FREEPORT-MCMORAN INC Q2 FY2024 earnings call

• Richard Adkerson discussed copper market volatility, China's demand challenges, and the Indonesian smelter's commissioning. - Kathleen Quirk highlighted strong margins and cash flows ($2.7B EBITDA, $2B operating cash flows), progress on Indonesian smelter and innovative leach project, and US operations mitigating lower ore grades. - Focus on operational efficiency, automation, new technologies, and returning cash to shareholders via dividends and share purchases.

US: Ore grades processed through mill and leach facilities had over a 10% decrease year-over-year. Focused on mitigating impacts via productivity initiatives, equipment reliability, automation, and innovative leach. South America: Cerro Verde operation had solid second quarter with mill throughput over 425,000 tons/day, unit net cash costs improved sequentially despite a $0.22 per pound non-recurring charge. Indonesia: Despite June shipping delays, results were strong with net unit cash credits of $0.21 per pound; Indonesian smelter project advanced to commissioning phase.

• 2024 copper sales slightly revised; consolidated unit cash costs approximate $1.63 per pound. - EBITDA projections range from nearly $11B at $4 copper to $15B at $5 copper; operating cash flows range from $7.5B to $11B at $5 copper. - Capital expenditures forecasted at ~$3.7B in 2024 and $4.1B in 2025, emphasizing value-enhancing projects and shareholder returns.

• Market volatility in copper prices. - China's economic challenges impacting demand. - Permitting and regulatory hurdles in project development, especially in Indonesia and Chile.

Q: On the new smelter in Indonesia, ramp-up profile and reporting?

A: Commissioning well underway, team prepared with expertise from existing smelters; smelter will be reported as part of PT-FI's results, integrated into financials.

Q: On gold sales revision, why don't ounces reappear in plan period?

A: Purely timing issue due to wet conditions in Block Cave; ounces come back over next few years, a timing matter.

Q: On Kucing Liar project, update on first production and spending pace?

A: Expect start-up towards end of this decade in advance of 2030; spending will ramp up, average ~$400M/year over 10 years, with resource beyond 2041 benefiting from extension.