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Southern Copper Posts Profit as Copper Prices Surge (Update1)
Feb 1,2010 09:06CST
industry news

Jan. 29 (Bloomberg) -- Southern Copper Corp., the largest producer of the metal in Peru and Mexico, posted a profit in the fourth quarter on rising copper prices and output.

Net income was $363.3 million, or 43 cents a share, compared with a loss of $124.7 million, or 14 cents, in the year-earlier period, Phoenix-based Southern Copper said today in an e-mailed statement. Southern was expected to earn 32.2 cents a share, the average of six estimates in a Bloomberg survey.

Sales more than doubled to $1.14 billion as New York-traded copper and silver averaged at least 70 percent higher in the fourth quarter than a year earlier. The company said copper output rose 0.7 percent to 126,088 metric tons in the quarter.

"It was a solid quarter for Southern due to stronger metals prices,"Daniel Mori, a mining analyst at Lima-based brokerage SAB Centura, said in a telephone interview before the results were released. "The company’s reduced hedging positions have given them the benefit of the upside to prices."

Growing Chinese and U.S. industrial demand may drive copper above $4 a pound this year, Southern Copper Chief Executive Officer Oscar Gonzalez Rocha said in a Nov. 4 interview.

Copper for March delivery fell 1.5 percent to $3.0525 pound on the Comex division of the New York Mercantile Exchange. Copper, which doubled in the past year, touched a record $4.2605 a pound in May 2008.

Southern Copper fell 99 cents to $26.63 in New York Stock Exchange composite trading. The stock has jumped 78 percent in the past year.



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