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Southern Copper’s earnings, sales decline on lower prices

Keywords: Tags  Southern Copper, net income, copper, molybdenum, Raul Jacob

NEW YORK — Southern Copper Corp.’s net income tumbled 17.2 percent to $1.93 billion last year from $2.34 billion in 2011 as sales fell 2.2 percent to $6.67 billion largely due to lower commodity prices.

LME copper prices averaged $3.61 per pound in 2012 compared with $4 the previous year, and the average Comex price fell to $3.61 per pound from $4.01.

The company’s copper production increased 2 percent to 651,801 tonnes last year from 638,810 tonnes in 2011, although fourth-quarter output of 165,089 tonnes was down 2.7 percent from 169,750 tonnes in the same period a year earlier.

The Phoenix-based company said it expects to boost its annual copper production to more than 1.17 million tonnes by 2017, in part from its $2.8-billion investment to increase output at its Buenavista Mine in Mexico to 488,000 tonnes per year by 2015 from 180,000 tonnes.

Chief financial officer Raul Jacob said he is optimistic about copper demand this year, noting that the company is forecasting 8.5-percent growth in China in 2013, an improvement over 5-percent growth in 2012.

The company’s molybdenum sales fell 2.2 percent to 18,220 tonnes in 2012 from 18,635 tonnes the previous year, but zinc sales rose 3 percent to 93,392 tonnes from 90,664 tonnes in the same comparison and silver sales jumped 14.6 percent to 16,232 tonnes from 14,161 tonnes.

Fourth-quarter net income dipped 1 percent to $531.8 million from $537 million a year earlier on sales that fell 1.1 percent to $1.65 billion.

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