Document ym6zrMDzEKb7rdewgXayJD33r

Anaconda Copper Mining Company CAPITAL STOCK December 31, 1929 Authorized, 12.000,000 shares. $50 each .... Issued. 8.828.063 shares, $50 each .... $600,000,000 441.403.130 OFFICERS Chairman of the Board JOHN D. RYAN President.................................... CORNELIUS F. KELLEY Vice-President.............................. BENJAMIN B. THAYER Vice-President ........................JAMES R. HOBBINS Vice-President........................ ROBERT E. DWYER Secretary and Treasurer ALBERT H. MELIN General Auditor........................ JAMES DICKSON Assistant Secretary .... KENNETH B. FRAZER Assistant Treasurer .... DAVID B. HENNESSY DIRECTORS Percy A. Rockefeller John D, Ryan Benjamin B. Thayer Cornelius F. Kelley Charles E. Mitchell Charles T. Fisher *Nicholas F. Brady Andrew J. Miller John A. Coe Deceased March 27. t930 OFFICES An a c o n d a , Mo n t an a 25 Br o a d w a y , Ne w Yo r k To the Shareholders of Anaconda Copper Mining Company: The extraordinary- increase in the domestic demand for copper which developed during the 'as: half, of 1923, carried through into'1929; and continued until the general decline of business which culminated in the drastic recession of the dosing months of the year. The buying movement which had gained impetus in the last quarter of 1928, continued through the first Quarter; Of 19J9, iincfieckediby the .frequent admonitions of the producers, who were increasing production as rapidly as possible, but who could not sell further against unmined production, Until approximately 500:000 tops of copper were sold for forward delivery. The result was that fora time the market got out of control and the price advanced on bids for smail tonnages made largely to custom smeiters. until a price1 for delivery in CofihecticutT'alfeymfiJ-le'a,pound On. March 23 was quoted. The total;amount;qf; copper sold above 20c a pound was smail. ar.d S3 soon as buying ceased the price declined until the equivalent of lac delivered Connecticut Valley was reached.. This price, representing approximately the average of all forward contracts, prevailed throughout the rest of the year. ' A high record for production, fabrication and manufacture was established by your Company and its affiliated organizations. World production of copper, as reported by the American Bureau of Metal Statistics, amounted ifO; 243p|$5'!tdiiSi;:, 'Toltpl sfpcljls Ihdrieased 154.510 tons. World consumption of 2,001.895 tens, lufiiMprfea^eiiqf JJSui^p'JdyUliilhjSj'iUS thus indicated, divided approximately, l,bfilj;,J>?2 afii hkcrease of 10.95%, and 950,573 tons in other countries, a; deefeftle'.pf 3.S16%.. The; price of copper, as reported by Engineering and Mining Journal, ranged from 16.58 on January 2 to a ijh4$r|u:iii; 23,275*' March 23 to April 3, closing the year at l7.j77Wi wiifijkhisSilieaf'sa^ulk^'pk tS^l'Olij.qr 3-5p8' hlg.hei-Than in 1928. The price of lead Uci.the.p^lihipgipIthlJka'fi.Was'pIS'Stili. if advanced to 7.8758 on March 20. thereafter deAinld! td: IfeyfUnbefi if? !ajf iwhipK price .it closed the:ykaf>;with art average of 6.833e. At the beginning of the year the price of zinc was 6.358, advancing to a high of 6.808 June 27, declining to 5.458 December 19 to the end of the year, with an average of 6.512c per pound. On January 2 silver was quoted at 57 125e, advancing on January 10 to 57 58, steadily declining thereafter to 46.258 Decemoer 30, closing the year at 46.758, with an average price of 52.993* per ounce. Corporate Growth and Structure Important changes were made in the corporate and financial structure of your Company. Of these the shareholders have1 been fully advised! They may be briefly summarized as folows: At a special meeting of Stockholders held March 14, 1929, the authorized capital stock of the Company was increased from 6,000,000 shares of the par value of $50 per share to 12,000,600 shares of the same par value. Offers of exchange were made to the owners of the outstanding shares of Chile Copper Company, Andes Copper Mining Company and Greene Cananea Copper Company, as a result of which your Company acquired all but a small minority of the outstanding stock of these companies. 3 PNlfC0C00999 Stockholders of record at the close of business April 30 were offered the right to subscribe, on of before June If at $55 per share, for two shares of stock of the par value oi $50 per share for each h\ c shares of such stock held by them.. The purpose of the offer was to provide funds to discharge the then outstanding funded debt of the Company. Pracricallv the Entire offer was subscribed for. There was no underwriting or charge of any- kind, ekeCjpt necessary expense actually incurred in connection w.-.h this financing. On January 2. at maturity, there was paid off from current funds of the Company the outstanding 10-Year $bris A: 6%-j; Secured Gold Bonds, amounting to 516,933,000. On Atl9|ist'Ththgief|tii;'fe,iissue,'lOf;iSl0+:-l0l,(ip(} :First,; Consolidated Series .A 6GB Sinking Fund Gold, iBdndSi, diie.:J95:3,; was paid from funds obtained by subscription to the additional shares': of the Company issued for that purpose. ' As of the same date the remainder of the $30 000 000 13-Xear V%' Convertible Debentures, dud' 1938, amounting to S13.143,- 000; mete-either cbhvefteft'or'paidi . :%;y%tite.of the Ipb^bing,: transactions, your Company and subsidiary companies were relieyedi'of $2,132,000 First Mortgage 5^.Sinking Fund Railway Company, and 535.000.000 20-Year Company. In February, 1929. the Anaconda Wire and Cable Company was organized to take overj'ther'iJ&feiF^lii^lilii^ldl'WBSft'Mifl pf your1 Company ar.d the Kenosha Wire .Mill of The) America^, iBrass--Cbmpany, It.subsequently acquired the- plants and assets of the following: cbifpsnie#: llh%nd'::S'>ffe SfiGirdle-jCompany, Sycamore. Illinois; Tubular Woven Fabrics Company, Pawtucket, Rhode Island; |MSting:WirelfOtebW, Muskegon. Michigan, and Anderson, Indiana; Marion Insulated Wire and Rubber Company. Marion, Indiana; iHaspngsiiWiresa; Cable1 i.Corporation (a. subsidiary of The American Brass Company), Haerings^ort-HudeoDriNew York, The AnaeCjnld Mrite]:and cable1 Coijip|iiy is an, organization with facilities for the manufactmreyand;:;distri!butlpnl !tihroughput:.the United: States and for export, of a complete line of copper rods and of bare, weatherproof and insulated copper wire, cable and strand. Your Company owns a majority of the outstanding shares of this company. On March 15 The American Brass Company acquired for a cash price of $3,000,000 all of the issued stock of the French Manufacturing Company, of Waterbury, Conn., one of the most successful fabricators of small seamless tubes. Due to the various corporate transactions outlined above, the outstanding capital stock of your Company increased from 3,0-43 311 shares at the beginning of the year to 3.828.063 shares December 31, and there was discharged either by conversion or payment a total of $134,477,000 funded debt. Financial The consolidated balance sheet at Deceml^r 3t. 1929, includes the assets and liabilities of Chile Copper Company, Andes Copper Mining Company and Greene Cananea Copper Company, as your Company owned substantially- all of the issued shares of those cor porations on that date; In order to properly state the income of the consolidated companies 4 TP 9 priycoO009993 for the year, the total income of the above-mentioned companies has been included in the consolidated income account. The income which accrued to the minority interests out standing at the close of the year, and the dividends paid by those companies on shares of stock subsequently acquired by the Anaconda Company, are shown iij the statement of surplus, account herewith:: The funds ,fjor redemption pf bonds on August 1st were provided through The'Subscription to ptock. Interest paidand discount on such bonds, amounting o $4,080,866.92 up to August 1st, the date of redemption, should be added to (income shown, on Auditor's statement to arrive at true income or. total shares outstanding at the end of the year. Including this amount, r.ec earnings for the year, after all charges except depiction, amounted to $73,196,595.81. In ascertaining earnings for the year, no profit hasibien talten ori.uri^M production. Metals In inventories at the dose of the year were priigedlatciblfi,;with tiff!"exception of the norma! metal inventories of the fabricating plants, which were priced at the basis fixed in 1926. Capital Expenditures Miscellaneous mining claims and lands were acquired at a cost of $978,985.32. Construction expenditures during the year totalled $9,596,569.54, and were distributed as follows: Butte Mines....................................................... $1,059,487,76 Reduction Works, Anaconda................................................... 232.851.72 Reduction Works, Great Falls................................................. 54,408.63 The American Brass Company............................................... 1,583,072.20 Raritan Copper Works-.............................. 244,893.29 International Smelting Company........................................... 872,446,61 International Lead Refining Company............................ . 208,949.04 Andes Copper Mining Company............................................ 2,025,793.29 Chile Copper Company.................... 2,346.257.91 Greene Cananea Copper Company......................................... 939,195,31 Miscellaneous............................................................................. 29,213.78 Copper Operation* The production of metals of the Anaconda Company and its subsidiary companies from copper operations for the year 1929 was as follows: Anaconda Copper Mining Co,... Andes Copper Mining Co._____ Chile Copper Co--..................... Greene Cananea Copper Co....... International Smelting Co.......... Copper lbs. 297,014,107 162,663,775 299.575,752 58,826.951 172,488,878 SUver oz. 8,564,609.45 263,268.65 402,029.94 2.154,868.63 Gold ors. 33,077.04.1 16,536.862 12,365.615 44,441.157 Total. 990,569,463 11,384,776.67 106,420.677 Of the above, 188,050,954 pounds copper, 3,598.424.07 ounces silver, and 53,079.553 ounces gold were produced from custom ores and ores treated on toll. 5 PNYC0C0C9994 Zinc Operation* The production of electrolytic zinc af the Anaconda and Great Falls plants during 1929 amounted to 273.357.416 pounds. In addition, metals in dross and residue produced amounted to 13.854.061 pounds zinc. 26.913,002 pounds lead, 2,921.526 pounds copper, 3,5,85,368.18 ounces silver, and 8,702,023 ounces gold. Of this amount 2 404.05!'pounds copper, 290,465.40 ounces silver, and, 139.945 ounces gold were treated through operations of the Copper Plant. Lead Operations The Lead Plant of the International Smelting Company, Tooele. Utah, produced from custom ores 152,536,672 pounds lead, 6,3561611.11 ounces silver, and 38,163.637 ounces gold. Miscellaneous Products Miscellaneous production consisted of: 128,115.171 feet, 19,714 tons, 10.628.97 " 57,619,579 pounds, 17,831,740 802,753.65 " 379,100 800,493 lumber. treble superphosphate and phosphoric acid. arsenic. zinc oxide. white lead. cadmium. nickel sulphate. copper sulphate. Fabricating Plants The output of manufactured products of the plants of The American Brass Company (eliminating the Kenosha Wire Mill and the Hastings Rod and Wire Mill which were sold to Anaconda Wire and Cable Company), amounted to 695,059,2t3 pounds, which estab lished a new high record, with an increase of 69,823,589 pounds over the output of 1928. The copper used in the fabricated products of the plants of Anaconda Wire and Cable Company amounted to 354,994,832 pounds. The combined output of the fabricating plants totalled 1,050,054,045 pounds. SilesUn-American Corporation The principal amount of outstanding bonds was reduced to 811,512,000 at December 31, 1929. The subsidiary Polish companies increased output in all departments, particular improvement developing in the coal business. The price of zinc was lower than in the previous year, declining to 5.39i per pound as compared with 1928 average of 5.467f, in 6 i PNYCGCGC9995 i contrast to which price in the United States averaged .+85i more than in 1928. London price of zinc at December 31, 1929, for spot and future, had declined to equivalent of 4.333c per pound. Principal production for the year was as follows: Sulphuric Acid...... Superphosphate. 153,946.000 pounds 14.559,000 " 3.208.000 metric tons 121,060 71,880 During the year $1,410,506.41 was expended for construction. There is attached hereto a Consolidated Balance Sheet showing the financial condition of the Company and its subsidiary companies at the close of business December 31, 1929, together with an Income Statement for the year, certified to by Messrs. Fogson, Peioubet & Company, Certified Public Accountants. JOHN D. RYAN, Chairman of the Board. CORNELIUS F. KELLEY, President. New York, N. Y,, May 6, 1930. 7 pNVX00C09996 I ANACONDA COPPER MINING COMPANY and Subsidiary Companies Consolidated Balance Sheet--31st December, 1929 ASSETS Fix e d : Mines and Mining Claims, Coal Mines, Timber Lands, Phosphate Deposits, Water Rights and Lands for Metal Producing and Manufacturing Plants.............................................................. $295,030,767.55 Buildings and Machinery at Mines, Reduction Works, Refineries, Manufacturing Plants, Saw mills, Foundries, Waterworks, Steamships and Railroads............. .............................. 255,889,684.10 Investments in sundry companies............................... 25,349,194.45 $576,269,546.10 I 5 i I De f er r ed Ch ar g es and discount on bonds. 11,052,712.85 Cu r r e n t : Supplies on hand, advances on Ores and Expenses prepaid.................................................................... $ 32,780,024.38 Metals and Manufactured Products in process and on hand--at cost, less reserve............................... 84,655,074.38 Accounts Receivable..................................................... 26,070,341.61 Marketable Securities.-................................................. 17,243,410.52 Cash....-........................................................................... 16,156.605.59 176,905,456.48 $764,227,815.43 We have examined into the affairs of Anaconda Copper Mining Company and of its Subsidiary Companies and have verified the Assets and Liabilities shown above and the relative Surplus and Income accounts. The .Vet and Dinecpormeeciaistiaofnt-eorfdPeldaunctstinagndallEDqeuvipemloepnmt.entWeexpheenredbityurceeorftitfhyethyaeat rt,hDiaeBplaeltaionnceoSf hCeoeatl and Timber Lands shows the financial condition at 31st December, 1929, of the companies as an aggregate whote and that the accompanying Surplus and Income accounts for the year ended that date are correct as stated. POGSON, PELOUBET * CO. Mew York and Butte, 2nd April, 1930 Certified Public Accountants \ 8 N11766.01 PNYCU0009997 a n a c o n d a c o p p e r min in g c o mp a n y and Subsidiary Companies Consolidated Balance Sheet--31st December, 1929 LIABILITIES Ca p it a l St o c k of Anaconda Copper Mining Company: Authorized, 12,000,000 shares of $50.00 each Issued, 8.828,063 shares..................... Ca p it a l St o c k a n d Su r p l u s of Subsidiary Companies owned by Minority Interest.................... $441,403,150,00 12,232,860.77 Bo n d s Ou t s t a n d in g : Chile Copper Co. Twenty Year 5% Gold Deben tures, due 1947..... ............................ Butte, Anaconda & Pacific Railway Co. First Mort gage 5% Sinking Fund Gold Bonds, due 1944 $35,000,000.00 2.182,000.00 37,182,000.00 Re s e r v e f o r De p r ec iat io n ..... ..................... . .. 83,679,863.20 Cu r r e n t : Notes Payable-............................................. Taxes and Interest accrued.................. Accounts and Wages payable.......... Dividend No. 106 payable 17th February. 1930 Su r pl u s . $35,000,000.00 8,142,153.31 19,105,124.91 15,449,110.25 77,696,388.47 112,033,552.99 $764,227,815.43 No t e--In order to comply with the Government fn. mr Tas requirement* for the purpose of computing depletion, additional valuation* of the mining properties been recorded upon the books of the companies; but, for the sake of uniformity, the result oftnose entries ha* been omitted from the current statements. 9 PNYC0000999a v*. 1 ANACONDA COPPER MINING COMPANY and Subsidiary Companies Consolidated Surplus Account--Year Ended 31 st December, 1929 Surplus 31st December, 1928....... ...................................... .............................. Premium received on Capital Stock sold for cash or issued for Convertible Debentures, less premium and discount on First Consolidated mort gage bonds redeemed and sundry surplus adjustments....................... $99,703.59933 1.634.921.43 Net Income of the year 1929, per Income Account: Anacohda Copper Mining Company share................ Minority Interest share.............................'....... .......... $69,115,728.89 1,202.010.49 $101,338,520.76 70,317,739.38 $171,656,260.14 Deduct, Dividends: By Subsidiary Companies on stock owned by Minority Interest at 31st December, 1929....... By Subsidiary Companies on stock acquired by Anaconda Copper Mining Co. in 1929--amount paid prior to acquisition........................................ By Anaconda Copper Mining Co.--dividends Nos. 103,104,105 and 106............................................ * 1,234,878.00 4,178,080.13 53.567,278.25</^ 58,980,236.35 $112,676,023.70 Deduct, Minority Interest................................................................................ 642.470.7' Surplus 31st December, 1929, per Balance Sheet.......................................... $112.033.552.99 i l l J1 f 1 10 PNVC00009999 ANACONDA COPPER MINING COMPANY and Subsidiary Companies Consolidated Income Account--Year Ended 31st December, 1929 Gross SaTes and Earnings--................................................................................ Costjof Sales--operating expenses, development, maintenance and repairs, administrative, selling and general expenses and ail taxes...................... $305,751,876,46 223,972,464.43 Othejr Income--interest, dividends and miscellaneous income.................... $81,779,412.03 8,483,040.82 Deductions from Income: Amount charged off this year for depreciation and obsolescence....... ........ ............. ............ $11,685,736.04 Interest, including discount on bonds.......................... 8,258,977.43 $90,262,452.85 19,944,713.47 Net Income, carried to Surplus Account.. $70,317,739.38 No t e--The Income Account includes no sales end expenses of the Greet Felts Rod. Kenoeha Wire sxtd Hastings Rod and Cable milts and does include the entire year's sales and expenses of Chile Copper Company, Andes Copper Mining Company and Greene Cananea Copper Company. n PNtCCCOiCOOC ^AIIl[1St5a5gKflSU0EWWK