Tough copper, oil market marks quarterly loss for Freeport-McMoRan

JOHANNESBURG (miningweekly.com) – NYSE-listed diversified miner Freeport-McMoRan on Tuesday reported a net loss attributable to common stock of $4.1-billion, or $3.47 a share, for the fourth quarter of 2015, and $12.2-billion for the year, owing in part to weaker commodity prices.

This was compared with a net loss of $2.9-billion for the same quarter in 2014 and $1.3-billion for the entire year, according to the US copper/gold miner and oil producer.

Commodity prices weakened further in the fourth quarter of 2015 and early this year, with current copper spot prices of $2/lb being 15% below prices as at September 30, 2015. The current Brent crude oil spot price of $30.50/bl was also 37% below September prices.

"As we enter 2016, our clear and immediate objective is to restore our balance sheet and to position the company appropriately to enhance shareholder value in the current market environment,” commented CEO Richard Adkerson.

He added that, while Freeport believed that the physical copper market was “essentially balanced”, it was concerned about the global economy, particularly the weakening of the Chinese economy.

“[These concerns] have dominated financial market sentiment and negatively impacted commodity prices, including copper. Oil prices have also weakened to multiyear lows in response to excess global supplies and economic conditions,” said the company.

However, it remained confident about the longer-term outlook for copper prices based on the global demand and supply fundamentals. It expected to sell 5.1-billion pounds of copper during the year, up from 1.15-billion sold during 2015.