Freeport-McMoRan Copper & Gold (FCX)
Q3 2009 Earnings Call Transcript
October 21, 2009 10:00 a.m. ET
Executives
Kathleen Quirk - Executive Vice President and Chief Financial Officer
Richard Adkerson - President and Chief Executive Officer
Mark Johnson - Sr. Vice President and Chief Operating Officer
Jim Bob Moffett - Chairman of the Board
Red Conger - President of Freeport-McMoRan Americas
Analysts
David Gagliano - Credit Suisse
Michael Gambardella - JPMorgan
Sal Tharani - Goldman Sachs
Tony Rizzuto - Dahlman Rose
Mark Liinamaa - Morgan Stanley
David Lipschitz - CLSA
Tony Chan - Merrill Lynch
Brian MacArthur - UBS Securities
Jorge Beristain - Deutsche Bank
Charles Bradford - Affiliated Research
John Tumazos - John Tumazos Very Independent Research
Thomas Edward - Stifel Nicolaus
Dave Katz - JPMorgan
Brett Levy - Jefferies & Company
Blaine Ladette - Jordan Securities
Ben Elias - Sterne, Agee
Presentation
Operator
Welcome to the Freeport-McMoRan Copper & Gold third quarter earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. If you wish to ask a question during the Q&A session, press star one on your touchtone phone, if you require assistance during the conference, please press star zero. I would now like to turn the conference over to Ms. Kathleen Quirk Executive Vice President and Chief Financial Officer. Please go ahead, ma''am.
Kathleen Quirk
Thank you and good morning, everyone. Welcome to the Freeport-McMoRan Copper & Gold third quarter 2009 earnings conference call. Our earnings announcement was released earlier this morning and a copy of the Press Release is available on our web site at fcx.com.
Our conference call today is being broadcast live on the internet and anyone may listen to the call by accessing the web cast link on the internet home page. We have several slides to supplement our comment this is morning. We will be referring to the slides during the call. They''re also accessible using the web cast link on our fcx.com web site home page.
In addition to analysts and investors the financial press is also invited to listen to today''s call and a replay of the call will be available by accessing the web cast link on our home page later today.
Before we begin today''s comments, I would like to remind everyone that today''s press release and certain of our comments on the call include forward-looking statements. Please refer to the cautionary language included in our press release, the slide presentation, and to the risk factors described in our SEC filings.
On the call today are Jim Bob Moffett, Chairman of the Board, Richard Adkerson, President and Chief Executive Officer. We also have Red Conger with us today as well as Mark Johnson and Dave Thornton. I will start by briefly summarizing our financial results and then turn the call over to Richard, who will be referring to the slide presentation materials and after that, we will open the call for the questions.
Today, FCX reported third quarter 2009 net income attributable to common stock of $925 million, $2.07 per share, compared with $523 million or $1.31 per share for the third quarter of 2008. For the nine months period ended September 30th, 2009, FCX reported net income of $1.6 billion, $3.70 per share, compared with $2.6 billion or $6.20 per share for the nine months, 2008 period.
Our third quarter copper sales totaled 1 billion pounds. That was similar to last year''s third quarter, but higher than our July 2009 estimate of 910 million pounds, as we had access to the high-grade section of Grasberg during the period. Our gold sales were of 706,000 ounces or significantly higher than last year''s third quarter of 307,000 ounces, and our July 2009 estimate of 550,000 ounces reflected accelerated mining of a high-grade section at Grasberg.
Our molybdenum sales during the quarter of 16 million pounds were lower than last year''s level of 19 million pounds, but slightly better than our July 2000 estimate of 15 million pounds. Our recorded copper prices for the quarter averaged $2.75 per pound that was lower than last year''s third quarter, which averaged $3.14 per pound.
Our gold prices averaged $987 per ounce during the third quarter of 2009 and that''s compared with $869 per ounce in the year ago period. Our molybdenum realizations were 1395 per pound. That was about 57% lower than last year''s $32 per pound level in third quarter of 2008.
As you will see from the press release our results reflect strong performance at all of our operation and continued successful execution of our plans which we will talk more about in the slides.
Consolidated unit net cash costs, which exclude our Tenke Fungurume operations which are currently in start-up average $0.50 per pound to the third quarter of 2009, substantially lower than last year''s level of $1.29 per pound. Strong cash flows were generated in the third quarter totaling $2 billion. That brought the year-to-date number to $2.9 billion.
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