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Freeport-McMoRan 2Q profit drops, but beats forecast

Freeport-McMoRan Copper & Gold Inc. on July 21 said its second-quarter profit dropped 38 percent, largely because of weak copper sales in North America.

The Phoenix-based company, the world’s largest publicly traded copper company, beat analyst expectations and raised its full-year consolidated sales estimates, boosting shares in premarket trading.

Shares jumped $1.45, or 2.5 percent, to $58.45 before the opening bell on July 21.

Quarterly earnings fell to $588 million, or $1.38 per share, compared with $947 million, or $2.25 per share. Analysts surveyed by Thomson Reuters forecast a profit of 69 cents a share.

Revenue fell 32 percent to $3.68 billion, down from $5.44 billion in the prior-year period. Analysts forecast revenue of $3.4 billion, on average.

Global demand for copper surpassed prior-year levels, strengthened by increased activity in China and other emerging markets. However, the U.S. housing market, which uses copper for wiring and pipes, showed little improvement.

Consolidated copper sales rose to 1.1 billion pounds, compared with 942 million pounds in the prior-year period. Better demand was tempered by a lower average realized price per pound compared with last year. For instance, in North America the average price was $2.18 per pound, down from $3.82 per pound last year.

Freeport-McMoRan raised its estimated 2009 consolidated sales to 3.9 billion pounds of copper, 2.4 million ounces of gold and 56 million pounds of molybdenum, compared with a previous estimate of 3.9 billion pounds of copper, 2.3 million ounces of gold and 50 million pounds of molybdenum.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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