UPDATE 1-Southern Copper net income falls 9.5 pct in quarter on higher costs

Tue Jul 29, 2014 5:23pm EDT

(Adds expectation of analysts)

LIMA, July 29 (Reuters) - Southern Copper Corp's net income fell 9.5 percent in the second quarter from the same period a year earlier because of rising costs, the global miner said in a statement on Tuesday.

The company's reported net income of $337.3 million, or 40 cents per share, in the second quarter came in below the analysts' average estimate of $352.1 million, or 42 cents per share, according to Thomson Reuters I/B/E/S.

Earnings before interest, taxes, depreciation and amortization rose by 4.6 percent to $707.6 million in the quarter, the company said.

Southern Copper, controlled by Grupo Mexico, said its sales rose 5.5 percent as output increased by 4.9 percent in the second quarter from the same period in 2013, but the cost of sales rose 2.2 percent.

The company cited higher expenses for fuel, spare parts, tires and other materials.

Southern Copper operates the Buenavista and La Caridad mines in Mexico and the Toquepala and Cuajone mines and Ilo refinery in Peru.

The company said it expects Peru to approve its environmental impact study for its stalled $1.4 billion Tia Maria project in Peru in the third quarter.

The first environmental impact study for the project was rejected during the previous presidential administration amid local protests.

Southern Copper has said it will likely produce some 670,000 tonnes of copper in 2014, up from 637,000 tonnes produced in 2013.

(Reporting by Patricia Velez; Editing by Lisa Shumaker)

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