Document RJ0j98XJrwzoGvRn6J5LBm8

^ .* . . */.. - v . \ r- !:>'h -- /' \ Anaconda Copper Mining Company CAPITAL STOCK December 31. 1925 Authorized, 6,000.000 shares, $50 each.............................. $300,000,000 Issued. 3,000,000 shares, $50 each ........................$150,000,000 OFFICERS Chairman of the Board . . JOHN D. RYAN President .............................. CORNELIUS F. KELLEY Vice-President .................... BENJAMIN B. THAYER Vice-President ....................JAMES R. HOBBINS Secretary and Treasurer . . ALBERT H. MELIN General AuditorROBERT E. DWYER Assistant Secretary . . . . RALPH D. COLE Assistant Treasurer.... DAVID B. HENNESSY . DIRECTORS Percy A. Rockefeller John D. Ryan Benjamin B. Thayer Cornelius F. Kelley George H. Church Charles F. Brooker Nicholas F. Brady Andrew J. Miller Albert H. Melin OFFICES An a c o n d a. Mo n t an a 25 Bio a d w a y . Ne w Yo r k PNYC000Q9897 To the Shareholders of the Anaconda Copper Mining Company: The year 1925 was characterized by a record production and consumption in all of the non-ferrous metals. The available statistics indicate that the world's production of copper exceeded 3.1"5.000;000 pounds, lead 3.213,000.000 pounds and zinc 2.493.000.000 pounds; and that the apparent consumption of copper was 3,260.100.000 pounds, lead 3.131.j OO.OGO pounds and zinc 2,493.100.000 pounds. The consumption of copper materially ex ceeded production. The increase in the volume of business was accompanied by a gratifying increase in the prices of both lead and zinc, the prices of these metals fluctuating between a low of 7.935 cents per pound and a high of 10.169 cents per pound for lead, and a low of 6.951 cents per pound and a high of 8.614 cents per pound for zinc, with averages, respectively, of 9.020'and 7.622 cents pCr; pound .for the year; while, on the other hand, the price of copper fluctuated between the low price of 13.252 cents per pound and a high of 14.709 cents per pound, with, an average of 14-042 cents per pound for the year. The explanation for the failure ot the price of popper to advance correspondingly with the prices of other metals, and in line with the increase in consumption over production, is to be found; (a) in the intensely competitive effort of the various copper selling agencies, both in the United States and abroad; and (b) in the activity of the speculative dealers abroad whose available supplies of copper have been1 during the past few years largely increased. Fin&nci&l Results The operations of your Company and its subsidiary and affiliated companies were con ducted continuously throughout the year, although copper production was upon a cunaik-i basis. The gross income from sales and tolls amounted to $212,770,498.33 as. against $166,467,901.80 for the year 1924. Operating profit and income from investments amounted to $33,077,229.48 as against $21.744.965.25 for the previous year. The net profit, after deducting all charges, deprecia tion. bond interest and discount, etc., amounted to $17,540,532.32 as against $6,719,215.-' for the previous year. Von Giesche Negotiations During the year your Company, associated with other American interests, entered inu> negotiations with Bergwerks Gesellschaft Georg von Giesche's Erben and Giesche Spolka Akcyjna, looking toward the possible participation in the reconstitution and financing of the latter named companies. The Bergwerks Gesellschaft Georg von Giesches Erben is the oldest operating mining company in Europe. It had a uniformly successful financial history from about the middle of the eighteenth century to the post war period, being one of the largest producers of coal in Europe and the largest producer of zinc. The company, and itsubsidiary above named, own extensive zinc Ore deposits in Upper Silesia on the newi> created, border between East Prussia and Poland. Due to difficulties of operation encoun tered since the war and the depreciation in value of securities payable in Marks, held b> 3 PNircocooswa I the -impany, it became involved in financial difficulties. Your Companv has participated in the .paking oi a temporary loan of $10,000,000 to the above mentioned companies upon adequate security and has obtained in connection with its associates in the business a six months option within which to determine whether your company will participate in the re constitution and refinancing of the above companies: At the dose of the vear an examina tion iwas being made into the mines, smelteries and business of the above companies by members pt the staff of your1 company. Result* of Operations Following is a summary of the, results of the operations of your Company, its departments and its subsidiary and: affiliated companies, during the year: Butte Mine* Development During the year 1923 there were done in the mines of the Company, in the form of drifts, cross-cuts, laterals, raises, winzes and shafts, 34.19 miles of development work, as com pared with 25.14 miles during the year: 1924, an increase of 36 per cent. Production The tonnages mined during the year were as follows: Copper Ore The mines of the Company produced during the year 2,847,138.45 tons of copper ore. 7,990.04 tons of precipitates were produced from the water pumped from the mines. Zinc Ore The mines of the Company produced 25,109.68 tons of zinc ore. Construction There was expended on new construction during the year $416,297.39, in mechanical and electrical equipment. Of this amount $157,897.23 was expended at the Orphan Girl mine in equipping this mine for the production of zinc ore. The Rocker Timber Framing Plant on December 15 was totally destroyed by fire. The reconstruction of this plant has been; authorized. Expenditures aggregating $2,276,854, to provide for the equipping and installing of electrical hoists, with auxiliary hoists, at the Badger State, Mountain Con and Belmont mines, were authorized. Conda Phosphate Mines During the year the total advance in drifts, cross-cuts and raises in the mines amounted to 2991 linear feet, as compared with 1,062 feet in 1924. 4 # l PNYC0C009899 The mines at Conda, Idaho, produced 78.768.64 tons of rock, averaging 31.84% P- O.. 'f this; amount 2.430.65 tons were sold and the balance shipped to the Phosphate Plant at Anaconda. Reduction Work*--Anaconda Copper At the concentrator there were treated 2.599.891.77 tons of copper ore. and 16.079 tons o| copper tailings were treated bv the new combined leaching and flotation process. The Anaconda Reduction Works treated for all companies 3.143.626.63 tons of copper pre and other cupreous material. Of the total amount. 2.750.735.99 tons of ore were produced by the mines of the Company; 363.S11.72 tons of ore were either purchased from or treated for other comoanies; 27.983 70 tons of material were shipped from the old plants at .Anaconda and Great Falls, and 3.095.22' tons from the Great 'Falls Zinc Plant. There were produced 266,864,833 pounds of fine copper, 9,071,359.67 ounces of silver and 3S.I390-320 ounces of gold; Of this production 266.373.956 pounds of fine copper. 0.054.740.99 ounces of silver and 38,390.320 ounces of gold were produced for your Company. Zinc The rebuilding of the Zinc Concentrator, after the fire of November 15, 1924, was finished and the plant put into operation January 19, 1925. During the year 419.887.70 tons of zinc ore were concentrated. Of this amount 24.839.45 tons were from the mines of the Company and 395,048.25 tons were purchased from other producers located in the Butte District. From this ore there were produced 5.S94.1C) tons of lead concentrates and 81.062.01 tons of zinc concentrates. Arsenic As a by-product of copper smelting operations. 8,817,109 pounds of arsenic were produceji. of which 8,789,626 pounds were refined. During the year 7,275.552 pounds were soid. Of this amount, 21,401 pounds were crude and 7,254,151 pounds were refined. Sulphuric Acid The Sulphuric Add Plant at Anaconda produced 52,304.40 tons of sulphuric acid, averaging 60 Deg. Beaume. This was used prindpally by the Fertilizer Department. Fertilizer Tfhe Phosphate Plant at Anaconda treated 68.733 tons of rock, from which there were produced 800 tons of merchantable phosphoric acid and 33,660 tons of Anaconda Treble Superphosphate assaying more than 45% available P2 Os. Construction No important construction work was undertaken at the Reduction Works at Ana conda during the year. 5 PNVCo 0990C o Reduction Works--Great Fall* Copper Refinery Construction of an extension to the Refineries was authorized at an estimated cost of Sl.l&LOOO. This extension will increase the annual capacity of the Refineries from 216.'XO.OOp to about 300.000,000 pounds, per annum. An anode 'scrap melting furnace is also ihdGdjtd'.m the proposed extension.The ptovirion of, these'facilities will enable the com pany tp refine in Montana ill copper produced: there and deliver, it: to Western and Middle West points; thereby saving freight to the Atlantic Seaboard. AVijrk on this extension is procKffdihg satisfactorily and it is expected that it will be completed about the middle of the current year:. i The output of the _Copper Refinery at Great Falls was 210.552.163 pounds of cathodes, al which 197.952,750 pounds were melted into shapes'at that point. Zinc Plant [The mechanical acid leaching and purification residue leaching steps, begun in 1924. were completed during the year. On July 25th authorization was given for the construction of a tio unit extension to the Zinc Plant at a cost of $1,250,000. This extension will in crease [the capacity of the plant from 180,000,000 pounds to 240.000,000 pounds per annum. Work |was begun at once and pushed as rapidly as possible, with the result that both units were pjit into commission soon after the dose of the year. The zinc plants treated S08.786.07 tons of ore and other zinciferous material. Of this arpount 26.CS54.55 tons Were produced by mines of the Company and 482,721.52 tons of ore and concentrates were purchased. The electrolytic zinc plant produced 161,795,891 pounds of zinc, 8,414,359 pounds ot zinc in, dross. 1105,200,13 pounds of cadmium, and residue from which there were recovered 20.626.p64 pounds of lead, 1,365,762 pounds of copper, 2,631,494.00 ounces of silver and 6.36S.93C ounces.of gold. Rod and Wire Mill During the month of August an extension of the Rod Mil! was authorized at an estimated cost of $382,000. Work On this extension was partially completed at the end of the year. The mill at Great Falls rolled into rods 133,851.764 pounds of copper; 40,867,277 pounds of rods were drawn into wire, of which 14,453,655 pounds were made into strand. 43,041,411 pounds of rods were shipped from this mill to the Kenosha Flant of The American Brass Company to be drawn into wire. Miscellaneous Products Lumber The year 1925 opened with a favorable promise for the lumber industry, but the year had run but little when production exceeded movement of stocks from the mills, weak ness in the national market developing and continuing throughout the year. The sawmill at Bonner cut 82,882,062 feet of lumber and purchased 3,436,128 feet, of which 57,058,579 feet were shipped to the departments of the Company; 30,528,429 feet 6 PNYCQ0CC9901 u were sold commercially; 392,909 feet were used at the mill for repairs and construction, and 1.940.139 feet were supplied to the factory for manufacturing-, or a total disposition of 89.- 920,036 feet : decreasing the stock of finished, lumber on hand by 3,601,866 feet, making a stock on hand at December 31, 1925, of 60,026,594 feet. Coal At Diamondville, Wyoming, 456,643.05 tons of coal were produced; 298,326.05 tons were shipped to other departments of the Company; 126,336.80 tons were sold commercially, and 31,480.20 tons were used at the coal mines. At Washoe. Montana, 179,700,00 tons of coal were produced; 65,084.90 tons were shipped to other departments of the Company, 113,327.10 tons were sold commercially, and 1,2881tons were used at the coal mines. At Sand Coulee, Montana, no operations of any kind were conducted during the year. Metal Roofing The Copperclad Shingle Plant at Rutherford, New Jersey, operated during the year. Difficulties encountered in the operation of this new plant were overcome and it is now operat ing on a satisfactory basis. The production of copperciad shingles for the year amounted to 33,548 squares. The American Brass Company The output of manufactured products of the various plants exceeded the production for the year 1924, the previous record year, by 153.319,508 pounds, an increase of approxi mately 26%, establishing a new record of 653.268.973 pounds of copper, brass and nickelsilver, the manufacture of Which was distributed among the various plants as follows: Ansonia ... ....... Buffalo.......................... Hastings ........ Kenosha_______ ____ Torrington ..... .............. Waterbury........... ......... Toronto.......... ............. 170.775,594 79.793,835 101,884,543 126.486,022 62.228,802 96,887,891 15.212,286 633.268,973 The demand for Anaconda products during 'he vear showed a gratifying increase, and in the attainment of the above output each plant m, rra-ed its poundage over that of the previous year. At the close of the year the .unfilled rders on the books amounted to an appreciably larger poundage than at the beginning of the year and the outlook for 1926 is good. The policy of consistent expansion of Anaconda advertising is bringing cumulative re sults. This advertising, combined with the. work of -ales representatives in the field, has developed many new outlets for Anaconda products and is reflected by increased sales and profits. Expenditures for improvements to buildings and machinery during the year totalled ,$1,210,715.54. PNYC00009902 w1 Raritan Copper Work* During the year a thorough study of power conditions of the plant was undertaken, resulting in the adoption oi a plan ior changing the power arrangements, and new equip ment is!'now being installed. The expenditure on this improvement will amount to about Sl.oOC.OCO. The capacity of the plant will be increased from. 38.000,000 tp +5.000.000 pounds, of copper per month, and the cost of refining will be materially reduced. The in creased: capacity is being provided in anticipation of, the production o'f copper from the Andes mines in Chile. The nickel department was. enlarged to increase the production of nickel sulphate from 30.000 pounds to 30000 pounds per month. The metal Output of, the plant was 405.803,075 pounds of fine copper. 20.57S.003.06 ounces, oi sd|en ,1:2Sl S90:!502 1 punees ot: gold, 28.335 pounds of selenium, 570 pounds of tellurium, 4514*815 pounds of nickel sulphate, 1.054,000 pounds of copper sulphate, 253.92 ounces bf platinum, and 748.14 ounces of palladium. International Smelting Company International, Utah Both the Copper and Lead Plants operated continuously during the year. The Con centrator was enlarged to a capacity oi 1.000 tons per' day and" the first of the new Mineral Separation units placed in operation February 4. I!925t The Concentrator Plant treated 284.766.33 tons oi ore. from which there were pro duced 93.323.43 tons of concentrates, of which 40,696.92 tons were line concentrates, which were shipped to the electrolytic zinc plant at Great Fails, The Copper Plant treated 78.761.95 tons of ore and concentrates, from which there were produced 20,669,490 pounds of fine copper, 1,735,051.82 ounces of silver and 15.821.7SI ounces of gold. The Lead Plant treated 234.046.20 tops of ore, and concentrates, from which there were produced: 112,105,154 pounds of lead) 6.744,037.98 ounces of silver, and 18.019.467 ounces of gold. From the treatment of fume and flue, dust there were obtained 240.60 tons of crude arsenic, averaging 92.06?8 As,Oj- The Tooele Valley Railway Company handled during the year 750.249 tons of ore an.! miscellaneous freight, and 463,893 passengers. Expenditures on improvements during the vear, mainlv at the Concentrator, - totalled 5190,078.70. Miami, Arizona During the year the plant treated a larger tonnage than in 1924, but, owing to a de crease in the grade of matenal, the production for the year was somewhat lower than the year previous. At the Miami Smelter there were treated 387,789.88 tons of concentrates and pur chased ores, from which there were produced 177,227,211 pounds of copper, 536.498.90 ounces of silver, and 9,737.287 ounces of gold. Utah-Delaware Mina During the year there were produced 8,122.64 tons of copper ore and 90,715.1' tons ofl lead-zinc ore, which were shipped to International, Utah. 8 ^ PNYC00009903 International Lead Refining Company Lead Refinery The retirerv at East Chicago. Indiana, treated 67.137.21 tons or lead bullion, from which there were produced - lj4.616.S50' .pounds -oi common lead. 6.592.7-15 pounds ot ar.:imonial lead, 7.571.423.79 ounces of silver, and 2I.932.0S0 ounces ot gold. Zinc Oxide The manufacturing plants at East Chicago. Indiana, and at Akron. Ohio, were operated satisfactorily throughout the vear. There were produced 44.797.773 pounds of merchantable zinc oxide, of which 13.712,729 pounds were produced at East Chicago and 26.083.044 pounds were produced at Akron. Butte, Anaconda & Pacific Railway Company The Railway transported during the year 3.384,543 tons of ore and other freight, and 22.S5I passengers. The gross revenues were S1.725.536.04; operating expenses SI.364.943.44; taxes, interest, rentals of leased lines and loss on road and equipment retired due to abandon ment of Georgetown* Extension, less miscellaneous receipts, $188,255.50: net income. 5172.385.10. Anaconda Lead Products Company There were produced from the plant at East Chicago, Indiana. 11.323.101 pounds barrelled white lead, and 12,101.288 pounds were sold. Walker Mining Company Operations at the mine were conducted throughout the year. 229.616 tons ot ore were broken. The concentrator made an average recovery of 94.488%. 263,411 tons of ore, averaging 2.432% copper were treated, from which 25.079.01 tons of concentrates, averaging 24.731% copper, were produced. There were sold to the smelter 26,015.58 tons of con centrates and ore containing 12,764,496 pounds of copper, 230.808.45 ounces of silver and 3,749.911 ounces of gold. Arizona Oil Company Operations of the Ariaona Oil Company during the year resulted in the production oi 362.413 barrels ot oii. Distributions from Reserves to the extent of 5293,760 were made by the Oil Company in 1925. From these distributions your Company received S146,S80. South American Companies Andies Copper Mining Company Work on general plant construction and on the preparation for mining operations was resumed in February, 1925. From the time ot resumption of construction all divisions of the work have been carried forward at a very satisfactory rate, and at the end of the year were in advance of the delivery of structural material and equipment. Mine Work during the year was done on the preparation of the South Sulphide orebody for mining; the removal of waste and storage of ore from the South Oxide orebody: the c o m""0* rfT removal of waste from the Central orebody, and the construction of housing accommodations tori employees. The total lineal feet of all classes of openings driven during the vear was 21 133.39 The waste removed amounted to 376,834 short tons. No, direct exploration work was done during the vear, consequently the estimate of ore reserves remains unchanged. Reduction Works j The machine, carpenter and boiler shops, the foundry and the warehouse were prac tically complete and in full operation, at the end of the year. Concrete was poured at the Fine Crushing plant to the extent of 82.2% of the total required, which was sufficient to permit1 the erection of the structural steel building. The brick plant was completed: except for the construction of the Oregon kilns. The plant was put in operation late in November and by the end of the year 484.600 bricks had been! out gnd 70.450, burned;, briefe produced from the round kiln, the balance being in the process of drying or burning. Potrerillos Towuaite Construction Construction in this department was directed principally toward the erection of work men's family houses, workmen's dormitories, American family dwellings and American single men's dormitories. La Ola Dam and Pipe Lines Construction on the La Oia dam started in October. By the end of the year the cut off trenches were 70% complete and the dam foundation and abutments 50% complete. The driving of the Pedemales tunnel and the lining of the Llanta tunnel were com pleted in December. During, the year 12.3 miles or 40% of the total pipe line trenching was completed. The Assembly plant for the manufacture of pipe was brought into production in August and 1583 twenty-foot lengths of 36 inch pipe were manufactured. An incline railway, approximately 3400 feet in length, for the transportation of pipe-' line material,, was completed and put in operation in October. The major portion of the potablei water development in Quebrada Larga, Colorados and Acerillos canyons was completed during the year. Six and eight-tenths miles of pipe line on the Colorados project, and 7.46 miles on the Quebrada Larga development were laid during the year. Barquito There are now in service 26 wooden lighters varying in capacity from 40 tons to 100 tons and two 100 ton steel lighters. Two more 100 ton steel lighters were ready for launch ing at the end of the year. The excavation for the Barquito Power Plant was 97% complete and one 3000 KVA turbine for temporary use was in process of erection. Labor At the end of the year there were 5558 workmen employed in all departments. 10 i pKtC0C00<39G5 I mp Potrerillo* Railway Company The tonnage hauled by the Railway Company was 46.252 short tons. During the year there were added to the rolling stock, three Mikado locomotives of 128,000 pounds' weight on drivers,' one switch engine of 97,000 pounds weight on drivers. 15 Sat cars and IQ gondola cars. The work of reconstructing the Chanaral branch of the State Railway between Pueblo Siindido knd, Chanarai was begun. For a distance of 20.50 miles, the old'40 pound rail: was replaced, pkith 60 pound rail and ties were replaced where needed. On the 60 pound rail-:section! between Salado and Pueblo, Hundido approximately 7.46 miles were repaired. The! railroad is now operating satisfactorily. Santiago Mining Company There was no change in the condition of Santiago Mining Company's affairs. Chile Copper Company There is attached hereto for your information a copy of the annual report of the Chile Copper Company. Financial There is also attached hereto a Consolidated Balance Sheet showing the financial con dition of the Company and its subsidiary companies at the close of business December 31. 1925, and an Income Statement for the year, certified to by Messrs, Pogson, Peloubet & Company, Certified Public Accountants. JOHN D. RYAN, Chairman of the Board. CORNELIUS F. KELLEY, President. New York, N. Y,, May 3, 1926. n PNY C00009906 ANACONDA COPPER MINING COMPANY and Subsidiary Companies Consolidated Balance Sheet--31st December, 1925 Fix e d : ASSETS -'` fines and Mining Claims. Coal Mines. Timber Lands. Phosphate Deposits. Water Rights and Lands ior Reduction Works and Renneries. etc..................... SI30,447,161.33 Buildings and Machinery at Mines. Reduction Works. Refineries. Manufacturing Plants. Saw-mills, Foundries. Waterworks. Railroads, etc. ..... 136.496.891.35 Investments in sundry companies............ ...... 100.533.913.4" 5357.467,966,0? Def er r ed charges and discount on bonds... .. 14.665.1S3.67 1 CwatEST: Supplies cm hand, advances on Ores and Expenses prepaid........... .................. --............. ....... 3 20,640,595.38 Metals and Manufactured Products in process and on hand--at cost.................. ................. ., 50,645,457.86 Accounts Receivable....... ...... 23,434,216.75 Marketable Securities........... .............. 15,347,868.75 Cash................................. 12.224,315.26 122,292,454.00 $494,425,602.72 We bar* examined into the affairs of Anaconda eprr Mmme Company and of its Subsidiary Companies and haw verified the Assets, Liabilities and In me *,n..wn above. The Net Income is after deduct ing all Development expenditure of the year, Deplr <r. >t Coal and Timber Lands and Depreciation of Plants1 and Equipment. We hereby certify that this Balance Sheet shows -he vnancial condition at 3Ut December. 1925. of the Companies as an aggregate whole arid that the acc xg Income Account for the year ending that date is correct as stated. New York and Butte, I6tfa April 1926. POOSON, PELOUBET & CO., Certified Public Accountants. 0 12 N11762.01 . ...........nil ------------------------- ! i; ' 11 'i! v_ V.., ANACONDA COPPER MINING COMPANY and Subsidiary Companies Consolidated Balance Sheet--31st December, 1925 LIABILITIES Ca p it a l St o c k of Anaconda Copper Mining Company: Authorized. 6.000,000 shares of SSO.OO each Issued, 3,000.000 shares:...... ..... .............. ...................... Min o r it y ! In t er es t in Subsidiary Companies--................ Bo n d s Ou t s t an d in g : First [Consolidated Mortgage 6% Series A Sinking Fund. Gold Bonds, due 1953.................................... $104,731,000.00 Convertible Debentures, due 1938--...................... 30,000.000.00 Ten Year 6fc Series A Secured Gold Bonds, due 1929_________________ _________; . 16,933,000.00 Butte, Anaconda St Pacific Railway Co. First Mort gage 5% Sinking Fund Gold Bonds, due 1944_ 2.313.000,00 In s t a l l me n t Re c e ip t s Ou t s t a n d in g for first and sec ond installments on $40,000,000 Andes Copper Min ing Cj>. Convertible 7% Debentures, due 1943 Res er v e 5}o r De p r e c ia t io n .............. .................................. Cu r r e n t : Notes'.Payable ........ ............................................. Interest!and Taxes Accrued..... .................... ..... Accounts and Wages Payable........................... Dividend Xo. 90! payable 23rd February, 1926_. S 5,000,000.00 5.936,932.41 12.731.613.83 2.250,000.00 Su r p l u s : Balance 31st December, 1924_________ Net Income of the year ending 31st December, 1925, per [income Account annexed 74,320,665.06 17.540.532.32 $ 92.061.197.38 Deduct, Dividends X'os. 87, 88, 89 and 90... .............. 9.000.000.00 $130,000,000.00 2.014.214.33 174.179.000.00 20.000.000.00 39,232,644.77 25,938,546.24 83,061.197.33 $494,425,602.72 No t e.--In order to comply with the Government Income Tax requirements for the purpose of comput* mg depletion^ an additional valuation of the mining property as of 1st March, 1913, has been recorded upon the books of|the Company: buL for the sake of uniformity, the result of those entries has been omitted from the current statements. No t e.--This Balance Sheet does not reflect an item of $5,000,000.00 which was temporarily advanced on Anaconda! Copper Mining Company's credit to Bergwerks Gesellschaft Georg von Giesche's Erben. 13 PNYCC0GG99G8 J ANACONDA COPPER MINING COMPANY and Subiidiar? Companies Consolidated Income Account--Year Ending 31st December, 1925 EXPENSE Metals and Manufactured Products in process and on hand at beginning oi year-------------------------------------------------------------- -------- ----------------- Ores add Metals Purchased-------------------------------------------------------- ------_ Mining, Reduction and Refining of MetalsManufacturing Expenses, including SellingCost of Merchandise sold and Operation of Public Service Companies-- Administration and Federal Taxes---------------------------------------------------Balance from Operations carried down- $ 45,643,598.28 73.404.146.39 43,797,717.30 66.616.862.39 2,457,792.72 1,939,600.88 26,554,238.23 $263,415,936.19 >v I Amount charged off this year for Depredation and Obsolescence-------------- $ 5,049,347.20 Interest, including discount on bonds, less income from marketable securi ties 10,482,519.35 Balance, Net Income: Carried to foregoing Balance Sheet________________ Apportioned to Minority Interest---------------------------- $17,540,532.32 4,830.61 17,545,362.93 i i s I t. $ 33,077,229.48 14 PNYC0C0099Q9 ANACONDA COPPER MINING COMPANY and Subsidiary Companies Consolidated Income Account--Year Ending 31st December, 1925 INCOME Sales of Metals and Manufactured Products................................................. Tolls. Royalties, Rentals, etc_____ ______________ Sales of Merchandise and Revenue from Public Service Companies______ Metals arid Manufactured Products in process and on hand at end of year.. $198,698,144.86 10.393.873.78 3.478,477.69 30.645,457.86 $263,415,956.19 Balance from Operations brought down $ 26.554,238.23 Income from Investments in sundry companies__________________________ 6,522,991.25 $ 33,077,229,48 15 PNYXQ00Q99IG Chile Copper Company CAPITAL STOCK December 31. 1925 Authorized, 5,400.000 shares. S25 each.............................. Issued. 4,391.302 shares. $25 each............................. 5135.000,000 109,782.5:0 Chile Copper Company and Chile Exploration Company OFFICERS Chairman of the Board . . . JOHN D. RA AN President ........................ CORNELIUS F. KELLEh Vice-President.............................. BENJAMIN B. THAYER Vice-President.............................. HERMAN C. BELLINGER Secretary and Treasurer , . . CHARLES \V. WELCH DIRECTORS John D. Ryan Percy A. Rockefeller Cornelius F. Kelley Nicholas F. Brady Benjamin B. Thayer Charles F. Brooker George H. Church Andrew J. Miller Herman C. Bellinger Alfred Houston, Resident Director. Chile Exploration Company Office at 25 Br o a d w a y , Ne w Yo r k Mines at Ch u q u ic a ma t a , Ch il e PNYC000099il To the Shareholders of Chile Copper Company: Your Company and its subsidiary operating Company, Chile Exploration Company, which holds the, title to all property in South America, conducted operations throughout the year upon a satisfactory though somewhat restricted basis. The Exploration Company pro duced during Yhevyear. 2I9;,516,420 pounds of electrolytic copper at a cost delivered of 8.369c per poling including. depreciation, taxes, interest and bond discount, but exclusive of depletion.. This compares with the cost of 7.992c for the previous year, an increase of .377c per pound, which: was due to the following causes: increased charge for depreciation; increased; taxes iresuiting' from, the adjustment and settlement of capital stock taxes for 1923 and prior ye^rfe-.jhcteaspd''taxes, due to increased income; and increased Chilean customs duties. The layerage, price received for copper sold during the year was 14.273c per pound delivered. The construction of additional units to the plant, which will `Tease the productive capacity to 350,000,000 pounds per annum, was authorized and was carried on during the year. It is estimated, that; these additional units will cost approximately $16,000,000, Expenditures on construction: during the year amounted to $7,111,523.20. Charges to obsoIesqenceM proh^aiKi loss, etc., totalled $736,246.06. The book value of property accounts was thus increased from $142,276,090.95 at the beginning of the year to $148,651,368.09 at the close of the yekr* an increase of'$6,375,277.14. Your;('C|c'mpahy. Jladyon hand at December 31. 1925, marketable securities and cash amounting to $8 512,542 46, as compared with $14,910,945.29 at the close of the previous year. This dedrealc^W^ldhe to fee' large' construction expenditures made during the year,. Mining Clgims and Government Concession* No additional property was acquired by the Company during the year 1925. Mine Two new benches were opened during the year, namely. E-2 and E*3. The total length of all bench'faces developed as of December 31, l''C5. amounted to 52,114 feet as compared with 33,304 feet as of December 31, 1924. Ore mined during the year amounted to a total of 7,778,910 short tons, averaging 1.592% copper. The total of all ore shipped from the Mine to the Plant from the start of operations to December 3l, 1925, amounted to 44..U5.687 tons, averaging 1.651% copper. Waite removal during the year amounted to a total of 5.400,221 short tons, averaging 0.47% copper. 19 PNrC0C0099^ In blasting. 31.316 feet of main and auxiliary tunnels and 377.957 feet of churn drill holes were blasted during the year. The following additional mine equipment, necessary to prepare the Mine for the increased rate of production and to handle the tonnage, of ore required for the extension t'-> the Plant, has practically all been delivered and placed in operation: l Large Revolving Electric Shovel 1 Standard Revolving Electric Shovel 4 Standard Electric Railway Type Shovels 2 Small Diesel Revolving Shovels 12 87-ton Superheater Locomotives 40 20-yard Air Dump Waste Cars 23 Chum Drills 6 50-tpn Flat Cars 2 Gil Tank Cars 1 120-ton Locomotive Crane 1 40-ton Locomotive Crane 1 20-ton Locomotive Crane 1 Spreader Plow The southern outlets to the individual benches are practically completed and are being connected to the Plant with'a new main line. Northern outlets are being constructed for such of the intermediate benches as have not been previously connected to the system of northern approaches. Plant A total of 7,785,875 short tons of ore was crushed during the year. The average leaching extraction obtained from the 731 charges treated was 90.05rr v compared with 89.73% achieved during the previous year. There were produced during the year 219,516,420 pounds of electrolytic copper, following tabulation shows a comparison of results by quarters: Period 1925 1st quarter 2nd quarter 3rd' quarter 4th i quarter Ore Crashed Short Toes 1,979,065 1,897,919 1,983,595 1,925,276 Average Per Day 24,739 24.024 23,899 24,371 Per Cent Copper in ore Leached 1.634 1.527 1.605 1.605 Per Cent Ampere Efficiency 86.05 86.03 88.03 87.50 Per Cent Net Re- covery 89.94 89.46 89.92 92.15 PoutvU oi Copper Produr*-' 58.482 : 31.6/ 54.383 J 34.952 - Year 7,785,875 24255 1.393 86.91 90.36 219.51 ^ 4. The smelter melted 219,866,000 pounds of electrolytic copper into marketable sharduring the year. Construction During the year plans were drawn, orders placed and construction started on the .i tional units required to bring the plant capacity up to 350,000,000 pounds per year. ' 20 pNtC00009^ :ng facilities and welfare provisions are also included in the program to accommodate the increased labor force necessary for the larger production. It is expected that the new units will be completed early in 1927. Cenau Thei average number of inhabitants--men, women and children--in camp in 1925 was 15,433 as compared with 13,339 for 1924. On December 31, 1925, the population of the Chilean Village was 16,80?, and of the foreign section 1.378, a total of 18,185, which was the maximum month. The average working force for the year 1925 was 5.987 men, of whom 5,027 were on operation and 960 were on construction. For December, the average working force was 7,650 men, of whom 5,633 were on operation and 2.017 were on construction. The total number of men on the payroll for December was 10,497. This, based on the average working force of 7,630, shows an attendance of 72.9%,. During the year the Company had a 37.6% labor movement, 6,643 men out of a total of 10,497 men on the December payroll, or 63,2%, received the attendance bonus. The labor movement figure is high, due to the large increise in the construction force. Thebe were 1,532 pupils enrolled in the Chilean Schools as of December 1, 1925. The average attendance during the year was 1,172. In the foreign school there were 69 pupils enrolled at thi close of the term. Tocopilla An average of 38,857 K.W. was generated. The fuel oil consumption for the year in Tocopilla amounted to 1,077,740.44 barrels, which represents an oil factor of 1.056 pounds consumed per K.W. Hour generated or, conversely, 315.84 K.W. Hours generated per bar rel (42 gallons) of fuel oil. Financial Attached hereto you will find a Consolidated Balance Sheet at the close of business December :31, 1925, together with an Income Statement for the year, certified to by Messrs. Fogson, Peloubet & Company, Certified Public Accountants. JOHN D. RYAN, Chairman of the Board. CORNELIUS F. KELLEY, President. New York, N. Y., May 3,1926. 21 PNYCCC009914 CHILE COPPER COMPANY and Subsidiary Companies Consolidated Balance Sheet--31#t December, 1925 Fix e d : ASSETS Property Investment .................................................... Plant and, Equipment at Mines, Reduction Works. Power Plants. Railroads. Steamships, etc.............. S 99.291.999.82 49.359.3*8.27 Less Reserve tor Depreciation ot Plant and Equip ment -- 148.651.568.09 19.180,705.68 St 29,470.662.41 Def er r ed Ch ar g es including discount on bunds ....... 3.315.399,96 Cu r r en t : Supplies on hand and Expenses prepaid................. .. Copper in process and on hand, at cost........ .............. Accounts Receivable ..................... .......... ...... ....... ..... Marketable Securities ................................................... Cash and Call Loans..... .......................... -..................... 7.509.395.20 2.537,028.65 4,437.890,62 4.059,437.30 4,453.104.96 22.996.856.93 LIABILITIES Ca p it a l St o c k : Authorized--5,400,000 shares of $25.00 each Issued;--4,391,302 shares--------------------- -------------- Co l l at e r a l Tr u s t Go l d Bo n d s , due 1932: Authorized--$100,000,000 Issued--$35,000,000 Series A, 6% Convertible Outstanding ---------------------------------------------- --------- RSs er v e for Renewals and Replacements, Insurance, etc. Cu r r e n t : Interest and Taxes accrued $ Accounts and Wages payable.____________ ________ Su r p l u s : Surplus 31st December, 1924.______________________ Net Income of the year 1925, per statement annexed- Distributions to Stockholders______ _____ ___________ $135,782,919.30 $109,782,550.00 34,991,500.00 559.459.40 872.334.16 1.451,617.53 2,324,131.69 7.164.095.17 11,939,150.56 19.103.245.73 10,977,987.52 8,125.238.21 $135,782,919.30 We have examined into the affairs of Chile Copper Company and of its subsidiary companies and have verified the Assets. Liabilities and Income shown above. We hereby certify that this Balance Sheet shows the financial condition at 31st December. 1523. of the companies as an aggregate whole and that the accompanying Income Account for the year ending that date is correct as stated. POGSON, PELOUBET & CO., New York, 31st March 1926. Certified Public Accountants. 22 i PNYC000099I5 /'***!V u CHILE COPPER COMPANY and Subsidiary Companies Consolidated Income Account--Year Ending 31st December, 1925 Op e r a t in g Re v en u e : Copper sold--207,9/8,026 pounds at an average of 14.2731 cents per pound............-............ .................. Pr o d u c t io n Co s t ..................... ................... ....................... $ 29,684,407.13 11.293,499.32 Op e r a t in g Pr o f it ......... ................. .............. .... ................ Ot h e r In c o me ..... .......-___ ______________ _________ -- Ch a r g e s Ag a in s t In c o me : 18,390,907.81 997,100.28 19,388,008.09 Taxes and Miscellaneous Charges............. ................. $ 2.367,923.25 Interest and Discount on Bonds--.......... -.............. 2,239,958.92 For Depreciation and Obsolescence of Plant and Equipment ,,... ...... ............. ................................... ..... 2.640.975.36 7,448,857.53 Me t In c o me,, carried to Balance Sheet________________ $ 11,939.150.56 No t e.--In order to comply with the Government Income Tax requirements for the purpose of comput ing depiction, an additional valuation of the mining property as of 1st March, 1913, has been recorded upon the books of the Company; but, being made for tax purposes only, the result of those entries has been omitted from tite current statements. 23 PNVC0QOO9916