Mineral Miner Grupo Mexico Closes Solid Quarter

Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)

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Summary

Grupo Mexico closed Q3 with a positive net income despite lower copper output, but was supported by copper prices. The company's projects in Mexico, Peru, Spain, and the United States remain in progress with investments projected at US$27 billion.

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Grupo Mexico (Mexico City, Mexico) posted net income of US$1.2 billion during Q3, some 20.3% more than during the same period last year, driven by its mining division, which accounted for US$1 billion. The financial results were achieved thanks to higher mineral prices, such as copper, and stronger sales of molybdenum, silver and zinc.

The company declared a cash dividend of 1.5 Mexican pesos (approximately US$0.08) per share outstanding, payable by December 1.

The company's copper output was 265,000 tons in Q3, 5.5% down from the same period last year, due to lower ore grades at the Buenavista mine in Mexico, the Toquepala and Cuajone mines in Peru.

Copper sales reached 263,000 tons during Q3, 4.3% lower than last year, though copper revenues accounted for 76.7% of the mining division's total, given its price boost.

During Q3, the company's operating cash costs per pound of copper, net of byproducts, were US$0.78, down 24.9% from last year.

Silver and molybdenum production during Q3 stood at 3.2 million ounces and 7,800 tons, a 2.1% and 8.3% increase year over year, respectively. Silver accounted for 6.3% of this division's revenues this year, while molybdenum accounted for 10.6%.

Grupo Mexico also reported a capital investment program across mining projects in Peru, the United States, Spain, and Mexico of US$27 billion for this decade.

Its Peru copper-dominated portfolio would exceed US$10.3 billion in projects across the construction and engineering phases. These include the Tia Maria development, which is 23% complete and is expected to have a capacity of 120,000 tons of copper cathodes per year starting 2027. The mine also received government authorization in October to begin exploitation activities. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can learn more by viewing the related project reports.

The company also has the Los Chancas greenfield project in Peru, expected to come online between 2030 and 2031 with investments estimated at US$2.6 billion and an output of 130,000 tons per year, and the Michiquillay asset, which could produce up to 225,000 tons per year for over 25 years from 2032, with projected investments of US$2.5 billion.

In Mexico, Grupo Mexico awaits permits to develop the El Arco and El Pilar copper projects, with combined projected costs of US$10.2 billion.

Click here to see related project reports.

In its Q3 report, the company claimed the world's largest copper reserves across its combined assets.

Key Takeaways:

• Grupo Mexico's Q3 net income rose 20.3% to US$1.2 billion, with its mining division contributing US$1 billion, driven by higher mineral prices.
• The company plans US$27 billion in project investments this decade.
• Grupo Mexico expects new copper production capacity by 2032.

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