New York, USA —MININGREVIEW.COM — 22 July 2009 – Freeport-McMoRan Copper & Gold says its second-quarter profit dropped sharply, but that cost-cutting measures and a three-fold increase in gold sales helped the company match Wall Street earnings estimates, driving up its stock.
A statement released here revealed that net earnings were US$588 million (R4.7 billion), or $1.38 per share, compared with US$947 million (R7.5 billion), or $2.25 per share, in the same quarter of 2008. Revenue dropped to US$3.68 billion (R29.4 billion), from US$5.44 billion (R43.5 billion).
Consolidated sales from its mines in the second quarter totaled 1.1 billion pounds of copper, 837 000 ounces of gold and 16 million pounds of molybdenum. That production compared with 942 million pounds of copper, 265 000 ounces of gold and 20 million pounds of molybdenum for the second quarter of 2008.
The company expects third-quarter sales of about 910 million pounds of copper, 550 000 ounces of gold and 15 million pounds of molybdenum. The full-year estimate is for about 3.9 billion pounds of copper, 2.4 million ounces of gold and 56 million pounds of molybdenum.
In April, Freeport had said it expected to sell more gold in the second quarter and to report stronger earnings for the rest of the year as copper prices inched upward.
Chinese purchases of copper are helping drive the metal’s price and Freeport is now mining higher-grade ore at its vast Grasberg gold mine in Indonesia.
During the second quarter, the copper price rose about 22 %, but that is still way off the price of a year earlier. The gold price was virtually unchanged in the second quarter at around $925 per ounce.