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Freeport flips to Q3 loss

US copper and gold producer Freeport-McMoRan says September-quarter financial results slipped into the red as copper sales and prices sagged.
Freeport flips to Q3 loss Freeport flips to Q3 loss Freeport flips to Q3 loss Freeport flips to Q3 loss Freeport flips to Q3 loss

Freeport-McMoRan earnings slid into the red on lower copper sales and prices during the September quarter

Staff Reporter

The company reported 14% lower copper production year-on-year at 864 million pounds as the giant Grasberg mine in Indonesia continues to transition to underground, and a disappointing performance at Cerro Verde impacted output.

The Phoenix, Arizona-based company reported a net loss of US$131 million, or 9c per share for the period, after earnings of $556 million, or 38c per share, in the year-earlier period.

Adjusted to exclude $123 million in special items, the company reported a loss of 1c per share, lower than Wall Street analyst forecasts calling for breakeven.

Revenue fell 33% year-on-year to $3.308 billion, which was also below the consensus average of $3.53 billion.

Freeport said copper sales of 795Mlb were 4% below its July forecast, and it tracked 24% below the year-earlier figure. Gold output at 333,000oz was 6% higher than the July estimate but 71% lower year-on-year, mainly owing to the lower milling and ore grades at Grasberg.

Freeport reiterated its full-year guidance for 3.3Blb of copper sales, 874,000oz gold and 92Mlb molybdenum.

"We are effectively executing our plans to establish large-scale production from our significant high-grade, low-cost and -lived underground ore bodies at Grasberg; advance the Lone Star project in Arizona as a new cornerstone asset in the US; and progress our innovation initiatives to enhance productivity and grow our Americas operations with low capital intensity," CEO Richard Adkerson said.

Company shares (NYSE:FCX) closed 2% or 20c higher at $10.13, which gives it a market capitalisation of $10.13 billion.