Freeport-mcmoran, Inc. · NYSE:FCX
Freeport-mcmoran — Freeport Mcmoran Copper & Gold — Q1 2006 Earnings Presentation
27 slides from Freeport-mcmoran's earnings presentation, Apr 18, 2006
Slide 1: 1st Qtr 2006 Earnings Conference Call
is Qtr 2006 Earnings Conference Call James R. Moffett Richard C. Adkerson Chairman of the Board President and Chief Executive Officer Kathleen L. Quirk Mark J. Johnson Senior Vice President, Senior Vice President and Chief Financial Officer Chief Operating Officer April 18, 2006 i=] FREEPORT-McMoRau
Slide 2: Cautionary Statement
Cautionary Statement This presentation contains forward-looking statements in which we discuss factors we believe may affect our performance in the future, Forwarclooking statements are all statements other than historical facts, such as statements regarding projected ore grades and milling rates, p
Slide 3: The Elements of Shareholder Value
The Elements of Shareholder Value Grasberg: World’s Largest Copper & Gold Reserve = The Right Asset == = The Right Time = The Right Financial Strategy The Elements of Shareholder Value = A Bright Future
Slide 4: 1st Qtr. 2006 Highlights
15t Qtr. 2006 Highlights PT-FI Sales 1Q06 Volumes Realization Copper 225 mm lbs $2.43/1b Gold 472,500 ozs $556/0z ($406/oz. after revenue adjustment for Gold Preferred redemption) Net Income: $252 Million ($1.23/ diluted share) - Includes Losses of $37.9 Million ($0.17/share) on Redemptions of Debt,
Slide 5: Full Year Outlook
Full Year Outlook = PT-FI Copper and Gold Sales Expected to Total 1.3 Billion Ibs. and 1.7 Million ozs. 1Q06 2Q - 4Q06e 2006e Copper (MM Ibs) 225 1,050 1,275 Gold (M ozs) 472 1,215 1,687 Net Cash Costs (per Ib) 40¢ 57¢ 54g = At Prices of $2.25 Copper and $550 Gold in Balance of Year, Operating Cash
Slide 6: Positive Markets
Positive Markets LME Copper Price wpa LME & COMEX Exchange Stocks* Jan-99 Ju-99 Jan-00 JuLQ0an-O1 Jul Jan-02 Jul02 Jan03 Jul03 Jano4 ud Jan.95 “LME and Comex, excluding Shanghai stocks, producer, consumer andmerchant stocks. London Gold Price punog .Bd s1uaD, Producer Hedging Announcements ECB Annou
Slide 7: Grasberg Open Pit
| Grasberg Open Pit e In 2005, Pushback 6S Was our primary source of high-grade ore. e Pushbacks 6N & 6E to provide the majority of the ore from the Grasberg in 2006 e Pushback 7S to provide the majority of the ore in 2007 and 2008
Slide 8: Mine Plan Review
i= a Mine Plan Review « We update plans for latest data & conditions, with the objective of operating safely, managing risks & maximizing economic values. « Weare currently undertaking studies to include recent geotechnical data in our plans. Studies to be completed & plans revised in 3Q. 2006-2010
Slide 9: Mining Sequence in 2006
-) Mining Sequence in 2006 ol} Copper Equivalent Cross Section Mm 0.50-0.99% Eqcu 1.00 - 1.99 % Eqcu ME 2.00-2.99% Eqcu mm > 3.00% Eqcu
Slide 10: Mining Sequence in 2006
-) Mining Sequence in 2006 ol} Copper Equivalent Cross Section 7_ © Mm 0.50-0.99% Eqcu 1.00 - 1.99 % Eqcu ME 2.00-2.99% Eqcu mm > 3.00% Eqcu
Slide 11: Mining Sequence in 2006
-) Mining Sequence in 2006 ol} Copper Equivalent Cross Section Mm 0.50-0.99% Eqcu 1.00 - 1.99 % Eqcu ME 2.00-2.99% Eqcu mm > 3.00% Eqcu
Slide 12: Mining Sequence in 2006
-) Mining Sequence in 2006 ol} Copper Equivalent Cross Section Mm 0.50-0.99% Eqcu 1.00 - 1.99 % Eqcu ME 2.00-2.99% Eqcu mm > 3.00% Eqcu
Slide 13: 2006 Outlook
2006 Outlook Quarterly Payable Metal Sales PT-FI's share of Copper PT-FI's share of Gold 3 billion pounds 17 million ounces 500 490 625 £20 400 500 472 ® g 2 300 375 = 320 © 5 275 3 § 200 250 3 & 100 125 0 o 1Q06 2Q06 3906, 4906. 1Q06 2Q06 3Q06 4Q06. Actual Estimate Actual Estimate 219
Slide 14: Mining Sequence in 2007
Fv Mining Sequence in 2007 ol} Copper Equivalent Cross Section 6N & 75 are the Primary Ore Pushbacks in 2007 5) Leaend: Mm 0.50-0.99% Eqcu 1.00 - 1.99 % Eqcu ME 2.00-2.99% Eqcu mm > 3.00% Eqcu
Slide 15: Mining Sequence in 2008
P44) Mining Sequence in 2008 ol} Copper Equivalent Cross Section 7S is the Primary Ore Pushback in 2008 Leaend: Mm 0.50-0.99% Eqcu 1.00 - 1.99 % Eqcu ME 2.00-2.99% Eqcu mm > 3.00% Eqcu
Slide 16: Mining Sequence in 2009
-4) Mining Sequence in 2009 i Copper Equivalent Cross Section 8S is the Primary Ore Pushback in 2009 é {$7 Grasb 5 Leaend: Mm 0.50-0.99% Eqcu 1.00 - 1.99 % Eqcu ME 2.00-2.99% Eqcu mm > 3.00% Eqcu
Slide 17: Mining Sequence in 2010
a Mining Sequence in 2010 i Copper Equivalent Cross Section 8N is the Primary Ore Pushback in 2010 Leaend: Mm 0.50-0.99% Eqcu 1.00 - 1.99 % Eqcu ME 2.00-2.99% Eqcu mm > 3.00% Eqcu
Slide 18: PT-FI Mine Plan (January 2006)
PT-FI Mine Plan (January 2006*) PT-FI’s Share of Metal Sales, 2006e-2010e | Copper, billion lbs Gold, million ozs 2006¢ - 2010e PT-Fi Share 2006¢ - 2010e PT-Fi Share Total: 6.5 billion ibs Total: 9.6 million ozs Annual Average: 1.3 billion ibs* Annual Average: 1.9 million ozs* 2.4 2.0 1.9 1.7 i 1.6
Slide 19: Unit Production Costs
Unit Production Costs (per pound of copper) 1906 29-4Q06e” 2006e” Cash Unit Costs Site Production & Delivery 122¢ 81¢ 88q¢ Royalties 9 7 8 Treatment Charges 38 33 33 Gold/Silver Credits 129 (64) (75) Net Cash Unit Costs 40¢ 57¢ 54¢ (1) Estimate based on 2006 volumes of 1.3 billion pounds of copper a
Slide 20: Development Projects
| Development Projects = DOZ 50K Expansion = Common Infrastructure = On-going Mill Optimization - High Pressure Grinding Rolls = Big Gossan 20
Slide 21: Common Infrastructure
Common Infrastructure Access to Underground Reserves Grasberg Block Cave “Spur” 2Q 2007 Complete tunnel to Grasberg BC ¥ Grasherg © fae ey # 94 Begin mine development & other facilities Grasberg Block Kueing Liar Cave “Spur” Kueing Liar Amole y/ infrastructure March 2006 WA Peet cerns Dcovnior cOW A
Slide 22: FCX Capital Expenditures
FCX Capital Expenditures ( in millions) i) AC & Other 2006 — 2010 Annual Average ~ $200 Million ww ptr $250 ee $215 $185 $170 $170 $143 $1is $100 $100 i] . : 2005 2006e 2007e 2008e 2009e 2010e e = estimate. Amounts are projections; see cautionary statement. “Includes PT-FI's share of capital expendi
Slide 23: FCX Debt Maturities
FCX Debt Maturities (B in miliions) $1,000 March's 172006: F TotalDebt $1)101 Less Cast 284) #000 | TotalAtter, Cash $ 817 $600 $400 282 #316 az rp 10%0% | Conv. $200 Senior ion 674% $87 Notes | Convert i Senior rice Notes $48 Callable { 20.87 | 1907 7 a5 | $14 $14 Q share | 2006 2007 2008 2009 2010
Slide 24: FCX Operating Cash Flows at Varying Copper & Gold Prices
FCX Operating Cash Flows (Annual Avg. 2006e-2010e at Varying Copper & Gold Prices ( in millions, except copper and gold prices) $1,400 $1,200 $ $1,000 Ep... a é 2 Bo... 5 $800 az | o 3 S 5% 2 Lower £ $600 \, s - = Volumes} g Volumes” b § $400 8 3 $200 a $0 / 5 $1.25 $1.50 $1.75 $2.00 $400 $450 $500
Slide 25: Financial Policy
| Financtal Policy " Maintain Strong Balance Sheet and Financial Flexibility " Maintain Regular Quarterly Dividend That Can Be Sustained Within Broad Range of Commodity Prices " In Periods of High Commodity Prices, Supplement Regular Dividend With Special Dividends/Share Purchases 25
Slide 26: Historical Shareholder Returns
Historical Shareholder Returns = $1.5 Billion in FCX Open Market Purchases Since 1995 Spin-off - 80 Million Shares in Open Market Purchases at an Average Price of $18.66 per Share $2.16 Billion in Common Stock Dividends Since 1988 - $846 Million Since 2003 $3.65 Billion in Total Long Track Record fo
Slide 27: Strong Cash Flow Generator
Strong Cash Flow Generator Long-lived Reserves Unhedged Exposure to Copper & Gold Markets Improved Balance Sheet/Enhanced Shareholder Returns Attractive Valuation 2
Freeport Mcmoran Copper & Gold — Q1 2006 Earnings Presentation on 6ix