Southern Copper Corporation · NYSE:SCCO
Southern Copper — Investor Presentation (September 2014)
17 slides from Southern Copper's investor presentation, September 2014
Slide 1: Southern Copper Corporation September, 2014
Southern Copper Corporation September, 2014 0
Slide 2: I. Introduction
ra 2 Pd 3) 5 =) fe) = Pd = Lo =i
Slide 3: Management Presenter
Management Presenter Presenter Title Raul Jacob Vice President, Finance & CFO Victor Pedraglio Financial Planning Manager & IR 2
Slide 4: Safe Harbor Statement
Safe Harbor Statement This presentation contains certain statements that are neither reported financial results nor other historical information. These estimates are forward-looking statements within the meaning of the safe-harbor provisions of the Mexican securities laws. These forward-looking esti
Slide 5: Corporate Structure
Corporate Structure 100.0% (*) AMERICAS MINING CORPORATION 82.6% (*) Public Float 17.4% (*) 99.29 % 99.95 % SCC Peru Branch Minera Mexico (*) As of August 1, 2014 4
Slide 6: Copper – The Best Fundamental Story in Commodities
Copper – The Best Fundamental Story in Commodities Solid Fundamentals Copper Consumption by Region ► Copper has the best fundamentals in the basic materials space: Other ― Asia represents over 60% of world demand (China=41% and Japan 7% 5% could reach 45% in 5 years) USA ― China and EM countries wil
Slide 7: Southern Copper Strengths
Southern Copper Strengths ►Highest copper reserves of the industry ►Excellent organic growth projects ►Low cost, fully integrated operations ►Experienced management team ►Strong financial performance / investment grade ►Outstanding dividend history ►Good long-term copper & molybdenum fundamentals 6
Slide 8: II. Overview of Operations
II. Overview of Operations 7
Slide 9: Company Overview
Company Overview Copper Reserves 1: 67.6 mmt Mexico Buenavista 2013 Cash Cost: $ 1.00/lb. Santa Eulalia La Caridad Santa Barbara 2014 Estimates: San Martin Charcas Copper Production: 672 kt San Luis Potosi Sales: $ 6.3 B Taxco EBITDA: $ 3.2 B Peru 50% of Sales 1H 2014 Cash Cost $ 0.97/Lb. Key #1 cop
Slide 10: World's Largest Copper Reserves
World’s Largest Copper Reserves Copper Reserves as Reported SCC Highlights 80 70 67.6 ► #1 mine life among copper producers 61.2 60 ► #6 world’s largest producer of mined copper Copper Reserves (Mt) 50 ► Highly diversified geographical presence 39.3 40 34.2 34.1 ► Four large-scale open-pit mines 29.
Slide 11: Geographic Footprint & Product Diversification
Geographic Footprint & Product Diversification 1H 2014 Revenue by Product 1H 2014 Revenue by Market Mexico Acid Other 25% Zinc 2% 3% Other 4% 3% Molybdenum 10% Peru 5% Europe Silver Chile 14% 5% 8% Brasil Copper 7% 76% (75 pp refined or further processed) United States 21% Asia 17% 10
Slide 12: Low Cost Operations
Low Cost Operations Cash Cost per Pound of Copper Produced Low Cost Drivers Net of By-Products 1.5 Fully integrated low cost operations 1.00 1.02 World class assets 1.0 0.92 0.71 Significant SX-EW production (US$/lb) 0.52 0.5 Strong by-product credits 0.0 Management focus on cost efficienc
Slide 13: III. Financial Overview
III. Financial Overview 12
Slide 14: SCC Financial Summary
SCC Financial Summary (US$ MM) 2012 2013 LTM 2014 1H 2014 Copper Price (LME) US$ per pound 3.61 3.32 3.18 3.13 Income Statement: Net Revenues $6,669 $5,953 $5,761 $2,842 EBITDA 3,456 2,954 2,780 1,377 EBITDA Margin 52% 50% 48% 48% Net Income 1,935 1,624 1,411 661 Dividends paid per share 4.06 0.68 0
Slide 15: Solid Financial Performance
Solid Financial Performance Top Tier Margins and Conservative Leverage for Increased Financial Flexibility 1H 2014 EBITDA Margin (%) 1H 2014 Total Debt / EBITDA (x) No Amortizations Until 2015 1 1 SCC 48% Freeport 0.67 2015 $200 1 1 BHP 48% Antofagasta 0.94 2020 $400 1 1 Antofagasta 42% BHP 1.07 202
Slide 16: Investment Program to Significantly Increase Production
Investment Program to Significantly Increase Production Board approved Other projects 2013-14 2015-16 Buenavista Molybdenum Plant 3Q13 - Buenavista: Buenavista Zinc Conc. 2016 - Los Chancas. - $1.2B - 100K $38M - 2K Tons Mo - Concentrator Plant 1H15 - $1.4B - $332M 16K Tons Cu - 55K Tons Cu, 7.5K To
Slide 17: SCC's Major Strengths
SCC’s Major Strengths SCC is the Premier Copper Play • World class assets in investment grade countries • #1 in reserves of any company with various exploration prospects - Increasing copper production • Capacity to deliver projects through flexible capital structure and significant cash generation
Southern Copper — Investor Presentation (September 2014) on 6ix