Posted on 24 Jul 2024
Mexican conglomerate Grupo Mexico has posted strong quarterly results, propped up by the positive copper price environment.
In the three months to 30 June, revenue in the mining division rose by 32% on-year to $6.2 billion due to higher sales volumes for copper, molybdenum, and zinc, as well as a 6% price increase to $4.21/pound for copper.
Total copper production in the first half was 5% higher than last year at 488,737 tonnes, driven by growth in Peruvian operations and stronger output in Mexico, Kallanish Power Materials understands. The performance was partially offset by a decrease in production at the Asarco division, located in the US state of Arizona.
Half-year earnings came in at $3.3 billion, up 18% from the same period last year.
The company, which is one of the largest copper producers in the world, reached the forecast production at the new Buenavista Zinc concentrator in the state of Sonora. The facility produced 20,865 t of zinc and 5,029 t of copper in H1.
Grupo Mexico also has a railway division and an infrastructure arm, which includes various activities such as drilling rigs operating for Mexican oil company Pemex, renewable power facilities and toll roads.
Analysts at Jefferies say "it is key for management to provide visibility for their cash usage near term," considering the company's "sizeable discount to its sum of the parts."
Source:Kallanish Power Materials
