | |||
Financial information relating to segments | |||
Net sales | (154.7) | (26.1) | |
Cost of sales (exclusive of depreciation, amortization and depletion) | (91.4) | (31.5) | |
Selling, general and administrative | 3.9 | 2.7 | |
Depreciation, amortization and depletion | 9.7 | 9.7 | |
Exploration | 0.7 | 0.6 | |
Operating income | (77.5) | (7.6) | |
Capital investment | 3 | 2.2 | |
Property net book value | 551.1 | 544.9 | |
Total assets | 3,414.2 | 3,639.2 | |
Reportable subsegments | |||
Financial information relating to segments | |||
Net sales | 2,763.8 | 2,532.5 | |
Reportable subsegments | Corporate, other and eliminations | |||
Financial information relating to segments | |||
Net sales | (114.6) | ||
Mexican Open-Pit | Operating segment | |||
Financial information relating to segments | |||
Net sales | 1,646.2 | 1,478.5 | |
Cost of sales (exclusive of depreciation, amortization and depletion) | 548.3 | 509.9 | |
Selling, general and administrative | 15.5 | 15.9 | |
Depreciation, amortization and depletion | 98 | 95.6 | |
Exploration | 0.5 | 0.5 | |
Operating income | 983.8 | 856.6 | |
Capital investment | 89.3 | 149.6 | |
Property net book value | 4,662.5 | 4,653.8 | |
Total assets | 8,611.5 | 7,698 | |
Mexican Open-Pit | Reportable subsegments | Operating segment | |||
Financial information relating to segments | |||
Net sales | 1,646.2 | 1,478.5 | |
Mexican IMMSA Unit | Operating segment | |||
Financial information relating to segments | |||
Net sales | 177.5 | 124.3 | |
Cost of sales (exclusive of depreciation, amortization and depletion) | 131.7 | 80.4 | |
Selling, general and administrative | 2.4 | 2.1 | |
Depreciation, amortization and depletion | 11.3 | 13.9 | |
Exploration | 1.1 | 1.3 | |
Operating income | 31 | 26.6 | |
Capital investment | 31.7 | 14.3 | |
Property net book value | 593.5 | 548.4 | |
Total assets | 1,080.9 | 965.1 | |
Mexican IMMSA Unit | Intersegment sales | |||
Financial information relating to segments | |||
Net sales | 40 | 26.1 | |
Mexican IMMSA Unit | Reportable subsegments | Operating segment | |||
Financial information relating to segments | |||
Net sales | 137.5 | 98.2 | |
Peruvian Operations | Operating segment | |||
Financial information relating to segments | |||
Net sales | 1,094.8 | 955.8 | |
Cost of sales (exclusive of depreciation, amortization and depletion) | 469.1 | 385 | |
Selling, general and administrative | 8.5 | 9.4 | |
Depreciation, amortization and depletion | 77.6 | 81.4 | |
Exploration | 6.8 | 4 | |
Operating income | 532.8 | 476 | |
Capital investment | 81.2 | 66.5 | |
Property net book value | 3,685.8 | 3,707.3 | |
Total assets | 4,792.3 | 4,915.5 | |
Peruvian Operations | Reportable subsegments | Operating segment | |||
Financial information relating to segments | |||
Net sales | $ 1,094.8 | $ 955.8 |
SUBSEQUENT EVENTS_ (Details)
SUBSEQUENT EVENTS: (Details) $ / shares in Units, S/ in Millions, $ in Millions | Apr. 28, 2022$ / shares | Apr. 12, 2022PEN (S/) | Apr. 12, 2022USD ($) | Mar. 31, 2022$ / shares | Mar. 31, 2021$ / shares |
SUBSEQUENT EVENTS | |||||
Dividends declared and paid | $ 1 | $ 0.6 | |||
Subsequent Events | |||||
SUBSEQUENT EVENTS | |||||
Quarterly dividend authorized (in dollars per share) | $ 1.25 | ||||
Income tax refund | S/ 124.8 | $ 33.6 |