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Freeport projects 9.8% drop in net profit this year to $3.7b
PTFI has forecast a 7.2 percent decline in copper output as well as a 9.2 percent decline in gold output this year, resulting in a 9.8 percent fall in net profit to $3.7 billion.
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Tony Wenas, president director of PT Freeport Indonesia, poses for reporters during the CEO Insight session in Jakarta on Oct. 23, 2023, as part of the 14th Kompas100 CEO Forum. (JP/Deni Ghifari)
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T Freeport Indonesia (PTFI) is expecting a decline in net profit this year due to reduced copper and gold production, pointing to lower mineral content in the ore it plans to mine.
The mining firm has estimated copper output would decline from 1.8 billion pounds in 2024 to 1.67 billion pounds (757,499 tonnes) this year, and then to 1.58 billion pounds in 2026.
It also expects gold output to drop from 1.84 million ounces (52.16 tonnes) last year to 1.67 million ounces this year.
PTFI president director Tony Wenas attributed the decline to natural variations in ore grades, but said the company would still adhere to its structured mining plan.
"Since we mine in a sequential manner, we can't selectively extract ore with higher mineral content. The process must be balanced to prevent damage, as we operate underground mines," Tony told a meeting on Thursday with House of Representatives Commission VI, which oversees state-owned enterprises (SOEs).
As a result, the company expected its revenue to dip 1.8 percent to US$11.2 billion this year, while net profit was projected to fall 9.8 percent to $3.7 billion.
Despite the lower earnings forecast, PTFI remains a significant contributor to state revenue, contributing an estimated $1.7 billion in tax payments and $900 million to nontax revenue. Additionally, the firm is set to distribute $1.2 billion in dividends to its parent company, state-owned mining holding company MIND ID.
