Freeport-McMoran (FCX) Misses Q3 EPS by 9c, Revenues Miss

October 23, 2019 8:06 AM EDT

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Freeport-McMoran (NYSE: FCX) reported Q3 EPS of ($0.09), $0.09 worse than the analyst estimate of $0.00. Revenue for the quarter came in at $3.3 billion versus the consensus estimate of $3.55 billion.

  • Net loss attributable to common stock totaled $131 million, $0.09 per share, in third-quarter 2019. After adjusting for net charges of $123 million, $0.08 per share, third-quarter 2019 adjusted net loss attributable to common stock totaled $8 million, $0.01 per share.
  • Consolidated sales totaled 795 million pounds of copper, 243 thousand ounces of gold and 22 million pounds of molybdenum in third-quarter 2019. Consolidated production totaled 864 million pounds of copper and 333 thousand ounces of gold in third-quarter 2019.
  • Full year consolidated sales guidance is similar to prior estimates, with consolidated sales expected to approximate 3.3 billion pounds of copper, 874 thousand ounces of gold and 92 million pounds of molybdenum for the year 2019, including 870 million pounds of copper, 200 thousand ounces of gold and 24 million pounds of molybdenum in fourth-quarter 2019.
  • Average realized prices in third-quarter 2019 were $2.62 per pound for copper, $1,487 per ounce for gold and $12.89 per pound for molybdenum.
  • Average unit net cash costs in third-quarter 2019 were $1.59 per pound of copper and are expected to approximate $1.76 per pound of copper for the year 2019.
  • Operating cash flows totaled $224 million (net of $146 million of working capital uses and timing of other tax payments) in third-quarter 2019 and $1.3 billion (including $135 million of working capital sources and timing of other tax payments) for the first nine months of 2019. Based on current sales volume and cost estimates, and assuming average prices of $2.60 per pound for copper, $1,500 per ounce for gold and $12.00 per pound for molybdenum for fourth-quarter 2019, operating cash flows are expected to approximate $1.6 billion (including $0.2 billion of working capital sources and timing of other tax payments) for the year 2019.
  • Capital expenditures totaled $0.7 billion (including approximately $0.3 billion for major mining projects) in third-quarter 2019 and $1.9 billion (including approximately $1.1 billion for major mining projects) for the first nine months of 2019. Capital expenditures for the year 2019 are expected to approximate $2.6 billion, including $1.6 billion for major mining projects primarily associated with underground development activities in the Grasberg minerals district in Indonesia and development of the Lone Star copper leach project in Arizona.
  • The Grasberg underground and Lone Star copper leach development projects are progressing according to plan.
  • At September 30, 2019, consolidated debt totaled $9.9 billion and consolidated cash totaled $2.2 billion. FCX had no borrowings and $3.5 billion available under its revolving credit facility at September 30, 2019.
  • On September 25, 2019, FCX declared a quarterly cash dividend of $0.05 per share on its common stock, which will be paid on November 1, 2019.

Richard C. Adkerson, President and Chief Executive Officer, said, "Our global team has established strong momentum on our three major initiatives to build value for shareholders. We are effectively executing our plans to establish large-scale production from our significant high-grade, low-cost and long-lived underground ore bodies at Grasberg; advance the Lone Star project in Arizona as a new cornerstone asset in the U.S.; and progress our innovation initiatives to enhance productivity and grow our Americas operations with low capital intensity. These initiatives are expected to significantly enhance our cost position, cash flow and the long-term value of our premier copper portfolio, providing opportunities for increased returns to shareholders. We are pleased with our progress to date and remain focused on successful execution of our plans, which would enable us to increase copper production by 30 percent, gold production by 70 percent, reduce unit net cash costs by 25 percent and more than double operating cash flows in 2021 from 2019 levels.”

For earnings history and earnings-related data on Freeport-McMoran (FCX) click here.



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