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Freeport income drops in qtr. on Grasberg woes

Keywords: Tags  Freeport-McMoRan Copper & Gold, Freeport earnings, copper, copper productionm, copper prices, gold output, quarterly earnings, Richard Adkerson Everdeen Mason

NEW YORK — Freeport-McMoRan Copper & Gold Inc. reported lower net income and sales in the second quarter, primarily due to the May tunnel collapse at its Grasberg Mine in Indonesia.

Freeport’s net income of $482 million for the quarter ended June 30 fell 32.1 percent from $710 million a year earlier on sales that dropped 4.2 percent to $4.29 billion from $4.48 million.

The Phoenix-based company’s second-quarter copper and gold production volumes missed initial estimates by 125 million pounds and 120 million ounces, respectively, Freeport vice chairman, president and chief executive officer Richard Adkerson said in a conference call.

"That is really what drove the shortfall of our performance," he said, referring to the May 14 tunnel collapse in Indonesia that killed 28 people and injured 10 (, May 15).

Freeport was also impacted by a "very volatile season" in copper, Adkerson said.

Comex copper prices were trading at a little more than $3.05 per pound June 28, down 9.5 percent from around $3.37 per pound April 1.

Despite this, "we are very confident about the long-term (fundamentals) of this marketplace," Adkerson said.

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