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PHELPS DODGE EARNS 66 CENTS PER SHARE IN SECOND QUARTER 1993

    PHOENIX, Ariz., July 22 /PRNewswire/ --  Phelps Dodge Corporation (NYSE: PD) today reported consolidated net income of $46.3 million, or 66 cents per common share, for the second quarter of 1993, compared with $65.8 million, or 94 cents per common share, in the 1992 second quarter. Net income for the six months ended June 30, 1993, was $106.6 million, or $1.51 per common share.  Income in the corresponding 1992 period was $117.8 million, or $1.67 per common share, before the cumulative effect of accounting changes.  The company recognized a non-recurring, after- tax charge of $79.9 million, or $1.13 per common share, for the cumulative effect of postretirement and postemployment benefit and income tax accounting changes resulting in consolidated net income of $37.9 million, or 54 cents per common share, in the first six months of 1992.  All 1992 financial information presented in this report has been revised to reflect the cumulative effect of these accounting changes and certain ongoing operating costs in excess of those recorded under previously used accounting methods.
    Douglas C. Yearley, Chairman of the Board, President and Chief Executive Officer, said:  "Our second quarter results demonstrate the earning power of our company.  In spite of a significant decline in the price of our primary product, copper, earnings and cash flow remained healthy.  Cash flow provided by operating activities, the principal measure of our operating performance, was $156.2 million for the first six months of 1993, compared with $149.3 million in the 1992 period. Phelps Dodge Mining Company maintained its high level of copper production and competitive cost profile.  Phelps Dodge Industries continued its recovery, posting earnings that approached the levels established prior to the U.S. recession.
    "We are especially proud that Phelps Dodge Mining Company's Morenci, Arizona, operation was recently named the safest open pit mine in the country and received the prestigious Sentinels of Safety Award from the U.S. Department of Labor and the American Mining Congress.  In addition, our Tyrone, New Mexico, mine was awarded second place in the same competition."
    As previously reported, the company has contracts with several financial institutions that provide for a minimum 1993 annual average price of 95 cents per pound for 475 million pounds of copper cathode, about 45 percent of anticipated 1993 production.  These contracts are based on the average London Metals Exchange (LME) price for the entire year; therefore any benefit to be received will be determined finally at the end of 1993.  During the 1993 second quarter the company recognized revenue of $7 million before taxes ($4.7 million, or 7 cents per common share, after taxes) from these arrangements.  The amount recognized took into consideration the average LME price through the first six months, the current LME price and possible changes during the remainder of the year.
    Sales were $629.8 million in the second quarter of 1993, compared with $663.3 million in the 1992 second quarter, and $1,296.5 million in the first six months of 1993, compared with $1,253.8 million in the corresponding 1992 period.  These decreases in 1993 sales resulted from lower average copper prices, partially offset by increased sales by the international wire and cable operations, principally from a late 1992 acquisition in Venezuela, and by improved sales volumes of wheels and rims.  The effects of lower copper prices in the first half of 1993 were also partially offset by higher sales volumes of copper (including copper purchased for resale).
    Phelps Dodge Mining Company recorded earnings from operations of $51.3 million in the second quarter of 1993, compared with $82.5 million in the 1992 second quarter.  For the six-month period ended June 30, 1993, Phelps Dodge Mining Company contributed earnings from operations of $131.1 million, compared with $157.5 million in the corresponding 1992 period.  The decreases in both the second quarter and first six months of 1993 resulted from lower copper prices.  The New York Commodity Exchange spot price per pound of copper cathode averaged 83 cents in the second quarter and 91 cents in the first six months of 1993, compared with $1.02 and $1.01 in the corresponding 1992 periods.
    Phelps Dodge Mining Company reported sales of $305.0 million in the 1993 second quarter, and $661.6 million in the 1993 six-month period. Sales were $361.6 million and $663.1 million in the corresponding 1992 periods.
    The Phelps Dodge Mining Company share of mine production from its worldwide operations was 134,800 tons of copper in the second quarter and 269,100 tons in the first six months of 1993, compared with 133,100 tons and 256,200 tons in the corresponding 1992 periods.  Phelps Dodge Mining Company copper sales from mine production were 130,400 tons in the 1993 second quarter and 270,800 tons in the first six months, compared with 127,600 tons and 255,300 tons in the corresponding 1992 periods.
    Phelps Dodge Industries recorded earnings from operations of $33.7 million in the 1993 second quarter and $57.1 million in the first six months of 1993, compared with $25.3 million and $43.3 million in the corresponding 1992 periods.  Higher 1993 earnings for the second quarter and first six months reflected improved results in the wheel and rim, wire and cable, and carbon black businesses primarily due to improved business conditions in the United States.
    Phelps Dodge Industries reported sales of $324.8 million in the second quarter and $634.9 million in the first six months of 1993. Sales were $301.7 million and $590.7 million in the corresponding 1992 periods.
    The company's total debt at June 30, 1993, was $577.3 million, compared with $488.5 million at year-end 1992.  This $88.8 million increase principally resulted from borrowings for the company's La Candelaria copper-gold project in Chile and its new carbon black plant in Hungary.  The company's ratio of debt to total capitalization was 21.8 percent at June 30, 1993, compared with 19.4 percent at December 31, 1992.  During the 1993 second quarter final agreements were executed with a group of lenders for $290 million of limited recourse project financing for La Candelaria.
    Capital outlays during the first half of 1993 were $146.1 million for Phelps Dodge Mining Company (including $101.5 million for La Candelaria), and $36.1 million for Phelps Dodge Industries.  Capital outlays in the corresponding 1992 period were $110.8 million for Phelps Dodge Mining Company (including $18.5 million for La Candelaria), and $31.4 million for Phelps Dodge Industries.
    On June 8, 1993, the company paid a regular quarterly dividend of 41.25 cents per share on its common shares for the 1993 second quarter; the total amount paid was $29.1 million.
    During the first half of 1993 the company purchased 95,000 of its common shares under the buy-back program authorized in September 1989. Under this program, 1,662,000 shares remain authorized for purchase. There were 70,353,106 common shares outstanding on June 30, 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)
                                                          Second Quarter
                                                          1993     1992
    Sales and other operating revenues                   629.8    663.3
    Operating costs and expenses
        Cost of products sold                            463.2    488.2
        Depreciation, depletion and amortization          47.3     38.8
        Selling and general administrative expense        28.0     25.8
        Exploration and research expense                  12.9     11.6
                                                         551.4    564.4
    Operating income                                      78.4     98.9
        Equity earnings (losses)                          (1.5)     1.4
    Earnings from operations                              76.9    100.3
        Interest expense less amount capitalized          (9.8)    (9.1)
        Miscellaneous income and expense, net              3.4      4.0
    Income before taxes and cumulative effect
     of accounting changes                                70.5     95.2
        Provision for taxes                              (24.2)   (29.4)
    Income before cumulative effect of accounting
     changes                                              46.3     65.8
        Cumulative effect of accounting changes              -        -
    Net income                                            46.3     65.8
    Earnings per share
        Income before cumulative effect of accounting
         changes                                          0.66     0.94
        Cumulative effect of accounting changes              -        -
        Net income                                        0.66     0.94
    Average number of shares outstanding                  70.6     70.5
                           BUSINESS SEGMENTS
                        (Unaudited; in millions)
    Sales and other operating revenues
        Phelps Dodge Mining Company                      305.0    361.6
        Phelps Dodge Industries                          324.8    301.7
                                                         629.8    663.3
    Earnings from operations
        Phelps Dodge Mining Company                       51.3     82.5
        Phelps Dodge Industries                           33.7     25.3
        Corporate and other                               (8.1)    (7.5)
                                                          76.9    100.3
    Note:  1992 financial information has been revised to recognize accounting changes for postretirement and postemployment benefits and income taxes.
                        PHELPS DODGE CORPORATION
                  STATEMENT OF CONSOLIDATED OPERATIONS
             (Unaudited; in millions except per share data)
                                                        First Six Months
                                                          1993     1992
    Sales and other operating revenues                 1,296.5  1,253.8
    Operating costs and expenses
        Cost of products sold                            950.3    919.4
        Depreciation, depletion and amortization          93.0     78.6
        Selling and general administrative expense        54.9     50.9
        Exploration and research expense                  24.2     21.5
                                                       1,122.4  1,070.4
    Operating income                                     174.1    183.4
        Equity earnings (losses)                          (2.0)     2.5
    Earnings from operations                             172.1    185.9
        Interest expense less amount capitalized         (19.2)   (19.6)
        Miscellaneous income and expense, net              6.2      5.9
    Income before taxes and cumulative effect
     of accounting changes                               159.1    172.2
        Provision for taxes                              (52.5)   (54.4)
    Income before cumulative effect of accounting
     changes                                             106.6    117.8
        Cumulative effect of accounting changes              -    (79.9)
    Net income                                           106.6     37.9
    Earnings per share
        Income before cumulative effect of accounting
         changes                                          1.51     1.67
        Cumulative effect of accounting changes              -    (1.13)
        Net income                                        1.51     0.54
    Average number of shares outstanding                  70.7     70.4
                           BUSINESS SEGMENTS
                        (Unaudited; in millions)
    Sales and other operating revenues
        Phelps Dodge Mining Company                      661.6    663.1
        Phelps Dodge Industries                          634.9    590.7
                                                       1,296.5  1,253.8
    Earnings from operations
        Phelps Dodge Mining Company                      131.1    157.5
        Phelps Dodge Industries                           57.1     43.3
        Corporate and other                              (16.1)   (14.9)
                                                         172.1    185.9
    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)
                                                      June 30,  Dec. 31,
                                                        1993     1992
                                                     (unaudited)
    Assets
        Cash and short-term investments, at cost         241.8    251.2
        Receivables, net                                 388.9    365.4
        Inventories                                      226.7    223.9
        Supplies                                         102.9    101.5
        Prepaid expenses                                  23.2     15.4
        Deferred income taxes                             33.2     32.6
           Current assets                              1,016.7    990.0
        Investments and long-term receivables             99.9     93.8
        Property, plant and equipment, net             2,206.5  2,108.6
        Other assets and deferred charges                253.5    248.8
                                                       3,576.6  3,441.2
    Liabilities
        Short-term debt                                   92.2     72.5
        Current portion of long-term debt                 17.2     42.2
        Accounts payable and accrued expenses            411.2    391.7
        Income taxes                                      16.7     34.5
         Current Liabilities                             537.3    540.9
        Long-term debt                                   467.9    373.8
        Deferred income taxes                            262.5    265.1
        Other liabilities and deferred credits           240.6    238.2
                                                       1,508.3  1,418.0
    Minority interest in subsidiaries                     54.8     50.8
    Common shareholders' equity
        Common shares, 70.4 outstanding (1992 - 70.4)    439.7    439.8
        Capital in excess of par value                    77.3     80.6
        Retained earnings                              1,595.2  1,546.7
        Cumulative translation adjustments and other     (98.7)   (94.7)
                                                       2,013.5  1,972.4
                                                       3,576.6  3,441.2
                        PHELPS DODGE CORPORATION
                  CONSOLIDATED STATEMENT OF CASH FLOWS
                        (Unaudited; in millions)
                                                        Six months ended
                                                             June 30,
                                                          1993     1992
    Operating activities
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Date:Jul 22, 1993
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