April 23 (Reuters) – Miner Freeport-McMoRan said on Thursday it expects a slower-than-anticipated recovery at its flagship Grasberg mine in Indonesia after a fatal mud flooding incident disrupted operations.
Shares of the company fell more than 9% in premarket trading.
The company now expects only about 65% of production at Grasberg, the world’s second-largest copper mine, to be restored by the second half of the year, down from its earlier forecast of 85%.
The world’s largest publicly traded copper producer expects the mine to produce 800 million pounds of copper and 700 million ounces of gold this year.
It had earlier estimated 1.1 billion pounds of copper cathode and about 800 million ounces of gold.
Freeport’s copper production fell 23.7% to 662 million recoverable pounds in the first quarter, while gold production was down 66.2% at 97,000 recoverable ounces.
However, stronger copper prices helped offset the hit from lower volumes.
Average copper prices rose 36.7% during the January–March quarter, supported by supply constraints, low inventories and robust demand.
Freeport said its realized copper price averaged $5.78 per pound, up from $4.44 a year earlier.
The higher prices helped Freeport beat Wall Street estimates for quarterly profit.
The company reported an adjusted profit of 57 cents per share for the three months ended March 31, compared with analysts’ average estimate of 46 cents, according to data compiled by LSEG.
(Reporting by Pranav Mathur in Bengaluru; Editing by Sriraj Kalluvila)
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