Freeport 1Q Profit Up 59% On Higher Metals Prices

Freeport-McMoRan Copper & Gold Inc.'s (FCX) first-quarter profit jumped a better-than-expected 59% as higher production and surging prices boosted the top line.

Shares were up 4.4% to $54 premarket Wednesday. The stock has climbed 58% through Tuesday's close.

Freeport's earnings have risen of late as appetite for gold, the company's main source of revenue, remains at record levels, held up by investors stockpiling the precious metal as a hedge against other assets.

Freeport has also benefited from the recent rally in copper prices, which remain historically high despite worries about Japan's nuclear crisis and fears that high oil prices will damp the global economic recovery. Freeport is the world's second-largest copper producer after Chile's state-owned Corporacion Nacional del Cobre de Chile.

Surging earnings prompted the company to declare a 50-cent per-share special dividend on top of its normal quarterly payments. The one-time dividend will cost the company about $470 million. That comes on top of a $1-a-share special dividend last year and a two-for-one stock split. Shares have more than quintupled since December 2008.

Freeport posted a profit of $1.5 billion, or $1.57 a share, up from $945 million, or $1 a share, a year earlier, adjusted for the stock split. Revenue rose 31% to $5.71 billion. Analysts polled by Thomson Reuters had forecast a $1.26 profit on $5.3 billion in revenue.

Copper output grew 2.3% while gold production rose 3.8%. Molybdenum output increased about 18%.

Realized prices for gold and copper both rose 26%, while molybdenum prices increased 20%.

   -By Drew FitzGerald, Dow Jones Newswires; 212-416-2909; [e-mail]