Freeport-McMoRan shares rally after profit beats expectations
Reuters
Published Oct 20, 2022 08:14AM ET
Updated Oct 20, 2022 12:16PM ET
(Reuters) - Freeport-McMoRan (NYSE:FCX) Inc reported a sharp drop in third-quarter profit on Thursday due to falling copper prices, although the mining company's shares rose as results beat Wall Street's expectations and executives gave a bullish demand outlook for the red metal used widely across the economy.
Shares of the Phoenix-based company jumped more than 6% in midday trading to $30.25.
LME copper has given up 30% since touching a record peak in March, largely holding in a range between $7,200 and $8,000 since end-August, pressured by COVID-19 flare-ups in China, the world's biggest metal consumer.
Freeport nevertheless forecast rising demand for the red metal due to copper's use in renewable energy products and said none of its customers have scaled back orders.
"We certainly have no problem selling copper," Freeport Chief Executive Richard Adkerson told investors on a conference call. "It's just striking how negative the financial markets are about this industry and yet the physical market is so tight."
Adkerson and Freeport President Kathleen Quirk added, though, that they believe the company is ready for any economic downturn and has deferred major investment decisions "in the current market environment."
The company has seen rising costs for oil, labor and equipment, executives said.
Freeport's net income attributable to common stock fell to $404 million, or 28 cents per share, in the quarter ended Sept. 30, from $1.4 billion, or 94 cents per share, in the year-ago quarter.
By that measure, analysts expected earnings of 26 cents per share, according to IBES data from Refinitiv.
The company, which runs Indonesia's Grasberg, one of the world's largest copper mines, said its quarterly copper production rose 7% to 1.06 billion recoverable pounds.
Freeport said its average realized price for copper dropped 16.7% to $3.50 per pound at the end of the third quarter, compared with last year.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.