PHOENIX - Freeport-McMoRan Inc. (NYSE: FCX) reported first-quarter 2022 net income attributable to common stock of $1.5 billion, $1.04 per share, and adjusted net income attributable to common stock of $1.6 billion, $1.07 per share, after excluding net charges primarily associated with the settlement of an administrative fine and an adjustment to prior-period export duties at PT-FI totaling $38 million, $0.03 per share.
For additional information, refer to the supplemental schedule, 'Adjusted Net Income,' on page VI.
Richard C. Adkerson, Chairman and Chief Executive Officer, said, 'The strong operational and financial results we are reporting today reflect our long-term, ongoing focus on solid execution of our plans and the achievements of our committed global team. As a premier global leader in producing copper responsibly, with large-scale, long-lived reserves and an attractive portfolio of organic growth opportunities, we are strongly positioned to benefit from increasing global copper demand for infrastructure development and accelerating clean energy investments. We have created a durable foundation for long-term success supported by a portfolio of world class copper assets, an experienced and highly motivated global team and a strong financial base. Freeport is focused on delivering value to all our stakeholders and approaching the future with confidence and excitement.'
Consolidated Unit Net Cash Costs
Consolidated average unit net cash costs (net of by-product credits) for FCX's copper mines of $1.33 per pound of copper in first-quarter 2022 were in line with the January 2022 estimate of $1.35 per pound and four percent below the first-quarter 2021 average of $1.39 per pound. Compared with the January 2022 estimate, higher sales volumes and by-product credits during first-quarter 2022 offset the impact of increased energy and other input costs. Assuming average prices of $1,950 per ounce of gold and $19.00 per pound of molybdenum for the remainder of 2022 and achievement of current sales volume and cost estimates, consolidated unit net cash costs (net of by-product credits) for FCX's copper mines are expected to average $1.44 per pound of copper for the year 2022. The increase from the January 2022 estimate of $1.35 per pound of copper primarily reflects higher energy prices, consumables and stronger currency exchange rates in South America, partly offset by higher gold volumes and commodity price assumptions. The impact of price changes on consolidated unit net cash costs would approximate $0.03 per pound of copper for each $100 per ounce change in the average price of gold and $0.02 per pound of copper for each $2 per pound change in the average price of molybdenum for the remainder of 2022. Quarterly unit net cash costs vary with fluctuations in sales volumes and realized prices, primarily for gold and molybdenum.
FINANCIAL POLICY
FCX's financial policy is aligned with its strategic objectives of maintaining a strong balance sheet and increasing cash returns to shareholders while advancing opportunities for future growth. The policy includes a base dividend and a performance-based payout framework, whereby up to 50 percent of available cash flows generated after planned capital spending and distributions to noncontrolling interests would be allocated to shareholder returns and the balance to debt reduction and investments in value enhancing growth projects, subject to FCX maintaining its net debt at a level not to exceed the net debt target of $3.0 billion to $4.0 billion (excluding project debt for additional smelting capacity in Indonesia). In November 2021, FCX announced the implementation of its performance-based shareholder returns policy, including the commencement of a $3.0 billion share repurchase program and the addition of a variable dividend such that the expected base and variable dividends on common stock will total $0.60 per share for 2022.
Under the policy up to 50 percent of cash flows, after planned capital spending (excluding Indonesia smelter project investments) and distributions to noncontrolling interests, will be directed to shareholder returns with the balance available for investments in future value enhancing growth projects and further debt reductions. The FCX Board of Directors (the Board) will review the structure and the amount of performance-based payout framework at least annually. On March 23, 2022, FCX declared dividends totaling $0.15 per share on its common stock (which included a $0.075 per share quarterly base cash dividend and a $0.075 per share quarterly variable cash dividend), which will be paid on May 2, 2022, to shareholders of record as of April 14, 2022. The declaration and payment of dividends (base or variable) is at the discretion of the Board and will depend on FCX's financial results, cash requirements, business prospects, global economic conditions and other factors deemed relevant by the Board. Through April 20, 2022, FCX acquired 26.8 million shares of its common stock for a total cost of $1.1 billion ($41.69 average cost per share) under the $3.0 billion share repurchase program, including 14.1 million shares for a total cost of $631 million ($44.74 average cost per share) during 2022. As of April 20, 2022, FCX has 1.45 billion shares of common stock outstanding and $1.9 billion remains available under the share repurchase program. The timing and amount of share repurchases is at the discretion of management and will depend on a variety of factors. The share repurchase program may be modified, increased, suspended or terminated at any time at the Board's discretion.
Cautionary Statement and Regulation G Disclosure
This press release contains forward-looking statements in which FCX discusses its potential future performance. Forward-looking statements are all statements other than statements of historical facts, such as plans, projections, or expectations relating to business outlook, strategy, goals or targets; ore grades and milling rates; production and sales volumes; unit net cash costs; capital expenditures; operating costs; operating plans; cash flows; liquidity; PT-FI's financing, construction and completion of additional domestic smelting capacity in Indonesia in accordance with the terms of its special mining license (IUPK); FCX's commitments to deliver responsibly produced copper, including plans to implement and validate all of its operating sites under the Copper Mark and to comply with other disclosure frameworks; execution of FCX's energy and climate strategies and the underlying assumptions and estimated impacts on FCX's business related thereto; achievement of climate commitments and net zero aspirations; improvements in operating procedures and technology innovations; exploration efforts and results; development and production activities, rates and costs; future organic growth opportunities; tax rates; export quotas and duties; the impact of copper, gold and molybdenum price changes; the impact of deferred intercompany profits on earnings; mineral reserve and mineral resource estimates; final resolution of settlements associated with ongoing legal proceedings and the ongoing implementation of FCX's financial policy and future returns to shareholders, including dividend payments (base or variable) and share repurchases.
The words 'anticipates,' 'may,' 'can,' 'plans,' 'believes,' 'estimates,' 'expects,' 'projects,' 'targets,' 'intends,' 'likely,' 'will,' 'should,' 'could,' 'to be,' 'potential,' 'assumptions,' 'guidance,' 'aspirations,' 'future' and any similar expressions are intended to identify those assertions as forward-looking statements. The declaration and payment of dividends (base or variable) and timing and amount of any share repurchases is at the discretion of the Board and management, respectively, and is subject to a number of factors, including maintaining FCX's net debt target, capital availability, FCX's financial results, cash requirements, business prospects, global economic conditions, changes in laws, contractual restrictions and other factors deemed relevant by the Board or management, as applicable. The share repurchase program may be modified, increased, suspended or terminated at any time at the Board's discretion. FCX cautions readers that forward-looking statements are not guarantees of future performance and actual results may differ materially from those anticipated, expected, projected or assumed in the forward-looking statements.
Important factors that can cause FCX's actual results to differ materially from those anticipated in the forward-looking statements include, but are not limited to, supply of and demand for, and prices of the commodities we produce, primarily copper; changes in FCX's cash requirements, financial position, financing or investment plans; changes in general market, economic, tax, regulatory or industry conditions, including as a result of Russia's invasion of Ukraine; reductions in liquidity and access to capital; the ongoing COVID-19 pandemic and any future public health crisis; political and social risks; operational risks inherent in mining, with higher inherent risks in underground mining; fluctuations in price and availability of commodities purchased; constraints on supply, logistics and transportation services; mine sequencing; changes in mine plans or operational modifications, delays, deferrals or cancellations; production rates; timing of shipments; results of technical, economic or feasibility studies; potential inventory adjustments; potential impairment of long-lived mining assets; the potential effects of violence in Indonesia generally and in the province of Papua; the Indonesia government's extension of PT-FI's export license after March 19, 2023; satisfaction of requirements in accordance with PTFI's IUPK to extend mining rights from 2031 through 2041; the Indonesia government's approval of a deferred schedule for completion of additional domestic smelting capacity in Indonesia; cybersecurity incidents; labor relations, including labor-related work stoppages and costs; the results of the human health assessment to evaluate the potential impacts of tailings and mining waste, and compliance with applicable environmental, health and safety laws and regulations; weather- and climate-related risks; environmental risks and litigation results; FCX's ability to comply with its responsible production commitments under specific frameworks and any changes to such frameworks and other factors described in more detail under the heading 'Risk Factors' in FCX's Annual Report on Form 10-K for the year ended December 31, 2021, filed with the U.S. Securities and Exchange Commission (SEC). Investors are cautioned that many of the assumptions upon which FCX's forward-looking statements are based are likely to change after the date the forward-looking statements are made, including for example commodity prices, which FCX cannot control, and production volumes and costs or technological solutions and innovation, some aspects of which FCX may not be able to control. Further, FCX may make changes to its business plans that could affect its results. FCX cautions investors that it undertakes no obligation to update any forward-looking statements, which speak only as of the date made, notwithstanding any changes in its assumptions, changes in business plans, actual experience or other changes. This press release also contains financial measures such as net debt, adjusted net income and unit net cash costs (credits) per pound of copper and molybdenum, which are not recognized under U.S. generally accepted accounting principles. As required by SEC Regulation G, reconciliations of these measures to amounts reported in FCX's consolidated financial statements are in the supplemental schedules of this press release.
Contact:
David Joint
Tel: 602.366.8400
Email: ir@fmi.com
FREEPORT-MCMORAN INC. 
