INCOME TAXES: (Tables)

12 Months Ended

Dec. 31, 2020

INCOME TAXES:

Components of the provision for income taxes

(in millions)	2020		2019		2018
U.S. federal and state:
Current	$	—	$	—	$	2.6
Deferred		—		—		(13.0)
Uncertain tax positions		—		(1.3)		—
		—		(1.3)		(10.4)
Foreign (Peru and Mexico):
Current		1,237.9		966.3		1,102.4
Deferred		(63.5)		(30.1)		(38.5)
Uncertain tax positions		—		10.4		—
		1,174.4		946.6		1,063.9
Total provision for income taxes	$	1,174.4	$	945.3	$	1,053.5

Schedule of source of income

(in millions)	2020		2019		2018
Earnings by location:
U.S.	$	(15.3)	$	(1.9)	$	(2.3)
Foreign
Peru		723.9		513.0		441.8
Mexico		2,037.2		1,915.4		2,149.9
		2,761.1		2,428.4		2,591.7
Earnings before taxes on income	$	2,745.8	$	2,426.5	$	2,589.4

Reconciliation of the statutory income tax rate to the effective tax rate

The reconciliation of the statutory income tax rate to the effective tax rate for the three years ended December 31, 2020, is as follows (in percentage points):

	2020		2019		2018
Expected tax at U.S. statutory rate	21.0	%	21.0	%	21.0	%
Foreign tax at other than statutory rate, net of foreign tax credit benefit (1)	13.7		14.0		13.9
Percentage depletion	(2.2)		(2.7)		(2.1)
Other permanent differences	0.1		0.1		0.4
Change in 2017 valuation allowance on U.S. deferred tax assets, foreign tax credits and U.S. tax effect on Peruvian deferred taxes	—		—		7.5
Additional valuation allowance on 2018 U.S. deferred tax assets, foreign tax credits and U.S. tax effect on Peruvian deferred taxes	8.9		10.1		1.0
Decrease in 2017 U.S. deferred tax asset due to tax rate changes	—		—		(0.2)
U.S. one time transition tax on accumulated foreign earnings	—		—		0.4
Increase (decrease) in unrecognized tax benefits for uncertain tax positions	(0.1)		(2.1)		—
Amounts (over) / under provided in prior years	(0.1)		(1.1)		(1.3)
Other	1.5		(0.3)		0.1
Effective income tax rate	42.8	%	39.0	%	40.7	%

(1) Foreign tax at other than statutory rates, net of foreign tax credit benefit, also includes the effects of permanent differences in Peru and Mexico, that are determined at the local statutory rate.

Schedule of deferred tax assets and liabilities

	At December 31,
(in millions)	2020		2019
Assets:
Inventories	$	62.4	$	55.7
Capitalized exploration expenses		13.0		14.0
U.S. foreign tax credit carryforward, net of FIN 48 liability		974.1		731.8
U.S. tax effect of Peruvian deferred tax liability		111.2		131.3
Provisions		169.5		145.0
Mexican tax on consolidated dividends		—		9.0
Deferred workers participation		37.8		24.7
Accrued salaries, wages and vacations		8.5		10.0
Sales price adjustment (PUI)		(5.8)		3.0
Social responsibility expenses		4.3		2.1
Deferred charges		41.8		14.5
Valuation allowance on U.S. deferred tax assets, foreign tax credits and U.S. tax effect on Peruvian deferred		(1,343.2)		(1,097.0)
Other		19.5		9.9
Total deferred tax assets		93.1		54.0
	At December 31,
(in millions)	2020		2019
Liabilities:
Property, plant and equipment		(17.2)		(45.4)
Other		(5.3)		(3.0)
Total deferred tax liabilities		(22.5)		(48.4)
Total net deferred tax (liabilities) / assets	$	70.6	$	5.6

Summary of expiry of foreign tax credits

Year	Amount
2023		39.4
2024		102.0
2025		189.5
2026		107.0
2027		—
2028		159.6
2029		204.9
2030		237.6
Total	$	1,040.0

Schedule of reconciliation of amount of unrecognized tax benefits

The total amount of unrecognized tax benefits in 2020, 2019 and 2018, was as follows (in millions):

	2020		2019		2018
Unrecognized tax benefits, opening balance	$	58.4	$	214.5	$	214.5
Gross increases—tax positions in prior period		—		(7.5)		—
Gross increases—current-period tax positions		7.7		(4.2)		—
Decreases related to settlements with taxing authorities		—		(144.4)		—
		7.7		(156.1)		—
Unrecognized tax benefits, ending balance	$	66.1	$	58.4	$	214.5

Summary of tax years remaining open to examination and adjustment in major tax jurisdictions

Peru:	2014 and all subsequent years
U.S.:	2014 and all subsequent years
Mexico:	2015 and all subsequent years