Noranda Reports 2005 First Quarter Net Earnings of US $176 Million.TORONTO Toronto (tərŏn`tō), city (1998 est pop. 2,400,000), provincial capital, S Ont., Canada, on Lake Ontario. Toronto is the largest city in Canada and since the 1970s has been one of the fastest-changing cities in North America, experiencing -- Noranda Noranda: see Rouyn-Noranda, Que., Canada. Inc. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :NRD NRD National Registration Database (Canada) NRD Natural Resources District (Nebraska) NRD Natural Resource Damage NRD Navy Recruiting District NRD Normal Retirement Date NRD Natural Resources Department )(NYSE NYSE See: New York Stock Exchange :NRD) - ALL NUMBERS IN U.S. DOLLARS UNLESS OTHERWISE NOTED Generates US$455 Million of Income from Operating Assets Operating Assets Another term for working capital. and Lowers Net-Debt-to-Capitalization Ratio to 35% Merger Proposal with Falconbridge Falconbridge can mean:
Investors, analysts and other interested parties can access Noranda's Supplemental Information Package and its quarterly teleconference on its website at www.noranda.com under the For Investors and Presentations and Webcasts sections. The teleconference will be held on Tuesday Tuesday: see week. , April 26, 2005 at 8:00 a.m. Eastern Standard Time. To participate by conference call, dial (416) 620-2414 for local and overseas and 1-800-238-9605 toll free in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . Noranda Inc. today reported consolidated earnings of $176 million (basic earnings per share of $0.58 and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. earnings of $0.57 per share) for the first quarter of 2005. This compares with earnings of $152 million (basic earnings per share of $0.50 and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of of $0.49) for the first quarter of 2004.
KEY FINANCIAL RESULTS
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$ millions, except per First Quarter Y-O-Y
share information 2005 2004 Change
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Revenues 1,976 1,653 + $323 20%
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Income generated by
operating assets(a) 455 361 + $94 26%
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Net income 176 152 + $24 16%
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Basic earnings per
common share $0.58 $0.50 + $0.08 16%
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Diluted earnings per
common share $0.57 $0.49 + $0.08 16%
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(a) Defined as earnings before interest, corporate and general
administration, research, development, exploration, minority
interest, taxes, and other income
FIRST QUARTER 2005 HIGHLIGHTS Financial Results and Position - Realized prices were higher for all metals: copper 32%, nickel nickel, metallic chemical element; symbol Ni; at. no. 28; at. wt. 58.69; m.p. about 1,453°C;; b.p. about 2,732°C;; sp. gr. 8.902 at 25°C;; valence 0, +1, +2, +3, or +4. 2%, zinc zinc, metallic chemical element; symbol Zn; at. no. 30; at. wt. 65.38; m.p. 419.58°C;; b.p. 907°C;; sp. gr. 7.133 at 25°C;; valence +2. Zinc is a lustrous bluish-white metal. It is found in Group 12 of the periodic table. 21% and aluminum 16% - Net-debt-to-capitalization ratio reduced to 35%, from 39% at 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. 2004 and 44% one year ago Production and Operations - Increased copper mine output by 19% to 119,000 tonnes and nickel mine output by 7% to 20,500 tonnes - Achieved record refined nickel and cobalt Cobalt, town, Canada Cobalt (kō`bôlt), town (1991 pop. 1,470), E Ont., Canada, NE of Sudbury, near Lake Timiskaming. Once a center for cobalt and silver mining, the area is now economically depressed. output at 21,500 tonnes and 1,330 tonnes, respectively - Achieved record primary and fabricated fab·ri·cate tr.v. fab·ri·cat·ed, fab·ri·cat·ing, fab·ri·cates 1. To make; create. 2. To construct by combining or assembling diverse, typically standardized parts: aluminum sales at 61,800 tonnes and 45,600 tonnes, respectively - Received all necessary regulatory approvals for new 15-year power supply contract at the New Madrid New Madrid (mă`drĭd), city (2000 pop. 3,334), seat of New Madrid co., extreme SE Missouri, on Mississippi River at the sweeping New Madrid Bend; inc. 1808. primary aluminum facility - Began site preparations for new molybdenum molybdenum (məlĭb`dənəm) [Gr.,=leadlike], metallic chemical element; symbol Mo; at. no. 42; at. wt. 95.94; m.p. about 2,617°C;; b.p. about 4,612°C;; sp. gr. 10.22 at 20°C;; valence +2, +3, +4, +5, or +6. recovery circuit at the Collahuasi mine - Began ventilation shaft Noun 1. ventilation shaft - a shaft in a building; serves as an air passage for ventilation air duct, air passage, airway - a duct that provides ventilation (as in mines) shaft - a vertical passageway through a building (as for an elevator) sinking at the Nickel Rim South project - Completed 25 Six Sigma Not to be confused with Sigma 6. Six Sigma is a set of practices originally developed by Motorola to systematically improve processes by eliminating defects.[1] A defect is defined as nonconformity of a product or service to its specifications. projects with average annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. savings value of $404,000 per project, generating annualized savings of $10.1 million Other Developments - Announced a proposal to acquire the remaining public shares of Falconbridge Limited in a share exchange offer at a rate of 1.77 Noranda shares for each Falconbridge share. The merger would create one of North America's largest base metals companies - Subsequent to the quarter, finalized See finalization. a joint-venture agreement with Barrick Gold Barrick Gold Corporation TSX: ABX NYSE: ABX is the largest pure gold mining company in the world, with its headquarters in Toronto, Ontario, Canada; and four regional business units (RBU's) located in Australia, Africa, North America and South America. on the Kabanga Kabanga is a town in Tanzania, near the Burundi border. Maps
COMMENTARY "Due to strong operating performance and further rises in metals prices, Noranda delivered its best-ever quarterly results along with significant increases in earnings and cashflow," said Derek Derek is a male name of English and Old German origin, possibly derived from the Old German Theodoric,[1] meaning power of the tribe or ruler of the people. Pannell, Noranda's President and Chief Executive Officer. "Income generated by operating assets reached $455 million for the quarter and again demonstrated our enhanced earnings-generation capability. Sales volumes in each of our copper, nickel, zinc and aluminum businesses exceeded the levels of the first quarter of last year, and production at our copper and nickel mines increased substantially." "The Company continues to benefit from positive market conditions, increased metal price leverage and efficient operations," added Mr. Pannell. "These exceptional earnings allowed us to continue to strengthen our balance sheet, as we further reduced our net-debt-to-capitalization ratio to 35%. Our cash and cash equivalents position increased to $1.0 billion, and along with our available lines of credit, our total liquidity now stands at just under $2.0 billion. These resources put us in a favourable position Noun 1. favourable position - the quality of being at a competitive advantage favorable position, superiority advantage, vantage - the quality of having a superior or more favorable position; "the experience gave him the advantage over me" to continue to pursue the development of our stable of attractive growth projects in our copper, nickel and zinc businesses. The outlook for our business remains positive and is supported by very low inventory levels for copper and nickel and improved fundamentals for zinc and aluminum. We are exceptionally well positioned to continue to build on the success of this record quarter." The Company also announced the offer to acquire all remaining public shares in Falconbridge Limited in a share exchange offer. "If successful, the merger of Noranda and Falconbridge should address all concerns regarding our current corporate and ownerhsip structure. The merger with Falconbridge will increase our size, strength and ability to finance strategic growth initiatives. We will become one of the largest North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. base-metal companies, with a much larger market capitalization Market Capitalization A measure of a public company's size. Market capitalization is the total dollar value of all outstanding shares. It's calculated by multiplying the number of shares times the current market price. This term is often referred to as market cap. and public float and exciting growth prospects," Mr. Pannell said. NORANDA ISSUER BID AND MERGER WITH FALCONBRIDGE On March 9, 2005, Noranda announced an all-encompassing plan to reposition itself as a much larger publicly-held company with a simpler ownership structure, bringing the previously-announced sale process to a conclusion. The proposal involves the acquisition of all outstanding Falconbridge Limited common shares that it currently does not own and an issuer bid to purchase for cancellation $1.25 billion of Noranda common shares (approximately 63.4 million) in exchange for a new series of junior preferred shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. . This issuer bid offer has an expiry date expiry date expire n → date f d'expiration; (on label) → à utiliser avant ... expiry date expire n → Ablauftermin m of April 28, 2005. The merger offer entails an exchange of 1.77 Noranda common shares for each outstanding Falconbridge common share that is currently not owned by Noranda. This step would involve the issuance of approximately 133 million new Noranda common shares (a net issue of 70 million new shares after the completion of the issuer bid). If the Company is successful in having greater than 50% of the outstanding shares of Falconbridge held by minority shareholders tendered for exchange, the two companies will be merged into a new entity to be named NorandaFalconbridge. The Offer to Exchange expires on May 5, 2005. The new entity would continue to trade on the Toronto and New York stock exchanges New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. under the existing symbol, NRD. FINANCIAL RESULTS Revenues Total revenues for the first three months of 2005 were $2.0 billion, compared to $1.7 billion in the same period of 2004. The 20% increase was mainly due to higher realized metals prices and higher copper, nickel, zinc and aluminum sales volumes. - Copper mine production increased to 118,600 tonnes from 99,700 tonnes in the first quarter of 2005, as significant production increases were achieved at the Antamina, Collahuasi and Kidd Creek mines. - Refined nickel sales increased to 27,800 tonnes during the quarter from 24,900 tonnes in the year prior. Increases in mine output at the Integrated Nickel Operations and increased custom feed processing contributed to the increased nickel sales. - Combined Brunswick Brunswick, cities, United States Brunswick. 1 City (1990 pop. 16,433), seat of Glynn co., SE Ga., on St. Simon's Sound near the Atlantic coast; laid out 1771–72, inc. 1856. It is a port of entry with numerous container docks. and Antamina mine zinc concentrate Zinc concentrate is a highly hazardous product used in the production of zinc metal and zinc alloys, which is the result of a flotation process after the zinc ore has been mined and milled. and Kidd Creek mine and refined zinc sales were higher at 116,200 tonnes, up from 114,900 tonnes in the first quarter of 2004. Kidd Creek zinc mine production increased to 27,400 tonnes from 20,800 tonnes in the corresponding quarter in 2004. - Primary aluminum sales were 1,100 tonnes higher than last year at 61,800 tonnes, while fabricated foil products sales increased to 45,600 tonnes versus 42,400 tonnes in the first quarter of 2004.
Realized prices were as follows:
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Prices
Three Months Y-O-Y
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(US$ per pound) 2005 2004 Change
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Copper 1.54 1.17 32%
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Nickel 7.03 6.88 2%
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Zinc 0.63 0.52 21%
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Aluminum 0.92 0.79 16%
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Lead 0.49 0.41 20%
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Operating Costs operating costs npl → gastos mpl operacionales Cost of operations totaled $628 million in the first quarter of 2005 versus $464 million in the same period last year. - The higher cost of operations in the quarter was primarily attributable to the higher levels of output from most operations. - Higher energy costs as well as the stronger Canadian dollar Noun 1. Canadian dollar - the basic unit of money in Canada; "the Canadian dollar has the image of loon on one side of the coin" loonie dollar - the basic monetary unit in many countries; equal to 100 cents also contributed to the increased costs. The average value of one Canadian dollar increased to US$0.82 versus US$0.76 during the first quarter of 2004. - The cost to purchase raw materials was higher at $775 million for the period in 2005 versus $711 million in the same period in 2004 as a result of higher metal prices and increased custom feed processing in the nickel business, offset by decreased 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. at the Horne Horne , Lena Born 1917. American singer and actress. She has performed in Broadway musicals, television productions, and films, including Stormy Weather (1943). Noun 1. and Altonorte smelters and CCR 1. CCR - condition code register. 2. CCR - (Database) concurrency control and recovery. refinery. - Depreciation, amortization and accretion expenses In accounting, accretion expense is the expense created when updating the present value(PV) of a financial instrument. For example, if one originally recognizes the present value of a liability at $650, which has a future value (FV) of $1000, every year one must increase the increased to $118 million from $117 million a year ago. Interest expenses increased to $32 million from $29 million in the same quarter a year ago. - Corporate costs increased to $17 million from $13 million, largely due to impact of the stronger Canadian dollar. - Research and exploration expenses increased to $12 million from $7 million in the same quarter last year. - Minority interest in earnings of subsidiaries increased to $94 million from $79 million, largely as a result of the increased earnings of affiliates. - Tax expenses recorded increased from $86 million a year ago to $123 million during the first quarter of 2005. Net Income Net income increased to $176 million or $0.58 per basic common share and $0.57 per diluted common share for the three months ended March 31, 2005. This compares with a net income of $152 million or $0.50 per basic common share and $0.49 per diluted common share in the same period of 2004. Income generated by operating assets increased from $361 million a year ago to $455 million in the first quarter of 2005. Increased copper, nickel and aluminum production and sales in combination with higher prices contributed to the stronger results. LIQUIDITY AND CAPITAL INITIATIVES Cash generated from operations, before net change in non-cash working capital, totaled $451 million in the first quarter of 2005, compared to $348 million in the corresponding quarter of 2004. Cash and cash equivalents at March 31, 2005, totaled $1.0 billion, compared to $884 million at year end. Long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. , excluding the amount due in less than one year and preferred share liabilities, amounted to $2,574 million at March 31, 2005, compared to $2,736 million at year end. Total debt was $3.3 billion at the end of the period. The net-debt-to-capitalization ratio was reduced to 35% from 39% at year-end 2004 and 44% at March 31, 2004. The Company currently has just under $1.0 billion of undrawn un·draw tr.v. un·drew , un·drawn , un·draw·ing, un·draws To draw to one side, as a curtain. Adj. 1. undrawn - not represented in a drawing undelineated - not represented accurately or precisely committed bank lines. Investments in new production capacity such as the Nickel Rim South and Koniambo nickel projects The Nickel Project is a nickname for a transportation funding package enacted by the 2003 Washington State Legislature. The slogan for the package is "It’s your Nickel, Watch it Work." The $3. and the Kidd Mine Kidd Mine an underground base metal mine in the city of Timmins, Ontario. It is owned and operated by Xstrata Copper, following the August 2006 takeover of Falconbridge Ltd. D copper project totaled $62 million during the first quarter. For 2005, the Company's projected capital investment is $681 million, including $416 million in new productive capacity. REVIEW OF OPERATIONS Copper Revenues: For the first quarter of 2005, consolidated revenues of $980 million increased 16% from $844 million in the first quarter of 2004, reflecting higher realized copper, zinc and precious metals Precious Metals Valuable metals such as gold, iridium, palladium, platinum, and silver. Notes: Investing in precious metals can be done either by purchasing the physical asset, or by purchasing futures contracts for the particular metal. prices, and higher copper sales volumes. - Total sales of copper during the quarter were 213,800 tonnes versus 213,400 tonnes in the same period in 2004. - Sales of by-product by·prod·uct or by-prod·uct n. 1. Something produced in the making of something else. 2. A secondary result; a side effect. by-product Noun 1. zinc concentrate and metal from Kidd Creek increased significantly to 40,900 tonnes from 26,500 tonnes the year prior. Antamina by-product zinc concentrate sales increased 1,000 tonnes to 15,200 tonnes from the same quarter last year. - The realized copper price of $1.54/lb. increased by 32% in the quarter compared to $1.17/lb. realized in the same period in 2004. - The realized zinc price at Kidd Creek was $0.63/lb., a 21% increase in the quarter, compared with $0.52/lb. in the same period in 2004. - Also contributing to copper group earnings was increased recoveries and sales of by-product molybdenum concentrate from Antamina. A molybdenum price of $24/lb. was realized during the quarter resulting in Noranda's share of molybdenum revenues totaling approximately $31 million. Costs: Total operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. increased to $749 million from $705 million in the first quarter of 2004. - The cost of operations increased to $254 million from $195 million in the same period last year as a result of increased mine output at Antamina and expansion-related output increases at Collahuasi. - The cost of purchased raw materials decreased to $440 million from $462 million in the first quarter of 2004, due to reduced levels of output at the Horne and Altonorte smelters and CCR refinery. - The operating cash cost of producing a pound of copper in the first quarter of 2005 decreased to $0.35/lb. from $0.43/lb. in the fourth quarter of 2004. Income generated from operating assets: 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. for the Copper Business in first quarter of 2005 increased to $231 million from $139 million a year ago due to the impact of higher copper, zinc and precious metals prices. - Reduced treatment 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 charge revenues at Altonorte, Horne and CCR that resulted from decreased throughput were somewhat offset by higher prices and treatment and refining charges. - Also offsetting the stronger revenues were increased costs resulting from the impact of a weaker U.S. dollar on Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. and South American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of operating costs. Production: During the first quarter of 2005, copper mine production from Canadian and South American operations 'South American' operation Surgical oncology A radical operation for 'frozen' pelvis, which consists of en bloc resection of the uterus and rectum. See Frozen pelvis. Cf 'All-American' and 'North American' operations. totaled 105,500 tonnes, compared to 86,000 tonnes a year ago. - Significant increases in mined copper output were achieved at Antamina due to improved 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 at Collahuasi as a result of the expansion and transition of mining operations to the Rosario Rosario (rôsär`yō), city (1991 pop. 1,095,906), Santa Fe prov., E central Argentina, a port on the Paraná River, on the eastern margin of the Pampa. pit. - The Antamina mine achieved higher than budget ore grades and recoveries and its highest-ever daily ore crushing crushing deaths of newborn animals, especially those in litters, caused by the mother lying on them accidentally. Contributed to by weakness of the neonate or awkward accommodation. A problem in piglets and puppies. Called also overlying. and milling rates. Work continued on the new resource model which will lead to the development of a new statement on reserves and resources by mid-year. - At Collahuasi, during routine maintenance on March 31, 2005, it was discovered that one of the three SAG (1) A momentary drop in voltage from the power source. Contrast with spike. (2) (SAG) (SQL Access Group) See CLI. mill motors required repairs. The resulting loss of production is expected to total 9,000 tonnes of copper and reduce the Company's share of annual copper concentrate production to 211,000 tonnes of contained copper. - The Kidd Creek mine significantly increased output of copper and zinc. Kidd Mine D shaft shaft (shaft) a long slender part, such as the diaphysis of a long bone. shaft n. 1. An elongated rodlike structure, such as the midsection of a long bone. 2. progress is now at 94% of plan with shaft sinking shaft sinking, excavation from the surface of an opening in the earth. Shafts, which are generally vertical, are usually distinguished from tunnels, which are horizontal. now below the 9,000-foot level. Ramp and lateral lateral /lat·er·al/ (-il) 1. denoting a position farther from the median plane or midline of the body or a structure. 2. pertaining to a side. lat·er·al adj. 1. development are at 97% of plan. - Refined copper production was 121,600 tonnes of copper cathode in the first quarter of 2005 versus 133,800 tonnes in the first quarter of 2004. Production at CCR was affected by the decreased Altonorte anode anode (ăn`ōd), electrode through which current enters an electric device. In electrolysis, it is the positive electrode in the electrolytic cell. anode Terminal or electrode from which electrons leave a system. output and shipping delays due to a schedule maintenance shutdown shut·down n. A cessation of operations or activity, as at a factory. shutdown Noun the closing of a factory, shop, or other business Verb shut down at Altonorte. - Zinc-in-concentrate produced within the copper business totaled 27,400 tonnes at Kidd Creek, an increase from 20,800 tonnes in the first quarter of 2004, and decreased to 20,200 tonnes from 22,500 tonnes at Antamina due to a shift in the mine plan towards copper ores Copper ores may refer to:
- The Company also began site preparations for a new molybdenum recovery circuit at the Collahuasi mine. Start-up Start-up The earliest stage of a new business venture. of the circuit is still planned for first quarter 2006. Nickel Revenues: For the first quarter of 2005, consolidated revenues of $538 million increased from $481 million in the first quarter of 2004. - Sales volumes of nickel increased 17% to 21,300 tonnes from 18,100 tonnes in the first quarter of 2004 and copper sales volumes of 15,500 tonnes increased by 17% from 13,200 tonnes a year ago as production was impacted by a three-week strike at the Sudbury Sudbury, city, Canada Sudbury, city (1991 pop. 92,884), central Ont., Canada. It is the center of Canada's largest mining region, which produces much of the world's nickel and large quantities of copper, platinum, gold, silver, cobalt, and sulfur. Operations during the first quarter of 2004. - At Falcondo, ferronickel sales volumes decreased by 4% to 6,500 tonnes from 6,800 tonnes in the first quarter of 2004. - Cobalt sales volumes of 874 tonnes in the quarter decreased by 4% from 2004 levels. - Realized nickel prices of $7.03/lb. increased by 2% in the quarter compared with $6.88/lb. in the corresponding period in 2004. Realized ferronickel prices of $6.70/lb. decreased by 1% in the quarter, compared with $6.80/lb. in the same period in 2004. - Precious metals revenues increased by $6 million in the first quarter of 2005 compared to the same period in 2004. Costs: Total operating expenses increased to $344 million from $294 million in the first quarter of 2004. - Cost of operations increased to $173 million from $140 million in the same period last year, reflecting a full quarter of operations at Sudbury (the 2004 period contained the strike in Sudbury), new production costs at the recently commissioned Montcalm Montcalm could refer to:
- The cost of purchased raw materials increased to $142 million from $122 million in the first quarter of 2004 as the increase in metal prices impacted the cost of feed acquisition and due to additional sales volumes of custom feeds. - The operating cash cost per pound of mined nickel for all of Falconbridge (including INO Ino (ī`nō), in Greek mythology, daughter of Cadmus. She was the wife of Athamas, to whom she bore Learchus and Melicertes. She plotted to kill her stepchildren, Phrixus and Helle, but their mother, Nephele, saved them with the help of a winged and Falcondo) was $2.94 in the first quarter of 2005, compared with $2.72 for the same period in 2004. The operating cash cost of producing a pound of nickel from INO mines was $2.51. The $0.09/lb., or 3%, decrease was the result of increased mine production and higher by-product credits due to the increase in metal prices, which offset the impact of the stronger Canadian dollar. Falcondo's operating cash cost per pound of ferronickel increased by 34% in the first quarter of 2005 to $3.88/lb., mainly due to the increase in oil prices, maintenance costs and the impact on fixed costs fixed costs, n.pl the costs that do not change to meet fluctuations in enrollment or in use of services (e.g., salaries, rent, business license fees, and depreciation). of the slightly reduced production volumes. Income generated by operating assets: First quarter operating income for the Nickel Business totaled $194 million, compared to $187 million in the first quarter of 2004. - The $7 million increase was mainly due to the impact of higher nickel and copper sales volumes, higher precious metals revenues and the elimination of strike costs that affected the 2004 results. - These increases were reduced by the impact of the strengthening Canadian dollar on unit production costs at the Canadian operations, higher oil costs at Falcondo and lower cobalt and ferronickel sales volumes. Production: Total refined nickel production was 27,900 tonnes during the quarter versus 26,900 tonnes during the same period in 2004. - Sudbury mines production was 6,100 tonnes of nickel and 6,000 tonnes of copper during the first quarter of 2005, compared with 4,400 tonnes of nickel and 3,800 tonnes of copper in the first quarter of 2004. The increase in production was primarily attributed to the impact of the strike by the production and maintenance workers in the first quarter of 2004. - At Raglan, nickel in concentrate production in the quarter was 6,000 tonnes and copper production was 1,500 tonnes, compared with 6,700 tonnes of nickel and 1,700 tonnes of copper in 2004. The decreases in production were due to the impact of lower ore grades which more than offset a 4% increase in ore tonnes mined. - In its first full quarter after achieving commercial production, the Montcalm mine produced 1,900 tonnes of nickel and 1,000 tonnes of copper. - At the Sudbury smelter, nickel in matte production in the first quarter of 2005 increased to 17,400 tonnes from 11,400 tonnes in the same period of 2004, as a result of the treatment of higher concentrate tonnages with lower feed grades. - At the Nikkelverk refinery, nickel production during the quarter established a new record of 21,500 tonnes in the first quarter of 2005, compared to 18,900 tonnes in the same period in 2004. - In the first quarter of 2005, Falcondo produced 6,500 tonnes of nickel in ferronickel, compared with 8,000 tonnes in the first quarter of 2004. Production in the quarter was negatively impacted by a longer than anticipated ramp-up of one of the furnaces after a maintenance shutdown and the impact of heavy rains in January January: see month. . The shortfall Shortfall The amount by which the capital required to fulfill a financial obligation exceeds available capital. Notes: Shortfall risk is often combated with an efficient hedging strategy created by a fund, group, institution, or individual. in production is expected to be recovered over the balance of the year. Zinc Revenues: Total zinc revenues increased to $119 million, 40% higher than the $85 million recorded during the first quarter of 2004 due to increased prices for zinc, lead and other by-products by-products materials generated incidentally to the production of a principal product in an industry or industrial enterprise. In the meat industry by-products include blood, bone, fat, bristle, hair, wool, hide, skin, hoof, horn and offal products prepared in various ways for use . - In the first quarter of 2005, sales volumes of zinc-in-concentrates decreased 19% to 60,100 tonnes from 74,100 tonnes in the first quarter of 2004, while first quarter 2005 lead metal sales increased to 21,700 tonnes from 21,200 tonnes in the same period a year ago. - Revenues benefited significantly from higher prices. The average LME See London Metal Exchange. LME See London Metal Exchange (LME). price per pound of zinc during the first quarter was $0.60/lb., an increase of 22% compared to $0.49/lb. in the same period last year. The average realized price per pound of refined lead during the first quarter was $0.49/lb. versus $0.41/lb. in the same period last year. Costs: Total operating expenses increased to $113 million from $83 million in the first quarter of 2004. - The cost of purchased raw materials increased to $54 million from $31 million in the first quarter of 2004, along with the rise in zinc and lead prices. - At the Brunswick mine, the operating cash cost per pound of mined zinc was $0.40/lb. in the first quarter of 2005, an increase of 21% from $0.33/lb. for the same period in 2004. The increase is primarily due to a stronger Canadian dollar, higher treatment and freight charges and also reflects the closure of the Bell Allard
The Allard Motor Company was an English car manufacturer founded in 1936 by Sydney Allard. mine late in 2004. Income generated by operating assets: The first quarter 2005 operating income of the Zinc Business was $6 million, compared with $2 million for the first quarter of 2004. The $4 million increase was due to the impact of higher metal prices and decreased depreciation and amortization charges, which were offset by the impact of lower sales volumes, and an unfavourable impact on costs due to the foreign exchange variance The discrepancy between what a party to a lawsuit alleges will be proved in pleadings and what the party actually proves at trial. In Zoning law, an official permit to use property in a manner that departs from the way in which other property in the same locality caused by the strengthening of the Canadian dollar. Production: Contained zinc production was 67,100 tonnes in the first quarter of 2005, compared to 100,300 tonnes in the same period in 2004. The decrease in production is primarily attributable to the closure of the Bell Allard mine in October October: see month. 2004. Lead metal production was 21,600 tonnes in the first quarter of 2005, compared to 25,100 tonnes in the same period in 2004 as a result of an unplanned maintenance shutdown during January and a difficult start-up due to cold winter weather. Aluminum Revenues: Total aluminum revenues increased to $297 million or 46% higher than the $204 million recorded during the first quarter of 2004. - Sales volumes of primary aluminum increased 2% to 61,800 tonnes from 60,700 tonnes in the first quarter of 2004. - First quarter 2005 rolled-products sales volumes of 45,600 tonnes increased by 8% from 42,400 tonnes in the same period a year ago as a result of the continued ramp-up of the new Huntingdon
- The realized primary aluminum price of $0.92/lb. increased by 16% in the quarter, compared with $0.79/lb. in the same period in 2004. Costs: Total operating expenses increased to $262 million from $188 million in the first quarter of 2004. - The cost of operations increased to $139 million from $103 million in the same period last year, mostly as a result of the inclusion of Noranda's share of the newly acquired St. Ann ANN, Scotch law. Half a year's stipend over and above what is owing for the incumbency due to a minister's relict, or child, or next of kin, after his decease. Wishaw. Also, an abbreviation of annus, year; also of annates. In the old law French writers, ann or rather an, signifies a year. bauxite bauxite (bôk`sīt, bŏk`–), mixture of hydrated aluminum oxides usually containing oxides of iron and silicon in varying quantities. mine and Gramercy gra·mer·cy interj. Archaic Used to express surprise or gratitude. [Middle English gramerci, from Old French grand merci : grand, great; see grand + alumina alumina (əl  `mĭnə) or aluminum oxide, Al2O3, chemical compound with m.p. about 2,000°C; and sp. gr. about 4.0. refinery operating costs.- The cost of purchased raw materials increased to $111 million from $76 million in the first quarter of 2004, along with the rise in aluminum prices. - The operating cash cost per pound of primary aluminum metal production, net of metal premiums and by-product credits was $0.59/lb. in the first quarter of 2005, an increase from $0.57/lb. for the same period in 2004. - The cost per pound at the rolled products division was 2% higher in the first quarter of 2005, compared with the same period in 2004. Income generated by operating assets: First quarter 2005 operating income for the Aluminum Business was $35 million compared with $16 million for the first quarter of 2004. The $19 million increase was mainly due to the impact of higher metal prices, higher volumes and increased metal premiums and fabrication fabrication (fab´rikā´sh  n),n the construction or making of a restoration. margins. Production: The Aluminum Business achieved record quarterly primary and fabricated aluminum production. In the first quarter of 2005, primary aluminum production of 61,400 tonnes, compared to 61,200 tonnes in the same period in 2004. For the rolled products operations, shipments were 45,600 tonnes for the first quarter compared with 42,400 tonnes for the first quarter of 2004. The New Madrid primary smelter obtained final regulatory approval of the recently signed 15-year power supply contract. NEW PRODUCTION CAPACITY UNDER DEVELOPMENT AND PROJECTS UPDATE Nickel Montcalm Mine The Montcalm mine began production in late 2004. Permanent mine ventilation ventilation, process of supplying fresh air to an enclosed space and removing from it air contaminated by odors, gases, or smoke. Proper ventilation requires also that there be a movement or circulation of the air within the space and that the temperature and facilities and effluent effluent waste from an abattoir carried away in liquid form. Disposal is a major problem because of the need to avoid pollution of waterways. See aerobic effluent treatment, anaerobic effluent treatment. treatment systems were commissioned in February February: see month. . Mine and concentrator performance continue to meet feasibility targets. Raglan Mine Optimization optimization Field of applied mathematics whose principles and methods are used to solve quantitative problems in disciplines including physics, biology, engineering, and economics. Project Progress continues on the pre-feasibility and scoping phases of the mill conversion project that will improve grinding grinding, process by which surface material is removed from an object, usually metal, by the abrasive action of a rotating wheel or a moving belt that contains abrasive grains. capacity. The conversion will allow an increase in the level of annual throughput to approximately one million tonnes of ore per year and increase the mill's ability to process harder ore. In 2005, capital expenditures for Phase I are expected to be $21 million. Engineering work on Phase II is underway, assessing changes to the grinding circuit and other concentrator equipment to further increase annual production rates. Nickel Rim South Project Ventilation shaft sinking began in February 2005 and main shaft sinking is expected to begin in the second quarter of 2005. The project is currently 23% complete and on budget. Fraser Fraser, river, Canada Fraser, chief river of British Columbia, Canada, c.850 mi (1,370 km) long. It rises in the Rocky Mts., at Yellowhead Pass, near the British Columbia–Alta. line and flows northwest through the Rocky Mt. Morgan Morgan, American family of financiers and philanthropists. Junius Spencer Morgan, 1813–90, b. West Springfield, Mass., prospered at investment banking. Project Drilling increased on Zones 10 and 11 and work progressed on the generation of a high quality inferred resource for incorporation into the mine plan. A pre-feasibility study is expected to be completed during the balance of 2005. Koniambo Project The feasibility study The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. on the Koniambo joint venture, the Company's ferronickel project in New Caledonia New Caledonia, Fr. Nouvelle Calédonie, internally self-governing territory of France (2005 est. pop. 216,000), land area 7,241 sq mi (18,760 sq km), South Pacific, c.700 mi (1,130 km) E of Australia. , was completed in the fourth quarter of 2004 and presented to the Boards of Directors of the project's partners in early 2005. The Company also announced the appointment of Brian The name Brian (sometimes spelled Bryan) comes from an Irish backround. It is of Celtic origin and its meaning may be "hill" or "strong, noble, and high"[1]. F. Kenny Ken·ny , Elizabeth 1880?-1952. Australian nurse who developed a simple treatment for the paralysis brought on by poliomyelitis. as President of the Koniambo project. Mr. Kenny, whose appointment is effective May 1, 2005, will be responsible for the design, planning and development of the operation. Previously, Mr. Kenny was President, Bechtel  This article requires authentication or verification by an expert.Please assist in recruiting an expert or [ improve this article] yourself. See the talk page for details. Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of Inc./Bechtel Quebec Quebec, city, Canada Quebec, Fr. Québec, city (1991 pop. 167,517), provincial capital, S Que., Canada, at the confluence of the St. Lawrence and St. Charles rivers. , and General Manager, Mining and Metals, Canada and U.S. He also has significant international experience in project development. In accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the action plan set out with SMSP SMSP Storage Management Services Protocol SMSP Soil Moisture Strength Prediction (model) SMSP Small and Mid Market Solutions and Partners (Microsoft) SMSP St Mary's & St Peter's and the French Government earlier this year, the Company is actively working to complete the project financing Project financing A form of asset-based financing in which a firm finances a discrete set of assets on a stand-alone basis. , securing necessary operating and environmental permits and further advancing project engineering. The review of the technical feasibility study by the Trustee, as required by the Bercy Ber´cy n. 1. a sauce prepared from butter creamed with white wine, shallots, parsley and fish stock; - also called Bercy sauce ltname>. Noun 1. Accord, is near completion and Falconbridge is positioned to submit firm orders for at least $100 million in equipment and services. This will allow the Company to meet the final condition for jointly vesting Vesting The process by which employees accrue non-forfeitable rights over employer contributions that are made to the employee's qualified retirement plan account. Notes: the Koniambo deposit with its North Caledonian Cal·e·do·ni·a Roman Britain north of the Antonine Wall, which stretched from the Firth of Forth to the Firth of Clyde. Today the term is used as a poetic appellation for all of Scotland. partner SMSP. Start-up of the production facilities is targeted for 2009. Kabanga Project On April 19, 2005, the Company and Barrick Gold Corporation finalized a joint-venture agreement regarding the Kabanga nickel deposit and related concessions in Tanzania. Under the current terms of the agreement, the Company has acquired a 50% indirect interest in the Kabanga Project for $15 million and will be the operator of the joint venture. Over the next several years, the Years, The the seven decades of Eleanor Pargiter’s life. [Br. Lit.: Benét, 1109] See : Time Company will fund and conduct a $50 million work plan that will include additional exploration and infill in·fill n. 1. The use of vacant land and property within a built-up area for further construction or development, especially as part of a neighborhood preservation or limited growth program. 2. drilling, and further technical work to update the resource model for Kabanga. Drawing upon its nickel processing, project development and engineering expertise to bring the project towards feasibility, it will establish a dedicated team in Tanzania to coordinate and advance the work plan. Upon conclusion of the work plan, the Company will fund the first $95 million of project development expenditures. Thereafter, the partners will equally share joint-venture revenues and expenditures. Copper Molybdenum Production and Treatment Capacity Expansions The refurbishment re·fur·bish tr.v. re·fur·bished, re·fur·bish·ing, re·fur·bish·es To make clean, bright, or fresh again; renovate. re·fur of molybdenum concentrates roasting roasting: see cooking. roasting In metallurgy, usually the first step in smelting ore to extract metal. The ore is heated in the presence of an abundant flow of air to drive off moisture and, if the metal-bearing mineral is a sulfide, convert it to capacity at the Altonorte smelter should be completed before the end of this year. The smelter will then have the capacity to treat 10,000 tonnes per year of molybdenum concentrates. The engineering work for the Collahuasi molybdenum recovery circuit project is 97% complete and all critical equipment orders have been placed. Start-up of the circuit is anticipated for early 2006. The circuit will allow for the recovery of up to 12,000 tonnes per year of molybdenum concentrates. Work on the conceptual study for the second expansion of the Collahuasi copper concentrator is continuing. Fortuna Fortuna (fôrt `nə), in Roman religion, goddess of fortune. Worshiped under several forms, she appears to have originally been a goddess of fertility. de CobreThe Company began development of an exploration tunnel in March as part of its review of the Fortuna de Cobre deposit, adjacent to the Lomas Bayas copper mine. El Pachon Work on a conceptual study on the El Pachon copper project was advanced during the quarter, leading into a pre-feasibility study. El Morro El Morro is a Spanish term meaning "promontory" or "headland." Some places called el Morro:
The exploration campaign at the El Morro copper project completed 10,000 metres of drilling. Assay information is now being processed. Kidd Mine D Project Shaft sinking progress is at 94% of plan. The ramp and lateral development are at 97% of plan, with the new shaft sinking currently below the 9,000-foot level. EXPLORATION UPDATE During the quarter, Falconbridge and Noranda provided an update on greenfield Greenfield, town (1990 pop. 18,666), seat of Franklin co., NW Mass., at the confluence of the Deerfield and Green rivers, near their junction with the Connecticut; settled 1686, set off from Deerfield and inc. 1753. and brownfield See greenfield. exploration projects. The report described the Company's exploration strategy as one that is primarily focused on discovering 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. acquiring new nickel and copper deposits. With exploration projects around the world, Noranda has become a valued and sought-after Adj. 1. sought-after - being searched for; "the most sought-after item was the silver candelabrum" sought wanted - desired or wished for or sought; "couldn't keep her eyes off the wanted toy"; "a wanted criminal"; "a wanted poster" partner in the mining industry. At present Noranda and Falconbridge have partnerships with 55 exploration and mining companies. The report can be found on the Company's website at www.noranda.com. The mineral reserves and resources at operations and projects are generally updated on an annual basis. Please see the Noranda 2004 Annual Report for mineral reserves and resources. There are no changes to report at this time. MARKET REVIEW Copper The LME cash copper prices ranged from a low of $1.39/lb. to a high of $1.55/lb. and averaged $1.48/lb. during the first quarter of 2005. This compares against an average of $1.24/lb. during the first quarter of 2004. The price strength is mainly attributed the low inventory levels. Exchange stocks continued their downward trend dropping 16,700 tonnes to stand at 107,500. At quarter end, U.S. spot metal premiums for copper cathodes stoond at $0.06/lb. At these high prices, consumers are delaying spot purchases and drawing down existing stocks. Though demand has weakened weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. slightly in
the U.S. and the European Europeanemanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. markets, Chinese imports of refined copper for January and February continue to be strong, breaching the 100,000-tonne level supported by strong demand in the power generation sector. On the supply side, high copper prices are providing producers with a strong incentive to optimize optimize - optimisation production rates. However, the increase in supply growth and the expected softening softening /sof·ten·ing/ (sof´en-ing) malacia. softening a change of consistency, with loss of firmness or hardness. in global demand conditions will not be sufficient to keep the market from registering another deficit. A market deficit of 206,000 tonnes is forecast maintaining copper's positive market profile. Nickel The LME cash nickel prices ranged from a low of $6.37/lb. to a high of $7.51/lb. and averaged $6.96/lb. during the first quarter of 2005. This compares against an average of $6.68/lb. during the first quarter of 2004. The price strength is mainly attributed to physical market tightness Tightness is defined as a point in time where economically, it is very difficult to invest, but it is far easier to sell or to remove investments in return of monetary rewards. . LME stocks remained very tight during the quarter and finished the quarter at 10,002 tonnes. From a fundamental perspective, a tight nickel market is anticipated for 2005 with a forecast deficit of 16,000 tonnes. Total world primary nickel consumption is expected to increase by 2.8%. The stainless steel stainless steel: see steel. stainless steel Any of a family of alloy steels usually containing 10–30% chromium. The presence of chromium, together with low carbon content, gives remarkable resistance to corrosion and heat. market remains on a solid footing and the high-nickel alloy alloy (ăl`oi, əloi`) [O. Fr.,=combine], substance with metallic properties that consists of a metal fused with one or more metals or nonmetals. market continues to strengthen. Positive developments in the Chinese market include the recent issue regarding the suitability of 200 series stainless steel and the resurgence re·sur·gence n. 1. A continuing after interruption; a renewal. 2. A restoration to use, acceptance, activity, or vigor; a revival. of Chinese imports, pointing to restocking. Given the low level of nickel inventories, the nickel price is expected to remain volatile. Nickel prices should be well supported as inventories continue to be very low, with the market remaining susceptible to supply-side disruptions. Zinc The LME cash zinc prices rose sharply in the quarter, peaking at $0.65/lb. before settling back to $0.61/lb. at the end of March. The average for the quarter was $0.60/lb., up $0.11/lb. from the first quarter of 2004. The price strength is mainly attributed to investment fund buying based on expectations for further U.S. dollar weakness and the continuing positive outlook for zinc fundamentals. The resulting deficit caused LME stocks to fall 58,000 tonnes during the quarter to 570,600 tonnes, most of which is due to increased consumption in China. U.S. spot metal premiums are currently in the $0.04/lb. to $0.0425/lb. range. Global zinc mine supply continues to fall short of 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. capacity thereby constraining con·strain tr.v. con·strained, con·strain·ing, con·strains 1. To compel by physical, moral, or circumstantial force; oblige: felt constrained to object. See Synonyms at force. 2. refined zinc metal supply. Refined zinc output is estimated to have increased by less than 3% in 2004. Similar low growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. are expected this year. Demand, as estimated by ILZSG ILZSG International Lead and Zinc Study Group , recorded impressive growth in 2004 at 5.9%, led by a 14% increase in China and a 10% gain in apparent consumption in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . While global demand growth is expected to ease to less than 4% this year, the metal balance should remain in deficit resulting in ongoing LME stock reductions. Aluminum The aluminum market continues to demonstrate strength, most notably in the U.S. and China. The average LME cash price during the quarter of $0.86/lb. represents a $0.11/lb. increase from the same quarter a year ago. The current LME price is holding at the $0.85/lb. level. In the U.S., reported delivery premiums are steady at $0.07/lb., up $0.02/lb. from the same period in the year prior. Premiums in the U.S. should remain at these strong levels given the current healthy demand for metal in the North American market. LME warehouse stock levels continued the sharp decline that began in 2004, with first quarter removals totaling almost 150,000 tonnes. Other reported inventories, such as unwrought producer stocks reported to the International Aluminium Institute and Comex, are relatively unchanged from the year end. The focus remains on China and actions taken by its central government to curb development of both aluminum and alumina production capacity. Despite high energy costs, increased raw material costs, the removal of VAT VAT See: Value-added tax VAT See value-added tax (VAT). tax rebates tax rebate n → devolución f de impuestos; reembolso fiscal tax rebate n → ristourne f d'impôt tax rebate and the implementation of a 5% export tax, there continues to be year-over-year increases in the amount of aluminum exported from China. There are indications that the Chinese government Ever since Republic of China founded in January 1st, 1912, China has had several regional and national governments. List
Other Four collective agreements will expire expire /ex·pire/ (ek-spi´er) 1. to exhale. 2. to die. ex·pire v. 1. To breathe one's last breath; die. 2. To exhale. in 2005, at Norandal's Newport facility (May 31), Kidd Metallurgical met·al·lur·gy n. 1. The science that deals with procedures used in extracting metals from their ores, purifying and alloying metals, and creating useful objects from metals. 2. site (September 30), Gramercy alumina refinery (September 30) and Falcondo ferronickel mine and processing plant (November 30).
Dividends
The following dividends have been declared:
Security Dividend Amount Record Date Payable Date
-------- --------------- ----------- ------------
Common shares Cdn$0.12 April 26, 2005 May 16, 2005
per share
Preferred Series
F #63 shares Floating rate May 31, 2005 June 12, 2005
Preferred Series
F #64 shares Floating rate June 30, 2005 July 12, 2005
Preferred Series
F #65 shares Floating rate July 29, 2005 August 12, 2005
Preferred Series Cdn$0.38125
G shares per share July 15, 2005 August 1, 2005
Preferred Series Cdn$0.40625
H shares per share May 15, 2005 June 30, 2005
This news 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. concerning the Company's business and operations. The Company cautions that, by their nature, forward-looking statements involve risk and uncertainty and the Company's actual results could differ materially from those expressed or implied in such statements. Reference should be made to the most recent Annual Information Form for a description of the major risk factors. Noranda is a leading copper and nickel company with investments in fully-integrated zinc and aluminum assets. The Company's primary focus is the identification and development of world-class copper and nickel mining deposits. It employs 16,000 people at its operations and offices in 18 countries and is listed on The New York Stock Exchange and The Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. (NRD). This communication is being made in respect of (a) the offer (the "Falconbridge Offer") by Noranda Inc. to acquire all of the outstanding common shares of Falconbridge Limited (other than shares owned by Noranda) on the basis of 1.77 Noranda common shares for each Falconbridge common share and (b) the issuer bid (the "Preference Share Exchange Offer") by Noranda to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. approximately 63.4 million Noranda common shares in exchange for three new series of preference shares. In connection with the Falconbridge Offer and the Preference Share Exchange Offer, Noranda filed with the U.S. Securities and Exchange Commission (the "SEC") registration statements on Form F-8 containing a share exchange take-over bid circular to be delivered to the shareholders of Falconbridge and an issuer bid circular to be delivered to shareholders of Noranda. Noranda, if required, will be filing other documents regarding the transactions with the SEC. INVESTORS ARE URGED TO READ CAREFULLY THE SHARE EXCHANGE TAKE-OVER BID CIRCULAR AND THE ISSUER BID CIRCULAR AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors will be able to obtain documents filed with the SEC free of charge at the SEC's website (www.sec.gov). In addition, documents filed with the SEC by Noranda may be obtained free of charge by contacting Noranda at (416) 982-7111. Note: All dollar amounts are expressed in U.S. dollars unless otherwise noted. Condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge are attached. To participate in the first quarter analyst conference call scheduled for Tuesday, April 26, 2005, at 8:00 a.m., please call (416) 620-2414 for local and oversease callers and 1-800-238-9605 toll free in North America, or visit the Company's website at www.noranda.com to listen to a live webcast. The Annual General Meeting will follow at 10:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy at the Design Exchange, Trading Floor, 234 Bay Street, Toronto. Note: This press release is also available at www.noranda.com. All dollar amounts are in U.S. dollars unless otherwise noted.
NORANDA INC.
CONSOLIDATED RESULTS
(US$ millions, unaudited)
Three months ended
March 31
---------------------
2005 2004
Restated -
(1)
---------- ----------
Revenues $ 1,976 $ 1,653
---------- ----------
Operating expenses
Cost of operations 628 464
Purchased raw materials 775 711
Depreciation, amortization and accretion 118 117
---------- ----------
1,521 1,292
---------- ----------
Income generated by operating assets 455 361
Interest expense, net 32 29
Corporate and general administration 17 13
Research, development and exploration 12 7
Minority interest in earnings of
subsidiaries 94 79
---------- ----------
Income before undernoted 300 233
Other expense (income) 1 (5)
Tax expense 123 86
---------- ----------
Net Income $ 176 $ 152
Dividends on preferred shares 3 4
---------- ----------
Net Income attributable to common shares $ 173 $ 148
---------- ----------
Basic earnings per common share $ 0.58 $ 0.50
---------- ----------
Diluted earnings per common share $ 0.57 $ 0.49
---------- ----------
Basic weighted average number of shares -
000s 296,856 295,595
Diluted weighted average number of shares -
000s 304,815 303,524
---------------------------------------------------------------------
(1) Effective January 1, 2005, Noranda retroactively adopted the new
Canadian Institute of Chartered Accountants standards for variable
interest entities and classification and measurement of convertible
debentures and preferred shares.
NORANDA INC.
CONSOLIDATED STATEMENTS OF CASHFLOWS
(US$ millions, unaudited)
Three months ended
March 31
----------------------
2005 2004
Restated -
(1)
----------- ----------
Cash realized from (used for):
Operations
Net income $ 176 $ 152
Charges (credits) not affecting cash:
Depreciation and amortization 125 106
Future taxes 75 43
Minority interest 94 79
Foreign exchange, and other (19) (32)
----------- ----------
451 348
Net change in accounts receivable,
inventories and payables (66) (88)
----------- ----------
Cash from operations 385 260
----------- ----------
Investment activities
Capital investments (110) (124)
Investments and advances (3) 10
Proceeds on dispositions 3 2
----------- ----------
Cash used in investment activities (110) (112)
----------- ----------
Financing activities
Long-term debt, including current portion
Issued 13 28
Repaid (154) (44)
Issue of shares - common 8 13
Dividends paid (33) (30)
Issue of shares - minority shareholders 16 11
Dividends paid to minority shareholders (9) (8)
----------- ----------
(159) (30)
----------- ----------
Increase in cash and cash equivalents 116 118
Cash and cash equivalents, beginning of period 884 501
----------- ----------
Cash and cash equivalents, end of period $ 1,000 $ 619
----------- ----------
NORANDA INC.
CONSOLIDATED BALANCE SHEETS
(US$ millions, unaudited)
Mar. 31 Dec. 31
2005 2004
Restated -
(1)
----------- ----------
Assets
Current assets
Cash and cash equivalents $ 1,000 $ 884
Accounts receivable 957 948
Metals and other inventories 1,471 1,436
----------- ----------
3,428 3,268
Operating capital assets 4,892 4,870
Development projects 1,134 1,166
Investments and other assets 328 324
----------- ----------
$ 9,782 $ 9,628
----------- ----------
Liabilities and Equity
Current Liabilities
Accounts and taxes payable $ 1,242 $ 1,265
Debt due within one year 591 570
----------- ----------
1,833 1,835
Long-term debt 2,574 2,736
Preferred share liabilities 121 122
Future income taxes 371 304
Asset retirement obligation, pension and
other provisions 600 595
Stockholders' interests:
Interests of other shareholders 1,296 1,197
Shareholders' equity 2,987 2,839
----------- ----------
$ 9,782 $ 9,628
----------- ----------
Segmented Information
($ US millions)
Three Months ended March 31, 2005
-------------------------------------------------
Copper Nickel Zinc Aluminum Other Total
Revenues $ 980 538 119 297 42 $ 1,976
-------------------------------------------------
Operating
expenses
Cost of
operations 254 173 50 139 12 628
Purchase of raw
materials 440 142 54 111 28 775
Depreciation,
amortization and
accretion 55 29 9 12 13 118
-------------------------------------------------
$ 749 344 113 262 53 $ 1,521
-------------------------------------------------
Income (loss)
generated by
operating assets $ 231 194 6 35 (11) $ 455
-------------------------------------------------
Interest expense, net (32)
Corporate and
general
administration (17)
Research,
development and
exploration (12)
Minority interest
in earnings of
subsidiaries (94)
Income before
undernoted $ 300
--------
Other expense (1)
Tax expense (123)
--------
Net Income $ 176
--------
Total
assets,excluding
cash and
short-term
investments $ 4,550 2,047 394 1,008 783 $ 8,782
-------------------------------------------------
Capital
investments $ 48 48 1 7 6 $ 110
-------------------------------------------------
Three Months ended March 31, 2004 (Restated - 1)
--------------------------------------------------
Copper Nickel Zinc Aluminum Other Total
Revenues $ 844 481 85 204 39 $ 1,653
--------------------------------------------------
Operating
expenses
Cost of
operations 195 140 34 103 (8) 464
Purchase of raw
materials 462 122 31 76 20 711
Depreciation,
amortization and
accretion 48 32 18 9 10 117
--------------------------------------------------
$ 705 294 83 188 22 $ 1,292
--------------------------------------------------
Income generated
by operating
assets $ 139 187 2 16 17 $ 361
--------------------------------------------------
Interest expense, net (29)
Corporate and
general
administration (13)
Research,
development and
exploration (7)
Minority interest
in earnings of
subsidiaries (79)
--------------------------------------------------
Income before
undernoted $ 233
Other income 5
Tax expense (86)
--------------------------------------------------
Net income $ 152
--------------------------------------------------
Total
assets,excluding
cash and
short-term
investments $ 4,241 1,763 436 838 754 $ 8,032
--------------------------------------------------
Capital
investments $ 74 34 1 6 9 $ 124
--------------------------------------------------
NORANDA INC.
SALES VOLUMES & REALIZED PRICES
First Quarter
------------------------
2005 2004
------------ -----------
Metal Sales (tonnes, except as noted)
100% basis,
except as noted
---------------
Copper
Copper business
CCR 69,052 84,986
Kidd Creek 23,360 10,272
Horne - (concentrates) - 17,605
Antamina - (concentrates) (33.75%) 30,020 11,609
Collahuasi -
(concentrates) (44%) 35,976 11,957
Collahuasi (44%) 6,686 5,914
Lomas Bayas 17,505 15,935
Altonorte - (anodes) 31,198 55,097
------------ -----------
213,797 213,375
Nikkelverk 15,477 13,197
------------ -----------
229,274 226,572
------------ -----------
Zinc
Copper business
Kidd Creek 40,932 26,525
Antamina - (concentrates) (33.75%) 15,150 14,219
------------ -----------
56,082 40,744
Zinc business
Brunswick/Matagami -
(concentrates) 60,129 74,134
------------ -----------
116,211 114,878
------------ -----------
Nickel 21,266 18,118
Ferronickel 6,515 6,777
Aluminum
Primary Aluminum - shipments 61,810 60,745
Norandal - shipments 45,614 42,388
Lead 21,723 21,211
Gold - 000 ounces 184 236
Silver - 000 ounces
CCR 8,314 9,326
Kidd Creek 1,483 1,004
Antamina (33.75%) 380 423
------------ -----------
10,177 10,753
------------ -----------
Average Realized Prices - (US$ per pound, except as noted)
----------------------------------------------------------
Copper 1.54 1.17
Nickel 7.03 6.88
Ferronickel 6.70 6.80
Zinc 0.63 0.52
Aluminum 0.92 0.79
Lead 0.49 0.41
Gold - (US$ per ounce) 434.59 403.55
Silver - (US$ per ounce) 7.17 6.33
Exchange Rate (US$1 = Cdn$1) 0.82 0.76
----------------------------
NORANDA INC.
PRODUCTION VOLUMES
First Quarter
---------------------
2005 2004
----------- ---------
Mine Production (tonnes, except as noted)
100% basis,
except as noted
Copper
Copper business
Kidd Creek 11,155 9,296
Antamina (33.75%) 31,030 25,557
Collahuasi (44%) 46,974 35,369
Lomas Bayas 16,323 15,728
----------- ---------
105,482 85,950
Matagami - 1,856
Brunswick 1,272 1,842
INO 8,561 5,585
Other 3,321 4,430
----------- ---------
118,636 99,663
----------- ---------
Zinc
Zinc business
Brunswick 67,067 73,580
Matagami - 26,674
----------- ---------
67,067 100,254
Kidd Creek 27,426 20,792
Antamina (33.75%) 20,172 22,469
Other 2,588 1,544
----------- ---------
117,253 145,059
----------- ---------
Nickel 14,050 11,161
Ferronickel 6,474 7,999
Lead 18,893 20,287
Silver - 000 ounces
Copper business
Kidd Creek 827 1,194
Antamina (33.75%) 922 653
----------- ---------
1,749 1,847
Brunswick 1,486 1,602
Matagami - 114
Other 66 50
----------- ---------
3,301 3,613
----------- ---------
Metal Production (tonnes, except as noted)
Refined copper
Copper business
CCR 66,989 78,160
Kidd Creek 31,460 33,722
Collahuasi (44%) 6,813 6,152
Lomas Bayas 16,323 15,728
----------- ---------
121,585 133,762
Nikkelverk 8,952 9,746
----------- ---------
130,537 143,508
----------- ---------
Copper anodes
Horne 33,062 43,234
Kidd Creek 34,444 33,500
Altonorte 58,105 63,850
----------- ---------
125,611 140,584
----------- ---------
Refined zinc
Kidd Creek 37,965 28,458
Refined nickel
Nikkelverk 21,456 18,859
Falcondo 6,474 7,999
----------- ---------
27,930 26,858
----------- ---------
Primary aluminum 61,373 61,220
Fabricated Aluminum 45,614 42,388
Refined lead 21,594 25,148
Refined gold - 000 ounces 213 269
Refined silver - 000 ounces 8,210 10,123
Noranda Inc. (TSX:NRD) (NYSE:NRD) |
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