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Despite Q2/19 Production Setback, Miner Intends to Meet Full-Year Guidance
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A description of the current situation and near-term outlook were provided in a CIBC report.

In a July 2 research note, CIBC analyst Oscar Cabrera reported that Freeport-McMoRan Inc. (FCX:NYSE) lowered its Q2/19 gold sales estimate but maintained its 2019 guidance for gold and copper. It also provided an operations update for PT Freeport Indonesia.

Freeport maintained its 2019 copper and gold sales guidance at 3.3 billion pounds and 800,000 ounces, respectively. However, the company lowered its Q2/19 gold sales due to the Grasberg pit resequencing.

Cabrera pointed out that Freeport importantly declared its intention to meet 2019 revised mine plans for the Grasberg open pit and noted the pit could potentially produce more copper and gold in 2019 than expected. The company also indicated that material not mined from the Grasberg open pit could be mined from the Grasberg block cave.

Freeport's primary near-term catalysts, Cabrera wrote, include the company meeting operational guidance and executing development of the Grasberg underground ramp-up and of Lone Star.

After factoring into its model on Freeport revised Q2/19 guidance and the 2019 operating update, CIBC reiterated its Outperformer rating and $15 per share price target on the company. Freeport's current stock price, in comparison, is around $11.29 per share, a discount to peers that is unwarranted, Cabrera pointed out, "given the completion of Grasberg's agreement, strong operating/development project execution and a strong balance sheet."

Freeport will report Q2/19 results before the market opens on July 24, 2019, and immediately follow them with a conference call.

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Disclosures from CIBC, Freeport McMoRan Inc., July 2, 2019

Analyst Certification:
Each CIBC World Markets Corp./Inc. research analyst named on the front page of this research report, or at the beginning of any subsection hereof, hereby certifies that (i) the recommendations and opinions expressed herein accurately reflect such research analyst's personal views about the company and securities that are the subject of this report and all other companies and securities mentioned in this report that are covered by such research analyst and (ii) no part of the research analyst's compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed by such research analyst in this report.

Analysts employed outside the U.S. are not registered as research analysts with FINRA. These analysts may not be associated persons of CIBC World Markets Corp. and therefore may not be subject to FINRA Rule 2241 restrictions on communications with a subject company, public appearances and trading securities held by a research analyst account.

Potential Conflicts of Interest:
Equity research analysts employed by CIBC World Markets Corp./Inc. are compensated from revenues generated by various CIBC World Markets Corp./Inc. businesses, including the CIBC World Markets Investment Banking Department. Research analysts do not receive compensation based upon revenues from specific investment banking transactions. CIBC World Markets Corp./Inc. generally prohibits any research analyst and any member of his or her household from executing trades in the securities of a company that such research analyst covers.
Additionally, CIBC World Markets Corp./Inc. generally prohibits any research analyst from serving as an officer, director or advisory board member of a company that such analyst covers.

In addition to 1% ownership positions in covered companies that are required to be specifically disclosed in this report, CIBC World Markets Corp./Inc. may have a long position of less than 1% or a short position or deal as principal in the securities discussed herein, related securities or in options, futures or other derivative instruments based thereon.

Recipients of this report are advised that any or all of the foregoing arrangements, as well as more specific disclosures set forth below, may at times give rise to potential conflicts of interest.

Important Disclosure Footnotes for Freeport-McMoRan Inc. (FCX)

· CIBC World Markets Inc. expects to receive or intends to seek compensation for investment banking services from Freeport-McMoRan Inc. in the next 3 months.





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