Grupo México reported a net income of USD 1.07 billion for 2008, down by 34% YoY as against USD 1.6 billion reported for 2007. During the fourth quarter of 2008, it lost USD 175.2 million in net income, down by 203% YoY, which recorded a net profit of USD 169.5 million.
Grupo said that "We expect 2009 to be a difficult year for metals due to the fall in industrial production internationally and the difficulties in high consumption industries. However, we remain optimistic that demand will recover before year end, supported by aggressive economic stimuli and infrastructure programs in the US and China, as is the case in the majority of countries."
The company also announced that it would cut its previously announced USD 1.3 billion CAPEX by 61% to USD 515 million this year.
Grupo subsidiary Southern Copper Company announced that "Given the sharp drop in metals prices and economic deceleration, SCC is canceling the majority of its investment projects to reevaluate their viability and also to obtain prices from our supplies and engineering firms that reflect the current economic reality."
Meanwhile, subsidiary Minéra Mexico Cananea announced that "given the drastic fall in copper prices and high extraction costs under which we have been operating the mine at Cananea, the company considers it's appropriate to save its reserves for better times when the company has legal and labor certainty that will ensure an efficient operation."
After two proposed Asarco reorganization plans presented by Grupo México were rejected by Asarco's independent board, Grupo said that it is studying and evaluating taking proper legal action to recover assets lost from Asarco due to the negligence of its independent board.
During 2008, Grupo México reported copper production of 488,929 tonnes, down by 17% YoY. Molybdenum production increased by 1.1% YoY to 16,390 tonnes in 2008, while zinc production declined by 11.6% YoY to 106,920 tonnes. Silver production declined by 19.1% YoY to 383,058 kilogram, while gold production dropped by 33.9% YoY to 465 kilogram.
(Sourced from www.mineweb.com)
