(Correcting reporting period in headline to first quarter from second quarter; the following text is unchanged)
Winter Park, Florida 26/04/2016 - Freeport-McMoRan reported a massive first-quarter loss due to weak copper and oil prices, the US-based miner said on Tuesday.
Its net loss attributable to common stockholders was $4.18 billion or $3.35 per share compared with a loss of $2.47 billion or $2.38 per share a year earlier. Revenue fell 15.1 percent to $3.53 billion.
Consolidated copper sales in the first quarter totalled 1.1 billion pounds, around the January 2016 estimate and higher than first-quarter 2015 sales of 960 million pounds, primarily reflecting higher volumes from the Cerro Verde mine in Peru.
Gold sales of 201,000 ounces were also around the January 2016 estimate but were lower than first-quarter 2015 sales of 263,000 ounces due to lower ore grades and recoveries.
Molybdenum sales of 17 million pounds were lower than the January 2016 estimate of 19 million pounds and first-quarter 2015 sales of 23 million pounds, primarily reflecting lower demand and reduced volumes from the Henderson molybdenum mine in the US.
For the full year, the company expects to sell five billion pounds of copper, 1.85 million ounces of gold and 71 million pounds of molybdenum including 1.15 billion pounds of copper, 195,000 ounces of gold and 19 million pounds of molybdenum in the second quarter.
The latest forecast slightly downgrades Freeport's annual copper sales forecast while increasing the estimate for gold. The previous guidance released in January projected that the company would sell 5.1 billion pounds of copper and 1.8 million ounces of gold this year.
"Our global team is successfully executing our plans, managing production efficiently and reducing costs and capital spending," Richard Adkerson, president and CEO, said
The company has announced divestments totalling $1.4 billion since the start of the year and should report additional cost cutting progress in the second quarter, he added.
During the quarter, Freeport agreed to sell an additional 13 percent of the Morenci mine in Arizona and an interest in the Timok exploration project in Serbia for an aggregate consideration of $1.3 billion.
It also entered into an agreement to sell certain oil and gas royalty interests for $102 million. These transactions are expected to close in the second quarter.
As of March 31, Freeport's consolidated debt totalled $20.8 billion and consolidated cash totalled $331 million. It has $3.0 billion available under its $3.5-billion credit facility.
"We believe the quality and scale of our assets provide opportunities for significant debt reduction while retaining a substantial business with attractive low-cost, long-lived reserves and resources that will enable our shareholders to benefit from improved conditions in the future," Adkerson added.
Freeport's stock price on the NYSE was last at $11.35, down 2.74 percent in premarket trade.
NORTH AMERICA SALES
Freeport's North American consolidated copper sales volumes of 503 million pounds in the first quarter were higher than first-quarter 2015 sales of 472 million pounds, primarily reflecting higher ore grades at Morenci and Safford.
The company operates seven open-pit copper mines in North America - Morenci, Bagdad, Safford, Sierrita and Miami in Arizona and Chino and Tyrone in New Mexico. Last year, Freeport said it would suspend mining operations at the Miami mine and Sierrita mine while reducing output at the Tyrone mine by 50 percent.
North America copper sales, adjusted for the anticipated closing of the Morenci transaction, will be around 1.75 billion pounds for the year compared with 2.0 billion pounds in 2015.
SOUTH AMERICA
South American consolidated copper sales volumes of 323 million pounds in the quarter were higher than first-quarter 2015 sales of 200 million pounds, primarily reflecting higher mining and milling rates at Cerro Verde.
The company operates two copper mines in South America - Cerro Verde in Peru, in which Freeport holds a 53.56-percent interest, and El Abra in Chile, in which it has 51 percent.
Sales from South America mining are expected at around 1.37 billion pounds of copper for the year compared with 871 million pounds in 2015.
INDONESIA SALES
Freeport owns a 90.64-percent share of one of the world's largest copper and gold deposits at the Grasberg minerals district in Papua, Indonesia.
The company's first-quarter sales in Indonesia totalled 174 million pounds, which was higher than first-quarter 2015 sales of 155 million pounds, primarily reflecting higher copper ore grades.
Gold sales of 195,000 ounces were lower than first-quarter 2015 sales of 260,000 ounces, primarily reflecting lower gold ore grades and recoveries.
"During the first quarter, copper production was impacted by reduced mill operating rates associated with unplanned equipment failures. Temporary repairs to the mill were performed and a permanent repair is scheduled in the second quarter" Freeport said.
Equipment failure and repairs will lead to a reduction of 65 million pounds of copper for the year compared with its January estimates, it added.
Sales volumes from Indonesia mining are expected at around 1.4 billion pounds of copper and 1.85 million ounces of gold for the year 2016 compared with 744 million pounds of copper and 1.2 million ounces of gold for 2015.
Elsewhere, it expects African copper sales of around 123 million pounds in first quarter, which was lower than first-quarter sales of 133 million pounds, primarily reflecting lower copper ore grades.
African sales are expected at about 485 million pounds of copper and 35 million pounds of cobalt for the year 2016 compared with 467 million pounds of copper and 35 million pounds of cobalt for 2015.
(Editing by Mark Shaw)