Mining and rail conglomerate Grupo Mexico, a major player in the global copper production industry, has announced a notable 38% increase in net profit for the second quarter. The rise in earnings was driven by higher copper sales and robust results from its transportation unit.
Grupo Mexico reported earnings of 11 cents per share, surpassing the Refinitiv estimate of 9 cents per share. Sales of copper, which constitute a significant portion of the company’s mining division operations, rose nearly 13% compared to the same period last year. This increase in revenue was achieved despite copper prices experiencing an 11% dip, averaging $4.34 per pound during the quarter.
The company’s production rose by 9.2%, partially attributed to higher ore grades at its Toquepala mine in Peru. Grupo Mexico aims to produce 1.048 million metric tons of copper this year, slightly higher than the 1.007 million metric tons produced last year.
With a positive outlook for certain metals and an intensive investment plan, analysts at brokerage Monex predict that Grupo Mexico could maintain its positive trend throughout the year. The company plans to increase its capital expenditures for the year to $1.83 billion, up from the previously estimated $1.76 billion, mainly allocated to improvement and expansion projects.
However, the company is also closely monitoring political issues in Peru. Recent protests have called for President Dina Boluarte to step down, and earlier this year, demonstrations and roadblocks impacted the country’s mining production.
Overall, Grupo Mexico’s revenue for the April-to-June period rose by almost 8% to $3.45 billion, bolstered by increased volumes moved by its transportation division, Grupo Mexico Transportes.
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