Document ZBN3qL2MQvbkeEzzGojDO9GR8

Th e Ame r ic a n BMS Co mp a n y (a wholly owned subsidiary) Ah a^p h pA Anaconda Me*al Product* include copper and cooper alloyed with smc, nn, nickel, aluminum, lead, jilicon, manganese. chromiums and other element* in all combi nation* that can be manufactured commercially mto sheeti, plate*, strip*, wire, rod*, ban, segmles* tube*, extruded, railed and drawn shape* and hot Dressed parr*. Added to the favorable fabricating characteristic* of these metal* are: important properties such a* immunity to rust high resistance to other form* of corrosion, high electrical and thermal conductivity, high tensile and en durance strength, toughness, good bearing ovalities and other orooerties which mote them .'.nd.ispensaole in every held of_manufacture and engineering. The American Brass Company's commercial products, the properties of which hove been confirmed by perform, ance records, comprise the greater part of its production m serving the general trade and meeting the reaurement* of formal specification*; Special alloys designed to meet unusual condition* .have been developed by the Com. pony's technical expert* and further research of this chaiactet continue*. Air-Conditioning Automotive Aviation Building SOME OF THE INDUSTRIES SERVED Chemical Electrical Eauipment Hardware Heating Jewelry Light and Power Machinery Mining Petroleum Plumbing Pulp and Paper Railroad Refrigeration Shipbuilding Texhle Welding PRINCIPAL PRODUCTS COPPER, BRASS, BRONZE AND COPPER-NICKEL ALLOYS--SHEETS, WIRE, RODS, TUBES Airplane and Automotive Fuel and Pressure Lines Ammunition Metol Artillery Shell Rotating Band* Bras* and Copper Pipe Brazing Metal Bronze Screen Wire But Bart and Shapes Cartridge Disc* and Cup* Condenser Tube Sheets Condenser and Heat Exchanger Tubes Copper Water Tube* and Fittings Roiled and Drawn Section* Evetdut* and Supet-Nichel Tank Plates Extruded Shapes Eyelets, Grommet* and Stampings Flexible Metal Hot# ond Tubing Phosphor Bronze Die Presied Forgings Tobin* Bronze Shafting Turbine Blading Welding Rods *#*. u. 5. *h . Off. LOCATION OF MANUFACTURING PLANTS Ansonio, Conn. Buffalo, R Y. Detroit, Mich. Kenosha, Wis. Torrington, Conn. Woterbuty, Conn. Anaconda American Brats Limited, New Toronto, Ontario, Canada Atlanta, Go. Boston, Mass. Buffalo, N. Y. Chicago, Hi. Cincinnati, Ohio Cleveland, Ohio OFFICES ARE LOCATED IN THE FOLLOWING OTtES* Denver, Colo. Detroit, Mich. Houston, Texas Kenosha, Wis. Los Angeles, Calif. Milwaukee, Wis. Minneapolis, Minn. Montreal, Canada Newark, N.'J. New York, N. Y. Philadelphia, Pa. Pittsburgh, Pa. Providence, R. i. Rochester, N. Y, General Offices: Waterbvry 88, Connecticut St. Louis, Mo. Son Francisco, Calif. Seattle, Wash. Syracuse, N. Y. Toronto, Canada Washington, D. C. An a c o n d a Co p p e r Min in g Co mp a n y CAPITAL STOCK Decern ber 31, 1946 Authorized, 12,000,000 shares 3.50 each...........................................3600.000.000 Outstanding, 8,674,332 shares 830 each........................................... 433,716.600 OFFICERS Chairman of the Board....................................................Co r n el iu s F. Kel l ey President.......................................................................... Jame3 R. Ho bbin s Executice Vice-President.................................................... Ro ber t E. Dw y er Vice-President in Charge of Mining Operations , , . Cl y d e E. Weed Vice-President in Charge of Metallurgical Operations . . Fr ed er ic k La is t Vice-President and General Counsel..............................W, H. Ho o v er l' ice-President...................................................................El ber t O. So w er w in e Vice-President...................................................................Ed w ar d S. Mc Gl o me Assistant to the President.............................................Fr an c is O. Cas e Assistant Vice-President , .... Ric h a r d S. Ne w u n Comptroller ..................................... W, Ken n et h Pal y Treasurer.......................................................................... James E. Wo o d ar d Secretary and Assistant Treasurer..............................C. Ea r l e Mo r an Assistant Secretary and Assistant Treasurer . Ke n n e t h B. Fr a z e r Assistant Secretary and Assistant Treasurer . Th o ma s E, Co n r a d Assistant Secretary............................................................Jer emiah D. Mc r f h t Assistant Secretary . ............................................. Th o mas E. Tat em DIRECTORS Ro b er t E. Dw t b r E. Ro l a n d Ha r bima n Ja mes R. Ho b b in s Cl a r k S. Ju d d Co r n e l iu s F. Ke l l e t Ma u r ic e Ne w t o n Wil l ia m C. Po t t e r Go r d o n S. Re n t s c h l e r Wil l ia m D. Th o r n t o n OFFICES An ac o n d a , Mo n t a n a Bu t t e, Mo n t a n a 23 Br o ad w ay -, Ne w Yo r k 4, N. Y. An n u a l Re p o r t OF An a c o n d a Co p p e r Min in g Co mp a n y For the Year Ended December jr, :6 To the Shareholders of Anaconda Copper Mining Company: The gross sales and earnings of the Company upon a consolidated basis (after elimination of inter-company items) totalled.................... $293,737,817,39 Other income, including dividends from non-consolidated subsidiary, was....................................................................... 2,907.664.21 malting total gross income.................................................... $296,645,481,80 The cost of sales, including all operating expenses, develop ment and maintenance charges, repairs, administrative, selling and general expenses and all taxes except taxes on income, amounted to.............................. $242,373,098,85 Provision for depreciation and obsolescence and for depletion of timber lands and phosphate deposits amounted to.............................................................. 11,072,145.61 making total deductions from gross income....................... 253,445,244.46 United States and foreign taxes on income amounted to___ * 43,200,237.34 17,883,290.30 $ 25,316,947.04 Renegotiation payments applicable to prior yean were___ 1,324,724.99 Net income, without deduction for depletion of metal mine*. was........................................................................................... t 23,992,222.05 Of which minority share amounted to.......................... ......... 153,809.87 Leaving consolidated net income of........................................ $ 23,838,612.18 3 Gross income decreased $33,036,901.54 or 10.02% from 1945. Consolidated net income increased $3,435,835.91 or 16.84%. Profit per share without deduction for Capital Pepletion of Metal Mines was $2.75, compared with $2.35 in 1945. Net income as heretofore is based upon invoices to customers. Inventories are based On "Iast-in, first-out" method at the cost of various metals on hand and in process, such value being below market prices for the various metals and products at December 31, 1946. Payments were made during the year amounting to $1,324,724.99 covering re negotiation of prior years war contracts, principally to the Canadian Government by a subsidiary of the Company. These payments were charged against current income. All renegotiable contracts have been examined and are dosed. There is no further liability on the part of the Company or any of its subsidiaries with respect to the renegotiation of scar contracts. Current assets as of December 31, 1946, amounted to $224,009,906.64 of which $130,982,722.01 was in: cash and Government securities. There was no indebtedness except for current accounts and wages $15,446,212.65 and accrued taxes $28,038,427.14, a total of $43,484,639.79, leaving net current assets of $180,525,266.85 equivalent to $20.81 per share, an increase of $9,675,110.02 or $1.11 per share for the year. The Company and its subsidiaries had on hand at the end of the year United States and Canadian Government Securities of a par value of $78,576,000. During the year purchases amounted to $16,000,000 par value. $15,300,000 par value matured or were P"' applied to the payment; of Federal income taxes. Co r p o r a t e Tr a n s a c t io n s During the year the Company increased its holdings in shares of subsidiary companies by purchase of 3,310 shares of Anaconda Wire and: Cable Company, 5,600 shares of Andes Copper Mining Company, 770 shares of Chile Copper Company, 371 shares of Greene, Canapea Copper Company and four shares of Butte Water Company. These transactions increased Company holdings to 293,032 shares (69.44%), 3,508,125 shares '97.93%!, 4,373,938 shares (99.17%), 492,193 shares (98.44%) and 119,660 shares (99.88%)-, respectively, of the issued capital stock of those companies. During the year operations and exploratory work were continued at the lead-silver Darwin Mine yjritli satisfactory results. Exploratory work was continued at the'Victoria Mine located in Elko County, Nevada. The Company commenced exploration work by drilling upon mining claims in the Old Hat Mining District, Pinal County, .Arizona, generally referred to as tine Houghton Group, under option contracts with Apex Lead Vanadium Mining Company and others, and acquired exploratory rights on adjoining properties. The Company acquired option contracts from Van Dyke Copper Company and Sfap'Me Copper Company upon an extensive acreage of mining claims in the Globe Mining District, Gila County, Arizona, With a view to undertaking an exploratoryprogram thereon in the near future. The Company, through subsidiaries, has acquired contracts for exploration on and options to purp^ase, properties ,in Colombia and British Guiana, and anticipates con ducting a extensive program to explore these properties for gold and other minerals- One of the major capital items sold during the year was the lead refinery, white lead and zinc oxide plants of International Smelting and Refining Company at East Chicago, Indiana. Prior to the sale of this property, a long term contract was concluded for the refining of lead produced from the Company's operations in Montana and the output of lead bullion from the Utah operations of International'Smelting and Refining Company. As a result of these transactions the Company is no longer a producer of white lead and zinc oxide, but continues its production and sale of common desilverized lead and of bismuth previously produced at East Chicago. Op e r a t io n s Strikes of employees in many of the Company's plants adversely affected production and income. The Waterbury, Ansonia, Torrington and Buffalo plants of The American Brass Company were closed from February 4th to May 19th, the Detroit plant from March 11th to May 23rd and the Toronto plant of its subsidiary, Anaconda-American Brass Company, Ltd. from May 17th to October 17th, 1946, thus materially reducing 5 deliveries of its manufactured products. Production of primary copper was curtailed by strikes at the Butte mines for a short period in April and at the properties of Chile Exploration Cpmpanv from May 26th to June 30th, A strike of employees of the copper refinery of International Smelting and Refining-Company at Perth Amboy X, J., from March 4th to May 27th stopped the production and delivery of refined copper both from Company mines and from those companies whose copper is refined under toll contracts. Except for such strike interference the producing units of the Company operated at maximum capacity to the extent of manpower available. The shortage of manpower in the non-ferrous metal mining industries continued but showed some improvement in the latter part of the year. With the elimination of OPA price control on November 12th, prices advanced to 17.3c for copper, 10 je for lead and zinc. Copper continued its advance to 19.3c on November 23rd and lead to 12.33c per pound on December 16th, which prices were in effect at the end of the year. Notwithstanding the effect of strikes, deliveries by domestic fabricators during the year contained 1,233,295 tons of copper, of which 662,079 tons or 53.7% were of foreign origin. Production of primary copper in the United States, as reported by Copper Institute, was only 618,757 tons. There was no strike interference during the last three months of the year. During this period primary production was at the annual rate of 858,452 tons and deliveries by fabricators were at the annual rate of 1,541,476 tons. There is no yardstick for measuring demand for copper in the United States since the termination, of hostilities. All available copper has been utilized as rapidly as allocated, but in no single month have fabricating plants had sufficient tonnage to operate at capacity. Since the domestic production is so far short of the requirements of domestic consumption, there yrifl be a very serious interruption of fabrication for domestic use unless foreign copper is made available immediately. The suspension of the four cent per pound excise tax,on copper is a necessary and practical approach to the solution of this emergency problem. It is; noted with satisfaction that legislation for that purpose is receiving current consideration in Congress. The temporary legislation'providing for stockpiling of critical and strategic metals for national defense was replaced in 1948 by permanent legislation for the protection of the United States in any emergency that may arise. However, so far as copper is con cerned, this legislation has been inoperative. Not only has there been no stockpiling, but reserves which had been accumulated by. Government agencies have been practically exhausted due to the huge and unsatisfied demand for current domestic use. Metals Reserve Company stocks of refined copper in the United States declined from 472,171 tons on January 1st to 95,388 tons on December 31, 1948. No purchase contracts for foreign copper were made by the Government agencies after November 1946, and all such purchases pius quantities on hand will have been disposed of early in 1947. Post-war reconstruction, especially in the European countries, requires extraordinary quantities of copper. Thus the demand for copper is not limited to the United States alone, but worldwide demand exceeds the world supply. This reconstruction is proceeding slowly due to shortage of fuel and necessity for the restoration of transportation facilities. However, such reconstruction as has taken place and is now continuing absorbs all copper available. To this requirement for reconstruction must be added the cumulative need throughout the world for copper in the many current uses for which it is so essential. Consumption of silver for industrial uses in the United States declined in 1946 from the unprecedented demand in 1945 but continued at a rate greatly in excess of any pre war year. Congress decreased to 30% the seigniorage on domestically mined silver, resulting in a price of S'0.5e per ounce for all silver produced from ore mined in the United states after July 1,1946. At the same time it provided for sale of free silver from Government stocks at 91c per ounce. As a result price of foreign silver advanced to 90) ,c on July 11th and with the exception of a slight break in the price for one day continued unchanged to December 5th. Thereafter the price for foreign silver declined to 83fqi per ounce at clqse of the year. The following is a summary of the output of principal products of the Company in 1946 compared with 1945: Total Output--Founds.............. ................. . By-product materials sold to others: From Company Mines.............................. From Other Sources................................... Finished Copper.. . From Toll,.................................................. From Purchased ores, concentrates and secondary metals................................. .. From Company Mines............................... l9iS 984,077,005 1945 1,098,626,338 362,382 110,524 983,704,099 232,524.579 95,501 1,333.020 1,097,197,817 221,149,429 9,181,434 741,998,086 14.441,212 861.607,176 Total Production--Pounds........................... From Toll.................................................... From Purchased materials........................ From Company Mines............................... Contained in by-products sold to other companies......... ............. *.............. ............. Zinc Dross....................................................... Secondary Metal............................................. Electrolytic Zinc at Company Plants.......... 7 393,637,341 255,330,267 138,799,706 1,527,568 19,344,142 989,788 373,323,811 380,489,939 240,193,024 138,664,165 1,632,730 17,544,457 383,330 3,859,940 338,504,306 Total Production--Pounds.. `.................... From Purchased ores* concentrates and other, materials....................................... From Company Mines.. .................... Contained in by-products sold to other companies___*......... ............................. Produced in metallic form.. 19iS "9,905,609 64,289,900 15,615,71)9 o,oo4.84l 74,350,768 19hS 71,237,709 65,745,616 o,492,093 18.605,648 52,633,06V Total Production--Ounces............................ From Purchased Materials....................... From Company Mines............................... Contained in by-products sold to other companies.................................................... Produced in metallic form............................. 8,171,693 4,484,100 3,687,595 1,565,082 6,606,633 9.620,647 4,317.388 5.303,259 1,859,930 7,760,717 73,509 43,455 30,054 ' 7,627 65,882 77,995 41,488 36,307 11,048 66,947 111,397 60,39% 4,883 1,546,937 1,471,252 65*822 67,271,293 120,477 60,24c 6,271 1,508,944 2,856,670 55,785 65,354,524 9 Fa b r ic a t in o Pl a n t s The shipments of manufactured products from the plants of The American Brass Company (including Toronto Plant; and Anaconda Wire and Cable Company amounted to, 820,,847,637 pounds, a. decrease of 24.53% from the year 1945. Emp l o y e e s During the year 1,946 the average number of employees of the Company and its consolidated subsidiary companies was 45,079. Of. these -28,620 were within the United States, Compared with 29,183 in 1945. As of December 31, 1946, total employees of the Company including its nonconsolidated subsidiary companies numbered 51,1.84. Gr o u p In s u r a n c e The Group Insurance in force at the close of the year amounted to $88,838,573 covering 33,590 employees. The amount of insurance paid to beneficiaries during the year was $1,089,617. Nu mbe r o f Sh a r eh o l d er s The number of registered shareholders appearing on the transfer books of the Company at December 31, 1946 was 122,649 compared with 120,545 at the beginning of the year. Fin a n c ia l St a t e me n t s There is attached hereto as a part of this report a Consolidated Balance Sheet show ing the financial condition of the Company and consolidated subsidiary companies at the close of business December 31,1946, together with a Consolidated Income Account and a Consolidated Surplus Account for the year, certified by Messrs. Pogson, Peloubet & Co., Certified Public Accountants. By Order of the Board of Directors. CORNELIUS F. KELLEY, Chairman of the Board. JAMES R. HOBBINS, President. New York, N. Y., April 19, 1947. 9 An a c o n d a Co p pe r Min in g Co mp a n y and Subsidiary Companies Consolidated Balance Sheet--December 31, 1946 i 32.353,672.63 TS.629.049.3e 27,690,613.71 1.602,646.52 40,125,094.10 i3,6Q9,S30.S0 1224.009.906.64 An a c o n d a Co p p er Min in g Co mp a n y and Subsidiary Companies Consolidated Balance Sheet--December 31, 1946 LIABILITIES CURRENT LIABILITIES: Accounts and wages payable........ ................. :........................... .................... ................................................ 3 iy.446,212.65 Accrued taxes--see note H._.................... ....................................................................................................... 29,033,427.14 4 43.434.839,79 d e f e r r e d c r e d it s t o in c o me . ;>J.T37 71 RESERVES: For workmen's compensation insurance.-........ ..........................-.................................... ............ ................. For contingencies................... ....................................................................... ............... .... ................ .............. .. 1,407,379.S8 5,230,000.00 8.357.079.38 CAPITAL STOCK AND SURPLUSof consolidated subsidiaries owned by minority interest___ 3,844,778.iJtJ CAPITAL STOCK of Anaconda Copper Mining Company: Authorized--12.000,000 shares of the par value of 130 each Issued--.................. ............ .............................................................. ............... ...................... 8,019,083 shares 443,954,300.00 Held in treasury..-.________ -.... ........ -........... ............ --.........--.................. 244,734 shares 12.237,700.00 Outstanding., ______________________ _____ _______ ______ 8,874.352 shares 433.713.80o ,*.> SURPLUS--see note G. ADVANCES BY GOVERNMENT AGENCIES for extension and operation of metal producing facilities, less repayment*--per contra,-,-------- ------- ----------------------------------------- --- .........--------- See explanatory notes, pages IS and 14. 11 130.138.3-59 71 3.50SA54 i9 i62l.934.5ii4 Vt PNYC 00010275 An a c o n d a Co p p er Min in g Co mp a n y and Subsidiary Companies Consolidated Income Account--Year Ended December 31, 1946 4i83,T3T,3ir.5 NOTES TO FINANCIAL STATE.MENTS-DECEMBER 31, 1946 NOTE A--BASIS OF CONSOLIDATION' TTse consolidated financial statement* include the accounts of all significant subsidiaries, in which the stock interest of the company i3 .NOTE B--ASSETS AND LVCOME EN FOREIGN COUNTRJES Assets in foreign countries, principally those of subsidiaries operating in South America, Mexico and Canada, are approximately Sfty-six per cent, of the set iasoimt of fixed. assets, investments and deferred charges, iess reserves, and approximately eight per cent, of amount of net current assets (including cash balances in such countries of $1,713,464.64) shown on the Consolidated Balaace Sheet. The greater part of the assets Ir. * mth America and Mexico were acquired for United Stater dollars (see note E as to basis for fixed assets), those acquired for ( .reign currency, not significant in amount, being converted at rates of exchange current at the dates of acquisition. Assets in Canada are .carried at par. Consolidated net 'income includes llT.5I8.75i.12 as Anaconda Copper Mining Company's proportion of the income of subsidiaries operating in South America and Mexico, substantially all of which has been received in United States funds;,and $243,354.34. the net iocome. before deducting renegotiation payments applicable to prior years, of the Canadian subsidiary, which paid no dividends during the year. NOTE C--EQUITY IN ASSETS AND INCOME OF UNCONSOLIDATED SUBSIDLUUES The investment of the parent company in Its principal unconsolidated subsidiaries (Anaconda Wire and Cable Company and Mountain City Copper Company) is included in the Consolidated Balance Sheet at 13,730,725.08 less than the company's equity in the net assets of these subsidiaries as shown by their books. The company's proportion of the net earnings of such subsidiaries (without making any provision for depletion of metai mines) exceeded dividends received in the year by $1,270,356.42. Such dividends received, amounting to $877,341.00, are included in the Consoli dated Income Account. NOTE D--METALS AND MANUFACTURED PRODUCTS--FINISHED AND IN PROCESS Finished metals held for sale or in process of fabrication are carried at cost, principally on the last-in, first-out basis, except silver, gold and molybdenite which are carried at market or less. All other inventories in process or finished are carried at cost. The above costs are not in excess of current market values. NOTE E--FIXED ASSETS--BASIS OF VALUATION (a) Property, plant and equipment U included in the Consolidated Balance Sheet on the basis of cost to the consolidated group either in cash or in stock of the parent company at par value. Investments in securities of subsidiaries not consolidated and other investments are included in the Consolidated Balance Sheet at cost or less. Other investments include 333,000 sham of Inspiration Consolidated Copper Company, carried at $8,916,107.Jt. (b) As required by the United States Treasury Department, valuations as of March 1, 1913 of mining properties then owned have been recorded on the books for the purpose of computing the amount allowable as a deduction for depletion in arriving at taxable income under the Federal income tax laws. These values have not bees reflected in the published accounts cf the company. The company has consistently followed the practice of publishing its accounts: without deduction for depletion of metal mines, and no such deduction is included in these financial statements. Depletion baaed on cost of timber and phosphate lands has been deducted from income on the Consolidated Income Account and also from the cost basis shown in the Consolidated Balance Sheet. (c) Fixed assets carried on the above bases do not indicate current values which could be determined only by current appraisals. 13 NOTE F-FUNDS PROVIDED BY GOVERNMENT AGENCIES Under the contract pursuant to which Use amount of *18, ISO,654-S3, not included in assets shown in the Consolidated Balance Sheet, was expended, certain option* were granted to the subsidiary with which the contract *u entered into with respect to discharge of obligation! in connection therewith; There ia no basis at the present time for determining wither any of these options will be exercised. Under tiie construction contract the subsidiary is obligated to operate the property at cost until, the end of the war emergency, one of the principal considerations for the.expenditures and advances above referred to. If none of the options are exercised, the facilities:are be disposed of and contractual accounting made. In the year 1948, 47.350,759; pounds of copper were produced and delivered under, this contract, at cost, to the Government agency, but neither the cost nor funds received m. repay ment have been included in the Consolidated Income Account. NOTE G--SURPLUS Consolidated Surplus includes (a) a credit of *80.818,158.4*, the excess of the proceeds over the par value, of an issue of 3.109,598-54 shares of' stock of the company and (b) a charge of *11.907,498.30 in connection with bonds redeemed by proceeds of stock men* dotted under (a), being discount and expense on issuance and premium on redemption of bonds. See paragraph (b) of note E as to practice regarding depletion. NOTE H--FEDERAL INCOME AND EXCESS PROFITS TAXES Audits of income tax returns for the taxable year* up to and including December 31. 1940 have been made by the United States Treasury Department and addition*! assessments have been paid. Audits of excess profits tax returns for years 1940 to 1945 and of income tax returns1 for years subsequent to 1940 have not been completed. NOTE.: I--GROSS SALES AND EARNINGS Sales of metals and of manufactured products are included in income as billed and delivered to customers. Undelivered sales contracts anil purchase commitments are not given effect to in the Consolidated Income Account. Sales include amounts received under the " Premium Price Plan for Copper, Lead and Zinc.'1 NOTE J--"PORTAL-TOPORTAL" WAGE SUITS So-called "portal-to-portal" suits have bees filed against the company and certain of its subsidiaries for alleged back wages for over time. These actions are being contested and. in view of the uncertainty as to the liability, if any, no reserve bas been provided therefor in the accompanying financial statement*. NEW YORK MAumc* c. oouicr .ews m. h o *t o n srowcr w n.aurr u. suren* zxA'#ro*o c. -Ataer *AN* t. SMAU. EL>*SO POGSON. PEUOU8KT 8t CO. CERTIFIED PUBUC ACCOUNTANTS *.* *.&*** "ce!vnp\o- v ea, AGENT ej*0*t--xtM c*frtins :j U^soow 23 SROAOWAY. NE.V YORK 4 M. y. To the Board of Directors, Anaconda Copper Mining Company, 25 Broadway, New York 4, N*. Y. We have examined the Consolidated Balance Sheet as of December 31, 1946 of Anaconda Copper Mining Company and the other corporations whose accounts are consolidated with its accounts as stated im.note A to the financial statements, and their Consolidated Income and Surplus Accounts for the calendar year 1946.; have reviewed the system of internal control and the accounting procedures of the Company and its subsidiaries and, without making a detailed audit of the transactions, have examined or tested accounting records of the Company and its subsidiaries and' other supporting evidence, by methods and to the extent we deemed appro priate. Our examination was made in accordance with generally accepted auditing standards applicable in the circumstances and included all procedures which we considered necessary. The practice of the Company and its subsidiaries in computing their net income or net loss without deduction for depletion of metai mines is in accordance with accepted accounting procedures in industries .engaged in the mining of copper, zinc, lead, silver and gold, and is in agreement with long established and consistently maintained accounting practices and pro cedures of this Company and its subsidiaries and others similarly situated, and the Company is advised by counsel that such procedure is in accordance with legal requirements. In our opinion, the accompanying Balance Sheet and related Income and Surplus Accounts, together with the notes attached thereto or appearing thereon, present fairly the consolidated position of the Company and its consolidated subsidiaries at December 31, 1946 and the com bined results of their operations for the calendar year 1946, in conformity with generally accepted accounting principles which have been applied on a basis consistent in all material respects with that of the preceding year. POGSON, PELOUBET & CO. Certified Public Accountant* New York, March 27, 1947. 13 An a c o n d a Wir e a n d Ca b l e Co mp a n y (A Subsidiary Company) An ^o k o A Elecjr-co) and cooie* ore intjispenscbie to all Ame'ican n<Jus>rie5 ond find ihetr application whe'ever electricity :s unbred. During the oast year, the manufacturers of electrical wues and cobles have not been aoie to meet the backlog of aemand lor peacetime requirements. Production was hon<jicbpped by a lack ol raw materials, not only cooper, but also many of the other materials without which rhe various types of insulations and other camocnems coylO not be manufactured. It is interesting to note that notwithstanding Such short, ages, the engineering and 'eseorch staffs we'e abte o continue to improve the quality of rhe Company s oroducfs An outstanding result of research wos the devicement of a radically new and better rYoe of -!eod aiioy sheath for high voltage power cable. This patented alloy 1$ known os F-3 Lead' Alloy Sheath. Automotive Aviation Building Chemical Communication SOME OF THE INDUSTRIES SERVED Construction (Heavy) Electric Utilities Electrical Manufacturing Food Marin* Metal Fabrication Mining Petroleum Radio Railroad Rural Electrification Shipbuilding Textile Telephone and Telegraph Sate Wire and Cable Cable Accessories Communication Cable Copper Rods Cords PRODUCTS ELECTRICAL WIRE ANO CABLE5 OF EVERY DESCRIPTION Hollow Conductor Coble Magnet Wire and Coils Non-Merallic Conduit Rower Coble: Rubber, Paper, Varnished Cambric Parkway Coble Radio and Television Coble Rubber Covered Building Wires Shipboard Cables Synthetic Insulated Wirt and Coble Weatherproof Wire and Cable LOCATION OF MANUFACTURING PLANTS Anderson, Ind. Great Falls, Mont. Hastings-on-Hudson, N, Y. Marion, Ind. Muskegon, Mich. Orange, Coltf. Sycamore, III, Atlanta, Go. Boston, Mast. Charlotte, N. C. Cincinnati, Ohio Cleveland, Ohio Do IIq s , Texas OFFICES ARE LOCATED IN THE FOLLOWING CITIES. Denver, Cole. Des Moines, iowa Detroit, Mich. Kansas City, Mo. Los Angeles, Calif. Milwaukee, Wi*. Minneapolis, Minn. New Orleans, La. Philadelphia, Po. Pittsburgh, Pa. Rochester, N. Y. St. Louis, Mo. Son Francisco, Calif. Seattle, Wash. Washington, D. C. ,General Offices: 25 Broadway, New York 4 N. Y. Chicago Sales Offices-. 20 North Wacker Drive