Slide 1: FCX Conference Call 1st Quarter 2023 Results
FCX Conference Call st 1 Quarter 2023 Results April 21, 2023 fcx.com
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement 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 plans, projections, or expectation
Slide 3: 2022 Reports
2022 Reports 2022 Annual Report Highlights • Premier global leader in copper industry • Large-scale, long-lived reserves • Attractive portfolio of organic growth opportunities • Strongly positioned with favorable market outlook • Focused on delivering long-term value to all stakeholders 2022 Sustain
Slide 4: 1Q 2023 Highlights
1Q 2023 Highlights Copper Adjusted EBITDA Production Sales Price Realization (2) (1) $2.2 bn 965 832 $4.11 mm lbs mm lbs per lb Operating Cash Flow Gold $1.1 bn (1) Net of $0.5 bn in working capital uses 405 270 $1,949 k ozs k ozs per oz Net Debt (3) Molybdenum $1.3 bn Excluding net debt for smelter
Slide 5: 1Q23 Execution Under Challenging Circumstances
1Q23 Execution Under Challenging Circumstances U.S. Labor Shortages, Grasberg Weather Event Peruvian Civil Unrest Extreme Weather Events & in February Equipment Availability Issues PT-FI Copper Production Cerro Verde Copper Production U.S. Copper Production 139 65% 118 18% 116 106 13% 98 84 81 87 77
Slide 6: Copper – The Metal of Electrification
Copper – The Metal of Electrification Copper Demand Forecast (1) (mm tonnes) Strongly Positioned to Support Growing Demand ~50 Looming supply Copper Reserves (3) Copper Resources (3) gap expected 111 bn lbs 235 bn lbs ~25 Prices will need to rise to incentivize South Indonesia South new supplies Ind
Slide 7: Molybdenum Market Commentary
Molybdenum Market Commentary • FCX 1Q23 production 21mm lbs: 63% by-product / 37% primary World’s Largest Molybdenum Producer • S&P Platts Metals Week Daily molybdenum dealer oxide price (mm lbs) 0 20 40 60 80 100 o Averaged $32.78/lb in 1Q23 vs. $19.08/lb in 1Q22 o Price on April 20, 2023: $21.50/l
Slide 8: Leach Initiatives Gaining Traction
Leach Initiatives Gaining Traction Further Innovation Significant Operational Initiatives to Build Scale Potential Heat – Proven Enhancer Turning Up the Heat Copper in Leach • Covers installed on over 30% (42mm ft2) • Evaluating heated injections using Stockpiles Unrecoverable 30% of leach areas ren
Slide 9: Organic Development Pipeline
Organic Development Pipeline Near-Term Medium-Term Long-Term Potential Leach Initiatives Potential Step Change in Safford / Lone Star Sulfides ~200 mm lbs* Leaching Technology ~50 bn lbs ~600 mm lbs* Mineral Potential (1) North America Bagdad 2X Expansion Other U.S. Brownfield Staffing & Asset Oppor
Slide 10: Annual Sales Profile
Annual Sales Profile April 2023 Estimate Copper 5.0 Gold 2 1.8 1.8 1.6 Sales Sales 4.2 4.2 (billion lbs) 4.1 (million ozs) 4.0 1 0 3.0 2023e* 2024e* 2025e NOTE: Consolidated gold sales include 836k ozs in 2023e, 922k ozs in 2024e and 820k ozs in 2025e for noncontrolling interests. 2.0 Moly 100 85 90
Slide 11: Reconciliation of 2023e Unit Net Cash Cost Guidance
Reconciliation of 2023e Unit Net Cash Cost Guidance ($ and ¢ per pound of copper) 2023e Site Production January 2023e April 2023e Costs Breakdown Guidance (1) Impacts Guidance (2) Other (3) Site Production & Delivery $2.29 +7¢ $2.36 12%(5) Acid Materials By-product Credits (1.04) -10¢ (1.14) 5% and
Slide 12: EBITDA and Cash Flow at Various Copper Prices
EBITDA and Cash Flow at Various Copper Prices Assuming $2,000/oz gold, $18/lb molybdenum Sensitivities Average ’24e/’25e ($ in bns except copper, gold and molybdenum prices) (US$ in mms) EBITDA $16 EBITDA $12 Copper +/-$0.10/lb $425 Molybdenum +/-$1.00/lb $ 80 $8 Gold +/-$50/oz $ 80 $4 Average Curre
Slide 13: Consolidated Capital Expenditures
Consolidated Capital Expenditures Excluding Indonesia Smelter Projects CAPEX (1) ($ in bns) $3.5 $3.3 Discretionary Discretionary $2.7 $1.1 $1.0 Discretionary $2.5(2) Major Planned Planned Planned (2) Projects $1.4 $1.7(2) $1.3 (2) $0.8 Other Other Other $1.0 $1.1 $1.5 2022 2023e 2024e (1) See slide
Slide 14: Indonesia Manyar Smelter Project Update
Indonesia Manyar Smelter Project Update New Greenfield Smelter is ~60% Complete with Commissioning Expected in 2024 Desalination Plant Smelter Stack Installation Refinery Steam Dryers Substation Smelter Project Site View Northwest to Southeast 14 NOTE: See slide 29 for additional details.
Slide 15: Financial Policy: Performance-Based Payout Framework
Financial Policy: Performance-Based Payout Framework Maintain • Net Debt/Adjusted EBITDA less than 1x as of 3/31/23 Strong • $3 - $4 bn Net Debt target (excluding net debt for new smelter capacity in Indonesia) Balance Sheet • Net Debt of $1.3 bn(1) as of 3/31/23 Provide Cash • ~50% free cash flow(2
Slide 16: Responsible producer of scale, long-lived reserves
Responsible Experienced producer of scale management team Long-lived Strong balance reserves sheet Embedded Cash returns growth options to shareholders 16
Slide 17: Foremost in Copper
FOREMOST IN COPPER
Slide 18: Reference Slides
THE POWER OF COPPER Reference Slides FREEPORT FOREMOST IN COPPER
Slide 19: The Copper Mark & Molybdenum Mark
The Copper Mark & Molybdenum Mark Recognition for Responsible Production STATUS BY SITE: • Assurance framework developed to demonstrate the copper industry’s AWARDED responsible production practices Atlantic Copper smelter & Henderson mine (CO)** refinery (Spain) Miami smelter, mine • Producers part
Slide 20: 2022 ESG Highlights
2022 ESG Highlights 12 sites $177 2030 Global Tailings Standard 89% awarded Copper Mark, including 4 in 2022 and million GHG emissions reduction targets established for progressed implementation at total water use efficiency achieved 1 in early 2023 invested in our Atlantic Copper and our applicable
Slide 21: Financial Highlights
Financial Highlights Sales Data 1Q23 1Q22 Copper (1) Consolidated Volumes, excluding purchases (mm lbs) 832 1,024 Average Realization (per lb) $ 4.11 $ 4.66 Site Production & Delivery Costs (per lb) $ 2.57 $ 2.03 Unit Net Cash Costs (per lb) $ 1.76 $ 1.33 Gold (1) Consolidated Volumes (000’s ozs) 27
Slide 22: 1Q 2023 Mining Operating Summary
1Q 2023 Mining Operating Summary Production and Sales From Mines for 1Q23 by Region North America South America Indonesia (3) 402 332 332 (2) 329 304 302 266 (1) 198 21 19 Cu Mo Au mm lbs mm lbs 000 ozs Production Sales Production Sales Production Sales Production Sales Production Sales North South
Slide 23: 2023e Operational Data
2023e Operational Data 2023e Sales by Region North America South America Indonesia 1,382 1,453 1,222 (2) (1) 1.8 79 Cu Mo Cu Cu Au mm lbs mm lbs mm lbs mm lbs mm ozs North South 2023e Unit Net Cash Costs (3) (per lb of Cu) America America Indonesia Consolidated Site Production & Delivery (4) $2.91 $
Slide 24: Strong Balance Sheet and Liquidity
Strong Balance Sheet and Liquidity Attractive Debt Maturity Profile (US$ bns) $8 In March 2023, FCX repaid its 3.875% Senior Notes totaling ~$1 bn at maturity. Total Debt & Cash at 3/31/23 Significant liquidity FCX Revolver $ - $6.5 ▪ $6.9 bn in consolidated cash and cash equiv. FCX/FMC Senior Notes
Slide 25: 2023e Outlook
2023e Outlook Sales Unit Net Cash Operating Capital Outlook Cost of Copper Cash Flows (1,2) Expenditures • Copper: 4.1 billion lbs • Site prod. & delivery • ~$7 billion(3) @ $4.00/lb • $3.5 billion (excluding o 2023e: $2.36/lb copper for 2Q23e – smelter projects(4)) • Gold: 1.8 million ozs 4Q23e o 2
Slide 26: 2023e Quarterly Sales
2023e Quarterly Sales Copper 1200 1,115 Gold 600 500 535 Sales 1,065 1,045 Sales 450 450 (million lbs) 1000 (thousand ozs) 270 300 832 150 800 0 1Q23* 2Q23e 3Q23e 4Q23e NOTE: Consolidated gold sales include 74k ozs in 1Q23, 256k ozs in 2Q23e, 231k ozs in 600 3Q23e and 275k ozs in 4Q23e for noncontro
Slide 27: PT-FI Mine Plan
PT-FI Mine Plan Metal Production, 2022 – 2027e Copper 2023e – 2027e Gold 2023e – 2027e Total: 8.1 billion lbs copper Total: 8.0 million ozs gold Annual Average: ~1.6 billion lbs Annual Average: ~1.6 million ozs 1.9 1.9 1.8 1.7 1.6 1.6 1.6 1.6 1.6 1.6 1.3 1.3 Cu Au bn mm lbs ozs 2022 2023e 2024e 2025
Slide 28: Discretionary Capital Projects
Discretionary Capital Projects* Kucing Liar Lone Star Oxide Expansion ● Commenced long-term mine development activities ● Low capital intensity investment in 2022 ● Capital investment: ~$300 mm (~$120 mm in 2023e) ● Approximate 10-year development timeframe ● Increase stacking rate: 95k t/d to 120k
Slide 29: Indonesia Downstream Processing Activities
Indonesia Downstream Processing Activities Greenfield Smelter (Manyar) Precious Metals Refinery (PMR) PT Smelting Expansion • 1.7 mm mt of annual concentrate capacity • To be constructed to process gold and • 30% increase to existing smelter to add • Designed to be world’s largest single line flash
Slide 30: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation 12 mos ended ($ in mm) 1Q23 3/31/2023 Net income attributable to common stock $663 $2,604 Interest expense, net 151 584 Income tax provision 499 1,942 Depreciation, depletion and amortization 399 1,929 Net gain on sales of assets - (2) Accretion and stock-based compens
Slide 31: Foremost in Copper
FOREMOST IN COPPER