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PHELPS DODGE EARNS 85 CENTS PER SHARE IN 1993 FIRST QUARTER

 PHOENIX, Ariz., April 21 /PRNewswire/ -- Phelps Dodge Corporation today reported consolidated net income of $60.3 million, or 85 cents per common share, for the first quarter of 1993. Income in the corresponding 1992 period was $52.0 million, or 74 cents per common share, before the cumulative effect of accounting changes. The recognition of a non-recurring, after-tax charge of $79.9 million, or $1.14 per common share, for the cumulative effect of postretirement and postemployment benefit and income tax accounting changes resulted in a consolidated net loss of $27.9 million, or 40 cents per common share, in the 1992 first quarter. All 1992 financial information presented in this report has been revised to recognize the cumulative effect of these accounting changes and certain ongoing operating costs in excess of those recorded under previously used accounting methods. In addition, per share amounts reflect average shares outstanding for the respective periods after giving effect to a two- for-one stock split in May 1992.
 Douglas C. Yearley, Chairman of the Board, President and Chief Executive Officer, said: "I am extremely proud of the company's achievements for the first quarter of 1993. Our earnings were 16 percent higher than those in the same period last year even though copper prices were slightly lower.
 "In spite of record rainfall and very difficult weather conditions in the southwestern United States, our mining operations performed admirably, producing 268.6 million pounds of copper, which was 9 percent ahead of the same quarter last year. Even with record water accumulation, our mines in both Arizona and New Mexico remained in compliance with their environmental protection permits. These achievements are a tribute to the thoughtful planning and hard work of the men and women of Phelps Dodge Mining Company.
 "Phelps Dodge Industries continued its improved performance and provided its best first quarter results in the last three years. This achievement was the result of strengthening North American markets partially offset by softening demand in other markets.
 "Cash flow provided by operating activities was a respectable $84.1 million for the 1993 first quarter.
 "We continue to show good progress in growing our company toward our primary goal of increasing long-term shareholder value."
 Sales were $666.7 million in the 1993 first quarter, compared with $590.5 million in the corresponding 1992 period. Increases for the 1993 first quarter resulted from higher sales volumes of copper (including copper purchased for resale), wheels and rims, and wire and cable products.
 Phelps Dodge Mining Company recorded earnings from operations of $79.8 million in the 1993 first quarter, compared with $75.0 million in the corresponding 1992 period. Increased 1993 operating earnings reflected higher volumes of copper sold and lower copper production costs, partially offset by slightly lower average copper prices. The lower 1993 production costs resulted from additional production of cathode copper at the Morenci, Arizona, and Tyrone, New Mexico, solvent extraction/electrowinning (SX/EW) plants, and from the closure of the higher cost concentrator operations at Tyrone in the first quarter of 1992.
 Phelps Dodge Mining Company reported sales of $356.6 million in the first quarter of 1993, compared with $301.5 million in the 1992 first quarter. The New York Commodity Exchange spot price per pound of copper cathode averaged 98 cents in the 1993 first quarter, compared with 99 cents in the corresponding 1992 period.
 The Phelps Dodge Mining Company share of mine production from its worldwide operations was 134,300 tons of copper for the 1993 first quarter, compared with 123,100 tons in the first quarter of 1992. Phelps Dodge Mining Company copper sales from mine production were 140,400 tons in the 1993 first quarter, compared with 127,700 tons in the corresponding 1992 period.
 Phelps Dodge Industries recorded earnings from operations of $23.4 million in the 1993 first quarter, compared with $18.0 million in the 1992 first quarter. Increased 1993 operating earnings reflected improved sales volumes in the wheel and rim business, improved volumes and margins in the carbon black business, and the favorable earnings of the international wire and cable acquisition in Venezuela. These improvements were partially offset by lower volumes and margins in other international wire and cable operations.
 Phelps Dodge Industries reported sales of $310.1 million in the 1993 first quarter, compared with $289.0 million in the corresponding 1992 period.
 The company's total debt at March 31, 1993, was $521.5 million, compared with $488.5 million at year-end 1992. This $33.0 million increase principally resulted from a Chilean subsidiary's borrowings used to fund construction and development of the La Candelaria copper project in Chile. The company's ratio of debt to total capitalization was 20.2 percent at March 31, 1993, compared with 19.4 percent at December 31, 1992. In February 1993 the company sold $90.0 million of 6.5 percent refunding bonds due April 1, 2013. The proceeds from the sale of these bonds were used to prepay $90.0 million in 7 percent Installment Sale Obligations due 1993- 2003.
 The company enters into price protection arrangements from time to time, depending on market circumstances, to ensure a minimum price for a portion of its expected future mine production. With respect to 1993 production, the company has entered into contracts with several financial institutions that provide for a minimum average annual realized price of 95 cents per pound for 475 million pounds of copper cathode, approximately 45 percent of its anticipated production for 1993. The remainder of the company's expected mine production for 1993 is not subject to other such arrangements.
 Capital outlays during the first quarter of 1993 were $86.9 million for Phelps Dodge Mining Company, including $68.2 million for La Candelaria, and $12.8 million for Phelps Dodge Industries. Capital outlays in the corresponding 1992 period were $62.2 million for Phelps Dodge Mining Company, including $9.2 million for La Candelaria, and $17.6 million for Phelps Dodge Industries. The company expects capital outlays in 1993 to be approximately $320 million for Phelps Dodge Mining Company, including $200 million for the company's 80 percent share of the La Candelaria project, and approximately $150 million for Phelps Dodge Industries, including $50 million for the Columbian Chemicals carbon black project in Hungary.
 On March 8, 1993, the company paid a regular quarterly dividend of 41.25 cents per share on its common shares for the 1993 first quarter; the total amount paid was $29.0 million.
 During April 1993 the company purchased 55,000 of its common shares under the buy-back program authorized in September 1989. Under this program, 1,702,000 shares remain authorized for purchase. There were 70,441,434 common shares outstanding at March 31, 1993.
 Phelps Dodge Corporation is the world's second largest producer of copper. The company is also one of the world's largest producers of carbon black, the leading North American fabricator of wheels and rims for medium and heavy trucks, a major manufacturer of magnet wire and specialty conductors, and has operations and investments abroad in mines and wire and cable manufacturing facilities. The company's operations are located throughout the United States and in 24 other countries.
 PHELPS DODGE CORPORATION
 STATEMENT OF CONSOLIDATED OPERATIONS
 (Unaudited; in millions except per share data)
 First Quarter
 1993 1992
 Sales and other operating revenues 666.7 590.5
 Operating costs and expenses
 Cost of products sold 487.1 431.2
 Depreciation, depletion and amortization 45.7 39.8
 Selling and general administrative expense 26.9 25.1
 Exploration and research expense 11.3 9.9
 571.0 506.0
 Operating income 95.7 84.5
 Equity earnings (losses) (0.5) 1.1
 Earnings from operations 95.2 85.6
 Interest expense less amount capitalized (9.4) (10.5)
 Other miscellaneous income and expense, net 2.8 1.9
 Income before taxes and cumulative effect
 of accounting changes 88.6 77.0
 Provision for taxes (28.3) (25.0)
 Income before cumulative effect of accounting
 changes 60.3 52.0
 Cumulative effect of accounting changes --- (79.9)
 Net income (loss) 60.3 (27.9)
 Earnings per share
 Income before cumulative effect of accounting
 changes 0.85 0.74
 Cumulative effect of accounting changes --- (1.14)
 Net income (loss) 0.85 (0.40)
 Average number of shares outstanding 70.7 70.2
 BUSINESS SEGMENTS
 (Unaudited; in millions)
 Sales and other operating revenues
 Phelps Dodge Mining Company 356.6 301.5
 Phelps Dodge Industries 310.1 289.0
 666.7 590.5
 Earnings from operations
 Phelps Dodge Mining Company 79.8 75.0
 Phelps Dodge Industries 23.4 18.0
 Corporate and other (8.0) (7.4)
 95.2 85.6
 Note: 1992 financial information has been revised to recognize accounting changes for postretirement and postemployment benefits and income taxes.
 PHELPS DODGE CORPORATION
 CONSOLIDATED BALANCE SHEET
 (In millions)
 March 31 Dec. 31
 1993 1992
 (unaudited)
 Assets
 Cash and short-term investments, at cost 234.3 251.2
 Receivables, net 402.6 365.4
 Inventories 207.8 223.9
 Supplies 98.1 101.5
 Prepaid expenses 19.5 15.4
 Deferred income taxes 32.8 32.6
 Current assets 995.1 990.0
 Investments and long-term receivables 92.4 93.8
 Property, plant and equipment, net 2,169.7 2,108.6
 Other assets and deferred charges 249.1 248.8
 3,506.3 3,441.2
 Liabilities
 Short-term debt 104.0 72.5
 Current portion of long-term debt 32.4 42.2
 Accounts payable and accrued expenses 397.4 391.7
 Income taxes 30.3 34.5
 Current liabilities 564.1 540.9
 Long-term debt 385.1 373.8
 Deferred income taxes 257.8 265.1
 Other liabilities and deferred credits 242.4 238.2
 1,449.4 1,418.0
 Minority interest in subsidiaries 53.9 50.8
 Common shareholders' equity
 Common shares, 70.4 outstanding
 (1992 - 70.4) 440.3 439.8
 Capital in excess of par value 81.1 80.6
 Retained earnings 1,577.9 1,546.7
 Cumulative translation adjustments
 and other (96.3) (94.7)
 2,003.0 1,972.4
 3,506.3 3,441.2
 CONSOLIDATED STATEMENT OF CASH FLOWS
 (Unaudited; in millions)
 Three months ended March 31,
 1993 1992
 Operating activities
 Net income (loss) 60.3 (27.9)
 Adjustments to reconcile net income to cash
 flow from operations:
 Depreciation, depletion and amortization 45.7 39.8
 Deferred income taxes 6.2 7.1
 Equity earnings net of dividends received 0.5 (1.1)
 Cumulative effect of accounting changes --- 79.9
 Cash flow from operations 112.7 97.8
 Working capital and other adjustments (28.6) (13.6)
 Net cash provided by operating activities 84.1 84.2
 Investing activities
 Capital outlays (99.9) (79.9)
 Investment in subsidiaries (1.3) (2.2)
 Other (2.8) (0.8)
 Net cash used in investing activities (104.0) (82.9)
 Financing activities
 Increase in debt 132.3 161.5
 Payment of debt (103.4) (153.6)
 Common dividends (29.0) (26.2)
 Other 3.1 7.6
 Net cash used in financing activities 3.0 (10.7)
 Increase (decrease) in cash and short-term
 investments (16.9) (9.4)
 Cash and short-term investments
 at beginning of period 251.2 182.5
 Cash and short-term investments
 at end of period 234.3 173.1
 Note: 1992 financial information has been revised to recognize accounting changes for postretirement and postemployment benefits and income taxes.
 -0- 4/21/93
 /CONTACT: Thomas M. Foster of Phelps Dodge Corporation, 602-234-8139/
 (PD)


CO: Phelps Dodge Corporation ST: Arizona IN: MNG SU: ERN

KJ-JL -- SD003 -- 8509 04/21/93 08:59 EDT
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Date:Apr 21, 1993
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