Freeport-McMoRan 2011 Annual Report Download - page 33

2011 ANNUAL REPORT | 31
CONSOLIDATED RESULTS
Years Ended December 31, 2011 2010 2009
Financial Data (in millions, except per share amounts)
Revenues
a,b
$ 20,880 $ 18,982 $ 15,040
Operating income
b,c
9,140
d
9,068 6,503
Net income attributable to FCX common stockholders 4,560
d,e,f
4,273
e
2,527
e
Diluted net income per share attributable to FCX common stockholders $ 4.78
d,e,f
$ 4.57
e
$ 2.93
e
Diluted weighted-average common shares outstanding 955 949 938
Mining Operating Data
Copper (recoverable)
Production (millions of pounds) 3,691 3,908 4,103
Sales, excluding purchases (millions of pounds) 3,698 3,896 4,111
Average realized price per pound $ 3.86 $ 3.59 $ 2.60
Site production and delivery costs per pound
g
$ 1.72 $ 1.40 $ 1.12
Unit net cash costs per pound
g
$ 1.01 $ 0.79 $ 0.55
Gold (recoverable)
Production (thousands of ounces) 1,383 1,886 2,664
Sales, excluding purchases (thousands of ounces) 1,378 1,863 2,639
Average realized price per ounce $ 1,583 $ 1,271 $ 993
Molybdenum (recoverable)
Production (millions of pounds) 83 72 54
Sales, excluding purchases (millions of pounds) 79 67 58
Average realized price per pound $ 16.98 $ 16.47 $ 12.36
a. Includes the impact of adjustments to provisionally priced concentrate and cathode sales recognized in prior years. Refer to “Revenues” and “Disclosures About Market Risks —
Commodity Price Risk” for further discussion.
b. Refer to Note 17 for a summary of revenues and operating income by business segment.
c. We defer recognizing profits on intercompany sales until final sales to third parties occur. Refer to “Operations — Atlantic Copper Smelting & Refining” for a summary of net impacts
from changes in these deferrals.
d. Includes charges totaling $116 million ($50 million to net income attributable to common stock or $0.05 per share) primarily associated with bonuses for new labor agreements and other
employee costs at PT Freeport Indonesia, Cerro Verde and El Abra.
e. Includes net losses on early extinguishment and conversions of debt totaling $60 million ($0.06 per share) in 2011 associated with the redemption of our $1.1 billion outstanding 8.25%
Senior Notes and open-market purchases of Senior Notes, $71 million ($0.07 per share) in 2010 associated with the redemption of our $1.0 billion Senior Floating Rate Notes and
open-market purchases of Senior Notes, and $43 million ($0.04 per share) in 2009 associated with the redemption and open-market purchases of Senior Notes. Refer to Note 9 for
further discussion.
f. Includes additional taxes of $49 million ($0.05 per share) associated with Peru’s new mining tax and royalty regime. Refer to “Provision for Income Taxes” for further discussion.
g. Reflects per pound weighted average production and delivery costs and unit net cash costs (net of by-product credits) for all copper mines, excluding net noncash and other costs. The
2009 period excludes the results of Africa mining as start-up activities were still under way. For reconciliations of the per pound costs by operating division to production and delivery
costs applicable to sales reported in our consolidated financial statements, refer to “Operations — Unit Net Cash Costs” and to “Product Revenues and Production Costs.”
Revenues
Consolidated revenues totaled $20.9 billion in 2011, compared with
$19.0 billion in 2010 and $15.0 billion in 2009, and include the sale
of copper concentrates, copper cathodes, copper rod, gold,
molybdenum and other metals by our North and South America
copper mines, the sale of copper concentrates (which also contain
signicant quantities of gold and silver) by our Indonesia mining
operations, the sale of copper cathodes and cobalt hydroxide by
our Africa mining operations, the sale of molybdenum in various
forms by our Molybdenum operations, and the sale of copper
cathodes, copper anodes, and gold in anodes and slimes by
Atlantic Copper. Our mining revenues for 2011 include sales of
copper (78 percent), gold (12 percent) and molybdenum (6 percent).
environment and management’s projections for long-term average
metal prices. In addition to near and long-term metal price
assumptions, other key assumptions include commodity-based and
other input costs; proven and probable reserves, including the
timing and cost to develop and produce the reserves; and the use
of appropriate escalation and discount rates.
Because the cash ows used to assess recoverability of our
long-lived assets and measure fair value of our mining operations
require us to make several estimates and assumptions that are
subject to risk and uncertainty, changes in these estimates and
assumptions could result in the impairment of our long-lived asset
values. Events that could result in impairment of our long-lived
assets include, but are not limited to, decreases in future metal
prices, decreases in estimated recoverable proven and probable
reserves and any event that might otherwise have a material
adverse eect on mine site production levels or costs.
We did not record asset impairment charges during the three
years ended December 31, 2011.
MANAGEMENT’S DISCUSSION AND ANALYSIS