Freeport-mcmoran, Inc. · NYSE:FCX
Freeport-mcmoran — Q1 2021 Earnings Presentation
37 slides from Freeport-mcmoran's earnings presentation, Apr 22, 2021
Slide 1: FCX Conference Call 1st Quarter 2021 Results
Click to edit Master title style FCX Conference Call 1st Quarter 2021 Results April 22, 2021 fcx.com
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Click to edit Master title style Regarding Forward-Looking Statements This presentation contains forward-looking statements in which FCX discusses its potential future performance. Forward-looking statements are all statements other than statements of historical facts, such as p
Slide 3: 2020 Annual Reports
2020 Annual Reports Our 2020 Annual Report highlights the momentum Freeport achieved through resiliency, strong operating performance and project execution during 2020 to establish a solid foundation for future growth. Our 2020 Sustainability Report marks Freeport’s 20th year of reporting on its sus
Slide 4: 1Q21 Highlights
1Q21 Highlights Click to edit Master title style Key Stats Actual Solid execution of operating plans Copper Sales (mm lbs) 825 Production volumes and costs in line with targets Copper Realization ($/lb) $3.94 Gold Sales (k ozs) 258 Ramp-up of Grasberg underground mines advancing Unit Net Cash
Slide 5: Copper – Metal of the Future, Critical to Global Decarbonization
Copper – Metal Click to of the title edit Master Futurestyle Critical to Global Decarbonization Intensity of Use is Increasing with Decarbonization More than 70% of the Electric vehicles use Renewable energy Copper consumption world’s copper is used up to four times more technologies use four to ass
Slide 6: Compelling Investment Case for Copper & Freeport
Compelling Investment Click to edit Case Master title style For Copper & Freeport Rising Supply Structural Deficits/ Demand Scarcity Premium Value Global Growth Permitting Responsible Producer of Scale Accelerating Geology Strong Current Cash Flows New Demand Drivers Longer Lead Times
Slide 7: Growing Margins & Cash Flow
Growing Click toMargins & Cash edit Master titleFlow style Annual EBITDA Estimates (1) ($ in billions) Volume Growth 2021e v. 2020 2022e v 2021e ~$17 Copper ~20% ~15% Gold ~55% ~20% ~$12.5 Attractive Cost Structure Expanding Margins Laser Focused on Execution Additional Embedded Growth Opt
Slide 8: Financial Policy
Financial Click toPolicy edit Master title style Policy aligned with strategic objectives of maintaining a strong balance sheet, increasing cash returns to shareholders and advancing opportunities for future growth Organic Balance Growth Sheet Strength In February 2021, Board reinstated annual b
Slide 9: Future Growth Embedded in Existing Asset Base
Future ClickGrowth to editEmbedded in Existing Master title style Asset Base Provides Increased Leverage to Higher Copper Prices Lone Star El Abra Atlantic Copper Grasberg Minerals District Grasberg Kucing Liar NORTH AMERICA SOUTH AMERICA INDONESIA Bagdad Expansion El Abra Mill Project - Chile
Slide 10: Long-Lived Reserve Base
Long-Lived Reserve Click to edit MasterBase title style 30+ Year Implied Reserve Life for Copper, Excluding Mineralized Material Copper Reserves (1) By Region Consolidated Reserves (1) Mineralized Material (2) As of 12/31/2020 (recoverable) (contained) Copper (bn lbs) 113 120 Indonesia South 29% Gol
Slide 11: "Charging Ahead"
“Charging Ahead” Responsibly. Reliably. Relentlessly. Global Industry Leader Block Cave Leader One of the world’s largest publicly traded Industry leading technical capabilities; copper producers; Seasoned and value- Decades of block caving experience driven global team; 30+ year reserve life with s
Slide 12: TEAM "Charging Ahead" As One Freeport
“Charging Ahead” As One Freeport TEAM 12
Slide 13: Financial Review & Outlook
Click to edit Master title style Financial Review & Outlook
Slide 14: 1Q 2021 Operations Update
1QClick 2021 to Operations Update edit Master title style Continue to Focus on Strong Execution NORTH AMERICA SOUTH AMERICA INDONESIA Cu Sales: 308 mm lbs Cu Sales: 259 mm lbs Cu Sales: 258 mm lbs Au Sales: 256 k ozs Lone Star - Arizona Cerro Verde - Peru Grasberg Underground ➢ Successfully co
Slide 15: Indonesian Smelter Update
Indonesian Smelter Click to edit Update Master title style PT-FI committed in 2018 IUPK to construct 2 mm tpy in-country processing facility of Cu concentrate by December 2023 ➢ Project has been delayed by COVID-19 Advancing commercial and financial arrangements for 30% expansion of existing sme
Slide 16: Annual Sales Profile
Annual Sales Click to editProfile Master title style April 2021 Estimate Copper Sales(1) (billion lbs) Gold Sales(2) (million ozs) 5 2 1.8 1.6 4.4 4.4 1.3 4 3.85 1 0.9 3.2 3 0 2020 2021e 2022e 2023e 2 Molybdenum Sales (million lbs) 100 85 1 80 80 80 75 50 0 2020 2021e 2022e 2023e 25 (1) Consolidated
Slide 17: Reconciliation of 2021e Unit Net Cash Cost Guidance
Reconciliation of 2021e Unit Net Cash Cost Guidance ($ and ¢ per pound of copper) January 2021 Impact of April 2021 Guidance Updated Assumptions Guidance Price Assumptions Price Assumptions $3.50 Cu / $1,850 Au / $9 Mo $4.00 Cu / $1,750 Au / $11 Mo Energy Freight Other* Site Production & Delivery $1
Slide 18: Cash Flow and EBITDA at Various Copper Prices
EBITDA Clickand CashMaster to edit Flow at title Various Copper Prices style ($ in bns except copper, gold and molybdenum prices) Sensitivities Average ’22e/’23e EBITDA l ($1,750/oz gold, $11/lb molybdenum) (US$ in mms) $20 EBITDA $15 Copper +/-$0.10/lb $435 Molybdenum +/-$1.00/lb $ 80 (1) $10 Gold
Slide 19: Consolidated Capital Expenditures
Consolidated Click to editCapital Master Expenditures title style (1) Estimates Excluding Potential Indonesian Smelter CAPEX ($ in bns) $ Net of Scheduled Contributions $2.3 $2.2 $2.0 $2.1 (2) $2.0(2) $1.8(2) Major Projects $1.0(3) $1.2 (3) $1.4(3) Other $0.8 $0.9 $1.2 2020 2021e 2022e (1) See slide
Slide 20: Strong Financial Performance
Strong Financial Performance Driven by Growing Volumes and Pricing Financial Policy Provides Framework for Cash Returns to Shareholders, Investments & Balance Sheet Management $ Consolidated Cash (US$ bns) $4.6 $3.7 $2.4 $1.5 2Q20 3Q20 4Q20 1Q21 Copper Realizations ($/lb) $ 2.55 $3.01 $3.40 $3.94 Se
Slide 21: World's Premier Publicly Traded Copper Producer
World’s Premier Publicly Traded Copper Producer Portfolio of High-Quality Experienced Management Team Copper / Gold Assets with Embedded Growth Options Industry Leader Difficult to Replicate with Size, Scale and Durability Strong Track Record Copper Supported by Positive and Commitment to Communitie
Slide 22: Reference Slides
Click to edit Master title style Reference Slides
Slide 23: Our COVID-19 Response
Our COVID-19 Click Response to edit Master title style Prioritizing the Health & Supporting Serving Well-Being of Our Our Communities Our Customers Workforce Active and preventive Providing monetary and As a leading supplier management, through in-kind contributions of of copper to the global the im
Slide 24: Responsible Value Chains
Responsible Click to editValue Chains Master title style Dedicated to Delivering Responsibly Produced Copper to Markets Around the World Focused on advancing responsibility in our value chains by: 1) managing risks in our own supply chain; The Copper Mark is a new assurance framework 2) managing r
Slide 25: Financial Highlights
Financial Click toHighlights edit Master title style Sales Data 1Q21 1Q20 Copper Consolidated Volumes (mm lbs) 825 729 Average Realization (per lb) $ 3.94 $ 2.43 Site Production & Delivery Costs (per lb) $ 1.86 $ 2.19 Unit Net Cash Costs (per lb) $ 1.39 $ 1.90 Gold Consolidated Volumes (000’s ozs) 2
Slide 26: 1Q21 Mining Operating Summary
1Q21 Mining Click to editOperating Summary Master title style Sales From Mines for 1Q21 & 1Q20 by Region North America South America (2) Indonesia (3) 355 308 259 247 258 256 (1) (1) 21 21 127 139 Cu Mo Au mm lbs mm lbs 000 ozs 1Q21 1Q20 1Q21 1Q20 1Q21 1Q20 1Q21 1Q20 1Q21 1Q20 North South 1Q21 Unit
Slide 27: 2021e Operational Data
2021e ClickOperational Data to edit Master title style 2021e Sales by Region North America South America Indonesia 1,465 1,340 1,045 85 (1) 1.3 (2) Cu Mo Au mm lbs mm lbs mm ozs North South 2021e Unit Net Cash Costs (3) (per lb of Cu) America America Indonesia Consolidated Site Production & Delivery
Slide 28: 2021e Outlook
2021e ClickOutlook to edit Master title style Sales Unit Net Cash Operating Capital Outlook Cost of Copper Cash Flows (2) Expenditures Copper: 3.85 billion lbs Site prod. & delivery ~$6.5 billion @ $2.3 billion (3) ➢ 2021e: $1.83/lb $4.00/lb copper for Gold: 1.3 million ozs ➢ $1.4 billion
Slide 29: 2021e Quarterly Sales
2021e ClickQuarterly Sales title style to edit Master Copper Sales (million lbs) Gold Sales (thousand ozs) 1,200 500 360 380 400 330 1,045 1,005 300 258 1,000 975 200 825 100 800 0 1Q21 2Q21e 3Q21e 4Q21e Note: Consolidated gold sales include 48k ozs in 1Q21, 62k ozs 600 in 2Q21e, 67k ozs in 3Q21e an
Slide 30: Grasberg - World Class Block Cave Design
Grasberg Click to- edit World Classtitle Master Block Cave Design style Substantial Infrastructure in Place to Support Large-Scale Production Grasberg Block Cave DMLZ Plan View Ramp-up Schedule Plan View 100 meters Ramp-up Schedule (2) 100 meters (000’s t/d of Ore) (000’s t/d of Ore) 127 129 130 N 7
Slide 31: Project Update: Grasberg Transition Remains on Track
Project Click Update to edit Master title style Grasberg Transition Remains on Track Drawbelling Ore Extraction (000 t/d) Deep MLZ (DMLZ) DMLZ GBC 41 41 DMLZ & Grasberg Block 40 40 34 31 60 47 52 30 Forecast 30 27 39 Cave (GBC) 20 20 24 40 15 10 12 11 11 10 averaged 98,500 t/d 10 4 9 10 20 7 15 0 0
Slide 32: Grasberg Underground Ramp-up Accelerating
Click to Grasberg edit MasterRamp-up Underground title style Accelerating 2021e-2023e Annual Average as % of Targeted Average 2021e-2023e 100% 1.55 bn lbs Cu & 1.6 mm ozs Au Quarterly Production Annualized 75% Reached 75% in 1Q21 50% 25% 0% 4Q19 4Q20 4Q21e 2022e Note: Includes production from Grasbe
Slide 33: PT-FI Mine Plan
PT-FI Mine Click PlanMaster title style to edit Metal Sales, 2020 – 2025e Copper 2021e – 2025e Gold 2021e – 2025e Total: 7.7 billion lbs copper Total: 8.0 million ozs gold Annual Average: 1.55 billion lbs Annual Average: 1.6 million ozs 1.8 1.7 1.7 1.6 1.6 1.6 1.6 1.5 1.34 1.3 0.8 0.84 Cu Au bn mm l
Slide 34: FCX Debt Maturities as of 3/31/21
FCX Debt Click to Maturities edit Masterastitle of 3/31/21 style (US$ bns) $8 Total Debt & Cash at 3/31/21 FCX Revolver $ - $6.9 Senior Notes 9.1 Cerro Verde Term Loan 0.5 $6 Other 0.2 Total Debt $ 9.8 Consolidated Cash $ 4.6 Undrawn Credit Facility 3.5 Total Liquidity $ 8.1 $4 5.00%, 4.125%, 4.375%
Slide 35: 1Q21 Copper Realization & 2Q21e Guidance
1Q21 Copper Click Realization to edit & 2Q21e Master title style Guidance 1Q21 LME Average $3.86/lb Copper Price 3-Mo. Fwd Price for Copper $3.99/lb at the End of March $3.94/lb(1) FCX 1Q21 Consolidated Copper Price Realization (Generally, 50/50 weight of qtrly avg and 3-mo forward price at end of p
Slide 36: Adjusted EBITDA Reconciliation
Adjusted Click toEBITDA Reconciliation edit Master title style ($ in mm) 12 mos ended 1Q21 3/31/2021 Net income attributable to common stock $718 $1,808 Interest expense, net 145 616 Income tax provision 443 1,447 Depreciation, depletion and amortization 419 1,606 Metals inventory adjustments 1 (125
Slide 37: Click to edit Master title style
Click to edit Master title style