Shares in US copper giant Freeport McMoRan (NYSE:FCX) declined by as much as 2.3% in New York trading on Thursday after the company posted a worse than expected quarterly loss.
The company announced a non-adjusted loss of 3 cents per share, compared with analysts’ estimates for a loss of 2 cents per share, according to Refinitiv data.
The Phoenix, Arizona-based company, is now worth $19.4 billion on the NYSE, flat for the year to date despite a resurgent copper price.
The miner’s quarterly copper production fell 1.2% to 767 million pounds (350,000 tonnes), molybdenum declined to 19 million pounds while its gold output rose 19% to 191,000 ounces.
Consolidated sales for the year 2020 are expected to approximate 3.15 billion pounds of copper (1.43 million tonnes), 0.8 million ounces of gold and 77 million pounds of molybdenum, rising sharply next year as its 49%-owned Grasberg mine in Indonesia expands underground.
Capital expenditures this year are expected to come in around $2 billion, including $1.3 billion for Grasberg and the completion of the Lone Star copper leach project in Arizona, but does not include outlays for its smelter project in Indonesia.
Lone Star in Arizona is substantially complete and on track to produce some 200m pounds copper annually beginning in the second half of 2020
Freeport said Lone Star project, near its Safford mine in the eastern part of the state, is substantially complete and on track to produce some 200 million pounds (90,000 tonnes) of copper annually beginning in the second half of 2020.
In April, Freeport unveiled a $1.3 billion cost-cutting plan, including delays to expansion projects, suspension of operations at its China mine in New Mexico and deep cuts to exploration expenditure.
Exploration spending for the year 2020 is estimated at $30 million, roughly 60% below the total in 2019.
Freeport operates seven open-pit copper mines in North America – Morenci (72%-owned), Bagdad, Safford, Sierrita and Miami in Arizona, and Chino and Tyrone in New Mexico responsible for around half its output.
Freeport also operates the Cerro Verde mine in Peru where it has a 53.6% interest and the 51%-owned El Abra complex in Chile.
Freeport operates the Grasberg copper-gold mine and has an 81% economic interest in the venture through 2022. The government of the Asian nation owns 51% of the iconic mine.
Copper was last trading at $2.93 a pound, not far off two-year highs and up by more than 50% from the covid-19 lows struck in March.