The period ended July 20 was punctuated by a hefty second-quarter loss by Freeport-McMoRan Copper & Gold, which stemmed primarily from a major rockslide last October at its giant Grasberg mine in Indonesia.
Freeport lost US$53.3 million, or US30 per share, in the recent quarter, compared with net income of US$57.4 million a year earlier. Revenue slumped US$123 million between the two periods to $486.3 million. The financials were also affected by a maintenance shutdown at Freeport’s copper smelter in Spain. Nonetheless, the company’s shares ended the period up US31, to US$34.80.
The most active stock was Alcoa, which slipped US4 to US$32.15 as 800 unionized workers at the company’s aluminum smelter in Becancour, Que., entered their third week on strike. Management personnel are now operating only one of three potlines, slashing the annual production rate to 135,000 tonnes. With both sides entrenched in their positions, signs are pointing toward an extended strike. Becancour’s minority owner, Alcan, dropped US$1.10, to US$40.36.
Meanwhile in Brazil, Alcoa and BHP Billiton have decided to spend almost US$300 million over the next year expanding their Brazilian Alumar smelter capacity by 63,000 tonnnes to 433,000 tonnes per year. BHP was off US8 to US$18.58.
The hottest junior of the week was Denver-based iron-ore junior El Capitan Precious Metals, which soared 43% to US60 on 904,000 shares traded. The company, which is splitting its stock on a 3-for-1 basis on July 30, recently added James Ricketts and Bill Weeks to its board and hired Steve Antol as CFO.
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