Freeport-McMoRan Copper & Gold Inc. Reports Fourth-quarter and Year-end 1998 Results; Year-end Reserves.NEW ORLEANS--(BUSINESS WIRE)--Jan. 19, 1999-- HIGHLIGHTS --Freeport-McMoRan Copper & Gold Inc.'s (FCX FCX French Connexion (gaming site) FCX Freeport-McMoran Copper & Gold Inc (stock symbol) FCX Fuel Cell Experiment (Honda) FCX Fire Coordination Exercise FCX Fire Control Exercise ) net income for the fourth quarter of 1998 of $0.26 per share increased from the 1997 fourth-quarter net income of $0.21 per share because of higher sales volumes of copper and gold and lower unit costs, despite lower commodity prices. Net income was $0.67 per share for the year 1998 compared to $1.06 per share for 1997. --FCX's Indonesian mining unit, P.T. Freeport Freeport, city, Bahamas Freeport, city (1990 pop. 25,115), Grand Bahama Island, Bahamas. A popular resort area, it developed out of a 1955 agreement between the Bahamian colonial government and a private development company to create a free port and Indonesia Indonesia (ĭn'dənē`zhə), officially Republic of Indonesia, republic (2005 est. pop. 241,974,000), c.735,000 sq mi (1,903,650 sq km), SE Asia, in the Malay Archipelago. Company (PT-FI), achieved record quarterly sales of 421.4 million pounds of copper and 782,100 ounces of gold during the fourth quarter of 1998 attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to record quarterly mine/mill throughput The speed with which a computer processes data. It is a combination of internal processing speed, peripheral speeds (I/O) and the efficiency of the operating system and other system software all working together. 1. of 210,600 metric tons (Transparent Optical Networking Services) A marketing term for providing dark fiber to a customer. The customer is responsible for generating the transmission signal and interpreting it at the other end. See dark fiber. of ore ore, metal-bearing mineral mass that can be profitably mined. Nearly all rock deposits contain some metallic minerals, but in many cases the concentration of metal is too low to justify mining the ore. per day (MTPD MTPD Metric Tons Per Day MTPD Matsushita Toshiba Picture Display MTPD Maximum Tolerable Period of Disruption MTPD Move to Previous Data ). --PT-FI's average unit cash production costs, including gold and silver credits, were a net credit of $0.01 per pound of copper for the fourth quarter of 1998, as gold and silver credits exceeded cash costs. Net cash production costs for the year were $0.12 cents per pound. --P.T. Smelting smelting, in metallurgy, any process of melting or fusion, especially to extract a metal from its ore. Smelting processes vary in detail depending on the nature of the ore and the metal involved, but they are typified in the use of the blast furnace. Co. (PT-SC) began production of copper cathode in the fourth quarter of 1998. --PT-FI's share of aggregate proved and probable PROBABLE. That which has the appearance of truth; that which appears to be founded in reason. reserves increased to 39.9 billion recoverable pounds of copper and 51.4 million recoverable ounces of gold as of December December: see month. 31, 1998. These reserves reflect additions representing approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 250 percent and 100 percent of 1998's copper and gold production, respectively. -0-
Fourth Quarter Twelve Months
1998 1997 1998 1997
-----------------------------------------
(In thousands, except per share amounts)
Revenues $485,016 $420,652 $1,757,132 $2,000,904
Operating income 174,451 116,489 574,281 664,215
Net income 42,081 39,661 118,317 208,541
Diluted net income per share 0.26 0.21 0.67 1.06
Diluted average shares
outstanding 164,935 190,047 175,354 197,653
Freeport-McMoRan Freeport-McMoRan Copper & Gold Inc., (NYSE: FCX) often called simply Freeport, is the world's lowest-cost copper producer and one of the world's largest producers of gold. Copper & Gold Inc. (FCX) reported fourth-quarter 1998 net income applicable to common stock of $42,081,000, $0.26 per share, compared with fourth-quarter 1997 net income of $39,661,000, $0.21 per share. For the year ended December 31, 1998, FCX reported net income applicable to common stock of $118,317,000, $0.67 per share, compared with net income of $208,541,000, $1.06 per share, a year ago. The following factors contributed to the difference between the quarterly periods: o PRODUCTION AND SALES. Compared with a year ago, PT-FI's share of fourth-quarter 1998 copper and gold production and sales volumes benefited from higher mill throughput and gold grades resulting in quarterly records for copper and gold sales. PT-FI's mill throughput averaged a record 210,600 MTPD during the fourth quarter of 1998, as a result of its fourth concentrator mill expansion completed in early 1998. A 9 percent decline in copper realizations and a 5 percent decline in gold realizations negatively affected revenues. For the year, PT-FI's sales were 1.42 billion pounds of copper and 2.19 million ounces of gold. Because of a number of factors, including varying ore grades Ore grade is a measure that describes the concentration of a valuable natural material (such as metals or minerals) in its surrounding ore. Ore grade is used to assess the economic feasibility of a mining operation: the cost of extracting a natural material from its ore is directly and operating rates Operating rate The percentage of total production capacity of a company, industry, or country that is being used. operating rate The portion of capacity at which a business operates. , future operating quarterly results will vary from those achieved during 1998. PT-FI will continue to concentrate its efforts on optimizing production from its expanded operations during 1999. PT-FI's share of sales for 1999 is expected to approximate ap·prox·i·mate v. To bring together, as cut edges of tissue. adj. 1. Relating to the contact surfaces, either proximal or distal, of two adjacent teeth; proximate. 2. Close together. 1.4 billion pounds of copper and 2.0 million ounces of gold. First-quarter 1999 sales are expected to approximate 365 million pounds of copper and 595,000 ounces of gold. PRICING. PT-FI's copper concentrate sales agreements provide for provisional Temporary; not permanent. Tentative, contingent, preliminary. A provisional civil service appointment is a temporary position that fills a vacancy until a test can be properly administered and statutory requirements can be fulfilled to make a permanent appointment. pricing at the time of shipment with final pricing settlement generally based on the average LME See London Metal Exchange. LME See London Metal Exchange (LME). copper price for a specified spec·i·fy tr.v. spec·i·fied, spec·i·fy·ing, spec·i·fies 1. To state explicitly or in detail: specified the amount needed. 2. To include in a specification. 3. future month. Copper revenues on provisionally pro·vi·sion·al adj. Provided or serving only for the time being. See Synonyms at temporary. n. 1. A person hired temporarily for a job, typically before having taken an examination qualifying the person for permanent priced open pounds are adjusted monthly based on then current prices. Fourth-quarter 1998 FCX revenues included unfavorable adjustments to September September: see month. 30, 1998 open concentrate sales, excluding intercompany sales, totaling $11.8 million ($5.7 million to net income, $0.03 per share), compared with fourth-quarter 1997 unfavorable adjustments totaling $39.2 million ($19.1 million to net income, $0.10 per share). At December 31, 1998, copper sales totaling 191.5 million pounds, which were recorded at an average provisional price of $0.66 per pound, remained to be finally priced. Approximately 84 percent of these open pounds are expected to be finally priced during the first quarter of 1999 with the remaining pounds to be finally priced during the second quarter of 1999. A one cent change in the average price for these open pounds would have an approximate $0.9 million effect on FCX's 1999 net income. PT-FI CASH PRODUCTION COSTS. PT-FI's average cash production costs, including gold and silver credits, were a net credit of $0.01 per pound of copper during the fourth quarter of 1998, as gold and silver credits exceeded cash costs. This amount compared favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. to net cash costs of $0.09 per pound reported in the fourth quarter of 1997, as PT-FI strengthened its position as one of the lowest cost copper and gold producers in the world. For the year, unit net cash production costs were $0.12 per pound of copper compared to $0.22 per pound in 1997. Unit site production and delivery costs of $0.30 per pound of copper for the fourth quarter of 1998 were 32 percent below last year's fourth quarter comparable costs of $0.44 per pound primarily because of lower labor costs, lower power costs, economies of scale from the mine/mill expansion, the impact of currency exchange rates and cost reduction efforts of PT-FI's Hunker Down Hun´ker down v. 1. to crouch or squat; to sit on one's haunches. 2. to settle in at a location for an extended period; - also (figuratively) to maintain a position and resist yielding to some pressure, as of public opinion. 3. & Go program. Treatment charge rates, which were about the same as the prior year period, are expected to decline in 1999. ATLANTIC ATLANTIC Cardiology A clinical trial–Angina Treatments–Lasers And Normal Therapies In Comparison COPPER, S.A. Atlantic recorded operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of $8.1 million for the quarter compared with $13.2 million in the 1997 period. During the fourth quarter of 1998, FCX recognized a reduction in net income related to an increase in deferred intercompany profits totaling $7.8 million, $0.05 per share, compared with an increase in net income of $10.7 million, $0.06 per share, during the fourth quarter of 1997. FCX's consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: quarterly earnings fluctuate depending on the timing and prices of PT-FI sales to Atlantic. P.T. SMELTING CO. PT-SC's smelter/refinery in Gresik Gresik is the capital of the sub-region of Gerbangkartasusilo, East Java, Indonesia. History The port of Gresik has been an important commercial center since the eleventh century, trading with merchants from as far away as China, India, and Arabia. , Indonesia began first production of copper cathode in the fourth quarter of 1998. Production is expected to increase gradually grad·u·al adj. Advancing or progressing by regular or continuous degrees: gradual erosion; a gradual slope. n. Roman Catholic Church 1. to a design capacity of 200,000 tons per year of copper metal over an approximate two-year period. PT-FI owns 25 percent of PT-SC and provides 100 percent of its concentrate requirements. PT-FI's share of PT-SC's net operating results is recorded on the equity method of accounting and included in operating income. The elimination of intercompany profits for 25 percent of PT-FI's sales to PT-SC, for which the final sale of product has not occurred, is also recorded in PT-FI's operating income. In the fourth quarter of 1998, FCX recorded a reduction in operating income of $3.8 million ($1.9 million to net income, $0.01 per share) for its equity in PT-SC's operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. and the elimination of intercompany profits. OTHER ACTIVITIES Exploration. FCX reported $2.7 million of exploration expense in the fourth quarter of 1998 primarily for its share of exploration costs incurred in areas which are held in exploration joint ventures with Rio Tinto Rio Tinto may refer to:
Within Block A of PT-FI, delineation drilling continues on the Kucing Liar Liar - MIT Scheme , Grasberg Underground and DOZ DOZ Dozen Doz Dozent (German) DOZ Description Out of Zip resources. Three rigs are currently drilling in the Kucing Liar ore body. Recent step-out drilling to the west indicates a possible thinning or fault offsets to the mineralization Mineralization The process by which the body uses minerals to build bone structure. Mentioned in: Rickets mineralization, n the bioprecipitation of an inorganic substance. , but continuity of mineralization extends beyond the 1998 reserve additions. The deposit has additional reserve tonnage TONNAGE, mar. law. The capacity of a ship or vessel. 2. The act of congress of March 2, 1799, s. 64, 1 Story's L. U. S. 630, directs that to ascertain the tonnage of any ship or vessel, the surveyor, &c. potential towards the Grasberg deposit as well. Drilling at Grasberg Underground is ongoing with two drills working from the Amole amole: see soap plant. drift drift, deposit of mixed clay, gravel, sand, and boulders transported and laid down by glaciers. Stratified, or glaciofluvial, drift is carried by waters flowing from the melting ice of a glacier. to delineate the Grasberg deposit below the 1998 reserve additions. Copper-gold mineralization is decreasing below the level of the 1998 reserve additions, but additional drilling is required to fully define the ultimate geometry geometry [Gr.,=earth measuring], branch of mathematics concerned with the properties of and relationships between points, lines, planes, and figures and with generalizations of these concepts. of the mineralized min·er·al·ize v. min·er·al·ized, min·er·al·iz·ing, min·er·al·iz·es v.tr. 1. To convert to a mineral substance; petrify. 2. To transform a metal into a mineral by oxidation. 3. zone. Drilling at DOZ continues to return positive results, indicating good potential for additional reserve increases. FCX's exploration activities in the Block B, P.T. IRJA Eastern Minerals and other areas continue and are focused on prospects that potentially could lead to the discovery of significant porphyry Porphyry, Greek scholar Porphyry (pôr`fĭrē), c.232–c.304, Greek scholar and Neoplatonic philosopher. He studied rhetoric under Cassius Longinus and philosophy under Plotinus. and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. skarn-type copper-gold deposits. Reserve Additions. During 1998, additions and revisions ReVisions is a 2004 anthology of alternate history short-stories. It is edited by Julie E. Czerneda and Isaac Szpindel. Contents Title Author The Resonance of Light James Alan Gardner Out of China Julie E. to the aggregate proved and probable reserves of the Grasberg and other Block A ore bodies totaled approximately 381 million metric tons of ore representing 5.9 billion recoverable pounds of copper, 3.9 million recoverable ounces of gold and 16.5 million recoverable ounces of silver. Year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. aggregate proved and probable recoverable reserves, net of 1998 production, were 2.48 billion metric tons of ore averaging 1.13 percent copper, 1.05 grams per metric ton gold and 3.77 grams per metric ton silver representing 51.3 billion pounds of copper, 63.8 million ounces of gold and 150.9 million ounces of silver. Pursuant to joint venture arrangements between PT-FI and Rio Tinto, Rio Tinto has a 40 percent interest in future production from reserves above those reported at December 31, 1994. Net of Rio See RapidIO and MP3. Tinto's share, additions and revisions to PT-FI's proved and probable copper, gold and silver reserves replaced 250 percent of 1998 copper production, 100 percent of gold production and 300 percent of silver production. Net of Rio Tinto's share, PT-FI's share of proved and probable reserves was 39.9 billion pounds of copper, 51.4 million ounces of gold and 117.8 million ounces of silver as of December 31, 1998. General and Administrative Expenses. Fourth-quarter 1998 general and administrative expenses of $24.6 million included net charges of $5.0 million associated with the sale of corporate aircraft. The 1997 quarter included a $25.3 million gain for the reversal reversal n. the decision of a court of appeal ruling that the judgment of a lower court was incorrect and is reversed. The result is that the lower court which tried the case is instructed to dismiss the original action, retry the case, or is ordered to change its of stock appreciation rights costs. Excluding these items, general and administrative expenses declined 49 percent compared with the 1997 quarter primarily because of Hunker Down & Go program initiatives to reduce costs and the effect of sharing costs with Rio Tinto pursuant to joint venture agreements. Stock Purchases. As part of its previously announced open market share purchase programs, FCX purchased 1.2 million shares of its common stock during the fourth quarter for $13.5 million, approximately $10.94 per share. On December 31, 1998, FCX had outstanding 65.4 million shares of Class A common stock and 98.9 million shares of Class B common stock. Since July July: see month. 1995, FCX has purchased 50.2 million common shares, a 23 percent reduction in the 214.5 million common shares available for purchase during the period, at an average price of $20.49 per share for a total of $1.03 billion. As of January January: see month. 18, 1999, approximately 9.8 million shares remain under FCX's 60 million open market share purchase programs. FCX is engaged in mineral exploration and development, mining and milling of copper, gold and silver in Irian Jaya Irian Jaya, province, Indonesia: see Papua. , Indonesia, and the smelting and refining refining, any of various processes for separating impurities from crude or semifinished materials. It includes the finer processes of metallurgy, the fractional distillation of petroleum into its commercial products, and the purifying of cane, beet, and maple sugar of copper concentrates in Spain Spain, Span. España (āspä`nyä), officially Kingdom of Spain, constitutional monarchy (2005 est. pop. 40,341,000), 194,884 sq mi (504,750 sq km), including the Balearic and Canary islands, SW Europe. and Indonesia. Cautionary Statement. This press release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. regarding ore grades, production volumes, sales volumes, treatment charge rates and ore reserves. Important factors that might cause future results to differ from these projections include industry risks, commodity prices and other factors described in FCX's 1997 Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filed with the Securities and Exchange Commission. A copy of this press release is available by calling 1-800-469-1253 and on our web site at http://www.fcx.com. -0-
FREEPORT-McMoRan COPPER & GOLD INC.
SELECTED OPERATING DATA
Fourth Quarter Twelve Months
1998 1997 1998 1997
------------------------------------
PT-FI
Ore milled (metric tons per
day) 210,600 127,100 196,400 128,600
Average ore grade
Copper (percent) 1.45 1.46 1.30 1.37
Gold (grams per metric ton) 2.05 1.84 1.49 1.51
Gold (ounce per metric ton) .066 .059 .048 .049
Silver (grams per metric ton) 4.02 3.54 3.17 3.11
Silver (ounce per metric ton) .129 .114 .102 .100
Recovery rates (percent)
Copper 85.7 84.7 86.9 85.4
Gold 85.1 85.6 85.3 81.4
Silver 79.8 66.8 71.8 65.6
Copper
Production (000s of
recoverable pounds) 423,800a 308,400 1,427,300a 1,166,500
Sales (000s of recoverable
pounds) 421,400b 294,000 1,419,500b 1,188,600
Average realized price $.68 $.75 $.73 $.94c
Gold
Production (recoverable
ounces) 819,500a 573,400 2,227,700a 1,798,300
Sales (recoverable ounces) 782,100b 560,400 2,190,300b 1,888,100
Average realized price $289.46 $304.49 $290.57 $346.14c
Silver
Production (recoverable
ounces) 1,060,300a 745,000 3,421,200a 2,568,700
Sales (recoverable ounces) 1,024,000b 743,300 3,412,300b 2,724,300
Average realized price $4.78 $4.92 $5.29 $4.68
PT-FI gross profit per pound
of copper (cents):
Average realized price 67.9 74.7 72.8 94.4c
----- ----- ----- -----
Production costs:
Site production and delivery 29.6 44.3 32.2 50.6
Gold and silver credits (55.0) (59.1) (45.3) (55.5)
Treatment charges 22.5 22.4 23.5 24.4
Royalty on metals 1.6 1.4 1.3 2.6
---- ------ ---- -----
Cash production costs (1.3) 9.0 11.7 22.1
Depreciation and amortization 17.0 15.0 17.0 15.0
----- ------ ---- ------
Total production costs 15.7 24.0 28.7 37.1
----- ------ ----- -----
Revenue adjustments d (2.1) (17.6) 1.9 3.7
----- ------ ----- ------
Gross profit per pound of copper 50.1 33.1 46.0 61.0
===== ====== ===== ======
ATLANTIC COPPER
Concentrate treated (metric
tons) 233,000 246,600 973,900 929,700
Anodes (000s of pounds)
Production 152,400 168,700 642,400 639,800
Sales 13,800 37,100 96,900 133,500
Cathodes (000s of pounds)
Production 139,900 129,600 544,800 505,600
Sales (including wire rod) 138,900 129,400 544,300 505,300
Gold sales in anodes and
slimes (ounces) 172,100 169,700 678,700 532,900
Cathode cash production cost
per pound $.15 $.12 $.13 $.12
a. Amounts are PT-FI's share of aggregate production totaling
514.4 million pounds of copper, 1,072,100 ounces of gold and 1,357,700
ounces of silver for the fourth quarter and 1,721.3 million pounds of
copper, 2,839,700 ounces of gold and 4,040,600 ounces of silver for
the twelve-month period.
b. Amounts are PT-FI's share of aggregate sales totaling 511.2
million pounds of copper, 1,022,700 ounces of gold and 1,284,600
ounces of silver for the fourth quarter and 1,706.7 million pounds of
copper, 2,774,700 ounces of gold and 4,008,000 ounces of silver for
the twelve-month period.
c. Amounts were $0.90 for copper and $326.08 for gold before
hedging adjustments.
d. Reflects adjustments to PT-FI revenues for prior period
concentrate sales, including intercompany sales. The twelve-month 1997
period also includes amortization of the price protection program
cost. Net of intercompany sales, the adjustments to prior period
concentrate sales resulted in net increases (decreases) in FCX
revenues totaling $(11.8) million in the 1998 quarter, $(39.2) million
in the 1997 quarter, $24.4 million in the 1998 twelve-month period and
$46.7 million in the 1997 twelve-month period.
FREEPORT-McMoRan COPPER & GOLD INC.
STATEMENTS OF INCOME (Unaudited)
Three Months Ended Years Ended
December 31, December 31,
1998 1997 1998 1997
---------------------------------------------
(In Thousands, Except Per Share Amounts)
Revenues $ 485,016 $ 420,652 $1,757,132 $2,000,904a
Cost of sales:
Production and delivery 203,243 233,904 804,631 1,008,604
Depreciation and
amortization 80,009 53,215 277,407 213,855
--------- --------- --------- ---------
Total cost of sales 283,252 287,119 1,082,038 1,222,459
Exploration expenses 2,689 3,582 13,033 17,629
General and administrative
expenses 24,624b 13,462c 87,780b 96,601c
Total costs and
expenses 310,565 304,163 1,182,851 1,336,689
--------- --------- ---------- ---------
Operating income 174,451 116,489 574,281 664,215
Interest expense, net (52,475) (39,464) (205,588) (151,720)
Other income (expense),
net (1,276) 1,430 (7,267) 4,271
--------- --------- --------- ---------
Income before income
taxes and minority
interests 120,700 78,455 361,426 516,766
Provision for income
taxes (56,105) (29,285) (170,566) (231,315)
Minority interests in net
income of consolidated
subsidiaries (13,745) (557) (37,012) (40,343)
--------- --------- --------- ---------
Net income 50,850 48,613 153,848 245,108
Preferred dividends (8,769) (8,952) (35,531) (36,567)
--------- --------- --------- ---------
Net income applicable to
common stock $ 42,081 $ 39,661 $ 118,317 $ 208,541
========= ========= ========= =========
Net income per share of
common stock:
Basic $.26 $.21 $.67 $1.06
==== ==== ==== =====
Diluted $.26 $.21 $.67 $1.06
==== ==== ==== =====
Average common shares
outstanding:
Basic 164,935 189,486 175,353 196,392
======= ======= ======= ========
Diluted 164,935 190,047 175,354 197,653
======= ======= ======= ========
Dividends paid per common
share $.05 $.225 $.20 $.90
==== ===== ==== ====
a. Includes net additions totaling $80.2 million recognized from
PT-FI's copper and gold hedging contracts.
b. Includes a net $5.0 million charge ($2.4 million to net income
or $0.01 per share) in the three month period and a net $11.1 million
charge ($5.4 million to net income or $0.03 per share) for the year
ended December 31, 1998 associated with the sale of corporate
aircraft.
c. Includes a $25.3 million gain ($12.3 million to net income or
$0.06 per share) for the reversal of stock appreciation rights costs
caused by the decline in FCX's common stock price during the fourth
quarter of 1997.
FREEPORT-McMoRan COPPER & GOLD INC.
CONDENSED BALANCE SHEETS (Unaudited)
December 31,
1998 1997
(In Thousands)
ASSETS ---------------------
Current assets:
Cash and cash equivalents $ 5,877 $ 8,959
Accounts receivable 228,502 129,611
Inventories 301,404 314,800
Prepaid expenses and other 10,111 9,719
--------- ---------
Total current assets 545,894 463,089
Property, plant and equipment, net 3,474,451 3,521,715
Investment in PT-SC 80,822 83,061
Other assets 91,467 84,344
--------- ---------
Total assets $ 4,192,634 $4,152,209
=========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 344,906 $ 363,294
Current portion of long-term debt and
short-term borrowings 127,804 80,852
Accrued income taxes 45,777 31,519
Total current liabilities 518,487 475,665
Long-term debt, less current portion:
FCX and PT-FI credit facilities 658,000 250,000
Senior notes 570,000 570,000
Infrastructure asset financings 486,616 664,506
Rio Tinto loan 255,320 464,360
Atlantic Copper debt 283,472 311,223
Other notes payable 75,581 48,041
Accrued postretirement benefits and other
liabilities 124,073 125,980
Deferred income taxes 471,178 403,047
Minority interests 146,484 60,488
Redeemable preferred stock 500,007 500,007
Stockholders' equity 103,416 278,892
---------- -----------
Total liabilities and stockholders' equity $4,192,634 $4,152,209
========== ===========
FREEPORT-McMoRan COPPER & GOLD INC.
STATEMENTS OF CASH FLOW (Unaudited)
Years Ended December 31,
1998 1997
(In Thousands)
Cash flow from operating activities:
Net income $ 153,848 $ 245,108
Adjustments to reconcile net income to net
cash provided by
operating activities:
Depreciation and amortization 277,407 213,855
Deferred income taxes 62,165 61,717
Deferral of unearned income - (76,595)
Recognition of unearned income - 30,102
Minority interests' share of net income 37,012 40,343
Other 13,756 (53,131)
(Increase) decrease in working capital:
Accounts receivable (103,976) 80,611
Inventories 6,323 51,957
Prepaid expenses and other (455) 32
Accounts payable and accrued liabilities 16,713 (8,963)
Accrued income taxes 16,034 (71,484)
--------- ---------
(Increase) decrease in working capital (65,361) 52,153
Net cash provided by operating activities 478,827 513,552
--------- ---------
Cash flow from investing activities:
PT-FI capital expenditures (280,952) (530,191)
Atlantic Copper capital expenditures (8,422) (18,478)
Investment in PT-SC (2,709) (36,243)
Sale of assets and other 4,977 (7,705)
--------- ---------
Net cash used in investing activities (287,106) (592,617)
--------- ---------
Cash flow from financing activities:
Net proceeds from (repayment to) Rio Tinto (144,760) 371,040
Proceeds from other debt 549,230 1,097,770
Repayment of other debt (239,495) (723,398)
Purchase of FCX common shares (259,213) (438,388)
Cash dividends paid:
Common stock (35,382) (178,341)
Preferred stock (39,157) (40,543)
Minority interests (9,069) (33,773)
Other (16,957) (3,461)
--------- ---------
Net cash provided by (used in)
financing activities (194,803) 50,906
--------- ---------
Net decrease in cash and cash equivalents (3,082) (28,159)
Cash and cash equivalents at beginning of year 8,959 37,118
Cash and cash equivalents at end of year $ 5,877 $ 8,959
========= =========
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