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10/31/2025 | Press release | Distributed by Public on 10/31/2025 13:54

Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OFOPERATIONS

The following discussion provides information that management believes is relevant to an assessment and understanding of the condensed consolidated financial condition and results of operations of Southern Copper Corporation and its subsidiaries (collectively, "SCC", "the Company", "our", and "we"). This item should be read in conjunction with our interim unaudited Condensed Consolidated Financial Statements and the notes thereto included in this quarterly report. Additionally, the following discussion and analysis should be read in conjunction with the Management Discussion and Analysis of Financial Condition and Results of Operations and the Consolidated Financial Statements included in Part II of our annual report on Form 10-K for the year ended December 31, 2024.

EXECUTIVE OVERVIEW

Business: Our business is primarily the production and sale of copper. In the process of producing copper, a number of valuable metallurgical by-products are recovered, which we also produce and sell. Market forces outside of our control largely determine the sale prices for our products. Our management, therefore, focuses on value creation through copper production, cost control, production enhancement and maintaining a prudent capital structure to remain profitable. We endeavor to achieve these goals through capital spending programs, exploration efforts and cost reduction programs. Our aim is to remain profitable during periods of low copper prices and to maximize financial performance in periods of high copper prices.

We are one of the world's largest copper mining companies in terms of production and sales and our principal operations are in Peru and Mexico. We also have exploration programs in Chile and Argentina. In addition to copper, we produce significant amounts of other metals, either as a by-product of the copper process or through a number of dedicated mining facilities in Mexico.

Outlook: Various key factors will affect our outcome. These include, but are not limited to, the following:

●	Sales structure: In the third quarter of 2025, 72.5% of our revenue came from the sale of copper; 12.9% from molybdenum; 7.4% from silver; 3.7% from zinc; and 3.5% from other products, including gold, sulfuric acid, and other materials.

●

Copper: In the third quarter of 2025, copper prices per pound reported a stronger performance, with the LME price increasing from $4.17 to $4.44 (+6.5%) and the COMEX price rising from $4.23 to $4.83 (+14.2%). Based on current supply and demand dynamics, which include the negative production effects that we are seeing in Indonesia and Chile, we are currently estimating a copper market deficit of 380,000 tonnes. Copper inventories worldwide were at the end of September at 609,000 tonnes. We estimate that this inventory currently covers approximately eight days of global demand.

Recent U.S. tariff policy changes have thus far had a limited impact on our results. As such, we are confident now that the long-term fundamentals of prices for copper and other metals will remain very positive.

●	Molybdenum: Accounted for 12.9% of our sales in the third quarter of 2025 and remains our most significant by-product. Prices for molybdenum averaged $24.3 per pound in the third quarter of 2025, compared to $21.68 in the same period of 2024, representing a 12.1% increase.

Molybdenum is mainly used in the production of special alloys for stainless steel that require significant hardness, corrosion and heat resistance. New uses for this metal are associated with lubricants, sulfur filtering of heavy oils and shale gas production.

For 2026, we believe that prices will hold at the current level of about $20.00 per pound due to this metal's properties and diverse applications in critical industries.

●	Silver: Represented 7.4% of our sales in the third quarter of 2025. We believe that silver prices will be supported by demand for industrial use and precious metals.

●

Zinc: Average zinc prices increased 1.6% in the third quarter of 2025 versus the same period of 2024. We believe zinc has strong long-term fundamentals, driven by sustained industrial demand, particularly in the construction and automotive sectors. Although current supply levels are stable, a forecasted reduction in mine production and the closing of key refineries suggest that supply will tighten over time. As demand continues to grow, this imbalance is expected to put upward pressure on prices in the long run. Zinc represented 3.7% of our sales in the third quarter of 2025.

●	Production:In 2025, we expect our copper production to reach 958,800 tonnes, a decrease of 2% over final production in 2024. Last year we drove our Pilares project to full capacity and we expect this project to contribute 32,400 tonnes of copper in 2025.

Regarding by-products, we expect to produce 174,700 tonnes of zinc from our mines, up 34% from 2024 production level. This growth will be driven by the production of our Buenavista Zinc concentrator (113,400 tonnes), which is operating fully dedicated to zinc production. We also expect to produce 30,000 tonnes of molybdenum in 2025, which represents an increase of 4% compared to 2024 production levels. For silver, we expect to produce 23 million ounces of this metal, an increase of 10% compared to last year's production.

●	Capital Investments: In the third quarter of 2025, we spent $349.2 million on capital investments; this represented 31.4% of net income and an increase of 41.7% compared to the amount registered in the same period of 2024.

KEY MATTERS

Below, we discuss several matters that we believe are important to understand the results of our operations and financial condition. These matters include, (i) our earnings, (ii) our production, (iii) our "operating cash costs" as a measure of our performance, (iv) metal prices, (v) business segments, (vi) the effect of inflation and other local currency issues, and (vii) our capital investment and exploration program.

Earnings: The table below highlights key financial and operational data of our Company for the three and nine-month periods ended September 30, 2025 and 2024 (in millions, except copper price, percentages and per share amounts):


		Three months ended September 30,								Nine months ended September 30,
	2025		2024		Variance		% Change		2025		2024		Variance		% Change
Copper price LME		4.44		4.17		0.27	6.5	%		4.33		4.14		0.19	4.6	%
Copper price COMEX		4.83		4.23		0.60	14.2	%		4.71		4.21		0.50	11.9	%
Pounds of copper sold		516.5		535.9		(19.4)	(3.6)	%		1,547.6		1,563.8		(16.2)	(1.0)	%
Net sales	$	3,377.3	$	2,930.9	$	446.4	15.2	%	$	9,550.2	$	8,649.0	$	901.2	10.4	%
Operating income	$	1,768.8	$	1,450.3	$	318.5	22.0	%	$	4,891.3	$	4,247.3	$	644.0	15.2	%
Net income attributable to SCC	$	1,107.6	$	896.7	$	210.9	23.5	%	$	3,027.0	$	2,582.9	$	444.0	17.2	%
Earnings per share	$	1.35	$	1.12	$	0.22	19.9	%	$	3.71	$	3.25	$	0.46	14.0	%
Cash dividends paid	$	0.80	$	0.60	$	0.20	33.3	%	$	2.20	$	1.40	$	0.80	57.1	%
Stock dividends paid	$	1.00	$	0.60	$	0.40	66.7	%	$	2.40	$	1.80	$	0.60	33.3	%

Net salesin the third quarter of 2025 totaled $3,377.3 million, representing a 15.2% increase compared to the same period in 2024. An upswing in performance was mainly supported by increased sales volumes of molybdenum (+7.9%), silver (+21.9%), and zinc (+7.3%), along with higher prices for copper (+6.5% LME; +14.2% COMEX), molybdenum (+12.1%), silver (+34.4%) and zinc (+1.6%). This effect was partially offset by a decrease in copper sales volumes (-3.6%).

Net incomeattributable to SCC for the third quarter of 2025 reached $1,107.6 million, marking a 23.5% increase compared to the same period in 2024. Heightened performance was primarily supported by an increase in net sales

(+15.2%), which was mainly related to higher metal prices and was partially offset by higher operating costs (+8.6%), income taxes (+17.7%) and interest expenses (+9.9%).

Net salesfor the nine months of 2025 increased 10.4% compared to the same period in 2024. This growth was driven by with increased sales volumes of molybdenum (+6.7%), silver (+16.6%) and zinc (+18.7%), along with higher prices for copper (+4.6% LME; +11.9% COMEX), molybdenum (+3.3%), silver (+29.2%) and zinc (+3.3%). These positive effects were slightly offset by a decrease in copper sales volume (-1.0%).

Net incomeattributable to SCC in the nine months of 2025 increased by 17.2% compared to the same period in 2024. This improvement was primarily driven by a 10.4% rise in sales and a 62.5% increase in interest income. These positive effects were partially offset by a 5.8% increase in operating costs, mainly related to variances in workers' participation and purchased copper concentrates as well as a 13.1% increase in income taxes.

Production: The table below highlights our mine production data for the three and nine-month periods ended September 30, 2025 and 2024:


	Three months ended September 30,					Nine months ended September 30,
	2025	2024	Variance	% Change		2025	2024	Variance	% Change
Copper (in million pounds)	517.8	556.1	(38.3)	(6.9)	%	1,574.3	1,620.2	(45.9)	(2.8)	%
Molybdenum (in million pounds)	17.4	16.0	1.3	8.3	%	51.8	48.5	3.3	6.7	%
Silver (in million ounces)	6.2	5.3	0.9	16.4	%	17.6	15.3	2.3	15.3	%
Zinc (in million pounds)	100.3	68.5	31.8	46.3	%	288.3	191.5	96.8	50.5	%

The table below highlights our mine production data for the three and nine-month periods ended September 30, 2025 and 2024:


	Three Months Ended September 30,					Nine Months Ended September 30,
Copper (in million pounds):	2025	2024	Variance	% Change		2025	2024	Variance	% Change
Toquepala	131.2	143.4	(12.1)	(8.4)	%	414.5	423.7	(9.2)	(2.2)	%
Cuajone	85.2	90.2	(5.0)	(5.6)	%	265.4	271.0	(5.6)	(2.1)	%
La Caridad	69.7	64.4	5.4	8.4	%	194.2	193.9	0.3	0.2	%
Buenavista	226.0	253.0	(27.0)	(10.7)	%	683.5	715.8	(32.4)	(4.5)	%
IMMSA	5.7	5.1	0.5	10.2	%	16.7	15.8	0.9	5.5	%
Total mined copper	517.8	556.1	(38.3)	(6.9)	%	1,574.3	1,620.2	(45.9)	(2.8)	%

Third quarter:Copper mine production in the third quarter of 2025 stood at 517.8 million pounds, reflecting a 6.9% decrease compared to the same period of 2024. This decline was mainly attributed to lower production at Buenavista (-10.7%, which was attributable to lower ore grades and to the fact that the new concentrator was fully dedicated to zinc production); Toquepala (-8.4%; due to lower ore grades and recoveries); and Cuajone (-5.6%; due to lower ore grades). These effects were partially offset by higher production at La Caridad (+8.4%; driven by improved recoveries and increased SX-EW production) and at IMMSA (+10.2%; supported by higher ore grades and milling volume).

Molybdenum production increased 8.3% in the third quarter of 2025 compared to the same period of 2024. This growth was largely driven by improved production at our La Caridad (+24.2%) and Toquepala (+10.0%) mines, primarily due to higher ore grades. However, this performance was slightly offset by a decrease in production at our Buenavista (-8.7%) and Cuajone (-2.4%) operations, which was driven by lower ore grades and recoveries.

Silver mine production increased 16.4% in the third quarter of 2025 compared to the same period of 2024. This growth was mainly driven by higher production at our La Caridad (+44.7%), Buenavista (+37.5%) and IMMSA (+11.1%) operations. However, this positive performance was slightly offset by lower production at our Toquepala (-15.6%) and Cuajone (-2.2%) mines.

Zinc production increased 46.3% in the third quarter of 2025 compared to the same period in 2024. This significant growth was primarily driven by full-capacity operations at the Buenavista Zinc concentrator, which produced 30,086 tonnes of zinc (+108.2%) in the third quarter of 2025.

Nine months: Mined copper production in the nine months of 2025 was 1,574.3 million pounds, and represented a decrease of 2.8% compared to the same period of 2024. This decline was primarily attributable to lower production at Buenavista (-4.5%; due to lower ore grades and recoveries, and to the fact that the new concentrator was fully dedicated to zinc production. The aforementioned was partially offset by higher SX-EW output), Toquepala (-2.2%; due to lower ore grades and recoveries), Cuajone (-2.1%; due to lower ore grades) and La Caridad (-0.2%; due to lower milling volumes, which was partially offset by increased SX-EW production). The drop in mined copper production was slightly offset by higher production at our IMMSA operations (+5.5%; due to higher milling volumes and ore grades).

Molybdenum production increased 6.7% in the nine months of 2025 compared to the same period in 2024. This growth was mainly due to higher production at our La Caridad (+10.9%), Toquepala (+10.2%), and Buenavista (+0.3%) mines, reflecting an increase in ore grades. Growth, however, was slightly offset by a 1.4% decrease in production at the Cuajone mine.

Silver mine production increased 15.3% in the nine months of 2025, primarily due to higher production at our Buenavista (+36.9%), La Caridad (+17.9%), IMMSA (+10.6%) and Cuajone (+2.1%) operations. This growth was slightly offset by a decline in production at our Toquepala mine (-5.9%).

Zinc production increased 50.5% in the nine months of 2025. This growth was primarily driven by full-capacity operations at the Buenavista Zinc concentrator, which produced 86,313 tonnes (+128.3%) during the period.

Operating Cash Costs: An overall benchmark that we use, which is a common industry metric to measure performance is operating cash costs per pound of copper produced. Operating cash cost is a non-GAAP measure that does not have a standardized meaning and may not be comparable to similarly titled measures provided by other companies. This non-GAAP information should not be considered in isolation or as substitute for measures of performance determined in accordance with GAAP. A reconciliation of our operating cash cost per pound of copper produced to the cost of sales (exclusive of depreciation, amortization and depletion) as presented in the consolidated statement of earnings is presented under the subheading, "Non-GAAP Information Reconciliation" on page 59. We disclose operating cash cost per pound of copper produced, both before and net of by-product revenues.

We define operating cash cost per pound of copper produced before by-product revenues as cost of sales (exclusive of depreciation, amortization and depletion), plus selling, general and administrative charges, treatment and refining charges net of sales premiums; less the cost of purchased concentrates, workers' participation and other miscellaneous charges, including royalty charges, and the change in inventory levels; divided by total pounds of copper produced by our own mines.

In our calculation of operating cash cost per pound of copper produced, we exclude depreciation, amortization and depletion, which are considered non-cash expenses. Exploration is considered a discretionary expenditure and is also excluded. Workers' participation provisions are determined on the basis of pre-tax earnings and are also excluded. Additional exclusions from operating cash costs are items of a non-recurring nature and the mining royalty charge as it is based on various calculations of taxable income, depending on which jurisdiction, Peru or Mexico, is imposing the charge. We believe these adjustments allow our management and stakeholders to more fully visualize our controllable cash cost, which we believe is one of the lowest of all copper-producing companies of similar size.

We define operating cash cost per pound of copper produced net of by-product revenuesas operating cash cost per pound of copper produced, as defined in the previous paragraph, less by-product revenues and net revenue (loss) on sale of metal purchased from third parties.

In our calculation of operating cash cost per pound of copper produced, net of by-product revenues, we credit against our costs the revenues from the sale of all our by-products, including, molybdenum, zinc, silver, gold, etc. and the net revenue (loss) on sale of metals purchased from third parties. We disclose this measure including the by-product

revenues in this way because we consider our principal business to be the production and sale of copper. As part of our copper production process, much of our by-products are recovered. These by-products, as well as the processing of copper purchased from third parties, are a supplemental part of our production process and their sales value contribute to covering part of our incurred fixed costs. We believe that our Company is viewed by the investment community as a copper company, and is valued, in large part, by the investment community's view of the copper market and our ability to produce copper at a reasonable cost.

We believe that both of these measures are useful tools for our management and our stakeholders. Our cash costs before by-product revenues allow us to monitor our cost structure and address areas of concern within operating management. The measure operating cash cost per pound of copper produced net of by-product revenues is a common measure used in the copper industry and is a useful management tool that allows us to track our performance and better allocate our resources. This measure is also used in our investment project evaluation process to determine a project's potential contribution to our operations, its competitiveness and its relative strength in different price scenarios. The expected contribution of by-products is generally a significant factor used by the copper industry to determine whether to move forward or not in the development of a new mining project. As the price of our by-product commodities can have significant fluctuations from period to period, the value of its contribution to our costs can be volatile.

Our operating cash cost per pound of copper produced, before and net of by-product revenues, is presented in the table below for the three and nine-month periods ended September 30, 2025 and 2024:

Operating cash cost per pound of copper produced (1)

(In millions, except cost per pound and percentages)


		Three Months Ended September 30,								Nine Months Ended September 30,
	2025		2024		Variance		% Change		2025		2024		Variance		% Change
Total operating cash cost before by-product revenues	$	1,102.8	$	1,046.2	$	56.6	5.4	%	$	3,231.2	$	3,230.5	$	0.7	0.0	%
Total by-product revenues	$	(894.8)	$	(639.3)	$	(255.5)	40.0	%	$	(2,309.1)	$	(1,887.9)	$	(421.3)	22.3	%
Total operating cash cost net of by-product revenues	$	208.1	$	406.9	$	(198.9)	(48.9)	%	$	922.1	$	1,342.7	$	(420.6)	(31.3)	%
Total pounds of copper produced(2)		495.2		535.2		(40.0)	(7.5)	%		1,517.3		1,559.2		(41.9)	(2.7)	%
Operating cash cost per pound before by-product revenues	$	2.23	$	1.96	$	0.27	13.9	%	$	2.13	$	2.07	$	0.06	2.8	%
By-product revenues per pound	$	(1.81)	$	(1.19)	$	(0.61)	51.4	%	$	(1.52)	$	(1.21)	$	(0.31)	25.6	%
Operating cash cost per pound net of by-product revenues	$	0.42	$	0.76	$	(0.34)	(44.8)	%	$	0.61	$	0.86	$	(0.25)	(29.3)	%

(1)	These are non-GAAP measures. Please see page 59 for reconciliation to GAAP measure.

(2)	Net of metallurgical losses.

In the third quarter of 2025, the operating cash cost per pound before by-product revenues increased from $1.96 to $2.23 compared to the same period of 2024, driven mainly by the unit cost effect of a drop in copper production (-7.5%) and higher production costs (+8.9%). By-product revenues per pound rose 51.4%, from $1.19 to $1.81. As a result, the operating cash cost per pound net of by-product revenues decreased 44.8%, from $0.76 to $0.42. This decline reflects stronger by-product revenues, primarily from molybdenum, zinc and silver.

For the nine-month period of 2025, the operating cash cost per pound before by-product revenues increased from $2.07 to $2.13, mainly due to the unit cost effect of a slight decrease in copper production (-2.7%) as well as higher production costs (+2.9%), and offset, to a large extent, by lower treatment and refining charges due to market conditions. Additionally, a 25.6% increase in by-product revenues per pound helped reduce the operating cash cost per pound net of

by-product revenues from $0.86 to $0.61. This 29.3% reduction was primarily supported by higher sales volumes of molybdenum, silver and zinc.

Metal Prices: The profitability of our operations is dependent on, and our financial performance is significantly affected by, the international market prices for the products we produce, and for copper, molybdenum, zinc and silver in particular.

We are subject to market risks arising from the volatility of copper and other metal prices. For the remaining three months of 2025, assuming that expected metal production and sales are achieved; tax rates remain unchanged and giving no effects relative to potential cost changes, metal price sensitivity factors would indicate the following change in estimated net income attributable to SCC resulting from metal price changes:


	Copper		Molybdenum		Zinc		Silver
Change in metal prices (per pound except silver-per ounce)	$	0.10	$	1.00	$	0.10	$	1.00
Change in net earnings (in millions)	$	31.2	$	8.7	$	6.3	$	3.3

Business Segments: We view our Company as having three reportable segments and manage it on the basis of these segments. These segments are (1) our Peruvian operations, (2) our Mexican open-pit operations and (3) our Mexican underground operations, known as our IMMSA unit. Our Peruvian operations include the Toquepala and Cuajone mine complexes and the smelting and refining plants, industrial railroad and port facilities that service both mines. The Peruvian operations produce copper, with significant by-product production of molybdenum, silver and other material. Our Mexican open-pit operations include the La Caridad-Pilares and Buenavista mine complexes, the smelting and refining plants and support facilities, which service these mines. The Mexican open-pit operations produce copper, with significant by-product production of molybdenum, silver and other material. Our IMMSA unit includes three operating underground mines and several industrial processing facilities.

Segment information is included in our review of "Results of Operations" in this item and also in Note 14 "Segment and Related Information" of our condensed consolidated financial statements.

Inflation and Exchange Rate Effect of the Peruvian Sol and the Mexican Peso: Our functional currency is the U.S. dollar and our revenues are primarily denominated in U.S. dollars. Significant portions of our operating costs are denominated in Peruvian sol and Mexican pesos. Accordingly, when inflation and currency devaluation/appreciation of the Peruvian currency and Mexican currency occur, our operating results can be affected. In recent years, exchange rate volatility has been high but has had a limited effect on our results. Please see Item 3 "Quantitative and Qualitative Disclosures about Market Risk" for more detailed information.

Capital Investment Programs: We made capital investments of $902.7 million in the first nine months of 2025, compared to $792.0 million in the same period of 2024. In general, the capital investments and investment projects described below are intended to increase production, decrease costs or address social and environmental commitments.

Set forth below are descriptions of some of our current expected capital investment programs. We expect to meet the cash requirements for these projects by utilizing cash on hand; internally generated funds and additional external financing. All capital spending plans will continue to be reviewed and adjusted to respond to changes in the economy and market conditions.

Projects in Peru:

Our investments in Peruvian projects that are being built or for which basic or detail engineering is being conducted could surpass $10.3 billion in the next decade.

The openness of the Peruvian government and institutions to private investment; the strong support of local communities; and respect for the rule of law underpin our aggressive investment program. With the support and assistance of Peruvian authorities, the Company is moving forward to secure the administrative permits and licenses that are required prior to investment. The projects' construction and subsequent operating phases will generate new poles of development; create significant job opportunities; and drive growth in tax revenues at both, national and regional levels.

Tia Maria - Arequipa:This greenfield project, located in Arequipa, Peru, will use state of the art SX-EW technology with the highest international environmental standards with a capacity of 120,000 tonnes of SX- EW copper cathodes per year.

Tia Maria will generate significant revenues for the Arequipa region from day one of its operations. At current copper prices, we expect to export $18.2 billion and contribute $3.8 billion in taxes and royalties during the first 20 years of operation. The project budget has been set at $1,802 million.

Project update: As of September 30, 2025, progress at Tia Maria stood at 23% and 2,109 new jobs had been generated; 809 of these positions were filled with local applicants. To the fullest extent possible, we intend to fill the 3,500 jobs estimated to be required during Tia Maria´s construction phase with workers from the Islay province. In 2027, when we start operations, the project will generate 764 direct jobs and 5,900 indirect jobs.

In the early construction phase, progress on access roads and platforms stands at 90%. We will advance these efforts alongside work to set up a temporary camp; engage in massive earthworks; and roll out mine-opening activities.

As of October 14, 2025, the Company received from the Ministry of Energy and Mines an authorization for the commencement of exploitation activities for the Tía María project. This authorization is based on the considerations outlined in the supporting technical report and the environmental certification approved for the project. Consequently, we will soon initiate pre-stripping activities in La Tapada, and begin building main project components.

Projects in Mexico:

SCC has several projects in its Mexican pipeline that may boost organic growth if they are found to be of value for both stakeholders and the communities in which we operate. These projects are Angangueo, Chalchihuites and the Empalme Smelter, which could bolster our position as a fully integrated copper producer. We are conducting talks with the current administration to continue rolling out SCC's Mexican investments for $10.2 billion.

El Pilar - Sonora:This low-capital intensity copper greenfield project is strategically located in Sonora, Mexico, approximately 45 kilometers from our Buenavista mine. Its copper oxide mineralization contains estimated proven and probable reserves of 317 million tonnes of ore with an average copper grade of 0.249%. We anticipate that El Pilar will operate as a conventional open-pit mine with an annual production capacity of 36,000 tonnes of copper cathodes. This operation will use highly cost efficient and environmentally friendly SX-EW technology.

Potential projects:

We have a number of other projects that we may develop in the future. We continuously evaluate new projects on the basis of our long-term corporate objectives, expected return on investment, environmental concerns, required investment and estimated production, among other considerations. All capital spending plans will continue to be reviewed and adjusted to respond to changes in the economy and market conditions.

Los Chancas - Apurimac: This greenfield project, located in Apurimac, Peru, is a copper and molybdenum porphyry deposit. Current estimates of indicated copper mineral resources are 98 million tonnes of oxides with a copper content of

0.45% and 52 million tonnes of sulfides with a copper content of 0.59%. The Los Chancas project envisions an open-pit mine with a combined operation of concentrator and SX-EW processes that are expected to produce 130,000 tonnes of copper and 7,500 tonnes of molybdenum annually. The estimated capital investment is $2,600 million and the project is expected to begin operating in 2031. We continue to engage in social and environmental improvements for the local communities and are working on the project´s environmental impact assessment.

Project update: As of September 30, 2025, social and environmental management programs are underway in the communities directly influenced by the project, in accordance with the Framework Agreement signed between the Tiaparo Peasant Community and the Los Chancas Mining Project. Necessary actions are being undertaken to regain control of the project in response to the presence of illegal miners-control that is essential to continue advancing the development of our Los Chancas Project.

Michiquillay Project - Cajamarca: In June 2018, Southern Copper signed a contract for the acquisition of the Michiquillay project in Cajamarca, Peru. Michiquillay is a world class mining project with inferred mineral resources of 2,288 million tonnes and an estimated copper grade of 0.43%. When developed, we expect Michiquillay to produce 225,000 tonnes of copper per year (along with by-products of molybdenum, gold and silver) at a competitive cash-cost for an initial mine life of more than 25 years.

We estimate an investment of approximately $2.5 billion will be required and expect production start-up by 2032. Michiquillay will become one of Peru´s largest copper mines and will create significant business opportunities in the Cajamarca region; generate new jobs for the local communities; and contribute with taxes and royalties to the local, regional and national governments.

Project update: The geological information obtained from drilling programs has been used to develop the models required to estimate the deposit's Mineral Resources. These models are currently being audited by a third party under the SEC's mining disclosure standards, S-K 1300. A conceptual study is underway to determine the best location for a conventional and/or filtered tailings storage facility. Hydrological, hydrogeological, and geotechnical studies are also being conducted.

El Arco - Baja California: This is a world-class copper deposit located in the central part of the Baja California peninsula with ore reserves of over 1,230 million tonnes with an average ore grade of 0.40% and 141 million tonnes of leach material with an average ore grade of 0.27%. The project includes an open-pit mine with a combined 120 ktpd concentrator and 28 ktpy SX-EW operations.

Detailed engineering is still underway for the concentrator, SX-EW plant, water desalination, logistics infrastructure and power delivery.

The aforementioned information is based solely on estimates. We cannot make any assurances that we will undertake any of these projects or that the information noted is accurate.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE ("ESG") PRACTICES

Our sustainability ratings are on the rise. In its Corporate Sustainability Assessment 2025, S&P Global increased SCC's rating by four points over last year's print. This result positions the company among the leaders in the mining sector's performance ranking, with a rating that is more than twice the industry's average. Some of SCC's disaggregated ratings were the highest reported for the sector: i) transparency and reporting, ii) environmental management, iii) biodiversity, iv) cybersecurity, v) labor practices, vi) human rights and vii) community relations.

We prevent greenhouse gas emissions at our operations.The electricity our underground mines has received from the Fenicias wind farm has enabled us to curb greenhouse gas emissions by 180 thousand carbon tons thus far in 2025, which is equivalent to the electricity supply needed to sustain 40 thousand households in Mexico.

We are recovering ecosystems in Mexico and Peru.Thus far in 2025, we have conducted advance work to restore 67 hectares at our Buenavista del Cobre installations in Sonora and slightly less than 10 hectares in the Ite wetlands in Peru. These efforts entail reincorporating areas of the landscape that were previously impacted by our operations and

providing important environmental services. Additionally, we are preparing stocks and terraces and are installing assisted irrigation systems on approximately 200 hectares in Sonora, which will be reforested in 2025.

Tía María supports education in the Arequipa region of Peru. Through the works for taxes mechanism, we are financing the modernization and upgrades at an emblematic secondary school in the District of Cocachacra, which will serve 400 students, and a Biomedical Sciences Laboratory at the Universidad Nacional de San Agustín in Arequipa, which will be used by 3,000+ students and researchers.

Healthy communities with Dr. Vagón.During its tour of Sonora in 2025, the Health Train sponsored by Fundación Grupo México imparted more than 20 thousand free consultations in eight municipalities, marking an all-time high in Dr. Vagón's history. Over its nine previous visits to the region, more than 59 thousand medical consultations and 70 thousand prescriptions were provided at no cost. With these results, Dr. Vagón has become one of the most important traveling health projects in Sonora, Mexico.

ACCOUNTING ESTIMATES

Our discussion and analysis of financial condition and results of operations, as well as quantitative and qualitative disclosures about market risks, are based upon our consolidated financial statements, which have been prepared in accordance with U.S. GAAP. Preparation of these consolidated financial statements requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. We make our best estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Changes in estimates are recognized in accordance with the accounting rules for the estimate, which is typically in the period when new information becomes available to management. Areas where the nature of the estimate makes it reasonably possible that actual results could materially differ from amounts estimated include: ore reserves, revenue recognition, ore stockpiles on leach pads and related amortization, estimated impairment of assets, asset retirement obligations, determination of discount rates related to the financial lease liabilities, classification of operating leases versus financial leases, valuation allowances for deferred tax assets, unrecognized tax benefits and fair value of financial instruments. We base our estimates on historical experience and on various other assumptions that we believe reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

BENEFIT PLANS

At the Company's July 2025 Board of Directors meeting, approval was granted by the Board to terminate the Retirement Benefit Plan for Salaried Employees of Southern Copper Corporation (the "Plan") effective December 1, 2025. The Termination will proceed as a standard termination. Since November of 2000, the Plan has been frozen and closed to new participants and accruals of benefits. Retirees currently receiving their monthly benefits from The Metropolitan Life Insurance Company ("MetLife") will continue to receive their monthly benefit from MetLife. Plan participants that will begin drawing their benefits for the first time after October 1, 2025, will receive their benefit from Midland Insurance Company.

Settlement charges related to the Plan termination, which will include the recognition of accumulated gains and losses recorded within other comprehensive income on the Company's balance sheet, are currently expected to occur in the fourth quarter of 2025. The Plan termination is subject to certain conditions, including regulatory review, and the Company has the right to change the effective date of the termination or revoke the termination. It is not expected that the Plan termination will have a material impact on the Company's financial statements, and the termination process is expected to be completed by April 30, 2026.

RESULTS OF OPERATIONS

The following highlights key financial results for the three and nine-month periods ended September 30, 2025 and 2024:


	Three Months Ended									Nine Months Ended
	September 30,									September 30,
Statement of Earnings Data	2025		2024		Variance		% Change			2025		2024		Variance		% Change
Net sales	$	3,377.3	$	2,930.9	$	446.4	$	15.2	%	$	9,550.2	$	8,649.0	$	901.2	$	10.4	%
Operating costs and expenses		(1,608.5)		(1,480.6)		(127.9)		8.6	%		(4,658.9)		(4,401.7)		(257.2)		5.8	%
Operating income		1,768.8		1,450.3		318.5		22.0	%		4,891.3		4,247.3		644.0		15.2	%
Non-operating income (expense)		(44.6)		(23.6)		(21.0)		89.0	%		(144.7)		(134.4)		(10.3)		7.7	%
Income before income taxes		1,724.1		1,426.7		297.5		20.8	%		4,746.6		4,112.9		633.7		15.4	%
Income taxes		(619.7)		(526.4)		(93.3)		17.7	%		(1,728.4)		(1,528.6)		(199.8)		13.1	%
Equity earnings of affiliate		6.4		(0.5)		6.9		(1,370.5)	%		18.5		8.1		10.4		128.9	%
Net income attributable to non-controlling interest		(3.3)		(3.1)		(0.2)		6.9	%		(9.7)		(9.5)		(0.2)		2.3	%
Net income attributable to SCC	$	1,107.6	$	896.7	$	210.9	$	23.5	%	$	3,027.0	$	2,582.9	$	444.0	$	17.2	%

Net salesin the third quarter of 2025, net sales totaled $3,377.3 million, representing a 15.2% increase compared to the same period in 2024. This performance was mainly supported by increased sales volumes of molybdenum (+7.9%), silver (+21.9%), and zinc (+7.3%), along with higher prices for copper (+6.5% LME; +14.2% COMEX), molybdenum (+12.1%), silver (+34.4%) and zinc (+1.6%). These positive effects were partially offset by a decrease in copper sales volumes (-3.6%).

For the nine months of 2025, net sales increased 10.4% compared to the same period in 2024. This growth was driven by increased sales volumes of molybdenum (+6.7%), silver (+16.6%) and zinc (+18.7%), along with higher prices for copper (+4.6% LME; +11.9% COMEX), molybdenum (+3.3%), silver (+29.2%) and zinc (+3.3%). These positive effects were slightly offset by a decrease in copper sales volume (-1.0%).

The table below outlines the average published market metal prices for our metals for the three and nine-month periods ended September 30, 2025 and 2024:


		Three Months Ended September 30,					Nine Months Ended September 30,
	2025		2024		% Change		2025		2024		% Change
Copper price ($per pound-LME)	$	4.44	$	4.17	6.5	%	$	4.33	$	4.14	4.6	%
Copper price ($per pound-COMEX)	$	4.83	$	4.23	14.2	%	$	4.71	$	4.21	11.9	%
Molybdenum price ($per pound)(1)	$	24.30	$	21.68	12.1	%	$	21.77	$	21.07	3.3	%
Zinc price ($per pound-LME)	$	1.28	$	1.26	1.6	%	$	1.26	$	1.22	3.3	%
Silver price ($per ounce-COMEX)	$	39.56	$	29.43	34.4	%	$	35.16	$	27.21	29.2	%

(1)	Platts Metals Week Dealer Oxide

The table below provides our metal sales as a percentage of our total net sales for the three and nine-month periods ended September 30, 2025 and 2024:


		Three Months Ended				Nine Months Ended
	September 30,					September 30,
Sales as a percentage of total net sales		2025		2024		2025		2024
Copper		72.5	%	77.1	%	74.7	%	77.1	%
Molybdenum		12.9	%	10.1	%	11.4	%	11.0	%
Silver		7.4	%	5.2	%	6.6	%	4.9	%
Zinc		3.7	%	3.9	%	3.8	%	3.4	%
Other by-products		3.5	%	3.7	%	3.5	%	3.6	%
Total		100.0	%	100.0	%	100.0	%	100.0	%

The table below provides our copper sales by type of product for the three and nine-month periods ended September 30, 2025 and 2024. The difference in value between products is the level of processing. At the market price, concentrates take a discount since they require smelting and refining processes, while refined and rod copper receive premiums due to their purity and presentation.


	Three Months Ended September 30,					Nine Months Ended September 30,
Copper Sales (million pounds)	2025	2024	Variance	% Change		2025	2024	Variance	% Change
Refined (including SX-EW)	209.1	279.8	(70.7)	(25.3)	%	693.5	797.4	(103.9)	(13.0)	%
Rod	88.1	78.7	9.4	11.9	%	265.9	259.4	6.5	2.5	%
Concentrates and other	219.4	177.4	42.0	23.7	%	588.2	507.0	81.2	16.0	%
Total	516.5	535.9	(19.4)	(3.6)	%	1,547.6	1,563.8	(16.2)	(1.0)	%

The table below provides our copper sales volume by type of product as a percentage of our total copper sales volume for the three and nine-month periods ended September 30, 2025 and 2024:


	Three months ended September 30,					Nine months ended September 30,
Copper Sales by product type		2025		2024		2025		2024
Refined (including SX-EW)		40.5	%	52.2	%	44.8	%	51.0	%
Rod		17.1	%	14.7	%	17.2	%	16.6	%
Concentrates and other		42.4	%	33.1	%	38.0	%	32.4	%
Total		100.0	%	100.0	%	100.0	%	100.0	%

OPERATING COSTS AND EXPENSES

The table below summarizes the production cost structure by major components as a percentage of total production cost:


	Three months ended September 30,				Nine months ended September 30,
	2025		2024		2025		2024
Power	11.1	%	10.3	%	11.7	%	11.2	%
Labor	13.4	%	12.1	%	12.6	%	12.0	%
Fuel	15.1	%	16.0	%	14.9	%	15.9	%
Maintenance	24.5	%	25.2	%	25.2	%	23.6	%
Operating material	19.0	%	19.6	%	18.9	%	19.3	%
Other	17.0	%	16.8	%	16.7	%	18.0	%
Total	100.0	%	100.0	%	100.0	%	100.0	%

Third quarter:Operating costs and expenses were $1,608.5 million in the third quarter of 2025, compared to $1,480.6 million in the same period of 2024. The increase of $127.9 million was primarily due to:


Operating cost and expenses for the third quarter of 2024			$	1,480.6
Plus:
•	Increase in other cost of sales (exclusive of depreciation, amortization and depletion), which is mainly attributable to:			71.3
	- Workers participation	37.2
	- Labor expenses	22.7
	- Energy costs	15.6
	- Operations contractors	16.4
	- Sales expenses	15.0
	- Repairing materials, principally heavy equipment spare parts, partially offset by	12.7
	- Inventory variance	(41.6)
	- Exchange rate variance	(4.4)
	- Other net	(2.3)
•	Increase in volume and cost of metals purchased from third parties.			62.5
•	Increase in selling, general and administrative expenses.			2.5
Less:
•	Decrease in depreciation, amortization and depletion expense.			(5.3)
•	Decrease in exploration expense.			(3.0)
Operating cost and expenses for the third quarter of 2025			$	1,608.5

Nine months:Operating costs and expenses were $4,658.9 million in the first nine months of 2025 compared to $4,401.7 million in the same period of 2024. The increase of $257.2 million was primarily due to:


Operating cost and expenses for the first nine months of 2024			$	4,401.7
Plus:
•	Increase in other cost of sales (exclusive of depreciation, amortization and depletion), which is mainly attributable to:			179.4
	- Workers participation	90.2
	- Repairing materials, principally heavy equipment spare parts	64.7
	- Labor expenses	26.4
	- Energy costs	25.0
	- Sales expenses	22.4
	- Exchange rate variance, partially offset by	19.5
	- Reagents	(23.0)
	- Fuel	(22.8)
	- Freight	(22.7)
	- Other net	(0.4)
•	Increase in volume and cost of metals purchased from third parties.			78.8
•	Increase in depreciation, amortization and depletion expense.			6.0
•	Increase in selling, general and administrative expenses.			1.9
Less:
•	Decrease in exploration expense.			(8.8)
Operating cost and expenses for the first nine months of 2025			$	4,658.9

NON-OPERATING INCOME (EXPENSE)

Non-operating income (expense) represented a net expense of $44.6 million and $144.7 million in the three and nine months ended on September 30, 2025 compared to a net expense of $23.6 million and $134.4 million in the three and nine months ended September 30, 2024.

Third quarter: The $21.0 million increase in the expense level was due to:

●	$22.3 million increase in net miscellaneous expenses, which includes $3.9 million of social responsibility expenses. In addition, the 2024 figure included a $15.0 million insurance payment for damages at our Cuajone operations;

●	$8.3 million increase in interest expense, net of capitalized interest; partially offset by

●	$9.6 million increase in interest income due to higher cash balances.

Nine months: The $10.3 million increase in the expense level was due to:

●	$37.5 million increase in the net miscellaneous expenses, which includes a $9.9 million asset impairment at Tia Maria project. Additionally, the 2024 figure included a $15.0 million insurance payment for damages at our Cuajone operations,

●	$30.4 million increase in interest expense, net of capitalized interest, partially offset by

●	$57.6 million increase in interest income due to higher cash balances.

INCOME TAXES


	Nine Months Ended
	September 30,
	2025			2024
Provision for income taxes ($ in millions)	$	1,728.4		$	1,528.6
Effective income tax rate		36.4	%		37.2	%

In addition to the income taxes of Peru, Mexico and the United States, the provision for income taxes also includes the mining royalties from Peru and Mexico and the Peruvian special mining tax.

SEGMENT RESULT ANALYSIS

We have three segments: the Peruvian operations, the Mexican open-pit operations and the Mexican underground mining operations.

The table below presents information regarding the volume of our copper sales by segment for the three and nine-month periods ended September 30, 2025 and 2024:


	Three Months Ended September 30,					Nine Months Ended September 30,
Copper Sales (million pounds)	2025	2024	Variance	% Change		2025	2024	Variance	% Change
Peruvian operations	218.4	230.7	(12.3)	(5.3)	%	674.5	668.3	6.2	0.9	%
Mexican open-pit	297.4	306.0	(8.6)	(2.8)	%	870.0	905.3	(35.2)	(3.9)	%
Mexican IMMSA unit	6.9	7.0	(0.1)	(1.8)	%	20.3	24.7	(4.3)	(17.6)	%
Other and intersegment elimination	(6.2)	(7.8)	1.6	(19.6)	%	(17.3)	(34.5)	17.2	(49.8)	%
Total copper sales	516.5	535.9	(19.4)	(3.6)	%	1,547.6	1,563.8	(16.2)	(1.0)	%

The table below presents information regarding the volume of sales by segment of our significant by-products for the three and nine-month periods ended September 30, 2025 and 2024:


	Three Months Ended September 30,					Nine Months Ended September 30,
By-product Sales (million pounds, except silver-million ounces)	2025	2024	Variance	% Change		2025	2024	Variance	% Change
Peruvian operations:
Molybdenum contained in concentrate	8.2	7.7	0.5	6.1	%	24.0	22.5	1.5	6.6	%
Silver	1.9	1.4	0.5	33.0	%	5.1	4.3	0.9	21.0	%
Mexican open-pit operations:
Molybdenum contained in concentrate	9.3	8.4	0.8	9.6	%	27.8	26.0	1.8	6.9	%
Zinc	48.8	18.1	30.7	169.5	%	146.1	62.3	83.7	134.4	%
Silver	3.4	2.9	0.5	17.7	%	9.9	8.8	1.1	12.7	%
IMMSA unit
Zinc-refined and in concentrate	46.0	64.3	(18.2)	(28.4)	%	140.3	162.6	(22.3)	(13.7)	%
Silver	1.8	1.6	0.2	12.5	%	5.2	4.9	0.3	6.2	%
Other and intersegment elimination
Silver	(0.8)	(0.7)	(0.0)	6.6	%	(2.2)	(2.5)	0.3	(10.3)	%
Zinc	(6.4)	-	(6.4)	-	%	(19.3)	-	(19.3)	-	%
Total by-product sales
Molybdenum contained in concentrate	17.4	16.2	1.3	7.9	%	51.8	48.5	3.3	6.7	%
Zinc-refined and in concentrate	88.4	82.4	6.0	7.3	%	267.0	224.9	42.1	18.7	%
Silver	6.3	5.2	1.1	21.9	%	18.0	15.4	2.6	16.6	%

Peruvian Open-pit Operations:


	Three Months Ended September 30,									Nine Months Ended September 30,
	2025		2024		Variance		% Change			2025		2024		Variance		% Change
Net sales	$	1,301.6	$	1,189.9	$	111.7		9.4	%	$	3,745.8	$	3,465.3	$	280.5		8.1	%
Operating costs and expenses		(630.9)		(640.2)		9.3		(1.5)	%		(1,930.5)		(1,837.7)		(92.8)		5.0	%
Operating income	$	670.7	$	549.7	$	121.0		22.0	%	$	1,815.3	$	1,627.6	$	187.7		11.5	%

Net salesin the third quarter of 2025 increased $111.7 million compared to the same period of 2024. This improvement was mainly driven by higher sales volumes for silver (+33.0%) and molybdenum (+6.1%) and by higher prices for copper (+6.5%, LME), silver (+34.4%) and molybdenum (+12.1%). These positive effects were partially offset by a decrease in copper sales volume (-5.3%).

Operating costs and expenseswere $630.9 million in the second quarter of 2025 compared to $640.2 million in the same period of 2024. The decrease of $9.3 million was primarily due to:


Operating costs and expenses for the third quarter of 2024			$	640.2
Less:
•	Decrease in depreciation, amortization and depletion expense.			(4.1)
•	Decrease in exploration expenses.			(2.5)
•	Decrease in other cost of sales (exclusive of depreciation, amortization and depletion), mainly attributable to:			(2.3)
	- Inventory variance	(27.7)
	- Energy costs	(5.2)
	- Exchange rate variance, partially offset by	(4.2)
	- Labor expenses	10.1
	- Repairing materials, principally heavy equipment spare parts	9.8
	- Operations contractors	6.1
	- Workers participation	5.3
	- Other net	3.5
•	Decrease in cost of metals purchased from third parties.			(1.9)
Plus:
•	Increase in selling, general and administrative expenses.			1.5
Operating costs and expenses for the third quarter of 2025			$	630.9

Net salesin the first nine months of 2025 increased $280.5 million compared to the same period in 2024. This growth primarily reflects improvements in sales volumes of copper (+0.9%), silver (+21.0%) and molybdenum (+6.6%), as well as an increase in market prices for copper (+4.6%, LME), silver (+29.2 %) and molybdenum (+3.3%).

Operating costs and expensesin the first nine months of 2025 increased $92.8 million to $1,930.5 million compared to $1,837.7 million in the same period of 2024. This was primarily due to:


Operating costs and expenses for the first nine months of 2024			$	1,837.7
Plus:
•	Increase in other cost of sales (exclusive of depreciation, amortization and depletion), mainly attributable to:			114.3
	- Inventory variance	65.1
	- Repairing materials, principally heavy equipment spare parts	46.0
	- Labor expenses	22.0
	- Exchange rate variance, partially offset by	12.2
	- Operations contractors	(17.2)
	- Fuel	(13.7)
	- Other net	(0.2)
•	Increase in depreciation, amortization and depletion expense.			5.3
•	Increase in selling, general and administrative expenses.			1.1
Less:
•	Decrease in cost of metals purchased from third parties.			(21.2)
•	Decrease in exploration expenses.			(6.8)
Operating costs and expenses for the first nine months of 2025			$	1,930.5

Mexican Open-pit Operations:


	Three Months Ended September 30,									Nine Months Ended September 30,
	2025		2024		Variance		% Change			2025		2024		Variance		% Change
Net sales	$	1,944.9	$	1,602.7	$	342.2		21.3	%	$	5,449.0	$	4,807.2	$	641.8		13.4	%
Operating costs and expenses		(882.0)		(736.5)		(145.5)		19.8	%		(2,431.7)		(2,237.6)		(194.1)		8.7	%
Operating income	$	1,062.8	$	866.2	$	196.6		22.7	%	$	3,017.3	$	2,569.6	$	447.7		17.4	%

Net salesin the third quarter of 2025 increased $342.2 million compared to the same period of 2024. Growth was mainly driven by higher sales volumes of zinc (+169.5%), silver (+17.7%) and molybdenum (+9.6%), and was supported by full-capacity production at the Buenavista zinc concentrator. Zinc sales volumes over the period reached 48.8 million pounds in the third quarter of 2025. Additionally, higher prices for copper (COMEX, +14.2%) , silver (+34.4%) and molybdenum (+12.1%) further supported the rise in net sales. However, these positive effects were slightly offset by a decrease in sales volumes of copper (-2.8%).

Operating costs and expenseswere $882.0 million in the third quarter of 2025 compared to $736.5 million in the same period of 2024. The increase of $145.5 million was primarily due to:


Operating costs and expenses for the third quarter of 2024			$	736.5
Plus:
•	Increase in other cost of sales (exclusive of depreciation, amortization and depletion), which is mainly attributable to:			85.7
	- Workers participation	37.7
	- Energy costs	22.5
	- Sales expenses	16.0
	- Inventory variance	10.8
	- Labor expenses	9.7
	- Other net, partially offset by	4.1
	- Exchange rate variance	(15.1)
•	Increase in volume and cost of metals purchased from third parties.			64.8
•	Increase in exploration expense.			0.6
•	Increase in selling, general and administrative expenses.			1.1
Less:
•	Decrease in depreciation, amortization and depletion expense.			(6.7)
Operating costs and expenses for the third quarter of 2025			$	882.0

Net salesin the first nine months of 2025 increased $641.8 million compared to the same period of 2024. This growth primarily reflects improvements in sales volumes of zinc (+134.4%), silver (+12.7%) and molybdenum (+6.9%). Additionally, positive developments for metal prices, mainly copper (+11.9%, COMEX), silver (+29.2%) and zinc (+3.3%) contributed to this performance. Start-up at the Buenavista zinc concentrator played a pivotal role, as zinc sales volumes reached 146.1 million pounds for the period. However, this was partially offset by a decline in the sales volume of copper (-3.9%).

Operating costs and expensesin the first nine months of 2025 increased $194.1 million to $2,431.7 million compared to $2,237.6 million in the same period of 2024. This was primarily due to:


Operating costs and expenses for the first nine months of 2024			$	2,237.6
Plus:
•	Increase in volume and cost of metals purchased from third parties.			125.3
•	Increase in other cost of sales (exclusive of depreciation, amortization and depletion), which is mainly attributable to:			86.3
	- Workers participation	88.8
	- Energy costs	42.2
	- Sales expenses	27.1
	- Repairing materials, principally heavy equipment spare parts	15.1
	- Other net, partially offset by	1.1
	- Inventory variance	(34.8)
	- Exchange rate variance	(53.1)
Less:
•	Decrease in exploration expense.			(2.6)
•	Decrease in depreciation, amortization and depletion expense.			(14.9)
•	Decrease in selling, general and administrative expenses.			(*)
Operating costs and expenses for the first nine months of 2025			$	2,431.7

(*) Less than $0.1 million.

Mexican Underground Operations (IMMSA):


	Three Months Ended September 30,									Nine Months Ended September 30,
	2025		2024		Variance		% Change			2025		2024		Variance		% Change
Net sales	$	199.8	$	184.9	$	14.9		8.1	%	$	534.6	$	516.5	$	18.1		3.5	%
Operating costs and expenses		(153.5)		(148.3)		(5.2)		3.5	%		(452.0)		(435.6)		(16.4)		3.8	%
Operating income	$	46.3	$	36.6	$	9.7		26.5	%	$	82.5	$	80.9	$	1.6		2.0	%

Net salesin the third quarter of 2025 increased $14.9 million compared to the same period of 2024. This improvement was primarily driven by an increase in sales volumes of silver (+12.5%) and lead (+21.4%) and by higher prices for copper (COMEX, +14.2%) and silver (+34.4%). However, these effects were partially offset by a decrease in sales volumes of copper (-1.7%) and zinc (-28.4%).

Operating costs and expenseswere $153.5 million in the third quarter of 2025 compared to $148.3 million in the same period of 2024. The increase of $5.2 million was primarily due to:


Operating costs and expenses for the third quarter of 2024			$	148.3
Plus:
•	Increase in volume and cost of metals purchased from third parties.			15.3
•	Increase in depreciation, amortization and depletion expense.			2.3
•	Increase in exploration expense.			0.1
Less:
•	Decrease in other cost of sales (exclusive of depreciation, amortization and depletion), which is mainly attributable to:			(12.5)
	- Inventory variance, partially offset by	(24.7)
	- Operating contractors	4.4
	- Repairing materials, principally heavy equipment spare parts	3.4
	- Labor expenses	2.9
	- Other net	1.5
•	Decrease in selling, general and administrative expenses.			(*)
Operating costs and expenses for the third quarter of 2025			$	153.5

(*) Less than $0.1 million.

Net salesin the first nine months of 2025 increased $18.1 million compared to the same period of 2024. This growth primarily reflects favorable metal price trends, primarily for copper (COMEX, +11.9%), silver (+29.2%), and zinc (+3.3%). Growth in silver sales volumes (+6.2%) boosted this performance. However, these positive effects were partially offset by a drop in sales volumes of copper (-17.6%) and zinc (-13.7%).

Operating costs and expensesin the first nine months of 2025 increased by $16.4 million to $452.0 million compared to $435.6 million in the same period of 2024. This was primarily due to:


Operating costs and expenses for the first nine months of 2024			$	435.6
Plus:
•	Increase in volume and cost of metals purchased from third parties.			23.7
•	Increase in depreciation, amortization and depletion expense.			5.5
•	Increase in exploration expense.			1.8
Less:
•	Decrease in other cost of sales (exclusive of depreciation, amortization and depletion), which is mainly attributable to:			(14.5)
	- Energy costs	(12.3)
	- Inventory variance, mostly offset by	(33.8)
	- Exchange rate variance	25.4
	- Repairing materials, principally heavy equipment spare parts	3.6
	- Other net	2.5
•	Decrease in selling, general and administrative expenses.			(0.1)
Operating costs and expenses for the first nine months of 2025			$	452.0

Intersegment Eliminations and Adjustments:

The net sales, operating costs and expenses and operating income discussed above will not be directly equal to amounts in our condensed consolidated statement of earnings because the adjustments of intersegment operating revenues and expenses must be taken into account. Please see Note 14 "Segment and Related Information" of the condensed consolidated financial statements.

LIQUIDITY AND CAPITAL RESOURCES

Cash flow:

The following table shows the cash flow for the nine-month periods ended September 30, 2025 and 2024 (in millions):


	2025		2024		Variance
Net cash provided by operating activities	$	3,257.8	$	3,061.2	$	196.6
Net cash used in investing activities	$	(1,233.3)	$	(511.5)	$	(721.8)
Net cash used in financing activities	$	(1,275.7)	$	(1,091.2)	$	(184.5)

Net cash provided by operating activities:

The change in net cash from operating activities for the nine-month periods ended September 30, 2025 and 2024 include, in millions, the following significant items:


	2025		2024		Variance		% Change
Net income	$	3,036.7	$	2,592.4	$	444.3		17.1	%
Depreciation, amortization and depletion		637.7		631.7		6.0		1.0	%
Provision (benefit) for deferred income taxes		32.8		(2.4)		35.2		(1,491.6)	%
Loss on foreign currency transaction effect		30.4		13.8		16.6		120.2	%
Other adjustments to net income		(0.9)		8.4		(9.3)		(110.6)	%
Change in operating assets and liabilities		(479.0)		(182.8)		(296.1)		162.0	%
Net cash provided by operating activities	$	3,257.8	$	3,061.2	$	196.6		6.4	%

Nine months ended September 30, 2025:Net income was $3,036.7 million, which represented approximately 93.2% of the net operating cash flow. The cash flow from operating assets and liabilities dropped by $479.0 million due to the following:

●	$(529.8) million increase in trade accounts receivable, which was mainly attributable to an increase in metal prices and in reported sales volumes in the first nine months of 2025.

●	$(25.9) million decrease in accounts payable and accrued liabilities.

●	$15.2 million net decrease in inventory, which was primarily driven by a reduction in the work in process inventory.

●	$61.6 million decrease in other operating assets and liabilities, net.

Nine months ended September 30, 2024:Net income was $2,592.4 million, which represented approximately 84.7% of the net operating cash flow. The cash flow from operating assets and liabilities decreased by 182.8 million due to the following:

●	$(360.4) million increase in net, accounts payable and receivable at our Peruvian and Mexican operations.

●	$4.5 million net decrease in inventory.

●	$173.1 million decrease in other operating assets and liabilities, net.

Net cash used in investing activities:

Nine months ended September 30, 2025:Net cash used in investing activities included $902.7 million for capital investments. The capital investments included:

●	$533.9 million of investments at our Mexican operations:

●

$147.3 million for the new tailings disposal deposit at Buenavista mine,

●

$78.8 million for the IMMSA unit,

●

$26.7 million for the water supply system at La Churea,

●

$22.0 million for wells and recovered water conduction,

●

$21.0 million for land for new projects,

●

$245.7 million for replacement and maintenance expenditures, and

●

$(7.6) million increase in capital expenditures incurred but not yet paid.

●	$368.8 million of investments at our Peruvian operations:

●

$46.0 million for the Tia Maria project,

●

$43.7 million for the purchase of land at the Los Chancas project,

●

$24.2 million for the relocation of the leaching crusher at Toquepala,

●

$18.4 million for the cathode stripping machine at the Ilo refinery,

●

$8.3 million for the modernization of the delamination machine at Toquepala,

●

$6.0 million for the pump and cooling pipe replacement at the Ilo oxygen plant,

●

$4.9 million for the electric cogeneration at Ilo smelter,

●

$63.7 million for other minor projects with a budget below $1 million,

●

$143.1 million for replacement and maintenance expenditures, and

●

$10.6 million decrease in capital expenditures incurred but not yet paid.

Investment activities in the first nine months of 2025 included $330.6 million of net purchase of short-term investments.

Nine months ended September 30, 2024:Net cash used in investing activities included $792.0 million for capital investments. The capital investments included:

●	$570.4 million of investments at our Mexican operations:

●

$107.7 million for the tailing deposits of new concentrator,

●

$91.5 million for the IMMSA unit,

●

$45.6 million for Buenavista Zinc project,

●

$14.0 million for Bella Union mine,

●

$309.0 million for replacement and maintenance expenditures, and

●

$2.6 million in capital expenditures incurred but not yet paid.

●	$221.6 million of investments at our Peruvian operations:

●

$16.2 million for the HPGR optimization at Cuajone,

●

$7.1 million for Tia Maria project,

●

$6.6 million for the maintenance workshops at Cuajone,

●

$4.8 million for the relocation of the leaching crusher at Toquepala,

●

$2.7 million for the Maintenance workshops at Toquepala concentrator,

●

$1.6 million for the reinforcement of structures at the Ilo smelter

●

$1.3 million for the Quebrada Honda filter plant,

●

$175.1 million for replacement and maintenance expenditures, and

●

$6.2 million in capital expenditures incurred but not yet paid.

Investment activities in the nine-month period of 2024 included $280.5 million of net purchase of short-term investments.

Dividends:

On October 23, 2025, the Board of Directors authorized a quarterly cash dividend of $0.90 per share of common stock and a stock dividend of 0.0085 shares of common stock per share of common stock, payable on November 28, 2025 to shareholders of record at the close of business on November 12, 2025.

In lieu of fractional shares, cash will be distributed to each shareholder who would otherwise have been entitled to receive a fractional share, based on a share price of $129.74, which is the average of the high and low share price on October 23, 2025.

Capital Investment and Exploration Programs:

A discussion of our capital investment programs is an important part of understanding our liquidity and capital resources. We expect to meet the cash requirements for these capital investments from cash on hand, internally generated funds and from additional external financing if required. For information regarding our capital investment programs, please see the discussion under the caption "Capital Investment Programs" under this Item 2.

Contractual Obligations:

There have been no material changes in our contractual obligations in the third quarter of 2025. Please see item 7 in Part II of our 2024 annual report on Form 10-K.

NON-GAAP INFORMATION RECONCILIATION

Operating cash cost:Following is a reconciliation of "Operating Cash Cost" (see page 42) to cost of sales (exclusive of depreciation, amortization and depletion) as reported in our condensed consolidated statement of earnings, in millions of dollars and dollars per pound of copper in the table below:


	Three Months Ended				Three Months Ended				Nine Months Ended				Nine Months Ended
	September 30, 2025				September 30, 2024				September 30, 2025				September 30, 2024
			$ per				$ per				$ per				$ per
	$ millions		pound		$ millions		pound		$ millions		pound		$ millions		pound
Cost of sales (exclusive of depreciation, amortization and depletion)	$	1,356.8	$	2.74	$	1,223.1	$	2.29	$	3,887.7	$	2.56	$	3,629.6	$	2.33
Add:
Selling, general and administrative		33.7		0.07		31.2		0.06		97.9		0.07		96.0		0.06
Sales premiums, net of treatment and refining charges		(51.3)		(0.10)		(14.3)		(0.03)		(122.8)		(0.08)		(29.1)		(0.02)
Less:
Workers' participation		(116.2)		(0.24)		(79.0)		(0.15)		(320.3)		(0.21)		(230.1)		(0.15)
Cost of metals purchased from third parties		(96.7)		(0.20)		(40.9)		(0.08)		(210.7)		(0.14)		(124.7)		(0.08)
Royalty charge and other, net		(44.4)		(0.09)		(59.8)		(0.11)		(82.2)		(0.05)		(82.5)		(0.05)
Inventory change		20.8		0.04		(14.1)		(0.03)		(18.4)		(0.01)		(28.6)		(0.02)
Operating Cash Cost before by-product revenues	$	1,102.8	$	2.23	$	1,046.2	$	1.96	$	3,231.2	$	2.13	$	3,230.5	$	2.07
Add:
By-product revenues(1)		(887.8)		(1.79)		(627.3)		(1.17)		(2,291.1)		(1.51)		(1,852.7)		(1.19)
Net revenue on sale of metal purchased from third parties		(6.9)		(0.01)		(11.9)		(0.02)		(18.1)		(0.01)		(35.1)		(0.02)
Add:
Total by-product revenues		(894.8)		(1.81)		(639.3)		(1.19)		(2,309.1)		(1.52)		(1,887.9)		(1.21)
Operating Cash Cost net of by-product revenues	$	208.1	$	0.42	$	406.9	$	0.76	$	922.1	$	0.61	$	1,342.7	$	0.86

(1)	By-product revenues included in our presentation of operating cash cost contain the following:


	Three Months Ended				Three Months Ended				Nine Months Ended				Nine Months Ended
		September 30, 2025				September 30, 2024				September 30, 2025				September 30, 2024
			$ per				$ per				$ per				$ per
	$ millions		pound		$ millions		pound		$ millions		pound		$ millions		pound
Molybdenum	$	(434.9)	$	(0.88)	$	(296.8)	$	(0.55)	$	(1,090.1)	$	(0.72)	$	(949.5)	$	(0.61)
Silver		(228.5)		(0.46)		(132.8)		(0.25)		(562.7)		(0.37)		(374.5)		(0.24)
Zinc		(113.5)		(0.23)		(95.1)		(0.18)		(329.4)		(0.22)		(231.8)		(0.15)
Sulfuric Acid		(58.8)		(0.12)		(67.5)		(0.13)		(183.5)		(0.12)		(200.7)		(0.13)
Gold and others		(52.1)		(0.11)		(35.2)		(0.07)		(125.4)		(0.08)		(96.2)		(0.06)
Total	$	(887.8)	$	(1.79)	$	(627.3)	$	(1.17)	$	(2,291.1)	$	(1.51)	$	(1,852.7)	$	(1.19)

Southern Copper Corporation published this content on October 31, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on October 31, 2025 at 19:54 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]

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