Ero Copper Corp's (NYSE: ERO) stock surged 5.09% on November 7, 2024, following the release of its third-quarter earnings report, which showcased robust operational and financial performance. The company's strong production gains, coupled with lower costs and solid financial metrics, drove investor enthusiasm and contributed to the stock's rally.

One of the key highlights was the 11.9% increase in copper production at the Kariba mine, reaching 9,920 tons of copper in concentrate. This impressive production growth was fueled by higher mine grades. Furthermore, Ero Copper reported a significant decrease in C1 cash costs, which fell by 24.5% to $1.63 per pound of copper produced. This cost reduction was supported by favorable treatment and refining terms, as well as a favorable exchange rate.

The company's financial performance remained robust, with quarterly operating cash flows of $52.7 million and an adjusted EBITDA of $62.2 million. Additionally, Ero Copper maintained a strong liquidity position, with total balance sheet liquidity amounting to $125.2 million at the end of the quarter. These positive financial metrics underscored the company's operational efficiency and financial discipline.

However, the company did face operational challenges at both the Kariba and Tucuman operations, which impacted production rates and necessitated revisions to the full-year production guidance. Underground development rates at Kariba did not advance as anticipated due to underperformance by a third-party contractor, leading to the engagement of a second contractor. Similarly, voltage fluctuations on the regional power grid affected the ramp-up of the Tucuman operation, causing intermittent power disruptions and delaying commercial production.

Despite these challenges, Ero Copper's strong production gains, lower costs, and robust financial performance outweighed the operational setbacks, driving investor confidence and contributing to the stock's surge on November 7, 2024.