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On Wednesday, Freeport-McMoran (FCX), the copper and gold mining giant, reported another strong quarter, as the company continues to benefit from the rising prices of metals. The company earned $1.5 billion for the first quarter, or $1.57 per share, up from $897 million, or $1.00 a share in the year ago period. Realized selling prices for copper, gold and molybdenum all increased quarter-over-quarter, and both copper and gold were trading above Freeport's average reported selling price in the spot market yesterday, as well as above the prices Freeport uses to issue guidance.

Thanks to the strong quarter, the board of directors at Freeport-McMoran was able to issue a special dividend of $0.50 per share, in addition to the regular quarterly dividend of $0.25. Based on the number of shares outstanding, management said the special dividend will cost the company approximately $474 million. That figure is slightly less than a third of FCX's net income for the quarter, allowing it to continue to invest in projects and pay down debt, as well as return excess capital to shareholders. The company had announced a similar dividend in December of 2010, when management signaled it was looking for ways to return the excess cash the company was earning. As I discussed when FCX reported 2010 numbers, there is great potential for shareholders from these special, or supplemental dividends.

Assuming metals prices do not collapse, or Freeport-McMoran making a large acquisition, the company should continue to generate much more money than it needs. If the company were to continue to issue supplemental dividends of $0.50 a quarter, in addition to the regular dividend of $0.25 a quarter, investors could collect $3 a share this year in dividend from the company. Based on a closing share price of about $54, that comes out to a 5.5% dividend yield, very high in this low rate environment. Two supplemental $0.50 dividends for the year would still have shares yielding a respectable 3.7%, including the regular dividend.

Managment at FCX has signaled it will continue to make returning capital to shareholders a top priority, and as long as prices for copper, gold and molybdenum continue to move higher, FCX will have plenty of capital to return. Investors looking for both exposure to the upward prices of metals and a strong yield can find both in Freeport-McMoran. Supplemental dividends give this mining giant a hidden yield not shown on dividend screens, and investors holding the shares will likely see the trend continue.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: Special Dividends Continue at Freeport-McMoran