Picture: 123RF/PIOTRKT
Picture: 123RF/PIOTRKT

Bengaluru — Freeport-McMoRan   beat analysts’ estimates for fourth-quarter profit on Thursday, as higher copper output from the Americas cushioned lower production at its Grasberg mine.

Shares were down 5.4% in premarket trading as investors looked past the profit beat to focus on the drop in Indonesia production.

The Grasberg mine in Indonesia is in the final stage of its transition from open-pit to underground operations, and Freeport expects to achieve low-cost, long-life production from the underground ore. Production at the world’s second-biggest copper mine fell 14% in the last three months of 2019.

The world’s largest publicly traded copper producer expects capital expenditure for 2020 to be about $2.8bn, higher than 2019, including $1.8bn for major projects such as Grasberg and completion of the Lone Star copper leach project in Arizona.

Copper production from North America climbed 2.3% to 361-million pounds, while that from South America rose marginally to 320-million pounds. The average price Freeport received for its copper fell marginally to $2.74 per pound.

Net income attributable to shareholders fell to $9m from $485m as the company booked a tax provision of $329m, compared with a benefit of $552m in the year-ago period.

Excluding one-time items, Freeport earned 2c  per share, while analysts had expected break-even, according to IBES data from Refinitiv.