Business Segments (Tables)

9 Months Ended

Sep. 30, 2019

Revenue from External Customers by Products and Services

FCX’s revenues attributable to the products it sold for the third quarters and first nine months of 2019 and 2018 follow (in millions):



	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
Copper:
Concentrate	$	952		$	1,743		$	3,251		$	5,093
Cathode	878			1,015			2,696			3,383
Rod and other refined copper products	537			561			1,560			1,899
Purchased copper^a	210			256			872			776
Gold	415			1,073			1,111			2,814
Molybdenum	295			286			910			882
Other^b	202			381			697			1,179
Adjustments to revenues:
Treatment charges	(87		)	(162		)	(292		)	(433		)
Royalty expense^c	(24		)	(75		)	(73		)	(217		)
Export duties^d	(174		)	(52		)	(201		)	(153		)
Revenues from contracts with customers	3,204			5,026			10,531			15,223
Embedded derivatives^e	(51		)	(118		)	(40		)	(279		)
Total consolidated revenues	$	3,153		$	4,908		$	10,491		$	14,944


a.	FCX purchases copper cathode primarily for processing by its Rod & Refining operations.


b.	Primarily includes revenues associated with cobalt and silver.


c.	Reflects royalties on sales from PT-FI and Cerro Verde that will vary with the volume of metal sold and prices.


d.	Reflects PT-FI export duties. The third quarter and first nine months of 2019 include charges totaling $166 million primarily associated with an unfavorable Indonesia Supreme Court ruling related to certain disputed export duties (refer to Note 12).


e.	Refer to Note 6 for discussion of embedded derivatives related to FCX’s provisionally priced concentrate and cathode sales contracts.

Schedule of financial information by business segment

Financial Information by Business Segment




(In millions)

																								Atlantic			Corporate,
	North America Copper Mines						South America																	Copper			Other
							Cerro							Indonesia				Molybdenum			Rod &			Smelting			& Elimi-				FCX
	Morenci		Other		Total		Verde		Other			Total		Mining				Mines			Refining			& Refining			nations				Total
Three Months Ended September 30, 2019
Revenues:
Unaffiliated customers	$	61	$	19	$	80	$	504	$	117		$	621	$	488		^a	$	—		$	1,104		$	437		$	423		^b	$	3,153
Intersegment	462		598		1,060		65		—			65		—				90			8			—			(1,223		)		—
Production and delivery	377		519		896		417		111			528		399				85			1,111			421			(775		)		2,665
Depreciation, depletion and amortization	45		46		91		93		16			109		77				16			2			7			20				322
Metals inventory adjustments	1		37		38		2		—			2		—				1			—			—			—				41
Selling, general and administrative expenses	1		1		2		2		—			2		31				—			—			5			66				106
Mining exploration and research expenses	—		—		—		—		—			—		—				—			—			—			25				25
Environmental obligations and shutdown costs	—		—		—		—		—			—		—				—			—			—			20				20
Net loss on sales of assets	—		—		—		—		—			—		—				—			—			—			12				12
Operating income (loss)	99		14		113		55		(10		)	45		(19		)		(12		)	(1		)	4			(168		)		(38		)

Interest expense, net	—		1		1		25		—			25		1				—			—			5			91				123
Provision for (benefit from) income taxes	—		—		—		29		4			33		(8		)		—			—			(1		)	67				91
Total assets at September 30, 2019	2,943		5,005		7,948		8,500		1,723			10,223		16,447				1,786			236			680			3,623				40,943
Capital expenditures	61		163		224		61		7			68		334				5			1			9			25				666

Three Months Ended September 30, 2018
Revenues:
Unaffiliated customers	$	30	$	2	$	32	$	687	$	122		$	809	$	1,703		^a	$	—		$	1,212		$	579		$	573		^b	$	4,908
Intersegment	467		587		1,054		71		—			71		61				101			8			—			(1,295		)		—
Production and delivery	304		485		789		519		105			624		522				76			1,215			559			(716		)		3,069
Depreciation, depletion and amortization	43		45		88		122		20			142		181				20			3			6			18				458
Selling, general and administrative expenses	1		—		1		3		—			3		29				—			—			5			63				101
Mining exploration and research expenses	—		1		1		—		—			—		—				—			—			—			26				27
Environmental obligations and shutdown costs	—		2		2		—		—			—		—				—			—			—			6				8
Net gain on sales of assets	—		—		—		—		—			—		—				—			—			—			(70		)		(70		)
Operating income (loss)	149		56		205		114		(3		)	111		1,032				5			2			9			(49		)		1,315

Interest expense, net	1		—		1		15		—			15		—				—			—			7			120				143
Provision for income taxes	—		—		—		37		5			42		424				—			—			—			56				522
Total assets at September 30, 2018	2,826		4,465		7,291		8,613		1,709			10,322		11,764				1,808			284			835			5,445				37,749
Capital expenditures	63		118		181		47		3			50		246				4			1			3			22				507


a.	Includes PT-FI's sales to PT Smelting totaling $475 million in third-quarter 2019 and $827 million in third-quarter 2018.


b.	Includes revenues from FCX's molybdenum sales company, which includes sales of molybdenum produced by the Molybdenum mines and by certain of the North America and South America copper mines.



(In millions)

																							Atlantic		Corporate,
	North America Copper Mines						South America Mining																Copper		Other
							Cerro							Indonesia				Molybdenum		Rod &			Smelting		& Elimi-				FCX
	Morenci		Other		Total		Verde		Other			Total		Mining				Mines		Refining			& Refining		nations				Total
Nine Months Ended September 30, 2019
Revenues:
Unaffiliated customers	$	89	$	183	$	272	$	1,793	$	343		$	2,136	$	1,776		^a	$	—	$	3,403		$	1,554	$	1,350		^b	$	10,491
Intersegment	1,411		1,611		3,022		262		—			262		57				290		18			5		(3,654		)		—
Production and delivery	1,020		1,443		2,463		1,311		337			1,648		1,509				234		3,415			1,488		(2,173		)		8,584
Depreciation, depletion and amortization	128		133		261		294		48			342		281				50		7			21		59				1,021
Metals inventory adjustments	1		38		39		2		—			2		—				1		—			—		58				100
Selling, general and administrative expenses	2		2		4		6		—			6		91				—		—			15		199				315
Mining exploration and research expenses	—		1		1		—		—			—		—				—		—			—		82				83
Environmental obligations and shutdown costs	—		—		—		—		—			—		—				—		—			—		85				85
Net gain on sales of assets	—		—		—		—		—			—		—				—		—			—		(13		)		(13		)
Operating income (loss)	349		177		526		442		(42		)	400		(48		)		5		(1		)	35		(601		)		316

Interest expense, net	2		1		3		79		—			79		2				—		—			17		300				401
Provision for (benefit from) income taxes	—		—		—		159		(10		)	149		(9		)		—		—			2		39				181
Capital expenditures	172		469		641		160		16			176		992				11		3			18		76				1,917

Nine Months Ended September 30, 2018
Revenues:
Unaffiliated customers	$	58	$	30	$	88	$	2,031	$	443		$	2,474	$	4,863		^a	$	—	$	3,984		$	1,758	$	1,777		^b	$	14,944
Intersegment	1,636		1,917		3,553		273		—			273		114				307		24			2		(4,273		)		—
Production and delivery	892		1,475		2,367		1,391		354			1,745		1,404				214		3,992			1,694		(2,626		)		8,790
Depreciation, depletion and amortization	133		141		274		336		66			402		534				60		8			20		53				1,351
Metals inventory adjustments	—		2		2		—		—			—		—				—		—			—		—				2
Selling, general and administrative expenses	3		2		5		7		—			7		96				—		—			16		217				341
Mining exploration and research expenses	—		2		2		—		—			—		—				—		—			—		70				72
Environmental obligations and shutdown costs	—		2		2		—		—			—		—				—		—			—		74				76
Net gain on sales of assets	—		—		—		—		—			—		—				—		—			—		(126		)		(126		)
Operating income (loss)	666		323		989		570		23			593		2,943				33		8			30		(158		)		4,438

Interest expense, net	3		—		3		48		—			48		—				—		—			18		367				436
Provision for income taxes	—		—		—		207		15			222		1,254				—		—			1		66				1,543
Capital expenditures	151		262		413		178		10			188		695				6		3			10		76				1,391


a.	Includes PT-FI’s sales to PT Smelting totaling $1.4 billion for the first nine months of 2019 and $2.1 billion for the first nine months of 2018.

Includes revenues from FCX’s molybdenum sales company, which includes sales of molybdenum produced by the Molybdenum mines and by certain of the North America and South America copper mines.