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MAGMA COPPER REPORTS NET INCOME OF $9.7 MILLION OR $0.22 PER SHARE FOR FIRST QUARTER 1992

 MAGMA COPPER REPORTS NET INCOME OF $9.7 MILLION
 OR $0.22 PER SHARE FOR FIRST QUARTER 1992
 TUCSON, Ariz., April 28 /PRNewswire/ -- Magma Copper Co. (NYSE: MCU) today reported net income for the first quarter of 1992 of $9.7 million ($0.22 per share) on sales of $200 million. This compares to net income of $4.3 million ($0.10 per share) on sales of $198 million for the fourth quarter of 1991 and net income of $7.7 million ($0.18 per share) on sales of $170 million for the first quarter of 1991. The 1991 amounts exclude the effects of the non-recurring, non-cash accounting adjustments reported during the fourth quarter of 1991 as part of Magma's company-wide reorganization. Per share amounts are based on fully diluted shares outstanding.
 Including the adjustments, Magma reported a loss of $136.6 million ($4.56 per share) for fourth quarter 1991 and restated first quarter 1991 earnings resulting in a loss of $5.3 million ($0.24 per share).
 "Despite lower copper prices, first quarter 1992 earnings increased due to outstanding operating performance from each of Magma's mining divisions and Magma Metals Co. Net cash operating cost for the quarter dropped to a record low $0.66 per pound, compared to $0.71 per pound in 1991. Magma's costs have decreased by $0.12 per pound since 1988 and are expected to continue on this downward trend as our employee involvement, work redesign and gainsharing programs stimulate increased productivity," said J. Burgess Winter, Magma Copper Co.'s president and chief executive officer.
 Magma's average price realized per pound of copper sold declined to $0.97 for first quarter 1992, down from $0.98 for fourth quarter 1991 and $1.05 for first quarter 1991. Magma sold 147 million pounds of copper produced from its own mines during the first quarter of 1992, compared to 139 million for fourth quarter 1991 and 119 million for first quarter 1991. Magma also produced 56 million pounds of copper from third party sources for first quarter 1992, compared to 51 million for fourth quarter 1991 and 54 million for first quarter 1991.
 Magma Metals' production, which includes copper smelted and refined from Magma's mines as well as third party custom processing, was a record 151 million pounds of copper while Magma's leaching operations produced a record 36 million pounds of electrowon copper cathode during first quarter 1992, resulting in a record combined production of 187 million pounds, compared to 184 million pounds for fourth quarter 1991 and 172 million pounds for first quarter 1991.
 Net cash provided by operating activities increased significantly for the three months ended March 31, 1992 to $55 million, compared to $18 million for fourth quarter 1991 and $20 million for first quarter 1991. The increase was due primarily to higher earnings, a $23 million decrease in metals inventories and an $8 million decrease in accounts receivable from the fourth quarter of 1991.
 Magma received $125 million in cash from the issuance of debt and used $11 million for capital expenditures during first quarter 1992. Cash and short-term investments increased to $260 million at March 31, 1992, compared to $91 million at Dec. 31, 1991.
 On May 15, 1992, Magma will use $105 million of cash on hand to redeem all of its outstanding Subordinated Reset Debentures due 2001, which pay interest at the rate of 14.5 percent. The redemption completes a major refinancing of Magma's debt which reduces its weighted average interest rate on debt from 14.1 percent at the end of 1990 to 10.7 percent after the redemption. In total, the refinancings will result in annual interest savings of $7.5 million, or $0.17 per share before taxes on a fully diluted basis.
 Magma is evaluating several significant capital projects, which include development of its newly acquired Robinson copper and gold reserves, expansion of its smelter to capitalize on the worldwide shortage of smelting capacity and development of the Kalamazoo orebody. The new debt structure provides greater financial flexibility, and combined with a strong cash position enhances the company's ability to pursue these projects which present opportunities for further growth and cost reduction.
 Magma Copper Co., one of the largest primary copper producers in the United States, produces high-quality copper cathode and rod for sale to customers worldwide. Magma has operations in San Manuel, Miami, Superior and Humboldt, Ariz., and Ely, Nev. Magma Metals Co., a wholly owned subsidiary, operates Magma's smelting and refining complex located in San Manuel which represents approximately 25 percent of the U.S. smelting capacity. Corporate headquarters are in Tucson.
 Financial and operating results follow.
 MAGMA COPPER CO.
 Selected Financial and Operating Data
 (In millions, except per pound amounts)
 Three months ended
 March 31, Dec. 31, March 31,
 1992 1991 1991
 Electrolytic
 pounds produced
 from:
 Magma sources -
 Electrorefined 94.5 97.4 89.7
 Electrowon (SXEW) 36.4 35.8 27.9
 Total Magma sources 130.9 133.2 117.6
 Custom sources -
 Purchased
 concentrates 30.8 34.1 14.2
 Other purchases 2.5 5.3 8.7
 Toll customers 22.7 11.5 31.4
 Total custom sources 56.0 50.9 54.3
 Total production 186.9 184.1 171.9
 Pounds sold from:
 Magma sources 146.9 139.1 118.9
 Purchased
 concentrates 30.8 34.1 14.2
 Other purchases 2.5 5.2 9.7
 Total sales
 quantities (a) 180.2 178.4 142.8
 Sales of copper $177.8 $177.1 $151.7
 Price realized
 per pound
 (excluding rod
 premium) $.97 $.98 $1.05
 Cost of products
 sold:
 Cost of copper sold -
 Magma sources $115.1 $112.1 $99.2
 Custom sources -
 Purchased
 concentrates 27.2 31.9 14.5
 Other purchases 2.4 5.4 10.4
 Tolling 3.2 2.3 4.2
 Other 10.0 22.7 5.8
 Total 42.8 62.3 34.9
 Total cost of
 products sold $157.9 $174.4 $134.1
 Per pound cost of
 products sold:
 Magma sources
 Before credits $.79 $.81 $.83
 Credits (b) (.13) (.10) (.11)
 Net $.66 $.71 $.72
 Purchased
 concentrates $.88 $.94 $1.02
 (a) Excludes copper processed for toll customers.
 (b) Deductions for rod premiums and profits on by-products, custom processing and toll conversion.
 MAGMA COPPER CO.
 Summary Statement of Consolidated Income
 (In thousands, except per share amounts)
 Three months ended
 March 31, Dec. 31, March 31,
 1992 1991 1991
 Sales $199,920 $197,703 $170,448
 Cost of sales:
 Cost of products
 sold (157,936) (174,502) (134,147)
 Depreciation,
 depletion and
 amortization (13,525) (11,491) (10,140)
 Selling, general
 and administrative (4,861) (4,379) (4,082)
 Exploration, research
 and development (735) (684) (2)
 Restructure expense --- (203,169) ---
 Income (loss) from
 operations 22,863 (196,522) 22,077
 Other income
 (expense):
 Interest expense (12,831) (12,874) (13,659)
 Interest income 1,852 1,896 1,931
 Other 977 1,541 56
 Income (loss) before
 income taxes and
 cumulative effect of
 accounting change 12,861 (205,959) 10,405
 Income tax provision
 (benefit) (3,113) 69,400 (1,700)
 Income (loss) before
 accounting change 9,748 (136,559) 8,705
 Cumulative effect of
 accounting change --- --- (14,000)
 Net income (loss) $9,748 ($136,559) ($5,295)
 Preferred stock
 dividends (2,519) (1,955) (1,972)
 Net income (loss)
 available for
 common stock $7,229 ($138,514) ($7,267)
 Earnings (loss)
 per share of
 common stock,
 primary $.24 ($4.56) ($.24)
 Average common shares
 outstanding,
 primary 30,664 30,382 29,672
 Earnings (loss)
 per share of
 common stock,
 fully diluted $.22 ($4.56) ($.24)
 Average common shares
 outstanding, fully
 diluted 43,717 42,738 42,725
 MAGMA COPPER CO.
 Consolidated Balance Sheets
 (In thousands)
 March 31, Dec. 31,
 1992 1991
 Assets
 Current assets:
 Cash & short-term investments $259,799 $91,348
 Accounts receivable 49,599 57,873
 Inventories:
 Metals 43,166 66,277
 Materials and supplies 24,719 25,215
 Prepaid expenses 3,581 7,910
 Total current assets 380,864 248,623
 Net property, plant and
 mine development 764,146 766,184
 Other 2,632 1,112
 Total assets $1,147,642 $1,015,919
 Liabilities and stockholders' equity
 Current liabilities:
 Accounts payable $12,808 $9,438
 Accrued liabilities 82,034 90,305
 Current portion of
 long-term debt 114,082 14,082
 Income taxes payable --- ---
 Total current liabilities 208,924 113,825
 Accrued pension, retirement and
 other liabilities 57,903 59,628
 Deferred income taxes 95,579 92,466
 Long-term debt 366,234 340,923
 Stockholders' equity:
 Series B preferred stock 9 9
 Class A common stock 42 42
 Class B common stock 261 259
 Capital in excess of par value 411,448 409,905
 Retained earnings 7,229 ---
 Dividend payable in common stock 2,209 1,366
 Unearned stock grant
 compensation (2,196) (2,504)
 Total stockholders' equity 419,002 409,077
 Total liabilities and
 stockholders' equity $1,147,642 $1,015,919
 MAGMA COPPER CO.
 Consolidated Statements of Cash Flows
 (In thousands)
 Three months ended
 March 31, Dec. 31, March 31,
 1992 1991 1991
 Net income (loss) $9,748 ($136,559) ($5,295)
 Adjustments to
 reconcile net
 income to net
 cash provided
 by operating
 activities:
 Depreciation,
 depletion and
 amortization 13,525 11,491 10,140
 (Gain) loss on
 sale of assets (382) (37) 299
 Restructure expense --- 203,169 ---
 Other reserve costs --- 8,000 ---
 Cumulative effect of
 accounting change,
 net of taxes --- --- 14,000
 Other 309 621 434
 Total 23,200 86,685 19,578
 Change in certain assets
 and liabilities:
 (Increase) decrease in:
 Accounts receivable 8,274 (14,523) (2,175)
 Inventories 22,940 21,740 4,572
 Prepaid expenses 4,329 (3,257) 321
 Increase (decrease) in:
 Accounts payable and
 accrued expenses (4,901) (11,742) 4,741
 Income taxes payable --- (1,336) (5,895)
 Accrued pension
 retirement and
 other liabilities (1,725) (720) (151)
 Deferred income
 taxes 3,113 (59,059) (605)
 Net change in
 certain assets
 and liabilities 32,030 (68,897) 808
 Net cash provided by
 operating activities 55,230 17,788 20,386
 Cash flows from
 investing activities:
 Capital expenditures (11,136) (42,884) (11,100)
 Proceeds from sale
 of assets 696 730 (6)
 Other 981 840 1,082
 Net cash used in
 investing
 activities (9,459) (41,314) (10,024)
 Cash flows from
 financing activities:
 Long-term debt
 borrowings 125,000 200,000 ---
 Long-term debt
 repayment --- (226,800) ---
 Debt issuance costs (2,500) --- ---
 Issuance of common
 stock under stock
 plans 180 --- ---
 Preferred stock
 dividends -
 cash portion (311) (589) (489)
 Issuance of
 non-interest-
 bearing notes 311 589 489
 Net cash provided (used)
 by financing
 activities 122,680 (26,800) ---
 Net increase
 (decrease) in cash 168,451 (50,326) 10,362
 Cash at the beginning
 of the period 91,348 141,674 113,626
 Cash at the end of
 the period $259,799 $91,348 $123,988
 Supplemental disclosure
 of cash flow
 information:
 Cash paid during
 the year for -
 Interest $628 $15,396 $9,626
 Income taxes, net --- ($7,661) $8,200
 -0- 4/28/92
 /CONTACT: Richard P. Johnson, corporate treasurer, 602-575-5670, or Kimberly L. Wick, treasury analyst, 602-575-5673, both of Magma Copper/
 (MCU) CO: Magma Copper Company ST: Arizona IN: MNG SU: ERN


JL -- SD001 -- 3536 04/28/92 08:02 EDT
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