Printer Friendly

MAGMA FINALIZES ACCOUNTING ADJUSTMENTS AND SELECTS UNDERWRITERS OF NEW DEBT ISSUE

 MAGMA FINALIZES ACCOUNTING ADJUSTMENTS
 AND SELECTS UNDERWRITERS OF NEW DEBT ISSUE
 TUCSON, Ariz., Dec. 3 /PRNewswire/ -- Magma Copper Co. (AMEX: MCU) announced today that its board of directors has approved certain non-cash accounting adjustments, the consideration of which was previously disclosed by Magma on Nov. 15 as part of its companywide reorganization. As part of the reorganization, Magma will implement, effective Dec. 31, 1991, a "quasi-reorganization", an accounting treatment under which Magma will adjust certain assets and liabilities on its balance sheet.
 The adjustments, which include the early adoption of FASB 96 and FASB 106, one-time write-offs for capitalized mine development costs related to the Kalamazoo orebody and other items related to the reorganization and the "quasi-reorganization", will result in a $152 million after-tax charge to 1991 earnings and a proforma stockholders' equity balance of approximately $407 million compared to $562 million at Sept. 30, 1991. Magma emphasized that these accounting adjustments would have no impact on its cash balances or cash flow.
 Magma has elected early adoption of FASB Statements 96 ("Accounting for Income Taxes") and 106 ("Employers' Accounting for Post-Retirement Benefits Other Than Pensions"). The FASB 96 adjustment, primarily a result of Magma's former parent's utilization of Magma's tax deductions, will reduce stockholders' equity by $87 million. The FASB 106 adjustment will result in a
$15 million after-tax ($23 million before-tax) charge to 1991 earnings. Magma will recognize a $92 million after-tax ($143 million before-tax) charge for the write-down of Magma's investment in the Kalamazoo orebody, a result of mine development costs incurred prior to Magma's spin-off and recapitalization in 1988. Magma will also recognize reorganization charges primarily related to future environmental costs, employee benefit costs and obsolete inventories.
 Magma recently filed a shelf registration statement for up to $250 million of debt securities to refinance existing debt, which S&P has recently upgraded. On Dec. 2, Magma selected Goldman, Sachs & Co. and Jefferies & Co. Inc. to underwrite the new debt issue.
 Magma, 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. Corporate headquarters are in Tucson.
 -0- 12/3/91
 /CONTACT: Richard P. Johnson, of Magma Copper, 602-575-5670/
 (MCU) CO: Magma Copper Co. ST: Arizona IN: MNG SU:


KJ -- SD005 -- 8908 12/03/91 16:42 EST
COPYRIGHT 1991 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Dec 3, 1991
Words:397
Previous Article:HOVEN ASSUMES TOP MARKETING POST AT REVCO
Next Article:MOODY'S CONFIRMS Aa RATING FOR STATE OF OREGON GENERAL OBLIGATIONS
Topics:


Related Articles
MAGMA COPPER ANNOUNCES COMPANY-WIDE REORGANIZATION, CONTEMPLATES POTENTIAL NON-CASH ACCOUNTING ADJUSTMENTS INCLUDING EARLY ADOPTION OF NEW ACCOUNTING...
S&P UPGRADES RATINGS ON TWO MAGMA COPPER ISSUES
MAGMA COPPER REGISTERS NEW DEBT SECURITIES
MOODY'S RAISES RATINGS ON MAGMA'S COPPER ISSUES; ASSIGNS DEBT RATING TO SHELF
MAGMA COPPER ANNOUNCES NEW DEBT ISSUE
MAGMA COPPER CO. REPORTS 1991 FOURTH QUARTER AND YEAR-END RESULTS
MAGMA COPPER REPORTS NET INCOME OF $9.7 MILLION OR $0.22 PER SHARE FOR FIRST QUARTER 1992
MAGMA COPPER CO. REPORTS NET INCOME OF $23.3 MILLION OR $0.50 PER SHARE FOR THE THIRD QUARTER
MAGMA COPPER CO. REPORTS 1992 FOURTH QUARTER AND YEAR-END RESULTS
DUFF & PHELPS ASSIGNS 'BBB' RATING TO MAGMA COPPER SENIOR DEBT

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters