By Chelsey Dulaney
Freeport-McMoRan Inc. said Tuesday that it has slashed its
capital budget for the year and is searching for outside funding
for its oil and gas business as the mining company looks to shield
itself from plummeting commodity prices.
Phoenix-based Freeport, one of the world's largest copper
producers, expanded into oil and gas with 2013 acquisitions of
energy explorers McMoRan Exploration and Plains Exploration
Production. Recent tumbles in oil and copper prices have pressured
the company.
Freeport said Tuesday that it is taking "aggressive actions" to
defer or reduce its spending, including searching for third-party
funding for its oil and gas business. Freeport said it already has
cut its 2015 capital budget by $2 billion and is prepared to make
further cuts.
The warning came as Freeport swung to a heavy loss in its fourth
quarter costs related to the oil and gas segment, though its top
line beat Wall Street expectations.
Shares fell 5.3% in premarket trading.
Overall, Freeport posted a loss of $2.85 billion, or $2.75 a
share, compared with a profit of $707 million, or 68 cents a share,
a year earlier. The quarter included a $3.4 billion cost related to
the impairment of its oil and gas properties.
Excluding items, per-share earnings were 25 cents a share.
Revenue fell 11% to $5.24 billion.
Analysts polled by Thomson Reuters expected a profit of 35 cents
a share on revenue of $4.94 billion.
Average realized prices for copper fell 10.9% in the quarter,
while gold prices fell 2.2%. Oil prices sank 15.8% from a year
earlier.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
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