Southern Copper (PCU) Q3 2026 Earnings Report

The call was strongly positive overall. Management reported record sales, adjusted EBITDA and net income, substantial increases in operating cash flow, strong metal prices, very low net cash costs after by-product credits, and continued progress across major growth projects. These strengths outweighed lower mine production, higher operating costs, project timing and CapEx uncertainties, illegal mining at Los Chancas, and the unfavorable TC/RC environment.

Southern Copper expects 918,000 tons of copper, 29,000 tons of molybdenum, 24 million ounces of silver and 163,400 tons of zinc in 2026; next year’s copper production should be “about a little bit less than 920,000 tons,” with a “much more firmer forecast” in the January call. Fourth-quarter 2026 cash cost before by-product credits is expected to be “in line or slightly better than what we did last quarter,” while for 2027 cash cost should be “about to where we are now or a little bit better cash cost-wise.” Tia Maria is expected to produce 120,000 tons of SX-EW copper cathodes per annum in the early years of operations, with operations scheduled to begin in the first half of 2028; Los Chancas is expected to produce 130,000 tons of copper and 7,500 tons of molybdenum annually, with production by 2031; Michiquillay is expected to produce 225,000 tons of copper per year, with production expected by 2032; the Cuajone expansion is being evaluated from 90,000 tons per day to 120,000 tons per day, with a capital cost of $680 million and estimated annual production of 55,000 tons of copper and 1,400 tons of molybdenum, while 150,000 tons of milling capacity per day remains under study and “the most likely scenario is 120,000”; and El Pilar is expected to produce 36,000 tons of copper cathodes annually, with construction commencing in the first quarter of 2027 and production beginning in the second half of 2029.