(Reuters) - Freeport-McMoRan (NYSE:FCX) Inc reported a sharp drop in third-quarter profit on Thursday due to falling copper prices, although the mining company's shares rose as results beat Wall Street's expectations and executives gave a bullish demand outlook for the red metal used widely across the economy.
Shares of the Phoenix-based company jumped more than 6% in midday trading to $30.25.
LME copper has given up 30% since touching a record peak in March, largely holding in a range between $7,200 and $8,000 since end-August, pressured by COVID-19 flare-ups in China, the world's biggest metal consumer.
Freeport nevertheless forecast rising demand for the red metal due to copper's use in renewable energy products and said none of its customers have scaled back orders.
"We certainly have no problem selling copper," Freeport Chief Executive Richard Adkerson told investors on a conference call. "It's just striking how negative the financial markets are about this industry and yet the physical market is so tight."
Adkerson and Freeport President Kathleen Quirk added, though, that they believe the company is ready for any economic downturn and has deferred major investment decisions "in the current market environment."
The company has seen rising costs for oil, labor and equipment, executives said.
Freeport's net income attributable to common stock fell to $404 million, or 28 cents per share, in the quarter ended Sept. 30, from $1.4 billion, or 94 cents per share, in the year-ago quarter.
By that measure, analysts expected earnings of 26 cents per share, according to IBES data from Refinitiv.
The company, which runs Indonesia's Grasberg, one of the world's largest copper mines, said its quarterly copper production rose 7% to 1.06 billion recoverable pounds.
Freeport said its average realized price for copper dropped 16.7% to $3.50 per pound at the end of the third quarter, compared with last year.