Date: Thu, 20 Nov 1997 22:41:38 GMT Server: Apache/1.2.4 Last-Modified: Tue, 17 Jun 1997 15:03:13 GMT ETag: "dd45d-9de1-33a6a731" Content-Length: 40417 Accept-Ranges: bytes Connection: close Content-Type: text/html ASARCO Southern Peru News
Southern Peru News


SPCC REPORTS FOURTH QUARTER AND FULL-YEAR RESULTS

NEW YORK, N.Y. January 31, 1996 -- Southern Peru Copper Corporation (NYSE:PCU) today reported net earnings of $68.4 million, or $1.04 per share, for the fourth quarter of 1995 compared to net earnings of $30.7 million or 47 cents per share, for the fourth quarter of 1994.

Sales of products were $241.3 million in the fourth quarter of 1995 compared with $218.7 million in the fourth quarter of 1994.

For the full year 1995, SPCC reported net income of $217.8 million, or $3.31 per share, compared with $91.2 million, or $1.39 per share, for 1994. Results for 1994 included a $12.4 million after-tax gain on the sale of investments.

Sales of products for 1995 were $928.8 million compared with $701.7 million in 1994.

Copper mine production in the fourth quarter of 1995 increased nearly 28% over the fourth quarter of 1994 to 161.8 million pounds. The increase in production is principally attributable to higher ore grades and the start- up of a new solvent extraction electrowinning plant (SX-EW) at the Company's Toquepala mine in the fourth quarter of 1995. The SX-EW plant produces refined copper from copper leached from low grade copper ore. The plant, which is designed to produce approximately 80 million pounds annually, contributed 10 million pounds to the Company's 1995 production.

Copper prices were higher in the fourth quarter of 1995 compared with the year earlier period. The average price for copper on the London Metal Exchange (LME) was $1.32 per pound for the fourth quarter of 1995 compared with $1.26 per pound in the fourth quarter of 1994. The price for molybdenum, a by-product of the Company's copper production, was lower in the fourth quarter of 1995 at $4.34 per pound compared with $8.57 per pound in the fourth quarter of 1994. The price for silver was $5.25 per ounce in the fourth quarter of 1995 compared to $5.12 in the fourth quarter of 1994.

For the year 1995, copper averaged $1.33 per pound on the LME compared with $1.05 in the prior year. The average price of molybdenum was $7.42 per pound in 1995 compared with $4.50 in the prior year. Silver averaged $5.18 per ounce in 1995 compared with $5.28 in 1994.

In November 1995, the Company offered to exchange new common shares for labor shares issued by its Peruvian branch to workers under prior legal requirements in Peru. These labor shares, which are traded on the Lima stock exchange, represented a 17.3% interest in the Peruvian Branch, which comprises substantially all of the operations of SPCC in Peru. The offer ended on December 29, 1995 with 80.5% of the labor shares tendered. SPCC now owns 96.6% of the Branch. The common shares issued in exchange for the labor shares are listed on both the New York and the Lima stock exchanges. The Company's balance sheet at December 31, 1995 reflects the effect of this transaction.

Commenting on the Company's results, Charles G. Preble, President and Chief Executive Officer of SPCC, said 'Net earnings for 1995 were the highest in the Company's history. Strong metal prices, higher production, and lower costs all contributed to the Company's improvement in earnings. In addition, the Company realized the benefit of a full year's production from the Ilo Copper refinery which was acquired in May 1994.

'Copper production from the Company's mines increased to 557.2 million pounds in 1995, a 4% increase over the prior year. This increase is attributable to higher throughput and copper grade at the Toquepala mine and the 10 million pounds of copper from the new SX-EW facility.

'The Company constructed a new acid plant at its Ilo copper smelter which became operational in October. This plant will reduce sulfur emissions by approximately 18%. The new plant is designed to produce 175,000 tons of sulfuric acid per year. SPCC plans to use a portion of the sulfuric acid in its SX-EW operations at its Toquepala and Cuajone mines and expects to sell the remainder on the open market. Additionally, the Company has instituted an intermittent control program at its smelter in order to reduce sulfur emission levels during periods of adverse weather conditions.

'SPCC increased substantially its proven and probable ore reserves in 1995. At December 31, 1995, proven and probable ore reserves at Toquepala are 326.7 million tons with an average grade of 0.80% copper, and at Cuajone are 967.7 million tons with an average grade of 0.72% copper. In addition, leachable reserves at the two mines of 677.6 millions tons have an average grade of 0.23% copper.

SPCC is the largest mining company in Peru and operates two mines, a smelter and a refinery in the southern region of Peru, employing approximately 5,000 people. Shareholders in SPCC are ASARCO Incorporated (NYSE:AR) (54.1%), a subsidiary of the Marmon Corporation (17.7%); Phelps Dodge Overseas Capital Corporation (13.9%) and common shareholders (14.3%).


Southern Peru Copper Corporation and Subsidiaries
Fourth Quarter and Full-Year Results
(in millions, except per share data)


Three Months Ended Year Ended
December 31 December 31
1995 1994 1995 1994
Sales $241.3 $218.7 $928.8 $701.7
Earnings before taxes and
minority interest
110.2 52.7 380.4 163.9
Taxes on income 29.9 16.0 119.1 54.1
Earnings before minority interest 80.3 36.7 261.3 109.8
Minority interest 11.9 6.0 43.5 18.6
Net earnings $68.4 $30.7 $217.8 $91.2
Weighted average number of
shares outstanding
65.7 65.7 65.7 65.7
Net earnings per share $1.04 $0.47 $3.31 $1.39


Average Metal Prices


Three Months Ended Year Ended
December 31 December 31
1995 1994 1995 1994
Copper (per pound - LME) $1.32 $1.26 $1.33 $1.05
Silver (per ounce - COMEX) $5.25 $5.12 $5.18 $5.28
Molybdenum (per pound -
Metals Week Dealer Oxide) $4.34 $8.57 $7.42 $4.50


Metal Production and Sales


1995 1994 1995 1994
Copper (tons)
Mined 80,900 63,400 278,600 267,800
Refined (a) 59,100 55,200 221,200 122,500
Sales 88,900 83,700 323,300 326,600
Silver (000s ounces)
Mined 791 716 2,958 2,979
Refined (a) 705 585 2,519 1,210
Sales 1,053 798 3,761 3,184
Molybdenum (000s pounds)
Mined 2,173 1,450 8,009 6,120
Sales 2,327 1,083 8,401 5,697

(a) The Ilo refinery was purchased by the Company in May 1994. Refined data includes operations after the acquisition.


Southern Peru Copper Corporation and Subsidiaries
Consolidated Statement of Earnings


3 Months Ended 12 Months Ended
December 31, December 31,
1995 1994 1995 1994
(in thousands except for per share amounts)
(unaudited)


Net sales $241,350 $218,671 $928,840 $701,678
Operating costs and expenses:
Cost of sales 107,052 135,380 439,382 455,266
Administrative and other expenses 15,123 14,833 54,637 50,699
Depreciation, amortization and depletion 8,591 10,289 35,952 39,742
Provision for workers' participation 9,132 4,491 32,212 13,944
Total operating costs and expenses 139,898 164,993 562,183 559,651
Operating income 101,452 53,678 366,657 142,027
Interest income 6,191 2,434 14,827 6,521
Other income 5,931 (444) 12,825 23,204
Interest expense (3,384) (2,892) (13,904) (7,779)
Earnings before taxes on income and minority interest of labor shares 110,190 52,776 380,405 163,973
Taxes on income:
Currently payable 28,253 16,507 115,925 56,481
Deferred 1,616 (464) 3,168 (2,342)
29,869 16,043 119,093 54,139
Minority interest of labor shares in income of Peruvian Branch 11,934 6,030 43,558 18,610
Net earnings $ 68,387
_______
$ 30,703
_______
$217,754
_______
$ 91,224
_______
Per common share amounts:
Net earnings $ 1.04 $ 0.47 $ 3.31 $ 1.39
Cash dividends $ 0.43 $ 0.11 $ 0.85 $ 0.33
Weighted average number of shares outstanding 65,717 65,717 65,717 65,717


Southern Peru Copper Corporation and Subsidiaries
Consolidated Balance Sheets


December 31, December 31,
1995 1994


ASSETS: (dollars in thousands)
Current assets:
Cash and cash equivalents $ 219,646 $ 93,336
Marketable securities 42,453 42,997
Accounts receivable:
Trade 88,832 86,717
Other 11,631 12,062
Inventories:
Metals 35,154 43,692
Supplies 68,481 71,566
Prepaid expenses 15,095 14,676
Deferred income taxes, current portion 1,553 -
Total current assets 482,845 365,046
Property, at cost:
Buildings and equipment 1,351,669 1,125,519
Mine development 114,780 114,780
Mineral land 122,832 12,226
Land, other than mineral 936 867
Construction in progress 39,993 96,957
Total property 1,630,210 1,350,349
Less, accumulated depreciation, amortization and

depletion

851,149 827,499
Net property 779,061 522,850
Restricted cash - 60,450
Other assets 9,488 20,160
Total $ 1,271,394
_________
$ 968,506
________


Southern Peru Copper Corporation and Subsidiaries
Consolidated Balance Sheets


December 31 December 31
1995 1994


LIABILITIES: (dollars in thousands)
Current liabilities:
Current portion of long-term debt $ 17,034 $ 3,855
Accounts payable 40,945 65,874
Accrued liabilities 112,390 52,933
Total current liabilities 170,369 122,662
Long-term debt 76,828 114,118
Accrued severance pay 6,354 10,811
Deferred income taxes 39,597 6,242
Total non-current liabilities 122,779 131,171
Minority interest of labor shares in the Peruvian
Branch
25,314 79,824
STOCKHOLDERS' EQUITY:
Common stock, par value $0.01; authorized
100,000,000 shares, isssued at 76,251,193 shares,
outstanding 65,717,493 shares



-



763

Common stock, par value $0.01; 31,249,167 shares
authorized, 11,445,153 shares issued and
outstanding


114


-

Class A Common stock, par value $0.01;
68,750,833 shares issued, authorized and
outstanding


688


-

Additional paid-in capital 246,514 122,477
Retained earnings 705,616 571,609
Treasury stock at cost, 10,533,700 shares at

Dec. 31, 1994

- (60,000)
Total stockholders' equity 952,932 634,849
Total $ 1,271,394
_________
$ 968,506
________

Southern Peru Copper Corporation and Subsidiaries
Consolidated Statement of Cash Flows
(Condensed)


3 Months Ended 12 Months Ended
December 31, December 31,
1995 1994 1995 1994
(in thousands)
(unaudited)
(in thousands)
Cash flows from operating activities:
Net earnings $ 68,387 $ 30,703 $ 217,754 $ 91,224
Depreciation, amortization and depletion 8,591 10,289 35,952 39,742
Minority interest of labor shares 11,934 6,030 43,558 18,610
Cash provided from operating assets and liabilities 13,465 33,016 27,608 1,385
Other, net 5,247 (5,668) 5,641 (20,218)
Net cash provided by operating activities 107,624 74,370 330,513 130,743
Cash flows from investing activities:
Capital expenditures (23,566) (43,406) (183,041) (116,912)
Purchase of refinery
-
-
-
(65,000)
Transfer of cash from restricted account
-
-
60,450
-
Other, net investing (41,908) 9,862 3,140 43,093
Net cash used for investing activities (65,474) (33,544) (119,451) (138,819)
Cash flows from financing activities:
Dividends paid (28,000) (7,500) (83,747) (21,415)
Net borrowings (repayments) (7,433) 13,052 (24,110) 102,373
Escrow deposits on long-term loans (741) 11 10,809 (12,026)
Proceeds from labor share subscription
-
-
10,944
-
- 2,914 (1,555) (4,200)
Net cash provided by (used for) financing

activities

(36,174) 8,477 (87,659) 64,732
Effect of exchange rate changes on cash 3,937 3,165 2,907 4,970
Net increase in cash and cash equivalents ______
$ 9,913
_______
$ 52,468
________
$ 126,310
_______
$ 61,626



FOR FURTHER INFORMATION:
Jerry W. Cooper (212) 510-1810
Donald M. Noyes (212) 510-1813


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