Freeport-McMoRan surges after slim Q3 beat; copper market 'strikingly tight'

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Freeport-McMoRan (NYSE:FCX) +7.1% in Thursday's trading after Q3 adjusted earnings edged past estimates, even as revenues fell due to lower selling prices for copper and other metals, and the company said the current physical copper market is "strikingly tight."

Q3 net income fell to $404M, or $0.28/share, from $1.4B, or $0.94/share, in the year-earlier quarter, and revenues fell to $5B from $6.08B but topped Wall Street estimates.

Freeport (FCX) said its average realized price for copper was $3.50/lb at the end of Q3, well below last year's $4.20/lb, but Q3 copper production increased 2% Y/Y to 1.06B recoverable lbs from 987M a year ago.

Q3 consolidated gold sales jumped 19% Y/Y to 480K oz, while molybdenum sales slipped 15% to 17M lbs; average realized prices for gold and molybdenum were $1,683/oz and $17.05/lb, respectively.

"Current prices for copper are insufficient to support new mine supply development, which is expected to add to future supply deficits," the company said.

Freeport-McMoRan's (FCX) stock price return shows a 26% YTD loss and a 21% decline during the past year.