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Southern Copper Corporation November, 2012
1
I. Introduction
2
Management Presenters
Presenter Raul Jacob
Title CFO - Peruvian Operations & Company Comptroller
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Corporate Structure
100.0% (*)
99.29 % 99.95 %
18.7% (*)
Public Float
SCC Peru Branch Minera México
(*) As of September 30, 2012
AMERICAS MINING
CORPORATION
81.3% (*)
Transport13%
Electrical & Electronic Products
34%
Construction31%
Industrial Machinery
13%
Consumer Products
9%
Japan5%
Europe20%
USA8%
China39%
Asia Ex China19%
All Other9%
LME Copper Cash Price vs. Inventories Copper Consumption by End-use
Solid Fundamentals Copper Consumption by Region
Brook Hunt September 2012
CRU 2012
Copper – The Best Fundamental Story in Commodities
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► Short-term macroeconomic concerns regarding the US and Europe. Together, they represent over 50% of world’s economy and 28% of copper demand.
► Fundamentals are still excellent for copper:
― Asia represents over 60% of world demand (China=39% and could reach 45% in 5 years)
― China and EM countries will continue growing, at a lesser pace, but still substantial.
― Limited production upside and falling grades result in a deficit market going forward
― Combined inventories have decreased by 34% in LTM.
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
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0.50
1.00
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LME COMEX shanghai LME Cash
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Southern Copper Strengths
►Highest copper reserves of any listed company
►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
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II. Overview of Operations
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Peru
Ilo
Mexico
Copper open pit mines
Underground mines
Smelters and Refineries
Key
Company Overview
Copper Reserves 1: 58.8 mmt
2012 Estimates: Copper Production: 640 kt Sales: $ 6.5 B EBITDA: $ 3.3 B 51% of Sales 9M – 2012 Cash Cost: $ 0.65/lb. #1 listed copper company by reserves 2
#7 copper producer 3 #7 copper smelter 3
Source: Company Filings Notes: 1 Copper contained in reserves based on US$2.00 per pound of copper as of December 31, 2011 2 Based on available companies reports 3 CRU information for January 2012
Santa Barbara
Charcas
Taxco
San Luis Potosi
Santa Eulalia
San Martin
Cuajone
La Caridad
Buenavista
Toquepala
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Copper Reserves as Reported SCC Highlights
► #1 mine life among copper producers
► #7 world’s largest producer of mined copper
► Highly diversified geographical presence
► Four large-scale open-pit mines
Mine Life
World’s Largest Copper Reserves of any Listed Companies Support Substantial Organic Growth Potential
81
34 3425 21 21 18
0
20
40
60
80
100
SCC Anglo American
Codelco Freeport BHP Billiton
Rio Tinto Xstrata
58.8
42.4
27.5
20.9 20.717.3
10.8 8.8
0
10
20
30
40
50
60
70
SC
C
Free
port
BH
P B
illito
n
Ang
loA
mer
ican
Xst
rata
Rio
Tin
to
VA
LE
Ant
ofag
asta
Cop
per R
eser
ves
(Mt)
Source 10K 10K 20F Annual Rep. Reserve Rep. 20F 20F Annual Rep.
Period 12/31/11 12/31/11 06/30/11 12/31/11 12/31/11 12/31/11 12/31/11 12/31/11
Cu Price $2.00 $2.00 $2.97 N/A N/A N/A $3.25 $2.40
Geographic Footprint & Product Diversification
9M 2012 Revenue by Product 9M 2012 Revenue by Market
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Copper77%
Molybdenum7%
Silver7%
Zinc3%
Other3%
Acid3%
Europe22%
United States25%
Brasil7%
Chile7%
Mexico25%
Peru4%
Other Latin American
2%
Asia8%
Operating Materials
17%
Fuel14%
Power21%
Labor15%
Maintenance18%
Other15%
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Low Cost Operations
Cash Costs per Pound of Copper Produced Net of By-Products
Cost Structure (1) Operating Cash Cost per Pound of Copper
Produced
Low Cost Drivers
Fully integrated low cost operations
World class assets
Significant SX-EW production
Strong by-product credits
Management focus on cost efficiency
(1) 9M 2012
0.41
0.18
0.41
0.65
0.0
0.2
0.4
0.6
0.8
1.0
2009 2010 2011 9M 2012
(US
$/lb
)
1.411.52
1.661.77
1.00
1.50
2.00
2009 2010 2011 9M 2012
(US$
/lb)
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Low Cost of Operations
Rio
Tin
to
-100
-50
0
50
100
150
200
250
0 5000 10000 15000 20000 25000 30000
C1
Cas
h C
ost (
c/lb
Cu)
Cumulative Production (Paid Mlbs Cu)
Global average SCC AMC
FreeportAntofagasta
XstrataCodelcoBHP
Anglo
Glencore
Source: Brookhunt
2011
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III. Financial Overview
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SCC Financial Summary
(US$ MM) 2010 2011 LTM 2012 9M 2012
Copper Price (LME) US$ per pound 3.42 4.00 3.56 3.61Income Statement:Net Revenues $5,150 $6,819 $6,687 $5,018EBITDA 2,865 3,910 3,527 2,562EBITDA Margin 56% 57% 53% 51%Net Income 1,554 2,336 1,940 1,403Dividends paid per share 1.68 2.46 1.66 1.31 *
Balance Sheet Statement:Cash & Equivalents $2,193 $848 $1,158 $1,158Total Assets 8,128 8,063 10,842 10,842Total Debt 1 2,760 2,746 2,741 2,741Total Liabilities 4,218 4,026 4,241 4,241Total Shareholders' Equity 3,890 4,015 6,577 6,577Cash Flow Statement:Capital Expenditures $409 $613 $942 $666Free Cash Flow 2 1,512 1,457 1,302 1,094Dividends paid to common shareholders 1,428 2,080 1,402 814
Total Debt / EBITDA 1.0x 0.7x 0.8x 0.8x
1 Includes short-term and long-term debt2 Free Cash Flow defined as net cash from operating activities less capital expenditures* Includes Cash Dividend of US$0.19 per share of common stock and Stock Dividend of 0.0107 shares of common stock per share of common stock paid on February 28, 2012 plus US$0.53 per share of common stock paid on May 24, 2012 plus US$0.24 per share of common stock paid on August 28, 2012.
26%
36%
39%
40%
40%
47%
51%
58%
Xstrata
Anglo
Freeport
Vale
Rio Tinto
BHP
SCC
Antofagasta
1
2
1
2
2
1
1
2
Top Tier Margins and Conservative Leverage for Increased Financial Flexibility
2012 Total Debt / EBITDA (x) 2012 EBITDA Margin (%)
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Source: Company Reports 1 9M 2012 2 1H 2012
No Amortizations Until 2015
Source: Company Reports 1 9M 2012 2 1H 2012
Solid Financial Performance
$1,100
$1,000
$51
$400
$200
$10
$10
2040
2035
2028
2020
2015
2013
2012
1.65
1.59
1.39
1.05
0.80
0.67
0.50
0.42
Xstrata
Vale
Anglo
Rio Tinto
SCC
Antofagasta
Freeport
BHP
1
1
2
2
2
1
2
1
1,000
1,900 2,100
1,300
600
-
250
500
750
1,000
1,250
1,500
1,750
2,000
2,250
2012 2013 2014 2015 2016
640 660770
1,000 1,100
0
200
400
600
800
1000
1200
2012 2013 2014 2015 2016 15 Source: SCC
Tía María SX/EW 1H15 - $1.0B 120K Tons Cu
Toquepala Concentrator Exp. 1Q14 - $850M - 100K Tons Cu , 3.1K Tons Mo
2013 - 2014 2015 2015-17 2018 and on Buenavista Molybdenum Plant 1Q13 - $38M - 2K Tons Mo
Pilares Mine – Cu 2H14 - $189.5M 40K Tons Cu
Buenavista – Cu Concentrator 1H15 - $1.4B - 188K Tons Cu, 2.6K Tons Mo
Cuajone Concentrator Exp. - $500M - 50K Tons Cu , 0.7K Tons Mo Los Chancas $1,1 B – 100K Cu tons and 7.5K tons Mo Empalme Cu Smelter 1H17–$812M 350K Tons Cu contained Cu Refinery 1H17- $318M 350Kt cont.
Los Chalchihuites 2H15 - $140M 26Kt Cu
Buenavista Zinc Mine and Conc. 2H15 - $332M 16Kt Cu - 55Kt Zn
Investment Program to Significantly Increase Production
Board approved Other projects
Buenavista SX/EW III 1H14 - $444M 120K Tons Cu
Cuajone: Variable Cut-off Grade + HPGR 3Q13 - $120.7M - 22K Tons Cu, 0.7K Tons Mo
El Arco 2H17 -$2.6B - 190K Tons Cu and 105K Oz Au
2012-2016 Capex Program Overview (MM) 2012-2016 Copper Production Forecast (‘000 MT Cu)
Angangueo – 1H15 - $131M - 10.4K Tons Cu, 9.7K Tons Zn, 3.9K Tons Pb
$2,529
$1,814
$2,865
$3,910
$2,562
52.1% 48.6% 56.0% 57.0%
51.0%
2008 2009 2010 2011 9M 2012
SCC is the Premier Copper Play • World class assets in investment grade countries • #1 in reserves of any listed company with various exploration prospects
- Increasing copper production • Capacity to deliver projects through flexible capital structure and significant cash
generation capability
• Fully integrated low cost operations - Strategic investments focused on cost competitiveness
• Outstanding dividend history
• Experienced management with proven track record
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(in US$ millions) SCC EBITDA and % Margin
SCC’s Major Strengths
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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 estimates are
subject to risk and uncertainties that could cause actual results to differ materially from the
expressed in the forward-looking statements. Many of these risks and uncertainties relate to
factors that are beyond Grupo Mexico’s ability to control or estimate precisely, such as future
market conditions, commodity prices, the behavior of other market participants and the actions of
governmental regulators. Readers are cautioned not to place undue reliance on these forward-
looking statements, which speak only as of the date of this presentation. Grupo Mexico does not
undertake any obligation to publicly release any revision to these forward-looking estimates to
reflect events or circumstances after the date of this presentation.
Safe Harbor Statement