Freeport-McMoRan Inc. (NYSE:FCX)

Current Income Taxes

The current income tax expense demonstrated a general upward trend over the period analyzed. Beginning at $764 million in 2020, it sharply increased to $2,471 million in 2021. It then slightly declined to $2,231 million in 2022 and $2,088 million in 2023, before rising again to $2,600 million in 2024. This fluctuation suggests variability in the company's taxable income or changes in applicable tax rates.

Deferred Income Taxes

Deferred income tax expenses displayed more volatility. Starting at $298 million in 2020, there was a decline to $211 million in 2021 followed by an increase to $299 million in 2022 and further to $373 million in 2023. In 2024, however, the figure sharply reversed to a negative $74 million, indicating a deferred tax benefit or reversal of previously recognized deferred tax liabilities. This negative value may imply significant changes in temporary differences or tax planning strategies.

Provision for Income Taxes

The overall provision for income taxes largely mirrored the trend in current income taxes, with totals reflecting the aggregated current and deferred expenses. The provision rose from $944 million in 2020 to $2,299 million in 2021. It then remained relatively stable with slight decreases and increases: $2,267 million in 2022, $2,270 million in 2023, and a moderate rise to $2,523 million in 2024. The stability in the combined provision suggests consistent overall tax costs despite fluctuations in deferred taxes.

The analysis of the tax-related financial indicators reveals several noteworthy trends over the five-year period from 2020 to 2024. The U.S. federal statutory tax rate remains constant at 21% throughout the period, serving as a stable benchmark for other tax rate fluctuations.

Foreign tax credit expiration/limitation

This factor shows a significant upward trend, starting at -2% in 2020 and steadily increasing to 15% by 2024. The increase suggests growing restrictions or limitations on the benefits derived from foreign tax credits, which could impact net tax liabilities.

Valuation allowance

The valuation allowance exhibits a pronounced decline over the period, moving from a positive 12% in 2020 to a negative 13% in 2024. This shift indicates a reversal in deferred tax asset valuation, possibly reflecting improved expectations of future taxable income or changes in accounting assumptions related to deferred taxes.

Withholding and other impacts on foreign earnings

This component remains relatively stable, fluctuating slightly between 9% and 11% but generally maintaining a consistent impact on foreign earnings tax considerations.

Effect of foreign rates different than the U.S. federal statutory rate

The effect of foreign tax rates shows minor fluctuations but maintains a level close to 5% to 6% across the years, suggesting moderate and consistent differences between U.S. and foreign tax environments.

PT-FI historical tax disputes

This item appears intermittently, with a 3% impact reported in 2021 and a negative 2% impact in 2024, indicating some resolution or change in uncertainties surrounding historical tax disputes related to this entity.

Percentage depletion

Percentage depletion has a decreasing negative effect over the period, moving from -6% in 2020 to -2% in 2024. This trend suggests a diminishing benefit from depletion deductions, potentially due to changes in asset base or production activities.

State income taxes

Reported only in 2023 with a small positive impact of 1%, indicating a minor consideration of state-level income taxes in the overall tax rate calculation.

Non-deductible permanent differences

Also isolated to 2023 with a positive 1% effect, this reflects specific, possibly one-time, items that increase taxable income without being deductible for tax purposes.

Uncertain tax positions

Uncertain tax positions appear sporadically with a 1% positive effect in both 2020 and 2023, indicating some degree of risk or adjustment related to tax positions that are not firmly established.

PT Rio Tinto Indonesia valuation allowance

Noted only in 2021 with a -2% impact, suggesting a reduction in valuation allowance specific to this investment during that year.

Sale of Kisanfu and Timok exploration project sale

The sale of Kisanfu contributes an 8% positive impact in 2020, whereas the Timok exploration project sale has a -3% impact in the same year, reflecting tax impacts associated with asset disposals that year.

Cerro Verde historical tax disputes

Reported as a 2% positive impact in 2020 only, indicating that tax issues related to Cerro Verde were relevant during that year but not subsequently.

Other items, net

This category shows minor positive impacts, decreasing from 3% in 2020 to 1% in 2021, and no reported impact thereafter, suggesting miscellaneous adjustments became less significant over time.

Effective income tax rate

The effective income tax rate exhibits a marked reduction from a high of 53% in 2020 to a more moderate range between 30% and 38% during the subsequent years, with rates of 30%, 34%, 38%, and 37% from 2021 to 2024 respectively. This decline and subsequent stabilization imply improvements or changes in tax positioning, possibly driven by resolution of one-off items, changes in tax credits, and valuation allowance adjustments.

Overall, the data reflects significant fluctuations in various tax-related items contributing to changes in the effective income tax rate. The initial high effective tax rate in 2020 appears influenced by a combination of asset sales, valuation allowances, and tax disputes. Subsequent years show a stabilization with a reduction in valuation allowances and an increased impact from foreign tax credit limitations. These patterns suggest ongoing management of both domestic and international tax positions, as well as the impact of discrete transactions and disputes affecting the tax expense.

The financial data reveals several notable trends in the company's tax-related and operating accounts over the five-year period.

Net operating losses

These declined steadily from 2,443 million US dollars in 2020 to 1,761 million in 2023, before experiencing a slight increase to 1,814 million in 2024, indicating a general reduction in accumulated losses over time with a minor rebound in the final year.

Accrued expenses

This category showed a continuous upward trend, rising from 1,194 million US dollars in 2020 to 1,657 million in 2024, which may suggest growing obligations or accrued liabilities within the company.

Foreign tax credits

There was a significant decrease from 1,641 million US dollars in 2020 to 184 million in 2024, with the most pronounced drop occurring between 2023 and 2024. This sharp decline could indicate changes in the company's foreign tax positions or utilization of tax credits.

Employee benefit plans

This item steadily decreased from 171 million US dollars in 2020 to 76 million in 2024, reflecting either improvements in plan funding status or changes in benefit obligations.

Other deferred tax assets

These fluctuated modestly but generally trended downward, from 238 million US dollars in 2020 to 214 million in 2024, showing relative stability with slight decreases.

Total deferred tax assets

There was a consistent decline from 5,687 million US dollars in 2020 to 3,945 million in 2024, indicating a diminishing estimate of future tax benefits.

Valuation allowances

The valuation allowances decreased in magnitude from -4,732 million US dollars in 2020 to -2,984 million in 2024, signifying improved realizability of deferred tax assets over time.

Net deferred tax assets

This fluctuated, increasing from 955 million US dollars in 2020 to a peak of 1,219 million in 2021, then declining to 778 million in 2023 before recovering to 961 million in 2024. This pattern reflects varying assessments of deferred tax asset realizability relative to valuation allowances.

Property, plant, equipment, and mine development costs

These assets showed a consistent decrease in value, moving from -4,500 million US dollars in 2020 to -4,193 million in 2024, suggesting ongoing depreciation or asset disposals.

Undistributed earnings

The negative amount steadily increased from -694 million US dollars in 2020 to -981 million in 2024, indicating accumulation of losses or retained earnings not distributed to shareholders.

Other deferred tax liabilities

These liabilities diminished slightly from -169 million US dollars in 2020 to -155 million in 2024 after fluctuations, showing minor changes in other deferred tax obligations.

Total deferred tax liabilities

Deferred tax liabilities remained relatively stable, marginally decreasing from -5,363 million US dollars in 2020 to -5,329 million in 2024, suggesting consistent future tax obligations.

Net deferred tax assets (liabilities)

There was a gradual decrease in net deferred tax assets (liabilities) from -4,408 million US dollars in 2020 to -4,368 million in 2024, indicating a persistently negative net deferred tax position with minor variation over time.

Deferred Tax Assets

Deferred tax assets show an increasing trend over the reported periods, starting from an absence of reported values in 2020 and 2021, then rising to 2 million US dollars in both 2021 and 2022. The amount grows more substantially in 2023, reaching 7 million US dollars, and continues to climb to 8 million in 2024. This pattern indicates a gradual recognition or realization of deferred tax benefits over time.

Deferred Tax Liabilities

Deferred tax liabilities demonstrate relatively stable levels throughout the periods, with values oscillating slightly around the 4,200 to 4,400 million US dollars range. Specifically, there was a decrease from 4,408 million in 2020 to 4,234 million in 2021, followed by a minor increase in 2022 to 4,269 million. The figure peaked again at 4,453 million in 2023 before slightly declining to 4,376 million in 2024. This stability suggests consistent obligations related to deferred taxes without dramatic fluctuations.

Overall Observations

The company's deferred tax assets are steadily increasing, which may imply enhanced recognition of deductible temporary differences or carryforwards that could benefit future tax liabilities. Conversely, deferred tax liabilities remain largely stable over the years, indicating maintained levels of taxable temporary differences or tax obligations anticipated in the future. The contrasting trends in assets versus liabilities highlight a potential improvement in the net deferred tax position, which could positively affect the company’s tax expense management.

The financial data demonstrates evolving trends in the company’s asset base, liabilities, equity, and profitability over the five-year period ending in 2024. Both reported and adjusted figures are provided, enabling comparison between the conventional accounting measures and those modified for income tax considerations.

Total Assets

Total assets have shown a consistent upward trend from 2020 through 2024. The reported total assets increased from approximately $42.1 billion in 2020 to $54.8 billion in 2024, marking a growth of about 30%. The adjusted total assets follow a nearly identical pattern with only marginal differences, confirming that income tax adjustments had minimal impact on the asset base valuation.

Total Liabilities

Reported total liabilities rose from around $23.5 billion in 2020 to about $26.1 billion in 2024; however, this trajectory includes some fluctuations, with a peak near $26.2 billion in 2022 before moderately declining in 2023 and rising slightly again in 2024. Adjusted liabilities are consistently lower than reported liabilities by significant margins, starting at approximately $19.1 billion in 2020 and reaching $21.7 billion in 2024. The adjustments related to deferred income tax cause these lower liability figures, reflecting timing differences or tax assets not recognized in reported liabilities. Overall, adjusted liabilities demonstrate a steady increase but remain below reported figures throughout the period.

Stockholders’ Equity

The reported stockholders’ equity shows strong growth, increasing from about $10.2 billion in 2020 to $17.6 billion in 2024. This represents a rise of approximately 73%, highlighting an ongoing strengthening of the company’s equity base. Adjusted stockholders’ equity is higher than reported equity for every year, starting at $14.6 billion and increasing to $21.9 billion in 2024. The difference between adjusted and reported equity indicates that deferred tax impacts positively influence shareholders’ equity when adjustments are considered, reflecting potential tax benefits or liabilities timing differences. The increasing equity trend suggests improving financial stability and value for shareholders over time.

Net Income Attributable to Common Stockholders

Reported net income exhibits significant fluctuations. It surged dramatically from $599 million in 2020 to $4.3 billion in 2021, then declined to $3.5 billion in 2022, followed by a steeper decrease to $1.8 billion in 2023 and a slight increase to $1.9 billion in 2024. Adjusted net income figures also follow this pattern but are higher than reported net income in most years, reflecting positive adjustments related to deferred taxes. Specifically, adjusted net income rose from $897 million in 2020 to $4.5 billion in 2021, decreased to $3.8 billion in 2022, then declined to $2.2 billion in 2023, and decreased further to $1.8 billion in 2024. This pattern indicates volatility in earnings performance, potentially influenced by external factors such as commodity prices, operational efficiencies, or tax effects.

In summary, the company experienced asset growth and increasing equity over the analyzed period, accompanied by liability increases that are less pronounced when tax adjustments are applied. Net income displayed considerable volatility with a peak in 2021 followed by a downward trend into 2024. Adjustments for deferred income taxes consistently result in higher equity and net income values compared to reported figures, emphasizing the material impact of tax timing and accounting treatments on the company’s financial presentation.

Net Profit Margin

The reported net profit margin showed a marked improvement from 4.22% in 2020 to a peak of 18.85% in 2021, followed by a gradual decline to 7.42% by 2024. The adjusted net profit margin follows a similar pattern but with slightly higher values, indicating the impact of deferred income tax adjustments. This suggests profitability peaked significantly in 2021 but faced downward pressure in subsequent years.

Total Asset Turnover

The total asset turnover ratio remained relatively stable across the period, fluctuating slightly between 0.34 and 0.48. Both reported and adjusted figures are identical, indicating that deferred income tax adjustments did not affect this efficiency measure. This consistency suggests stable asset utilization for revenue generation.

Financial Leverage

Reported financial leverage decreased steadily from 4.14 in 2020 to 3.12 in 2024, indicating a reduction in reliance on debt financing or an increase in equity. Adjusted financial leverage also decreased from 2.89 to 2.5, albeit at lower levels than reported figures, reflecting the impact of adjustments on the company's financial structure. The declining trend suggests a gradual de-risking of the company’s capital structure.

Return on Equity (ROE)

The reported ROE increased sharply from 5.89% in 2020 to 30.8% in 2021 before gradually declining to 10.74% in 2024. Adjusted ROE follows a similar trajectory, rising to 24.8% in 2021 and decreasing to 8.27% by 2024. This pattern mirrors the profitability trends and indicates strong equity returns during 2021 with a tapering off in later years, influenced by both operational performance and tax-related adjustments.

Return on Assets (ROA)

Reported ROA increased from 1.42% in 2020 to 8.97% in 2021, then declined to 3.44% by 2024. Adjusted ROA showed a comparable trajectory but with consistently higher values except in the final year. The rise in 2021 demonstrates improved asset efficiency in generating profit, though the decline in subsequent years suggests challenges in sustaining asset profitability.

Overall Insights

The data reveals a peak in financial performance indicators such as profitability, returns on equity and assets, occurring in 2021, followed by a steady decline through 2024. Asset utilization remained stable, while financial leverage progressively decreased, signifying conservative financial management over time. Adjustments for deferred income tax generally elevate profitability and return metrics, but the overall directional trends remain consistent between reported and adjusted figures. The decline in profitability and returns after 2021 may merit further investigation into operational or market conditions affecting performance.

The financial data over the five-year period displays notable fluctuations in both reported and adjusted net income attributable to common stockholders, as well as their respective net profit margins.

Reported Net Income Attributable to Common Stockholders

There is a significant increase from 599 million US dollars in 2020 to a peak of 4,306 million in 2021. Subsequently, the income declines steadily over the following years to 3,468 million in 2022, then sharply to 1,848 million in 2023, followed by a slight increase to 1,889 million in 2024. This suggests a peak performance in 2021 with a downward trend thereafter.

Adjusted Net Income Attributable to Common Stockholders

The adjusted figures follow a similar pattern to the reported net income, starting at 897 million US dollars in 2020 and rising to 4,517 million in 2021. Thereafter, income decreases to 3,767 million in 2022, then to 2,221 million in 2023, and further down to 1,815 million in 2024. The adjustment appears to amplify income values in most years compared to the reported values, especially in the initial and peak years.

Reported Net Profit Margin

The margin rises sharply from 4.22% in 2020 to a high of 18.85% in 2021. It then declines over the subsequent years to 15.22% in 2022, further to 8.09% in 2023, and ends at 7.42% in 2024. The pattern indicates a peak in profitability in 2021, with a significant reduction in profit efficiency in the following years.

Adjusted Net Profit Margin

Adjusted net profit margin exhibits a comparable trend with a peak at 19.77% in 2021, up from 6.32% in 2020, followed by a decrease to 16.54% in 2022, 9.72% in 2023, and 7.13% in 2024. Notably, adjusted margins are consistently higher than reported margins except in 2024, indicating that adjustments generally enhance the reported profitability metrics.

Overall, the data reflect a strong performance spike in 2021 with both net income and profitability margins reaching their highest levels in the observed period. However, this was followed by a steady decline across both reported and adjusted metrics, suggesting challenges in maintaining peak profit levels. The adjusted values consistently show higher figures than the reported ones, highlighting the impact of deferred income tax and other adjustments on the financial outcomes.

The analysis of the adjusted and reported financial data over the period from 2020 to 2024 reveals several notable trends in asset values and asset turnover ratios.

Total Assets

Both reported and adjusted total assets exhibit a consistent upward trajectory from 2020 through 2024. Starting at approximately US$42.1 billion in 2020, total assets increased steadily each year, reaching about US$54.8 billion by the end of 2024. The alignment between reported and adjusted figures is nearly identical, indicating minimal adjustments between reported and deferred tax impacts on asset values during this timeframe.

Total Asset Turnover

The reported and adjusted total asset turnover ratios follow an almost identical pattern, reflecting stable operational efficiency relative to asset base. There was a marked increase from 0.34 in 2020 to 0.48 in 2021, suggesting improved utilization of assets to generate revenue during that year. Subsequently, the turnover ratio slightly declined to 0.45 in 2022, then marginally decreased to 0.44 in 2023, before rising again to 0.46 in 2024. This pattern indicates some variability but overall a maintained level of asset efficiency close to the peak observed in 2021.

In summary, the company demonstrated steady asset growth accompanied by a generally stable asset turnover ratio with a peak in 2021. The close alignment of reported and adjusted figures suggests that deferred income tax effects did not materially distort the underlying asset or turnover measurements over the analyzed period.

The financial data reveals a consistent growth trend in both total assets and stockholders’ equity over the five-year period. Reported total assets increased steadily from US$42,144 million in 2020 to US$54,848 million in 2024, showing a cumulative growth of approximately 30%. Adjusted total assets, which presumably account for deferred income tax adjustments, closely mirror this trend with marginal differences in values.

Stockholders’ equity demonstrates even more pronounced growth. Reported equity rose from US$10,174 million in 2020 to US$17,581 million in 2024, representing an increase of nearly 73%. The adjusted stockholders’ equity figures are consistently higher than the reported figures by a substantial margin, rising from US$14,582 million to US$21,949 million over the same period. This suggests the adjustment significantly affects equity valuation, likely reflecting deferred tax assets or liabilities that materially impact shareholders’ equity.

Financial leverage, calculated as the ratio of total assets to stockholders’ equity, exhibits a steady decline across both reported and adjusted measures. Reported financial leverage decreased from 4.14 in 2020 to 3.12 in 2024, indicating the company is progressively using less debt relative to equity to finance its assets. Adjusted financial leverage also declined, from 2.89 to 2.50, although the adjusted leverage ratios are consistently lower than the reported ones. This lower leverage on an adjusted basis may reflect the influence of deferred tax-related adjustments that increase equity or reduce liabilities, thereby improving the leverage profile.

Overall, the trends suggest improving financial strength and balance sheet resilience. The growth in equity outpaces asset growth, which contributes to a declining leverage ratio, signifying a stronger equity base supporting the company’s asset structure. The adjustments associated with deferred income taxes notably enhance the equity base and reduce leverage ratios, indicating that tax-related accounting adjustments have a meaningful impact on financial metrics and risk assessment.

The financial data reveals notable fluctuations and trends over the five-year period ending in 2024. The reported net income attributable to common stockholders showed a significant increase from 599 million US dollars in 2020 to a peak of 4,306 million US dollars in 2021, followed by a steady decline in subsequent years, reaching 1,889 million US dollars in 2024. The adjusted net income attributable to common stockholders follows a similar pattern, increasing from 897 million US dollars in 2020 to 4,517 million US dollars in 2021, then decreasing to 1,815 million US dollars by 2024.

Stockholders’ equity, both reported and adjusted, has demonstrated consistent growth throughout the period. Reported stockholders’ equity increased from 10,174 million US dollars in 2020 to 17,581 million US dollars in 2024, while adjusted stockholders’ equity rose from 14,582 million US dollars to 21,949 million US dollars over the same timeframe, indicating strengthening capital reserves.

Return on equity (ROE) metrics reflect the income trends. Reported ROE surged from 5.89% in 2020 to a high of 30.8% in 2021, before declining steadily to 10.74% in 2024. Adjusted ROE exhibited a similar trajectory, peaking at 24.8% in 2021, then falling to 8.27% by 2024. The decline in ROE after 2021 highlights a reduced efficiency in generating returns on equity despite the growth in equity levels.

Income Trends

Reported and adjusted net incomes peaked sharply in 2021, followed by a consistent decrease through 2024, indicating variability in profitability.

Equity Trends

Both reported and adjusted stockholders’ equity increased steadily each year, suggesting ongoing capital accumulation and a stronger equity base.

Profitability Ratios

ROE figures spiked in 2021 reflecting exceptional returns then declined over the next three years, pointing to a normalization or reduction in profitability relative to equity.

Overall Insight

The data suggests a peak in profitability in 2021, followed by a downward adjustment in earnings and returns on equity, while equity itself has been growing steadily, possibly indicating reinvestment or capital retention despite reduced income levels.

The financial data over the five-year period reveals several notable trends in income performance and asset base for the analyzed entity.

Net Income Attributable to Common Stockholders

Reported net income shows significant increase from 2020 to 2021, rising from 599 million US dollars to 4,306 million US dollars. However, following this peak, a declining trend is observed, with reported net income decreasing to 3,468 million in 2022, then further down to 1,848 million in 2023, and stabilizing slightly at 1,889 million in 2024.

Adjusted net income follows a similar pattern, increasing from 897 million US dollars in 2020 to a peak of 4,517 million in 2021, then tapering off to 3,767 million in 2022 and continuing to decline to 2,221 million in 2023 and 1,815 million in 2024. The adjusted figures consistently exceed reported net income, implying the presence of deferred income tax adjustments or other reconciliations improving the earnings figures.

Total Assets

Both reported and adjusted total assets increase steadily over the period. Reported total assets rose from 42,144 million US dollars in 2020 to 54,848 million in 2024, indicating continuous asset growth. The adjusted total assets follow the same trend with marginally lower values noted in some years (e.g., 48,020 million vs. 48,022 million in 2021), showing close alignment between the two measures.

Return on Assets (ROA)

Reported ROA surged sharply from 1.42% in 2020 to a high of 8.97% in 2021, before declining steadily to 6.79% in 2022, then falling notably to 3.52% in 2023 and slightly decreasing further to 3.44% in 2024. Adjusted ROA exhibits a similar trajectory, moving from 2.13% in 2020 to a peak of 9.41% in 2021, declining thereafter to 7.37% in 2022, 4.23% in 2023, and 3.31% in 2024.

The adjusted ROA consistently remains higher than the reported ROA, reflecting the influence of deferred tax adjustments or other factors improving profitability metrics on an adjusted basis.

In summary, the data indicates a strong improvement in profitability and asset efficiency from 2020 to 2021, followed by a discernible decline in subsequent years through 2024. Total assets, however, have exhibited steady growth throughout the entire period. The adjusted financial metrics offer a more favorable view of income and returns compared to reported figures, suggesting that deferred tax or related adjustments positively impact the adjusted profitability measures.