| Freeport-McMoRan’s Debt Levels Increase Further in 2Q15 | |
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Freeport-McMoRan’s 2Q15 Earnings: An Investor's Guide (Continued from Prior Part) Freeport-McMoRan’s leverage ratios
We’ve already seen that Freeport-McMoRan’s (FCX) cash operating margins for its energy business improved in 2Q15 compared to the previous quarter. Even though the margins have improved from 1Q15, they’re still a far cry from what Freeport enjoyed last year.
In this part of the series, we’ll take a look at Freeport-McMoRan’s leverage ratios, which went up sharply after the company acquired the energy assets.
Currently, Freeport forms 2.8% of the Materials Select Sector SPDR ETF (XLB) and 3.98% of the SPDR S&P Metals and Mining ETF (XME).
Freeport’s net debt was negative in 4Q12. This basically means that the cash on Freeport’s balance sheet was more than its borrowings. However, Freeport had to borrow heavily to acquire these energy assets. This increased its debt levels. Freeport’s debt ratios are currently much higher than other copper producers such as Southern Copper (SCCO) and Teck Resources (TCK).
Debt levels surge higher in 2Q15
The above graph shows Freeport’s total debt over the last few quarters. In 2Q15, its total debt went up $600 million and reached $20.9 billion. It ended the quarter with total cash of $466 million, which appears to be on the low side. After the recent correction in its share price, Freeport’s market capitalization is ~$12.6 billion.
Freeport was planning to reduce its debt levels. Lower crude oil prices have changed the equation. It has had to defer its debt reduction targets since commodity prices fell. It also had to slash its dividend by more than 80% in a bid to reduce cash outflows.
Freeport is investing in several growth projects that are leading to a cash burn. In the next part, we’ll discuss some of Freeport’s major expansion projects.
Continue to Next Part Browse this series on Market Realist:
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Freeport McMoRan Copper and Gold Inc.
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PRODUCTEUR |
CODE : FCX |
ISIN : US35671D8570 |
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ProfilIndicateurs de MarchéVALEUR : Projets & res.Communiqués de PresseRapport annuelRISQUE : Profile actifsContactez la cie |
Freeport McMoran est une société de production minière d'or et de cuivre basée aux Etats-Unis D'Amerique. Freeport McMoran est productrice d'or, de cuivre, d'argent, de cobalt et de molybdène au Chili, au Perou, en Indonesie et en Republique Democratique Du Congo, en développement de projets de cuivre au Perou, et détient divers projets d'exploration au Chili. Ses principaux projets en production sont CANDELARIA, EL ABRA, CHINO - MILL, HENDERSON, MIAMI - ROM LEACH, MORENCI - MILL, OJOS DEL SALADO, MORENCI et MORENCI - ROM LEACH au Chili, GRASBERG, SIERRITA et BAGDAD en Indonesie, TENKE FUNGURUME et TYRONE en Republique Democratique Du Congo et CERRO VERDE au Perou, son principal projet en développement est SAFFORD au Perou et ses principaux projets en exploration sont BAGDAD - ROM LEACH et CHINO - ROM LEACH au Perou et CERRO VERDE - MILL, CERRO VERDE - CRUSHED LEACH, CERRO VERDE - ROM LEACH, EL ABRA - ROM LEACH et CLIMAX au Chili. Freeport McMoran est cotée aux Etats-Unis D'Amerique et en Allemagne. Sa capitalisation boursière aujourd'hui est 72,6 milliards US$ (68,1 milliards €). La valeur de son action a atteint son plus bas niveau récent le 06 mars 2020 à 10,00 US$, et son plus haut niveau récent le 18 avril 2024 à 50,16 US$. Freeport McMoran possède 1 448 000 000 actions en circulation. |