DESCRIPTION OF THE BUSINESS:	6 Months Ended
Jun. 30, 2020
DESCRIPTION OF THE BUSINESS:
DESCRIPTION OF THE BUSINESS:	Southern Copper Corporation NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) NOTE 1— DESCRIPTION OF THE BUSINESS: The Company is a majority-owned, indirect subsidiary of Grupo Mexico S.A.B. de C.V. (“Grupo Mexico”). As of June 30, 2020, Grupo Mexico, through its wholly-owned subsidiary Americas Mining Corporation (“AMC”) owned 88.9% of the Company’s capital stock. The condensed consolidated financial statements presented herein consist of the accounts of Southern Copper Corporation (“Southern Copper”, "SCC" or the “Company”), a Delaware corporation, and its subsidiaries. The Company is an integrated producer of copper and other minerals, and operates mining, smelting and refining facilities in Peru and Mexico. The Company conducts its primary operations in Peru through a registered branch (the "Peruvian Branch" or “Branch” or “SPCC Peru Branch”). The Peruvian Branch is not a corporation separate from the Company. The Company's Mexican operations are conducted through subsidiaries. The Company also conducts exploration activities in Argentina, Chile, Ecuador, Mexico and Peru. In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary to fairly state the Company’s financial position as of June 30, 2020 and the results of operations, comprehensive income, cash flows and changes in equity for the three and six months ended June 30, 2020 and 2019. The results of operations for the six months ended June 30, 2020 are not necessarily indicative of the results to be expected for the full year. The December 31, 2019 balance sheet data was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements at December 31, 2019 and notes included in the Company’s 2019 annual report on Form 10-K. COVID – 19 PANDEMIC Since the World Health Organization (“WHO”) declared the COVID-19 virus outbreak as a global pandemic, all the countries where the Company operates and conducts exploration activities, as well as the countries where its main customers and suppliers are located, have published health and safety rules and restrictions on individuals and business activities. As of June 30, 2020, the Company‘s production facilities in Mexico and Peru were working at approximately 96% of their production capacity. The Company has developed a rigorous COVID-19 emergency protocol and the workforce are gradually returning to operations. At June 30, 2020, approximately 83% of the workforce in Mexico, was working on site or at home under strict safety measures; the remaining 17% of the workforce were not working, including all individuals at high risk due to age and/or prior medical conditions. At our Peruvian operations, approximately 64.0% of the workforce were working on site or at home under strict safety measures, while the remaining 36.0% were not working, including all individuals at high risk due to age and/or prior medical conditions. This headcount includes the Company´s personnel and contractors. Through June 30, 2020, SCC incurred approximately $10.5 million in COVID-19 related production costs that include protection equipment and labor costs. These costs have been expensed to cost of sales in the Company´s condensed consolidated statement of earnings. The Company’s exploration activities in Argentina and Chile have been reduced and their drilling teams are on stand-by. Meanwhile, in Ecuador, we resumed exploration activities at the end of the second quarter of 2020. The financial reporting process and the information required to prepare the Company’s financial statements suffered no interruption and the financial statements were prepared without restrictions or difficulties. SCC´s Corporate Crisis Committee as well as its Crisis Committees in Mexico and Peru continued to closely monitor the impact of the pandemic and to analyze and quickly resolve any issues that may arise. As of June 30, 2020, there were no major delays in the supply of materials and services critical for the operations and sales. Also, shipments and collections have registered no known major delays. After completing the first stage of its capital programs at Buenavista in Mexico and Toquepala in Peru, the Company currently does not have major capital expenditures commitments (see Note 10 - Commitments and Contingencies). The Company paid the first tranche of its 2010 bonds of $400 million on April 15, 2020. The Company has no other major debt maturity until 2022. At June 30, 2020 the Company has performed a qualitative analysis and has not identified any indicator of impairment. As the Company reported on its 2019 Annual report on Form 10-K, the results of its impairment sensitivity analysis showed projected discounted cash flows in excess of the carrying amounts of long lived assets by margins ranging from 1.2 to 4.8 times such carrying amount. This analysis included a stress test using a copper price assumption of $2.00 per pound and a molybdenum price assumption of $4.00 per pound. (Please see, Management´s Discussion and Analysis, Critical Policies and Estimates, Asset Impairments on the 2019 Form 10-K).

DESCRIPTION OF THE BUSINESS:

6 Months Ended

Jun. 30, 2020

Southern Copper Corporation

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1— DESCRIPTION OF THE BUSINESS:

The Company is a majority-owned, indirect subsidiary of Grupo Mexico S.A.B. de C.V. (“Grupo Mexico”). As of June 30, 2020, Grupo Mexico, through its wholly-owned subsidiary Americas Mining Corporation (“AMC”) owned 88.9% of the Company’s capital stock. The condensed consolidated financial statements presented herein consist of the accounts of Southern Copper Corporation (“Southern Copper”, "SCC" or the “Company”), a Delaware corporation, and its subsidiaries. The Company is an integrated producer of copper and other minerals, and operates mining, smelting and refining facilities in Peru and Mexico. The Company conducts its primary operations in Peru through a registered branch (the "Peruvian Branch" or “Branch” or “SPCC Peru Branch”). The Peruvian Branch is not a corporation separate from the Company. The Company's Mexican operations are conducted through subsidiaries. The Company also conducts exploration activities in Argentina, Chile, Ecuador, Mexico and Peru.

In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary to fairly state the Company’s financial position as of June 30, 2020 and the results of operations, comprehensive income, cash flows and changes in equity for the three and six months ended June 30, 2020 and 2019. The results of operations for the six months ended June 30, 2020 are not necessarily indicative of the results to be expected for the full year. The December 31, 2019 balance sheet data was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements at December 31, 2019 and notes included in the Company’s 2019 annual report on Form 10-K.

COVID – 19 PANDEMIC

Since the World Health Organization (“WHO”) declared the COVID-19 virus outbreak as a global pandemic, all the countries where the Company operates and conducts exploration activities, as well as the countries where its main customers and suppliers are located, have published health and safety rules and restrictions on individuals and business activities.

As of June 30, 2020, the Company‘s production facilities in Mexico and Peru were working at approximately 96% of their production capacity. The Company has developed a rigorous COVID-19 emergency protocol and the workforce are gradually returning to operations. At June 30, 2020, approximately 83% of the workforce in Mexico, was working on site or at home under strict safety measures; the remaining 17% of the workforce were not working, including all individuals at high risk due to age and/or prior medical conditions. At our Peruvian operations, approximately 64.0% of the workforce were working on site or at home under strict safety measures, while the remaining 36.0% were not working, including all individuals at high risk due to age and/or prior medical conditions. This headcount includes the Company´s personnel and contractors. Through June 30, 2020, SCC incurred approximately $10.5 million in COVID-19 related production costs that include protection equipment and labor costs. These costs have been expensed to cost of sales in the Company´s condensed consolidated statement of earnings.

The Company’s exploration activities in Argentina and Chile have been reduced and their drilling teams are on stand-by. Meanwhile, in Ecuador, we resumed exploration activities at the end of the second quarter of 2020.

The financial reporting process and the information required to prepare the Company’s financial statements suffered no interruption and the financial statements were prepared without restrictions or difficulties.

SCC´s Corporate Crisis Committee as well as its Crisis Committees in Mexico and Peru continued to closely monitor the impact of the pandemic and to analyze and quickly resolve any issues that may arise. As of June 30, 2020, there were no

major delays in the supply of materials and services critical for the operations and sales. Also, shipments and collections have registered no known major delays.

After completing the first stage of its capital programs at Buenavista in Mexico and Toquepala in Peru, the Company currently does not have major capital expenditures commitments (see Note 10 - Commitments and Contingencies). The Company paid the first tranche of its 2010 bonds of $400 million on April 15, 2020. The Company has no other major debt maturity until 2022.

At June 30, 2020 the Company has performed a qualitative analysis and has not identified any indicator of impairment. As the Company reported on its 2019 Annual report on Form 10-K, the results of its impairment sensitivity analysis showed projected discounted cash flows in excess of the carrying amounts of long lived assets by margins ranging from 1.2 to 4.8 times such carrying amount. This analysis included a stress test using a copper price assumption of $2.00 per pound and a molybdenum price assumption of $4.00 per pound. (Please see, Management´s Discussion and Analysis, Critical Policies and Estimates, Asset Impairments on the 2019 Form 10-K).