Freeport-McMoran 1Q13 Earnings Call Notes

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This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. The quotes are generally pieces of information that I find interesting or helpful to understanding the company, industry or economy and are not meant to provide summaries of the full content of the call. Other posts in this series can be found by clicking here. Full transcripts can be found at Seeking Alpha.

“Like all of you, we’ve been focused on the markets over the past two weeks.”

“As we look at the environment today, we walked away from the meetings in Chile with a lot of confidence in the long-term copper markets based on the fundamentals of the world’s requirements for copper longer term and continuing challenges of maintaining supplies from existing mines and also of developing new sources of supply.”

“China, of course, remains the important demand driver…The government of China continues to express confidence in meeting their targeted GNP growth for the year and…we’re certainly not seeing any diminishment in demand for our copper concentrates that we ship there and our other products. Chinese growth is likely to drop over time, because the growth levels in the past were extraordinarily high and unsustainable. But the economy has grown so much that when you look at the demand for physical copper based on a larger economy, even with slower growth rates in relation to what the industry can produce longer term, it still indicates a very positive outlook for copper longer term.”

“The market will work. Over time, the lower price will encourage consumption, the inventories will work off.”

“In connection with [our acquisitions], we completed $10.5 billion in financings during the first quarter. We sold $6.5 billion of senior notes in four tranches in March and also entered into an agreement for a $4 billion bank term loan which will be funded at closing of the transaction. The weighted average interest rate of these financings approximates 3.1%”

“we are taking on significant debt, as a result of this, the closing will have roughly $20 billion of debt and we’ll have $4 billion of cash”

“At this point, we have not made any decisions to sell the assets.”

“this mining is a tough, tough business”