QUOTE AND NEWS
TheStreet.com  11 hrs ago  Comment 
NEW YORK (TheStreet) -- Freeport-McMoRan stock is falling by 7.34% to $9.85 in late morning trading on Tuesday, after oil and copper prices declined on weaker Chinese manufacturing data. WTI crude is down 6.48% to $46.01 per barrel, while...
Benzinga  11 hrs ago  Comment 
The share price of Freeport-McMoRan, Inc. (NYSE: FCX) has declined almost 58 percent year-to-date. Citi’s Brian Yu has downgraded the rating on Freeport-McMoRan from Buy to Neutral, while lowering the price target from $20 to $12. The...
Motley Fool  Aug 28  Comment 
Billionaire investor Carl Icahn takes an 8.5% position in miner Freeport-McMoRan. Sound the value alarm!
TheStreet.com  Aug 28  Comment 
NEW YORK (TheStreet) -- Legendary activist investor Carl Icahn announced yesterday that he was taking an 8.5% position in miner Freeport-McMoRan  . I can imagine that traders rushed to their fancy monitors to see what was going on only to be...
Benzinga  Aug 28  Comment 
On CNBC's Fast Money Final Trade, Tim Seymour said that he is watching the rally in commodities. Brian Kelly is watching interest rates. He explained that despite everybody getting exited about growth the yield curve flattened, which suggests...
Benzinga  Aug 27  Comment 
After the close of the market on August 27, 2015, Carl Icahn filed a Schedule 13D regarding the acquisition of interests in Freeport-McMoRan Inc. (NYSE: FCX). FCX maintains an open dialogue with our shareholders and welcomes constructive input...
Wall Street Journal  Aug 27  Comment 
Forbes  Aug 27  Comment 
In early trading on Thursday, shares of Freeport-McMoran Copper & Gold (FCX) topped the list of the day's best performing components of the S&P 500 index, trading up 15.8%.  Year to date, Freeport-McMoran Copper & Gold has lost about 60.7% of its...
TheStreet.com  Aug 27  Comment 
NEW YORK (TheStreet) -- Freeport-McMoRan stock is advancing by 15.66% to $9.16 on heavy trading volume on Thursday morning, after the company decided to lower its operating costs and production as a result of lower copper prices. Copper...




RELATED WIKI ARTICLES
 


Freeport-McMoRan Copper & Gold Inc (NYSE:FCX) is a miner, smelter, and refiner of copper, gold, and molybdenum. Copper production represents over 80% of 2007 revenues, with FCX owning mining and smelting operations in North and South America, Indonesia, and Europe.[1] The company's total proven reserves in its three primary outputs range from 17 to 28 times 2007 output, with over a billion dollars already invested in developing what are estimated to be the largest undeveloped copper and molybdenum reserves in the world.[2]Prices for all three key outputs in the commodities markets have been at historically high levels since approximately 2004, leading to increased revenues for the company. Further increases in spot prices would lead to more positive financial effects, while any kind of downward corrections would lead to fairly elastic decreases in operating income. The no value-added products the company sells leaves it intimately vulnerable to commodity price fluctuations.

In March 2007, FCX acquired former American rival Phelps-Dodge, greatly expanding its copper output and reserves and entering the molybdenum market. Combined with existing mining holdings in Indonesia, Freeport-McMoRan is one of the world's largest mining companies.[3]

Corporate Overview

Freeport-McMoRan itself is a holding company, operating through three main subsidiaries: Phelps-Dodge, PT-Freeport Indonesia, and Atlantic Copper. Its operating segments are involved with mining, smelting, and refining copper, gold, and molybdenum.[4] Each subsidiary is either fully or majority-owned by FCX.

  • Phelps-Dodge, a former rival purchased by Freeport-McMoRan for $25.9 billion in March 2007,[5] is responsible for the company's North and South American mining operations. Previously one of the largest copper miners and suppliers in the Americas, Phelps-Dodge continues to operate fully integrated mining, smelting, and refining outfits.[6]
  • PT-Freeport Indonesia is responsible for FCX's Indonesian mining and controls the Grasberg mining operation, which contains the world's largest known reserve of gold and one of the largest copper reserves.[7] FCX effectively owns and controls over 90% of PT-Freeport, and the rest is owned by the Indonesian government. Since 1996, FCX has had a joint venture agreement with competitor Rio Tinto (RTP); under this agreement, Rio Tinto will gain a 40% total interest in the Grasberg operations after 2021, though it will also share a proportional amount of administrative and operating costs.[8]
  • Atlantic Copper is Freeport-McMoRan's wholly-owned copper smelting operation based in Spain. In both absolute and relative terms, this is by far the smallest of FCX's subsidiaries, with relatively negligible impacts on both total revenue and net income.[9]
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    Chart detailing the geographical distribution and crucial asset ownership stakes of FCX's main operating segments[10]

Business Segments

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2007 mining revenue by commodity[11]

Copper (82% of 2007 Mining Revenues)

Over 3/4s of FCX's revenues come from the sale of refined copper, of which over 75% is bought by third-parties for use in construction or the manufacture of electrical appliances and industrial machinery.[12] Worldwide copper consumption has been growing at an annualized rate of approximately 3.1% since 1990, representing a strong increase in demand for FCX's core product over the past two decades.[13] As of the end of fiscal year 2007, Freeport-McMoRan's total proven reserves of copper amounted to over 24 times 2007’s output.[14]

Molybdenum (12% of 2007 Mining Revenues)

Molybdenum, with useful applications in steel alloy production, is almost wholly mined by FCX's American operations.[15] As of the end of fiscal year 2007, Freeport-McMoRan's total proven reserves of molybdenum came to over 28 times 2007 output.[16]

Gold (6% of 2007 Mining Revenues)

Gold, which is used in jewelry and certain sensitive electronics, is mined primarily in Indonesia by PT-Freeport.[17] As of the end of fiscal year 2007, Freeport-McMoRan's total proven reserves of gold added up to over 17 times 2007's output.[18]

Business Financials

Key Financial Metrics and Trends (in millions$)[19][20]
Metric 2005 2006 2007
Total Revenue 4,179 5,791 16,939
Operating Income (Loss) 2,177 2,869 6,555
Net Income (Loss) 995 1,457 2,977
Diluted Earnings (Loss) Per Common Share ($) 4.67 6.63 7.50
Long-Term Debt 1,188 661 7,180
Total Shareholders' Equity 1,842 2,445 18,234
Operating Margin (%) 52.1 49.5 38.7
Net Profit Margin (%) 22.4 24.1 16.3
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FCX's revenue, operating income, and net income, FY2005-FY2007[21][22]

The March 2007 acquisition of rival North American miner Phelps-Dodge was the key factor driving the noticeable jumps in FCX's revenue, shareholders' equity, and long-term debt between fiscal years 2006 and 2007.


References

  1. FCX 2007 Form 10-K, Item 1, 'Business'
  2. FCX 2007 Form 10-K, Item 7, 'Management's Discussion and Analysis'
  3. FCX 2007 Form 10-K, Item 1, 'Business'
  4. FCX 2007 Form 10-K, Item 1, 'Business'
  5. FCX 2007 Form 10-K, Item 1, 'Business'
  6. PD 2006 Form 10-K, Item 1, 'Business'
  7. 'Grasberg MineSite,' Global Infomine
  8. FCX 2007 Form 10-K, Item 1, 'Business'
  9. FCX 2007 Form 10-K, Item 7, 'Management's Discussion and Analysis'
  10. Freeport-McMoRan Company Profile - Organizational Structure
  11. FCX 2007 Form 10-K, Item 1, 'Business'
  12. FCX 2007 Form 10-K, Item 1, 'Business'
  13. FCX 2007 Form 10-K, Item 1, 'Business'
  14. FCX 2007 Form 10-K, Item 1, 'Business'
  15. FCX 2007 Form 10-K, Item 1, 'Business'
  16. FCX 2007 Form 10-K, Item 1, 'Business'
  17. FCX 2007 Form 10-K, Item 7, 'Management's Discussion and Analysis'
  18. FCX 2007 Form 10-K, Item 1, 'Business'
  19. FCX 2007 Form 10-K, Item 8, 'Financial Statements and Supplementary Data'
  20. FCX 2006 Form 10-K, Item 8, 'Financial Statements and Supplementary Data'
  21. FCX 2007 Form 10-K, Item 8, 'Financial Statements and Supplementary Data'
  22. FCX 2006 Form 10-K, Item 8, 'Financial Statements and Supplementary Data'
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