Business Segments (Tables)

6 Months Ended

Jun. 30, 2019

Revenue from External Customers by Products and Services

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



	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2019			2018			2019			2018
Copper:
Concentrate	$	1,134		$	1,703		$	2,299		$	3,350
Cathode	959			1,183			1,818			2,368
Rod and other refined copper products	516			668			1,023			1,338
Purchased copper^a	325			282			662			520
Gold	305			933			696			1,741
Molybdenum	327			310			615			596
Other^b	218			400			495			798
Adjustments to revenues:
Treatment charges	(100		)	(139		)	(205		)	(271		)
Royalty expense^c	(19		)	(73		)	(49		)	(142		)
Export duties^d	(10		)	(55		)	(27		)	(101		)
Revenues from contracts with customers	3,655			5,212			7,327			10,197
Embedded derivatives^e	(109		)	(44		)	11			(161		)
Total consolidated revenues	$	3,546		$	5,168		$	7,338		$	10,036


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.


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 June 30, 2019
Revenues:
Unaffiliated customers	$	16	$	69	$	85	$	562	$	128		$	690	$	583		^a	$	—	$	1,171	$	546	$	471		^b	$	3,546
Intersegment	491		544		1,035		71		—			71		(1		)		109		4		—		(1,218		)		—
Production and delivery	348		477		825		455		126			581		554				78		1,171		515		(722		)		3,002
Depreciation, depletion and amortization	43		44		87		101		18			119		99				18		3		7		19				352
Selling, general and administrative expenses	—		—		—		2		—			2		30				—		—		5		60				97
Mining exploration and research expenses	—		1		1		—		—			—		—				—		—		—		30				31
Environmental obligations and shutdown costs	—		—		—		—		—			—		—				—		—		—		23				23
Net loss on sales of assets	—		—		—		—		—			—		—				—		—		—		8				8
Operating income (loss)	116		91		207		75		(16		)	59		(101		)		13		1		19		(165		)		33

Interest expense, net	1		—		1		25		—			25		1				—		—		6		99				132
Provision for (benefit from) income taxes	—		—		—		20		(9		)	11		(35		)		—		—		2		7				(15		)
Total assets at June 30, 2019	2,917		4,921		7,838		8,571		1,699			10,270		16,261				1,792		250		764		3,911				41,086
Capital expenditures	49		158		207		43		4			47		339				2		1		5		28				629

Three Months Ended June 30, 2018
Revenues:
Unaffiliated customers	$	25	$	13	$	38	$	719	$	171		$	890	$	1,639		^a	$	—	$	1,387	$	602	$	612		^b	$	5,168
Intersegment	568		641		1,209		100		—			100		1				111		8		—		(1,429		)		—
Production and delivery	298		491		789		445		133			578		425				71		1,389		579		(916		)		2,915
Depreciation, depletion and amortization	44		48		92		109		24			133		172				21		3		7		14				442
Selling, general and administrative expenses	1		—		1		2		—			2		28				—		—		5		73				109
Mining exploration and research expenses	—		—		—		—		—			—		—				—		—		—		24				24
Environmental obligations and shutdown costs	—		—		—		—		—			—		—				—		—		—		59				59
Net gain on sales of assets	—		—		—		—		—			—		—				—		—		—		(45		)		(45		)
Operating income (loss)	250		115		365		263		14			277		1,015				19		3		11		(26		)		1,664

Interest expense, net	1		—		1		16		—			16		—				—		—		6		119				142
Provision for (benefit from) income taxes	—		—		—		102		6			108		429				—		—		—		(22		)		515
Total assets at June 30, 2018	2,819		4,374		7,193		8,630		1,715			10,345		10,911				1,820		278		931		5,550				37,028
Capital expenditures	41		99		140		68		3			71		246				1		1		3		20				482


a.	Includes PT-FI's sales to PT Smelting totaling $470 million in second-quarter 2019 and $649 million in second-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
Six Months Ended June 30, 2019
Revenues:
Unaffiliated customers	$	28	$	164	$	192	$	1,289	$	226		$	1,515	$	1,288		^a	$	—	$	2,299	$	1,117	$	927		^b	$	7,338
Intersegment	949		1,013		1,962		197		—			197		57				200		10		5		(2,431		)		—
Production and delivery	643		925		1,568		894		226			1,120		1,110				149		2,304		1,067		(1,340		)		5,978
Depreciation, depletion and amortization	83		87		170		201		32			233		204				34		5		14		39				699
Selling, general and administrative expenses	1		1		2		4		—			4		60				—		—		10		133				209
Mining exploration and research expenses	—		1		1		—		—			—		—				—		—		—		57				58
Environmental obligations and shutdown costs	—		—		—		—		—			—		—				—		—		—		65				65
Net gain on sales of assets	—		—		—		—		—			—		—				—		—		—		(25		)		(25		)
Operating income (loss)	250		163		413		387		(32		)	355		(29		)		17		—		31		(433		)		354

Interest expense, net	2		—		2		54		—			54		1				—		—		12		209				278
Provision for (benefit from) income taxes	—		—		—		130		(14		)	116		(9		)		—		—		3		(20		)		90
Capital expenditures	111		306		417		99		9			108		658				6		2		9		51				1,251

Six Months Ended June 30, 2018
Revenues:
Unaffiliated customers	$	28	$	28	$	56	$	1,344	$	321		$	1,665	$	3,160		^a	$	—	$	2,772	$	1,179	$	1,204		^b	$	10,036
Intersegment	1,169		1,330		2,499		202		—			202		53				206		16		2		(2,978		)		—
Production and delivery	588		992		1,580		872		249			1,121		882				138		2,777		1,135		(1,910		)		5,723
Depreciation, depletion and amortization	90		96		186		214		46			260		353				40		5		14		35				893
Selling, general and administrative expenses	2		2		4		4		—			4		67				—		—		11		154				240
Mining exploration and research expenses	—		1		1		—		—			—		—				—		—		—		44				45
Environmental obligations and shutdown costs	—		—		—		—		—			—		—				—		—		—		68				68
Net gain on sales of assets	—		—		—		—		—			—		—				—		—		—		(56		)		(56		)
Operating income (loss)	517		267		784		456		26			482		1,911				28		6		21		(109		)		3,123

Interest expense, net	2		—		2		33		—			33		—				—		—		11		247				293
Provision for income taxes	—		—		—		170		10			180		830				—		—		1		10				1,021
Capital expenditures	88		144		232		131		7			138		449				2		2		7		54				884


a.	Includes PT-FI’s sales to PT Smelting totaling $879 million for the first six months of 2019 and $1.3 billion for the first six 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.