Freeport Q3 results buoyed by higher metal prices despite Indonesia mine halt

Freeport-McMoRan Inc (NYSE:FCX, ETR:FPMB)[1] on Thursday reported stronger-than-expected third-quarter earnings, boosted by higher copper and gold prices, even as production at its Indonesian operations was hit by a tragic mud rush incident. The US miner posted an adjusted profit of £0.50 per share on revenue of £6.97 billion, surpassing Wall Street estimates of £0.42 per share and £6.71 billion in revenue. Net income totaled £674 million.

Copper production fell 13% in the quarter to 912 million pounds from 1.05 billion pounds a year earlier, largely due to a temporary suspension at the Grasberg mine in Indonesia following a mud rush in September that killed seven workers. The incident prompted an investigation and halted operations, with Freeport estimating the suspension led to the loss of 90 million pounds of copper and 80,000 ounces of gold. Despite the production setback, copper and gold sales volumes beat prior guidance, supported by higher realized prices for both metals as well as molybdenum.

EBITDA for the quarter came in at £2.83 billion, above analysts' expectations. Net cash costs were £1.40 per pound, below the consensus of £1.70 per pound. Freeport's shares rose 2.9% in early trading as investors focused on the company's operational resilience and favorable metal prices.

Looking ahead, the company lowered its fourth-quarter and full-year 2025 sales guidance, with minimal expected contribution from Grasberg. Full-year capital expenditure guidance was trimmed to £3.9 billion from £4.3 billion, excluding downstream facilities. Production in 2026 from the Indonesian mine is now expected to be about 35% below prior estimates, with output heavily weighted toward the second half of the year as operations gradually ramp up.

"While the Grasberg incident adds uncertainty, we believe updated guidance is achievable, and production from other blocks could offset losses from the impacted area," analysts at Jefferies said, noting the risk of a semi-permanent overhang on Freeport's equity valuation.

References

^ Freeport-McMoRan Inc (NYSE:FCX, ETR:FPMB) (www.proactiveinvestors.com)