Freeport-mcmoran, Inc. · NYSE:FCX
Freeport-mcmoran — Freeport-McMoRan Copper & Gold — Bank of America Merrill Lynch Global Metals and Mining Conference 2010
21 slides from Freeport-mcmoran's conference presentation, May 11, 2010
Slide 1: Proven Performance, Shining Future
Richard C. Adkerson President & Chief Executive Officer PROVEN PERFORMANCE SHINING FUTURE May 11, 2010 www.fcx.com
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking Statements This presentation contains forward-looking statements in which we discuss factors we believe may affect our performance in the future. Forward-looking statements are all statements other than historical facts, such as statements regarding pro
Slide 3: Proven Performance, Shining Future: 2009 Annual Report Highlights
Proven Performance, Shining Future 2009 Annual Report Highlights Successful Execution of Our Operating Plans Long-Lived Reserves with Growth Potential Geographically Diverse Assets Strong Financial Position Experienced Team 3
Slide 4: First Quarter Highlights
First Quarter Highlights Solid Volume and Cost Performance Improved Commodity Pricing Strong Cash Flows and Financial Results Repaid $1.3 Billion in Debt YTD* Advanced Capital Projects Increase in Dividend * Takes into account the April 1, 2010 redemption of $1.0 billion in senior floati
Slide 5: Market Comments
Market Comments 2010e 2010e Change Change From From Copper Consumption* Consumption* Prior Prior Year Year China 7,107 9% China Demand Supports Market Asia 3,589 5% Some Positive Improvement in U.S. Western Europe 2,782 2% Limited New Supplies North America 1,704 3% Japan 902 3% Prices Have
Slide 6: Copper Reserves & Mineralized Material
Copper Reserves & Mineralized Material Estimates as of 12/31/09 12/31/09 Copper Reserves by Geographical Region 123 North 104 America 27% 27% South America Indonesia 33% 33% at $1.60 at $2.00 copper price copper price 7% Reserves (a) Mineralized Material (b) Africa (billion lbs of (billion lbs of co
Slide 7: Development Project Update: Morenci
Development Project Update North America Morenci Mill Restart & Ramp-up • Process sulfide ore being mined • Successfully restarted mill in March & ramping up rates – 50K mt/d by 2011 Increase Mine Rate • Initiating plans for a staged ramp-up from the current rate of ~450K to 635K mt/d (500K to 700K
Slide 8: Development Project Update: Miami and Safford
Development Project Update North America Miami Mine Restart • Began stripping activities in 1Q10 • Ramp up to 100MM lbs Cu/year by second half 2011 • $40MM project, primarily mining equipment • 12/31/09 reserves of 600MM lbs Cu Safford Sulphur Burner • Sulphur Burner at Safford • ~$150 million proje
Slide 9: Development Project Update: South America
Development Project Update South America Cerro Verde Expansion • $50MM project to increase mill rate from 108K t/d to 120K t/d • 30MM lbs Cu per year of incremental metal at low cash cost • Evaluating large scale concentrator expansion Potential to more than double the existing facility Feasibil
Slide 10: Long-Term Underground Mine Development in Indonesia
Long-Term Underground Mine Development in Indonesia Significant undeveloped underground reserves Aggregate reserves of 41 billion lbs Cu & 35 million ozs Au DOZ expanded to 80,000 t/d Big Gossan mine – full rates of Grasberg 7,000 t/d by late 2012 open pit Grasberg Block Cave – ramp-up to
Slide 11: Tenke Fungurume
Tenke Fungurume Achieved design Cu production rates; start-up issues on Co circuit and SO2 plant being addressed At full rates (initial phase), aggregate annual metal of 250MM lbs Cu & over 18MM lbs Co Sold 66MM lbs Cu & 3MM lbs Co in 1Q10 Exploration activities continue to support opportuni
Slide 12: Climax Restart
Climax Restart Preparing for resumption of construction activities One of the most attractive primary molybdenum development projects in the world – large scale production capacity, attractive cash costs and future growth options Initial annual capacity of 30mm pounds $700mm project with est
Slide 13: Current Projects Under Evaluation
Current Projects Under Evaluation North America Tenke Fungurume • Chino Restart • Debottlenecking • Further increases to Morenci • Further oxide expansion mining rate • Sulphide development • Plans for Twin Buttes/ Sierrita district • Climax • Major mill projects for sulfide development South Americ
Slide 14: 2010 Outlook
2010 Outlook Sales Outlook: • Copper: 3.8 Billion lbs. • Gold: 1.8 Million ozs. • Molybdenum: 62 Million lbs. Unit Net Cash Cost (1): • 88¢/lb Operating Cash Flows (2): • Exceed $6 Billion, net of $0.3 Billion in W/C Uses • Assumes $3.50/lb Copper for remaining 9-months • Each 10¢/lb Change in
Slide 15: Sales Profile 2008 - 2012e
Sales Profile 2008 - 2012e Gold Sales (million ozs) Copper Sales (billion lbs) 3 2.6 5 1.8 1.9 2 1.3 1.4 4.1 4.1 1 4.0 4 3.9 3.8 0 2008 2009 2010e 2011e 2012e 3 ____________________ Note: Consolidated gold sales include approximately 134 k oz in 2008, 256 k oz in 2009, 177 k oz in 2010e, 190 k oz in
Slide 16: 2010e Quarterly Payable Metal Sales
2010e Quarterly Payable Metal Sales Gold Sales (thousand ozs) Copper Sales (million lbs) 1,250 800 675 600 478 1,060 390 400 1,000 960 950 270 200 830 0 1Q10 2Q10e 3Q10e 4Q10e 750 ____________________ Note: Consolidated gold sales include approximately 47 k oz in 1Q10, 25 k oz in 2Q10e, 40 k oz in 3
Slide 17: 2010e Sales and Unit Production Costs by Region
2010e Sales and Unit Production Costs by Region 2010e Sales by Region (1) North America South America Indonesia 1,280 1,235 1,035 1.7 62 (2) 0.1 Cu Mo Cu Au Cu Au mm mm lbs lbs mm lbs mm mm lbs lbs mm ozs mm mm lbs lbs mm ozs 2009e 2010e 2 0 10 e 2 0 10 e 2 0 10 e 2010e North South (per pound of cop
Slide 18: EBITDA and Cash Flow at Various Copper Prices
EBITDA and Cash Flow at Various Copper Prices Average EBITDA* ($1,000 Gold & $10 Molybdenum) $10 (US$ billions) $8 $6 $4 $2 $0 Cu $2.50/lb Cu $3.00/lb Cu $3.50/lb Average Operating Cash Flow (excluding Working Capital changes)* ($1,000 Gold & $10 Molybdenum) $8 (US$ billions) $6 $4 $2 $0 Cu $2.50/lb
Slide 19: Capital Expenditures
Capital Expenditures (1) Major Projects All Other (US$ billions) $3.0 $2.7 $2.5 1.1 $2.0 $1.6 $1.7 $1.6 $1.5 0.6 0.9 0.9 $1.0 1.6 (2) $0.5 1.0 (3) 0.8 0.7 (4) $0.0 2008 2009 2010e 2011e (1) Capital expenditure estimates will continue to be reviewed and revised subject to market conditions. (2) Inclu
Slide 20: Balance Sheet
Balance Sheet (US$ billions) Significant Liquidity $20 (1) $17.6 Strong Credit Metrics $15 No Near-term Maturities Total Debt $10 $7.4 (2) $5.1 $5 $0 At Time of PD Acquisition 12/31/08 3/31/10 in March 2007 Pro Forma Cash $3.4 $0.9 $2.7 Net Debt $14.2 $6.5 $2.3 (1) Pro Forma year-end 2006 tota
Slide 21: Financial Policy
Financial Policy Maintain Strong Balance Sheet & Liquidity Position Aggressive Cost Management Invest in Attractive Growth Projects Opportunistic Debt Repayment Board Action to Increase Common Stock Dividend: $1.20/share per Annum 23.7 MM Shares Remaining Under Open Market Share Purchase