Summary
Freeport-McMoRan Inc. (FCX) reported increased revenues in the second quarter of 2014 compared to the prior year, driven by higher volumes and improved commodity prices, particularly in oil and gas. Net income attributable to common stockholders remained flat year-over-year at $482 million, with diluted earnings per share of $0.46. The company completed the sale of its Eagle Ford shale assets for $3.1 billion and acquired interests in the Deepwater Gulf of Mexico for $919 million, reflecting a strategic shift within its oil and gas segment. Operationally, the company noted the impact of Indonesian export restrictions on its mining segment, leading to deferred production and higher costs. However, a Memorandum of Understanding (MOU) with the Indonesian government in late July 2014 allowed for the resumption of concentrate exports, with ongoing negotiations for an amended Contract of Work. The company's debt remained substantial, but it continued to target significant reductions by the end of 2016 through cash flows and potential asset sales. Management expressed a positive long-term outlook for copper and oil, supported by global demand and supply dynamics.
Financial Highlights
45 data points| Revenue | $5.52B |
| Cost of Revenue | $4.09B |
| Gross Profit | $1.43B |
| SG&A Expenses | $164.00M |
| Operating Expenses | $4.37B |
| Operating Income | $1.15B |
| Net Income | $482.00M |
| EPS (Basic) | $0.46 |
| EPS (Diluted) | $0.46 |
| Shares Outstanding (Basic) | 1.04B |
| Shares Outstanding (Diluted) | 1.04B |
Key Highlights
- 1Revenues increased to $5.52 billion in Q2 2014 from $4.29 billion in Q2 2013, primarily driven by the oil and gas segment and higher copper volumes.
- 2Net income attributable to FCX common stockholders was $482 million for both Q2 2014 and Q2 2013. Diluted EPS was $0.46 for Q2 2014, down from $0.49 in Q2 2013.
- 3Completed the sale of Eagle Ford shale assets for $3.1 billion and acquired Deepwater Gulf of Mexico interests for $919 million, optimizing the oil and gas portfolio.
- 4The Indonesian mining operations faced export restrictions, impacting production rates and leading to deferred volumes, but exports resumed in August following an MOU with the Indonesian government.
- 5Total debt stood at $20.3 billion at June 30, 2014. The company redeemed $1.7 billion of senior notes in July 2014.
- 6The company projected consolidated sales volumes for copper at 4,075 million pounds, gold at 1,340 thousand ounces, molybdenum at 98 million pounds, and oil equivalents at 58.4 MMBOE for the full year 2014.
- 7Unit net cash costs for copper mines averaged $1.72 per pound in Q2 2014, an improvement from $1.85 per pound in Q2 2013.