Q3 2025 Southern Copper Corp Earnings Call
[music].
Good morning, and welcome to southern Copper Corporation's third quarter and nine months 2025.
With us. This morning, we have southern Copper Corporation, Mr. Zhao will Jackup, Vice President Finance stretcher N CFO, who will discuss the results of the company for the third quarter and nine months 2025, as well less answer any questions that you may have.
The information discussed on today's call May include forward looking statements regarding the company's results and prospects, which are subject to risk and uncertainties.
Actual results may differ materially from the company cautions not to place undue reliance on these forward looking statements.
Southern Copper Corporation undertakes no obligation to publicly update or revise any forward looking statements, whether as a result of new information future events or otherwise.
All results are expressed in full U S. GAAP now I will pass the call to Mr. Raul Jacob.
Thank you very much Garmin would morning, everyone and welcome to Southern Copper's third quarter 2025 results conference call.
Today's conference I'm, not comparing with Mr. Oscar Gonzalez Rocha CEO of southern copper and board member.
Another contributor we sold for Bornemann.
Today's call will begin with an update on our view of the copper market and then review saga Copper's key results related to production sales operating cost financial results expansion projects and ESG. After this we will open the session for questions.
Our performance in the fourth quarter deliberate New company records for net sales adjusted EBITDA and net income.
This is my story.
Milestones are a testament to the strength of our strategy execution and commitment to sustainable growth. This strong performance was primarily driven by a rise in byproduct production and improved metal practices prices across all our problems.
Zinc production rose, 46%, mainly on the back of significant production at our Buenavista zinc concentrator.
Silver and molybdenum output grew 16% and 8% respectively. The combination of higher production volumes and better copper byproduct prices enabled us to achieve a cash cost of 42 cents per pound of copper in the third quarter of this year one.
The industry's lowest we remain firmly committed to enhancing productivity and cost efficiency.
Driven by our strategy and of course in discipline and focus on achieving our long term goal to produce one 6 million pounds of copper at the lowest possible most competitive cost per pound.
Looking into the copper market yellow copper price increased 7% from an average of $4.17 per pound in the third quarter of 2020 for up to $4.44. This past quarter for.
For the Comex market, we saw a 14% increase base.
Based on current supply and demand dynamics, which include the negative production effects that we're seeing in Indonesia, and Chile. We're currently estimating a copper market deficit of almost 400000 tons.
Copper inventories worldwide, which is the sum of the London metal exchange, Comex, and Shanghai bond and Shanghai warehouses, as well Oh, they're bonded warehouses corporate this inventory some of this.
Different inventory.
At the end of September where she came in about 9000 tons. We estimate that this inventory currently covers approximately eight days of global demand.
The recent U S tariff policy changes have thus far had a limited impact on our results as such we're confident now that the long term fundamentals of prices for copper and other metals, we remain very positive.
Now, let's look at southern Copper's production for this past quarter.
Copper represented 73% of our sales in the third quarter of this year.
Copper production, where you saw a decrease of 7% compared to the third quarter of 2024 and it stood at 234892 times this past quarter.
Our quarterly results were sold reflects a 7% drop in production in Peru, which was triggered by a decrease in production at our toquepala and Cuajone mines production at our Mexican operations fell 7% quarter on quarter, driven by a decrease in production being there whenever you.
Due to lower ore grades.
The fact that the new win at least a concentrate or.
That's fully dedicated to maximizing zinc and silver production to leverage the favorable ore grades with enterprise in an important segment of the mine.
Okay.
On a year to date basis corporate production fell 3% in 2025 to stand at 714098 tonnes, mainly driven by a decrease in production at our Mexican and Peruvian operation due to lower ore grades.
For this year 2025, we expect to produce 960000 tons of copper.
Slightly lower less than 1% than the plan and a decrease of 2% over 2024 finance right.
Molybdenum represented 13% of the company face value in the third quarter of 2025 and it is currently our first by product.
Molybdenum prices averaged $24.30 per pound in the quarter compared to $21.68 per pound in the third quarter of 2024.
This represents an increase of 12%.
Molybdenum production registered an increase of 8% in the third quarter of this year compared to the same period of 2024.
This was mainly driven by higher production at our luxury that brand Coca Cola minds.
Which were partially offset by lower production at our win at least on the operation.
In 2025, we expect to produce 30000 tons of molybdenum, which represents an increase of 4% over our 2024 production level.
For silver it represented 7% of our sales value in the third quarter of 2025.
Average price of $39 56.
Per ounce for the quarter.
This reflected and an increase of 34%.
Silver is currently our second by product.
Mined silver production increased 16% in the third quarter of 2025.
Vis vis the next in the same quarter of 2024 after production growth in our Mexican operations.
And this was partially offset by lower production in the Peruvian mines.
Refined silver production increased 2% quarter over quarter.
This evolution was mainly driven by higher production in our Eagle refinery, which was partially offset by a drop in production in a cardiac refinery.
In 2025, we expect to produce 23 million ounces of silver an increase of 10% compared to last year.
Zinc represented 4% of our sales value in the third quarter of 2025 with an average price of a dollar and 28 cents per pound in the quarter.
This represents a 2% increase compared to the third quarter of 2024 think it's currently our third quarter.
Mine production increased 46% quarter over quarter and totaled 45000 and 482 times.
This was mainly driven by an increase in production.
Mr think of 108%.
He says when Arista zinc concentrate or has been processing.
Hi ore grade material that we found in a segment of the Buenavista mine that well it was.
Review and.
Decided on the base of the value that this additional production is contributing to this year's results.
For the year 2025, we expect to produce 174700 tons of zinc, which represents an increase of 34% over our 2024 production level. This growth will be driven by the production of our winter business in concentrate or.
Which are you already mentioned it is operating at.
Full capacity dedicated to sink deduction.
For the third quarter of this year.
<unk> were $3 4 billion.
This figure was $446 million or 15% above the third quarter of 2020 for print.
The corporate face value increased 8%, while the volume dropped 4% in any scenario better prices, the London metal exchange price increased 7% and the comex price increased 14%.
Regarding our main by products, we register and increasing sales of molybdenum by 46% due to growth in volume volume.
Sales increased 8% and better priced.
Sales increased 12% due to an uptick in volume of 7% and better prices for this.
You have seen.
Finally, hoover's sales increased 65% due to higher volume, 22% and better prices.
Our total operating cost and expenses were up to $128 million or 9% compared to the third quarter of 2024.
The main cost increments were in purchase copper concentrate workers' participation labor operations contractors and services.
And sales.
These cost increments were partially offset by a drop in inventory consumption and other factors.
The third quarter of 2025, EBITDA adjusted EBITDA was 1970 $5 million.
This represented an increase of 17% with regard to the 1600 85 million registered in the third quarter of 2024.
The adjusted EBITDA margin in the third quarter of this year stood at 59% versus 58% in the third quarter of 2024.
Adjusted EBITDA year to date.
5000 $512 million this is 13% than the mark for the nine months of 2024.
The adjusted EBITDA margin in the nine months of this year stood at 58%.
57% in the nine months of 2024.
Operating cash cost per pound of copper before byproduct credits was two.
$2.23 per pound.
In the third quarter of 2025.
This is 12% higher than the value for the second quarter of 2025, which was $2 11.
This 5% increasing operating cash cost if there were sort of higher cost per pound from production costs administrative expenses and lower premium.
And was offset by lower treatment and refining costs.
Southern Copper's operating cash costs.
The benefit of by product credits was 42 cents per pound. This past quarter. This cash cost was 21 cents lower or 34%.
Lower than the cash cost of 63 that we had in the second quarter of 2025.
Regarding byproducts, we had a total credit of $895 million or.
181 per pound in the third quarter of 2025.
These figures represent a 22% increase.
In by product credits, when we compared them to a credit of 756 million or <unk> 48.
Per pound in the second quarter of this year 2025.
Total credits have increased for molybdenum in 23% for silver, 29% and decrease a little bit for sync, 1% and so free cash is what do we have lower volume.
Two.
May your maintenance is as Howard.
At our smelter neither.
For net income in the third quarter of this year net income was 1100 $8 million, which represented a 23% increase over the 897 million registered in the third quarter of 2024.
Net in the net income margin in the third quarter of this year stood at 33% versus 31% in the same quarter of last year.
These improvements were mainly driven by an increase in sales and cost containment activities.
On a year to date basis net income was 17% higher than in 2024 due to growth in net sales.
Net income margins year to date stood at 32% versus 30% for the nine months of last year.
Yes.
Cash from operations.
Or cash flow from operating activities in the third quarter was 150.
100, and so sorry, 1500 $60 million.
Eight 4% above the figure in the third quarter of 2024.
For the nine months of 2025 cash flow from operating activities stood at 3250 $8 million.
Which represented an increase of 6% over the 3060 1 million posted in the nine months of dosing in 'twenty four.
Capital investments for the Peruvian projects, our investments in projects that are being built or for which basically detailed engineering is being conducted cold surpassed $10 3 billion barrels in the next decade.
Given that there is a description of our main capital projects in Southern Copper's press release, I'm going to focus on updating new developments for each of them.
In the case of the Tia Maria project in that it keep our reunion in Peru.
As of September 30 of this year progress.
But yes to the 23% and 2109, new jobs has been generated.
809 of these shops, where Phil.
Local applications.
To the fullest extent possible, we intend to fill that 300, the 3500 jobs estimated.
We required during the Tia Maria construction phase with workers from the slide proteins.
In 2027, when we start operations of Tia Maria will generate six to 764 direct jobs and 5900 indirect jobs.
In the in the <unk>.
Early construction phase progress on access roads platform stands at 90% we will advance this effort alongside work to set up a temporary camp engaging massive air work and rollout minor opening activity.
Recently on October 14 of this year the company received authorization from the Ministry of energy and mines.
To begin the exploitation activities on the Tia Maria project.
This authorization is based on consideration outline in this important technical report and environmental certification and improve for the project.
Consequently, we will soon initiate pre stripping activities aimed at APA and begin building main pre component.
For the large chunk of <unk>, Peru.
As of September 30 of this year, social and environmental management programs are underway in the community is directly influenced by the project.
In accordance with the framework agreement signed between the apparel piece and community in the Los <unk> mine in Peru.
Necessary actions are being undertaken to regain control of the project in response to the presence of illegal miner. This control is essential.
To ask for continuing advancing the development of our tanker freight.
In the case of <unk> in the America region were fatal.
The geological information obtained from drilling programs has been used to develop the models require to estimate the deposits mineral resources.
These models are currently being audited by a third party under the FCC's mind, you disclosure standard SK 1300.
A conceptual study is underway to determine the best location for our conventional or filter tailings storage facility.
Hydrogeological.
<unk> jewelry go and Youll Technical studies are also being conducted.
ACC cross several projects in its Mexican pipelines and may boost organic growth. If they are found to be of value for both the stakeholders and the communities in which we operate these breaks and Gail churchy weakness and impoundment smelter, which could could bolster our <unk>.
Position as a fully integrated copper producer.
We're conducting talks with the current administration to continue rolling out Acc's.
<unk> investments for $10 2 billion.
We have in Mexico.
In my Heart and Director, California State project in this case, we have.
Reporting additional progress in this.
Pretty extraordinary.
Regarding environmental social and corporate government or ESG practices or sustainability ratings are improving.
In the corporate sustainability assessment 2025, S&P global increase ACC rating by four points over last year sprint.
These results positioned the company among the leaders in the mining sector performance ranking with a rating that is more than twice the industry average.
Scc's disaggregated rating, where the highest reported for the sector that is the case for transparency in our reporting environmental management biodiversity Cyber security labor practices human rights and community relations.
Regarding greenhouse gas emissions at our operations the electricity our underground mines have received from the <unk> wind farm has enabled us to curb greenhouse gas emissions by 180000.
Tons of carbon.
Thus far in 2025, this is equivalent to electricity supply needed to sustain 40000 households in mix.
We're recovering ecosystems, Mexico and Peru.
So far in 2025, we have conducted advanced work to restore 67 factories at our winter Avista Corp. Whenever you start recording installations in Sonora.
About 10 characters in the wetlands in Peru.
These are first lien reincorporating areas of the landscape.
Obviously impacted by our operations and providing important environmental services. Additionally, we're preparing stocks and terraces.
Installing assisted irrigation systems on approximately 230 <unk>.
Which will be reversed in 2025.
Sure.
In the case of the Tia Maria project.
Through the workforce taxes mechanism, where financing modernization upgrades at an emblematic secondary schools in a district Coca Cola, Coca Chuck which will serve 400 students.
Also do.
Using these.
We're protected mechanism where.
Working on the construction of the Biomedical Sciences laboratory at the University.
That's nothing right now in order to keep.
Which will be used by about a little bit more than 3000 students and research.
During these four.
Oxford <unk> in 2025.
Total buy won't help train sponsored by for industrial and Grupo Mexico imports have more than 20000 free consultations in eight municipalities, marking an all time high and Doctor back owns Keith threw it.
It's nine <unk>.
Previous visits to the region more than 59000 medical can sustain consultations and 70000 prescriptions were provided at no cost with these results. The third of our AUM has become one of the most important traveling helped project in Sonora.
Regarding dividends as you know is the company policy to review our cash position.
The expected cash flow generation from operations capital investment plans and other financial needs at each board meeting to determine the appropriate quarterly dividend.
On October 23 of this year, Southern Copper Corporation announced a quarterly cash dividend of 90 cents per share of common stock.
And a stock dividend of <unk>.
0.085 shares of common stock for sure.
This is payable this will be payable on November 28 of 2025 to shareholders of record at the.
Close of business on November 12 of this year.
Ladies and gentlemen, with these comments we end our presentation today. Thank you very much for joining US now we will like to open the forum for questions.
Thank you so much and as a reminder to ask a question simply press Star one one on your telephone and wait for your name to be announced to remove yourself press star one again.
Based on buy for our first question. Please.
It comes from Carlos de Alba with Morgan Stanley. Please proceed.
Mr. <unk>. Your line is open yes. Thanks.
Good morning, sorry, I was on mute.
What is your expectations in terms of cash cost before byproducts.
In the fourth quarter and maybe.
In 2026.
For the fourth quarter, Carlos we will.
Very likely decrease our cash costs, because we will be having a partial recovery of production.
Particularly at the Peruvian operations, we believe that production will improve in the fourth quarter. So.
We are operating at about $2 23.
If I recall it will.
And we're expecting to have.
Well in the range of $2 50.
15% to 20.
Fourth quarter.
Okay. Thank you.
And how much of.
How much purchases of third party concentrate or cathodes did the company do.
In the third quarter, and if you could comment on any expectations for the fourth quarter.
Yes.
Acquisitions were for for the Mexican operations.
Uh huh.
It was to fill up.
Some of our facilities.
In fact.
Our mines are.
We don't we will very likely maintain.
Buying some comfort.
Materials from third parties in Mexico, because of the way that the blend with our own materials. So that's that was the main driver of these acquisitions.
But youre buying concentrate.
You didn't buy cathodes.
Data has meant there was battery.
No no we just.
We sold more copper concentrate for the Peruvian operations because of the maintenance at the <unk> smelter in refinery.
We didn't acquire any corporate capital skirts, okay, and if I may just one more.
We regularly seek airlines in Mexico.
The government engaging with southern copper.
Discussions to try to remediate.
They believe or some people believe I still pending.
Ben pending actions by by the company after the SPL Ngls or not.
Can you maybe give us.
Some comments as to why it is the company's perspective on these negotiations and what impact.
Or initiatives and the potential financial impact those may have in the company.
Well we have.
We have we're having these conversations.
And now we are basically.
Well for US. This is this is a matter that were sold already.
However, there are always.
Good possibility of making progress in government talks for other objectives that the company.
You may have.
So.
There is not much to report at this point Carlos on this.
Thank you Rob.
Alright.
Thank you. Our next question is from Timna Tanners with Wells Fargo. Please proceed.
Yeah, Hey, good morning.
With regard to silver I realize you don't move.
On a dime, but the guidance seems to imply a quarter over quarter drop into Q4, and I wanted to make sure I understood that but given the strong price of silver or is there anything you can do to try to produce a bit more.
And then next medium term.
Thank you for your question.
This is what we have been doing through 2025, we have the new concentrator in Buenavista, which is.
It's a concentrator that has a capacity of producing copper and zinc.
In other years last year for instance, 2024.
Indeed.
Bundles of copper production as well as zinc production, but looking at the areas that we were getting into in 2025.
Think constant content do you think or that we were finding in this part of the win Arista mine.
We decided to.
Not produce.
Cooper with this as the new concentrator of Buenavista in this year, but think Andrew.
And the reason for that is that the zinc content is much higher and that's why we're producing significant much important amount of <unk> last year and obviously.
The copper that we produce with these facilities last year, but was in the north of 12000 tonnes, whereas not produce in these same facility in 2025. So that explains why we are not producing as much corporates in 2024 now as I mentioned before.
Sure.
Close to.
Less than 1%.
Getting older corporate or do we need in that.
Forecasting our plan.
Now.
We are hopefully.
Making the plan and the plan.
When we announced it last year had a reduction.
A reduction in corporate production of about 2%, obviously, if we see opportunities to improve these we will certainly.
Tried to try to do it but.
That's so far what we're considering for this year.
Okay. My question was more about silver just because of the strength of that market.
So if you could comment on silver and then Mike My second question is more about.
Any updated thoughts on M&A given some additional M&A in this space are you still preferring organic projects sorry, given some delays there would you start to look at maybe buy versus bill. Thank you.
Okay on the silver.
Timna.
Producing more silver this year.
Yes.
And last year.
We made.
We are really.
Updates, our our silver production forecast.
<unk>.
This is a 23 million ounces, which will be 10% more than last year in 2024.
Coming to your question on <unk>.
M&A will no we're basically focusing on organic growth.
These projects that we're undertaking are excellent projects. The economics of them are are much more better than what we see outside.
The company, obviously, if there is a good opportunity.
Certainly review it and make a recommendation to our board, but so far this is what we are considering now.
Okay. Thank you.
Carolyn.
Thank you so much one moment. Our next question is from the line of Alejandro Demichelis with Jefferies. Please proceed.
Yes, good morning.
Gentlemen, a couple of questions if I may.
Yes.
Could you give us some kind of indications of how you're seeing 2026 in terms of volumes capex.
That's the first question and then the second question is obviously, we have seen the changing government recently in Peru, we have seen some protest on the state of emergency. So have you seen any kind of impact on the areas in which youre producing ore in the ports in the south where youre kind of exporting from.
Yes.
Okay. Let me let me go to your last question first.
Seeing no political.
No impact on our operations coming from the political situation in Peru I'd just.
I'd like to mention that.
The current precedent.
And the approval of 45% regarding the last poll and I think that the properties that you mentioned.
I believe they are there.
Diminishing.
As we have seen and particularly at the southern part of the country, where we have our operations are where our project is hiring the center of Peru, and Ah Premack Air Okay, We have hurt and legal mining issue over there that we have that we're working we go towards these two to fix.
In the northern part of that we will have <unk>, where we are with no specific issues regarding social and risks and in the Tia Maria project, we're moving forward with the construction, let's say reported before.
Looking into 2026.
We're still looking into what we expect for next year.
We are at this point and half.
Forecast that is under review to produce about 911000 tons of copper next year.
We expect to.
Review, this and hopefully improve it a little bit more but that's that's how we're our current.
Forecast for Cooper.
Year cash.
Cash costs will obvious obviously, depending on contingent of the.
Byproduct prices it is hard to say, but let's say that.
And the range of where we are now.
In terms of the year to date cash cost or better if prices hold as they have had has been the case in the past quarter.
On Capex.
We have we do have.
We're getting into the construction of Tia Maria next year.
This would require Tia Maria alone will require about $866 million of Capex.
And consequently, we have.
We're expecting a much higher capex in the range of $2 billion for next year.
Thank you very much.
Youre welcome.
Thank you. Our next question is from Myles Allsop with UBS. Please proceed.
Great.
Okay.
Maybe we came area.
Could you just give us a sense you've got the authorization to start exploitation now do you have all the permits that you need to push ahead with the project.
When do you think.
We will get to completion of the project and the ramp up phase.
Sure.
The straight answer to your question is yes.
There are some some for initiating the construction in developing mining activities we have.
All the permits.
Once you are finishing the construction do you need to get our final <unk>.
Permit from the authorities to begin operations, but that's kind of.
Or routine type of.
Both of our permit.
<unk>.
Now we are expecting to have the ramping Apple for the project through 2027.
Hopefully it will be.
At the half.
Half of 2027, when we will be able to initiate the.
Initiate the initial testing of the equipment and the ramping up.
Do operate very similar plants than the one that we wanted to building in Tia Maria in some other locations, both Mexico and Peru, So hopefully we will do it.
A good ramping up.
In terms of timeline for it but that's something that we will be reporting as we move on with the project.
Okay and in terms of the financing and then the policy some bonds too.
Linked to that kind of project kind of Capex is it still your intention that you would finance that.
Along those routes.
It's something that we look as we move on.
Obviously as interest rates are decreasing we are seeing this as a more positive thing, but we're still.
Evaluating if we want to follow that.
That.
Ruth.
For issuing one bond et cetera.
Or or doing some other.
Using a room.
Our own Capex cash.
<unk>, but I think it's going to be more more more likely than not that we will go to the debt market at certain point in time to finance, our Tia Maria project.
Okay.
Maybe just.
It's more of an organic tenant <unk> password.
Youre looking at.
When we look at the next projects North Shanghai, Some lockups, which one do you think it will be ready to FID.
<unk> first.
What needs to happen with each of them to get that.
A different project we should.
As it comes forward next off that Tia Maria.
Well the timeline that we have is that China should be should be the next project in terms of execution.
<unk> is also in line for that.
<unk> has been very very interesting very good actually.
We have.
We are quite encouraged to move on with it but we still need to do some some work that has been already down four four for a look.
Frank.
The case of electrical it's also schedule to move on.
Entering the next decade.
And hopefully we will be able to do that as well.
Yes.
But we do have certain customers next project.
Thanks for taking the illegal miners after land would you.
Be in a position to <unk> project is it still two years after getting rid of the illegal miners.
Cannot be brought forward.
It could be it could be speed up a little bit.
In these.
We have.
Two two.
With the Peruvian authorities to see.
Yeah.
When are they taking some actions on regarding the illegal mining activities that we're seeing there we're working with the communities because we believe that this could be also be sofa wood.
If the communities.
No.
Look into the matter and talk.
Total return.
On this on this.
Issue as well.
Okay. Thank you.
Sure.
Thank you. Our next question comes from the line of iPhone, So Salazar with Scotia Bank. Please proceed.
Thank you.
And thank you for taking my questions.
Two questions on <unk> first of all sorry to put you on the spot.
A moment I will just say that you are focusing on organic growth.
We see that on the capital allocation front that.
You already are increasing and you have an increasing your cash position.
<unk>.
Yes.
<unk>.
It's now at $4 5 billion.
You continue with this hybrid TV events and given the cash.
Cash generation that you are having.
Having today.
We'll continue to pile up so just want to understand how to reconcile these two things.
Especially what is the rationale behind.
Having so much cash and keeping your cash position at this time.
One question is regarding Tia Maria.
Okay.
It's great to see that.
Moving ahead, but I think it is about to start a critical moment with elections in Peru.
And potential.
Brought this up.
And noise against the money you have once again, so just wondering what that would be actually the action plan, what that you're doing to deal with such situation in case it <unk>.
Thank you.
Okay regarding.
Your comment on the company's cash.
Cash position will we are not.
At this point the depth that we required to finance.
JP and Maria and that is why we are having a slightly higher than the usual cash, but plus the fact that prices are really.
Contributing to that but thats.
That's mainly.
We're currently we're having.
<unk> cash position for keep paying the dividend the board has approved as well as <unk>.
Taking care of the projects that we have.
Now regarding a potential social or political impact in the <unk> area.
Yes that is always a possibility, but so far we're not seeing anything.
That's so we do have some some plans where we have been working with the boat.
The people in the area is Willis.
Towards these particularly the mayors of the slide Province, where <unk> is located.
And so far what we're seeing it's her calm environment.
He is very favorable for the project now obviously, we are continuously continuously monitoring the social.
Circumstances.
But at this point do we don't see any we don't have a concern regarding regarding the impact of the political campaign.
In the area.
At Samsung.
Yes. Thank you thank you Doug.
Youre welcome.
We have a question from the line of Tim trying sang.
C. ICC. Please proceed.
Oh, Hi, good morning, Robin Victor business, David Congratulations on the strong results.
First question is about <unk>.
We know that on your size.
I still expect it to start production in China.
H.
Wow.
It's not mentioned in the latest quarterly press release. So I'm just wondering can we have any updates on that.
Project development progress at our pillar.
Come back with my second one.
Okay. Okay. Thank you for your question David No we have not much to report on it.
Sure.
We are looking into.
The recovery that the.
Leaching part of the project costs and so far we have no no.
Major progress on this so at this point so that's why we haven't mentioned it in our press release.
Understood. Thank you Ralph.
My second question is just a follow up on Las Shanghai.
We noticed that recently there is some discussion about extending the rating for a scheme by five more years.
So just wanted from your per stock test.
Any further expansion out the scheme would have any.
Any impact on your development plan at large tankers, especially when youre dealing with the illegal miners.
Well at this point, we have no people with this specific permit that you mentioned inside the premises of the of the project. So for US it's a non issue at this point.
What you just said regarding this rainfall permit it's something that has to be a review by.
Congress.
We believe that.
Congress are realizing what we're seeing which is that most of the population in Peru does not like to have illegal mining activities.
In general and that is has been strongly as shown impulse and different older by different by some other different ways. So our view is that the they should not be any.
Tension of these type of permits.
Okay. Thank you very much that's really helpful.
Thank you. Our next question comes from the line of Matthew Smart <unk> with Bradesco <unk>. Please proceed.
Davis Your line is open.
Matthews do you have a question.
Okay.
Moreover, he made connect later.
Our next question is from Jon Brandt with HSBC. Please proceed.
Thank you hi, Ro thanks for taking my questions.
Two quick ones for me.
I know this is a board decision but.
The dividend can you has the board given you any rationale for why they are continuing the stock dividends.
The cash dividend.
90 science is pretty good.
I just don't see the rationale for stock dividends I'm, hoping you can.
Help me understand that and then the second question is just on on hedging.
Given any thoughts of potentially hedging.
Even if not copper or maybe some of the byproducts like silver and molybdenum, which have done well, particularly as youre going into Capex phase.
Next year with Tia Maria and then even after that.
Suspect if youre going to start on Ms. Chagas et cetera that the Capex will remain quite high so I guess im wondering if theres any discussion about maybe locking in some of these higher metal prices.
Okay. Let me focus on your last question first.
We have not had any specific discussions on hedging corporate hedgings or by protocol agents at this point in the past when we did the Taco pilot expansion we deep.
Hitch.
Using a zero cost collar.
It was I believe a good idea because of Lois to protect.
The copper the revenues from copper at that time, when we were undertaking a major project.
On the rationale for the stock dividend that you were mentioning it.
It's a board decision.
<unk>.
Well, we couldnt, we wouldn't be able to pay the dividends that we have been pain without.
Using a portion of the shares sold 90.
In cash is what the company can can.
Pay out.
But if we went to.
<unk>.
<unk>.
Provide the stockholders with more liquidity it has to be using the shares that were acquired in.
Before 2016 at a much much lower price. So that's that's what we did.
Board has been considering.
In deciding.
Okay. So is it can you tell us how many shares are.
And should we assume that.
<unk> dividend will continue on so those shares are depleted.
How long are effective.
Sure.
We have.
About $65 million million.
I don't know at this point before before paying the dividend of 72 million shares that we have in treasury.
Okay. Thank you.
No.
Thank you. Our next question comes from the line of grants for it with Bloomberg Intelligence. Please proceed.
Good afternoon, and thanks for taking my questions.
Jim.
The question is really around about your sort of medium term copper guidance and Im looking at the chart that you put out after the second quarter results, which has 2027 going up by about 50000 tons in 2008, another 70000 tons.
Can you yes.
No those are constantly under review, but if we assume that thats roughly in line with what you're still expecting can you can you sort of guide us through the dynamics on how that works is it.
Are you assuming a ramp up for Tia Maria Tia Maria.
<unk>.
<unk> and that offset some of the great decline.
Existing operations or how do we how do we go about thinking about that.
Yes grant.
Effective.
We have we're assuming for 2027, the ramping up of Tia Maria.
Okay.
Our production will increase as we getting getting operation.
Our major projects.
In the case of Tia Maria will kicking with production in 2027.
And later on in time, but it will be more in the.
19 thirties.
We will have.
We will have.
Shanghai's <unk>.
In the meantime.
We're expecting we're expecting to have a pillar getting in 2028.
And a lot of coal.
In 2000 2000.
29, 2008 2009.
Now.
Having said that.
On the existing operations.
We have.
For the long term some or decay.
And we're considering some actions to contain the impact of full impact of that.
Basically in the case of <unk>, we have we have we're expecting a reduction in ore grades starting next year and for that we will take some action and as such are expanding now we're concentrated are once again in order to.
To fill up that material that has not been approved by the board, but it's something that we're looking as a possibility.
We also have.
Some other actions regarding.
Different operations and how we should we.
We should complying or maintain our production level and increase it as we go.
Towards 2030.
Okay. So if I can just just sort of clarify.
If we take your existing operations.
<unk>.
Do nothing scenario, we use you don't you don't try and mitigate the impact.
Or degradation of all the great decline.
Your existing operations are probably decline sort of.
Two 3% and you're hoping to offset it through various actions.
And then the rest of your projects so all growth on top of that that would be good.
Your ideal scenario.
Is that that is current.
What we're considering is basically on the existing operations taking actions in order to maintain the production level or reduce as much as we can the dk due to ore or reduction.
I mentioned on the <unk>.
On the situation and as an example.
And besides this we have new new projects kicking in which will provide new production and helped us to maintain our production or production level and increase it up to one 6 million tons by.
Say mid 2000 <unk>.
Got it thank you very much.
Youre welcome.
Thank you.
And we have a question from the line of Marcio Farid with Goldman Sachs. Please proceed.
Thank you alright, thanks for the time.
A quick follow up.
On the two projects that you mentioned on <unk>.
Talking about volatile potentially rocky Mount and the first half of 'twenty seven.
And a follow up to the earlier question as well.
Feels like another failure to recover part of the loss in 2007, you'd need some significant volumes from <unk> rights, which is which I think is embedded in that guidance. So they can can you remind us how confident you are you can get to <unk>.
Production by 27, considering the current schedule.
Then secondly, I think it's.
I think we've talked about before potentially adding another concentrates Honda as well, what's the sort of timeline when can we expect that decision to be discuss R. B.
Being made by the board that will be great.
I'm sorry, how does.
Is there any change to potential 'twenty six 'twenty seven or 'twenty guidance, how should we think about the cost in the <unk>.
So, Florida fixed cost dilution as well thank you.
Okay. Thank you for your questions Marshall.
The case of Tia Maria we're expecting to initiate production in 2027.
As a general comment where we're still looking in our.
Plans for the next few years.
I mentioned already that we are expecting to have.
Sure.
<unk> over 900011 911000 tons for next year.
Hopefully we will improve that when we do our reporting in January and the same thing applies to our guidance for the next few years.
Hi.
I think we will we will provide a more detail unclear situation in January.
Sure.
<unk> report.
<unk>.
Coming to your other your other questions.
<unk> expansion, we're still working on.
On what to do it is not a new concentrator, it's going to be a new law.
Line in existing concentrated or that may have.
A much lower cost than a new concentrator just to give you an idea where it is thinking about of something between 600 $700 million.
For that project.
And it will provide about 40000 tonnes of copper, but as I say this is not board approved so we're.
We're still working on having a solid case, 2% to the board when could be these approved will let's say that we finished the work and percent somewhat some.
Guidance to the board next year, then we could we could have.
<unk>.
An initial approval and when we have all the permits and everything then we could be able to go for a final construction approval to the board.
Four four.
<unk> already made.
Answering your questions unless you have some common Marty.
Well that's great. Thank you very much.
Thank you so much.
And this concludes our Q&A session for today.
Everyone and I will pass it back to <unk> for any final comments.
Thank you very much Carmen with these we conclude our conference call for Southern Copper's third quarter of 2025, we certainly appreciate your participation and hope to have you back with US when we report the fourth quarter and full 2025.
Results.
This will be in January our January call. Thank you very much for being with us today and have a nice day.
Thank you so much and this concludes our conference for today.
You may now disconnect everyone have a great day.
You too.
Okay.
[music].
Okay.
Okay.
Yes.
[music].
Okay.
[music].