Freeport-McMoRan (FCX) is scheduled to release its first-quarter earnings on April 25. Analysts polled by Thomson Reuters expect the company to post revenues of $3.81 billion in the quarter. It posted revenues of $3.68 billion in the fourth quarter and $4.87 billion in the first quarter of 2018. While Freeport’s revenues are expected to rise 3.5% sequentially, they are expected to fall 21.7% on a YoY basis.

What to Expect from Freeport-McMoRan’s Q1 Earnings

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Freeport’s first-quarter adjusted EBITDA are expected to fall more than 56% YoY to $856 million. Before we analyze why analysts have such a pessimistic view of Freeport’s first-quarter earnings, let’s do a quick recap of the company’s fourth-quarter financial performance.

Q4 performance

Freeport reported revenues of $3.7 billion in the fourth quarter versus revenues of $4.9 billion in the third quarter and $5.0 billion in the fourth quarter of 2017. Its adjusted EBITDA also fell to $885 million in the fourth quarter versus $1.8 billion in the sequential quarter. Freeport missed both revenue and earnings estimates in the fourth quarter.

Lower-than-expected shipments were the key driver of Freeport’s fourth-quarter earnings miss. While its copper shipments were only marginally lower than what it guided in its third-quarter earnings call, its gold shipments were almost 20% lower as compared to its guidance. Freeport’s unit cash costs were also higher as compared to its guidance.

After falling sharply last year, Freeport has recouped some of its losses and is up 33.5% year-to-date.

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