Document z2M9XgL9xbV4y69574g4o1d0

N11536 pHYCOOOO?*12 An a c o n d a Co p p e r Min in g 35 BROADWAY NEW YORK Co mp a n y 1 To the Shareholder* of the Anaconda Copper Mining Company: FEDERAL TAX QUESTION There has been some publicity regarding Federal Income tax matters o the copper companies, including your Company, in connection with the investigation of the Senate Committee into the administration of the Bureau of Internal Revenue. The following statement is submitted: In February 1920 an exhaustive investigation of the taxes paid by your Company was conducted, after which, upon the submission of all the facts in connection with the business of the Company and its accounts, the Treasury Department made necessary findings and reached an, agreed final settlement of this Company's taxes for the year 1917 and previous years. The taxes for 1918 were also disposed of subject to the final ascertainment of the 1919 deductible loss. The entire issue now presented is as to whether valuations for subsequent years will be disturbed; because engineers, who participated in the original valuation and who determined the basis of valuation, or. their successors in office, have changed their opinions regarding certain factors which enter into the valuation. There is no question as tp the honesty, fairness and finality of the original valuations. As Secretary Mellon has publicly stated: . "Taxes for 1917 and 1918 were, assessed and paid by: the companies on the basis of these valuations and the companies were informed that the valuations were final." * * * * * ******* * ****** "The original valuation for 1917 and 1918 was made by competent authorities and was an honest, expression of judgment. The taxpayers had considered their taxes for 1917 and 1918 closed' and arranged their finances accordingly. To reopen them at this late date would have upset an entire industry. The Department, therefore, took the position that the 1917 ;anjd ;l91'Si taxes having Beenji.finally' 'Settled and paid, it would not extend the revalua tion to these years, but would commence, with the year 1919, for which year and subsequent years taxes had not yet been determined. It was felt that the Department should not substitute its present , judgment | for the: honest' judgment of those officials of the prior administration who were formerly in, authority in the Treasury and who had finally closed the cases for 1917 and 1918." It is the unanimous opinion of counsel for this Company, as well as of counsel for many of the other large producers who have been consulted in regard to the matter, that under the law and regulations the valuations arrived at are final and cannot tie disturbed. It is the belief of the officers of your Company that it has paid all the taxes that can be fairly claimed and that when the Department is in a position to con sider and close the subject for years subsequent to 1918, there will be no substantial change in the amount of taxes which have been paid by the Company. JOHN D. RYAN, Chairman of the Board. . CORNELIUS F. KELLEY, President. Ne w Yo r k , May 4, 1925. PNYC00009613 Anaconda Copper Mining Company CAPITAL STOCK December 31, 1924 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 Auditor ..... ROBERT 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 a n a 25 Br o a d w a y , Ne w Yo ik PNYCOC0096X4 To the Shareholders of the Anaconda Copper Mining Company: The year 1924 established a high record for both production and consumption in the world's copper industry, It is estimated that production exceeded 3,000,000,000 pounds and that consumption exceeded production by approximately 30,000,000 pounds. The do mestic consumption reached an approximate total of 1,472,000,000 pounds, nearly 100, 000,000 pounds in excess of that of the prior year. Exports from North America and South America also reached a new record, aggregating 1,130,(XX),000 pounds, an increase of nearly 300,000,000 pounds over that of the previous year. ' Notwithstanding a balanced position as between production and consumption, owing to the intensively active competition of the large selling agencies both at home and abroad, the price ruled at an: exceedingly low figure: throughout the year, the average as reported by the Engineering and Mining Journal-Press being 13.024c per pound, compared with 14.421c for the preceding year. Your Company did not sell copper except in manu factured form in domestic trade, during the years as its entire output aside from exports was taken, by its manufacturing plants ai Great Falls and those operated by The American Brass Company. Gross income from Sales and royalties for your Company amounted to $166,467, ' 901.80 for the year. Operating profit and income from investments amounted to $21, 744,965.25, Net profit, after deducting all charges, depreciation, bond discount, etc., amounted to $6,719,215.49. Corporate Transaction* During the year, the more important corporate transactions were: 1. The purchase by your Company for the sum of $3,000,000, of all of the physical property and assets of the Davis-Daly Copper Company. This Company, which owned 200 acres of mining ground in the heart of the Butte district together with other outside mining claims, had been engaged in expensive litigation with your Company over the ownership of a large number of veins and ore bodies. As a result of the above transaction, all litiga- 3 P*rC0C00961 tion was settled and in addition to clearing title to the ore bodies in question, your Com pany acquired a large area of undeveloped mining ground which may contain additional veins and ore bodies. 2. During the year, your Company purchased for $1,000,(XX), all shares of the Butte, Anaconda & Pacific Railway Company held by outside interests, and now owns all the issued stock of this Corporation. The accounts of the Railway Company are, there fore, included in the consolidated statement at the end of this report! Andes Copper Mining Company 3. With an increasing consumption of copper and prospects that this growth will continue, it was deemed necessary to finance this large subsidiary that it might be placed upon an operating basis. The Andes, Copper1 Mining Company, therefore, issued and sold $40,000,(XX) Convertible 7% Debentures, maturing January 1, 1943. Each $1000 Deben ture is convertible at any time into 44 shares of stock; This fund is estimated to amply cover cost of constructing the metallurgical plants with all necessary water and power lines,, townsite, railway equipment, development of mine for daily production of 12,500 tons sul phide and 7,500 tons oxide Ore, working capital for the completed property and for other corporate purposes. It is anticipated that construction of the plant for treatment of sul phide ore to produce 117,000,000 pounds copper annually, will require from two to two and one-half years. The plant for treatment of oxide ores Should be completed two years later, increasing output of copper, as estimated, to 190,548,000 pounds per year. Operat ing cost has been estimated at 6.672c per pound, and, with the higher price which should prevail with the increasing demand, should' show your Company a satisfactory profit on its .investment in this enterprise. Mines Investment Corporation 4. This Company, all of the stock of which is owned by your Company, increased its holdings of stock of the Inspiration Consolidated Copper Company, purchasing 65,700 shares at a cost of $1,581,305.00. The Mines Investment Corporation now owns 363,000 shares of the Inspiration Company, out of a total issue of 1,181,967 shares. Construction During the year, in addition to renewals, replacements and repairs, there was ex pended by your Company and its subsidiaries, the sum of $4,578,399.04 upon new plants and plant extensions. The principal items covered were a new wire miH at Kenosha, the 4- PNYC00009616 re-building of the casting shop at the Buffalo plant, the enlargement of the zinc plant at Great Falls and the remodeling of the concentrator acquired from the Utah Consolidated Mining Company at Tooele, Utah, so as to adapt it to the treatment of zinciferous ores. Copper Department Mine* The, mines of the Company produced during the year 3,092,151.32 tons of ore. 6,654.26 tons of precipitates were produced from the water pumped from the mines. Concentrator and Smelter At the concentrator there were treated 3,079,178.21 tons of ore, 78,752.50 tons of copper tailings, and 55,880.36 tons of zinc-silver tailings. The Anaconda Reduction Works treated for all companies 3,312,774.65 tons of ore. Of the total amount, 3,017,416.70 tons of ore were produced by the mines of the Com pany; 212,319.48 tons of ore were either purchased from or treated for other companies;' 19,659.05 tons of material were shipped from the old plants at Anaconda and Great Falls, and 63,379.42 tons from the Great Falls zinc plant. There were produced 238,823,149 pounds of fine copper, 8,383,591.44 ounces silver, and 37,688.812 ounces gold. Of this production 238,247,038 pounds fine copper, 8,345. 841.35 ounces silver and 37,688.812 ounces gold were produced for your Company. Refineries The Copper refinery at Great Falls produced during the year 209,966,554 pounds of cathodes, of which 202,877,392 pounds were melted into shapes at that point The Raritan Copper Works at Perth Amboy, N. J,, refined 406,548,498 pounds fine copper, 20,037,558.48 ounces silver and 117,520.023 ounces gold. Rod end Wire Mill The mill at Great Falls rolled into rods 107,931.230 pounds of copper. 40,101,844 pounds of rods were drawn into wire, of which 15,559,986 pounds were made into strand. Zinc Department Mines The Butte Mines of the Company produced 58,665.92 wet tons of zinc ore. 5' PNYC0C009617 Zinc Reduction Work* The plants at Anaconda and Great Falls, treated 599,275-09 tons of ore and other zinciferous, material. Of this amount 38,228.69 tons were produced by mines of the Com pany and 341,046.40 tons of ore and concentrates were purchased. The electrolytic plant at Great Falls produced 154,390.391 pounds zinc, 5,433,330 pounds of zinc in dross, and residue from which there were recovered 23,810,201 pounds lead,, 1.892,097 pounds copper, 3.628.862.32 ounces silver and 5,603.687 ounces gold. The, capacity of this plant was increased to 180,000*000 pounds per annum. Miscellaneous Products Lumber The sawmill at Bonner cut 80,000,879 feet of lumber and purchased 3,320,758 feet, of which 49,390,307 feet were shipped to the departments of the Company, 31,689,089 feet were sold commercially, 374,811 feet were used at the mill for repairs and construction, and 2,720,579 feet were supplied to the factory for manufacturing, or a total disposition of 84, 174,786 feet; decreasing the stocks of finished lumber on hand by 853,149 feet; making a stock on hand at December 31, 1924, of 63,628,460 feet. Coal At Diamondville, Wyoming, 472,449.82 tons of coal were produced; 280,111.77 tons were shipped to other departments of the Company; 156,409.90 tons were sold commer cially, and 35,928.15 tons were used at the coal mines. At Washoe, Montana, 199,065.80 tons of coal were produced; 70,697.90 tons were shipped to other departments of the Company; 126,963.90 tons were sold commercially and 1.404.00 tons were used at the coal mines. ' At Sand Coulee, Montana, 21,179.20 tons of coal were produced; 15,919.00 tons shipped to other departments of the Company; 5,158.20 tons were sold commercially, and 102.00 tons were Used at the coal mines. Arsenic As a by-product of copper smelting operations, 11,196,409 pounds of arsenic were produced, of which 11,018,967 pounds were refined. During the year 5,920,961 pounds 6 PNYCQ0009618 were sold at an average price of 9.400 cents per pound. Of this amount, 118,817 pounds were crude and 5,802,144 pounds were refined. Sulphuric Acid The sulphuric acid plant at Anaconda produced 46,396.90 tons of sulphuric acid averaging 60 Deg. Beaume. This was supplied to various departments of the Company. Fertilizer The mines at Conda, Idaho, produced 43,201.10 tons of rock, averaging 31.87% P,0.. Of this amount 1,423.90 tons were'sold and 37,948.42 tons were shipped to Anaconda. The Phosphate Plant at'Anaconda produced 20,585.89 long tons of Treble Superphosphate aver aging more than 45.5% P,0,, An aging shed Has been added to this plant improving the grade of the product by nearly 2% P2Os. Metal Roofing Development of the new copperdad shingle has been continued successfully, and a plant at Rutherford, New Jersey, was completed and is now being extended. It is estimated that production will reach 300 squares per day by the end of this year. Sale and distribution of these shingles in the United States and the Dominion of Canada is under the management of the Flintkote Company which owns the basic patents for the strip shingles upon which the copper is deposited and which, because of its established position in the roofing business and widely distributed sales organization, is equipped to handle the business efficiently and economically. Butte, Anaconda & Pacific Railway Company The Railway transported 5,386,961 tons of ore and other freight, and 32,026 pas sengers. The gross revenues were $1,723,291.11; rental and miscellaneous receipts $26, 988.21; operating expenses $1,349,863.43; taxes, interest and the rental of leased lines $240,781.43; net income $159,634.46. ' 7 PN'fC000096l9 International Smelting Company On January 27, 1922, the International Smelting Company loaned the Utah Console dated Mining Company $1,300,000, taking a mortgage on the properties of that Company, located in the Bingham, Utah, mining district. This was done to permit appeal by the mining company from judgment of the United States District Court awarding to the Utah Apex Mining Company title to certain ore bodies and damages amoimting to: $1,276,282.95. As a result of confirmation of judgment by the higher court, the Utah Consolidated was unable to meet its, obligations, Its stockholders, failed: to enter into a plan, of reorganization that was submitted by the ;Com{jany, A receiver was appointed and the property sold under foreclosure, proceedings March 31, 1924. ' The mines land equipment were purchased by the Utah-Delaware Mining Company, all the, stock ,of which is owned, by International Smelting Company. The concentrator was purchased by the International Smelting Company and has been remodelled for the treatment of zinc ores. International, Utah The concentrator plant treated 149,943.29 tons of copper and zinciferous ores, from which there were produced 24797.62 tons of concentrates, of which 3,075.18 dry tons were zinc concentrates, which were shipped to the electrolytic zinc plant at Great Falls. The Copper Plant treated 97,057.11 tons of ore and concentrates, from which there were produced 28,378,326 pounds fine copper, 1,841,984.39 ounces silver and 19,879.386 ounces gold. The Lead Plant treated 164,52174 tons of ore and concentrates, from which there were produced 75,967,432 pounds lead, 3,897,138.58 ounces silver and 8,146.500 ounces gold. From the treatment of fume and flue dust there were obtained 500.84 tons crude arsenic, averaging 92.15% As,Ot. The Tooele Valley Railway Company handled during the year 454,792 tons of ore and miscellaneous freight. Miami, Arizona At the Miami smelter there were treated for other companies 371,849.75 tons of con centrates and purchased ores, from which there were produced 185,351,537 pounds copper, 410,937.35 ounces silver and 7749717 ounces gold. .. 8 PNrC00009620 International Lead Refining Company Lead Refinery The refinery , at East Chicago, Indiana, treated 57,479.23 tons of purchased ore and bullion, from which there were produced 105,637,507 pounds common lead, 5,930,688 pounds antimonial lead, 5,907,412.43 ounces silver and 18,112.925 ounces gold. Zinc Oxide During the year, plant capacity was increased both at East Chicago, Indiana, and Akron, Ohio. All operations were satisfactory throughout the year. Production of merchantable zinc oxide at East Chicago amounted to 12,153,418 pounds. At Akron, the production of merchantable zinc oxide amounted to 29730,677 pounds. Anaconda Lead Products Company The plant at East Chicago was operated during the year. There, were produced 13,757,905 pounds barrelled white lead, of which 12,355,979 pounds were sold. . Walker Mining Company . Operations at the mine were conducted throughout the year. 251,492 tons of ore were broken. The new concentrator fully met expectations, yielding an average recovery of 95.84%. 205,903.40 tons of ore, averaging 3.268% copper, were treated, from which 25, 314.64 tons of concentrates, averaging 24.529% copper, were produced. There were de livered to the smelter and sold 25,747.35 tons of concentrates containing 12,659,429 pounds copper, 217,764.28 ounces silver, and 8,216.408 ounces gold. Arizona Oil Company During the year, the Arizona Oil Company produced 353,026 barrels of oil. No dividends were paid. 9 PNYC00009621 The American Bras* Company The output of manufactured products of the various plants established a new record of 519,749,665 pounds of Copper, brass and nickel silver, the manufacture of which was distributed among the various plants as follows: Ansoma . ._ . . . 149,679,858 5.3 71S057 8:7QQQKQO 74 134 53 838'146 90 376739 10 507 0*0 519,749,665 The Copper Wire Mill at' Kenosha was completed, and the first wire drawn on April 17, 1924. The Tube Mill at Torrington was practically reconstructed during the year, although kept in operation continuously. At Buffalo, the old Casting Shop buildings were reconstructed and a modem metal storage, weighing out system and electric melting furnace equipment were installed and placed in operation. The demand for Anaconda products has been greatly increased by more extensive advertising; as an instance, the sale of "Anaconda" brass pipe was 96% in excess of 1923 output and more than six times 1920 sales. South American Companies With the exception of a small amount of work in advancing the Pedemales tunnel, on the La Ola water line, a distance of 475 feet, and the obtaining of data relative to the available water in Pedemales Lake, the property of the Andes Copper Mining Company at Potrerillos, Chile, was on a shut down basis. In the development of mining plans it was found possible to eliminate certain small zones of low grade material included in the ore body. Recalculation of the ore reserve on this basis gave a tonnage of 137,400,000 assaying 1.51% copper. There was no change in the condition of the Santiago Mining Company's affairs. There is enclosed herewith for your information a copy of the annual report of the Chile Copper Company. 10 PNYC00009622 Attached hereto is also a Consolidated Balance Sheet showing the financial condition of the Company and its subsidiary corporations at the close of business December 31, 1924, and, an income statement for the year, both 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 4, 1925. 11 ANACONDA COPPER MINING COMPANY and Subsidiary Companies Consolidated Balance Sheet--31st December, 1924 Fix e d : ASSETS Mine3 and Mining Claims, Coal .Mines, Timber Lands, Phosphate Deposits, .Water. Rights and Lands for Reduction Works and Refineries, etc$129,375,264.61 Buildings and Machinery at Mines, Reduction Works, Refineries,. Manufacturing Plants, Sawmills, Foun dries, Waterworks, Railroads, etc 117,609,951.15 Investments in sundry companies--_____ _ 98,441,422.90 $345,426,638.66 Def er r ed charges and discount on bonds. 12,791,606.31 Cu r r e n t : Supplies on hand, advances on Ores and Expenses prepaid $18,859,538.30 Metals and Manufactured Products in process and on hand--at cost__I----------------,--------------------------------- 46,645,598.28 Accounts Receivable--------------------------- ------------- ----------- 19,429,768.96 Marketable Securities_______________ 9,332,105.90 Cash--------------------------------------------------------------- --------- 7,263,674.35 101.530,685.79 $459,748,930.76 We have examined into the affairs of Anaconda Copper Mining Company and of its Subsidiary Com panies and have verified the Assets, Liabilities and Income shown above. The Met Income is after deduct ing all Development expenditure of the year, Depletion of Coal and Timber Lands and Depreciation of Plants and Equipment. We hereby certify that this Balance Sheet shows the financial condition at 31st December, 1924. 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., Mew York and Butte, 10th April, 1925. Certified Public Accountants. 12 t00O962'* PNXCO ANACONDA COPPER MINING COMPANY and Subsidiary Companies Consolidated Balance Sheet--31st December, 1924 LIABILITIES Ca p it a;. St o c k of Anaconda Copper Mining Company: Authorized, 6.000,000 shares of $50.00 each issued 3,000,000 shares:_______________ Min o r it e In t e r es t in Subsidiary Companies________ _____ $150,000,000.00 . 2,014,113.49 Bo n e s Ou t s t a n d in g : First, Consolidated Mortgage 6% Series A Sinking fund Gold Bonds, due 4953------- ------ ----------------- $105,431,000.00 7% Convertible Debentures, due 1938-- 50,000,000.00 Ten Year' 6$L.Series A Secured Gold Bonds, due 1929 16,933,000.00 Butte, Anaconda & Pacific Railway Co. First Mortgage * Sinking Fund Gold Bonds, due 1944------------- 2,574,000.00 174,988,000.00 Res er v e f o e De p r e c iat io n ______________________________ Cu r r e n t : Notes Payable,_____________________ Interest and Taxes Accrued__________ Accounts and Wages Payable_______ Dividend payable 16th February 1925 $1,000,000.00 5,433,422.11 15,095,218.27 2,250,000.00 34,447,511.83 23,778,640.38 Su r e l u s : Balance 31st December 1923 Net Income for the year ending 31st December, 1924, per Income Account annexed6,719,215.49 70,051,449.57 .. $76,770,665.06 Deduct, Dividend No. 86!___________ 2,250,000.00 74,520,665.06 $459,748,930.76 No t e--In order to comply with the Government Income Tax requirements for the purpose of computinff depletion, an additional valuation of the mininff property as of 1st March, 1913, has been recorded upon the books of the Company; but, for the sake of uniformity, the result of those entries has been omitted from the current statements. 13 PNYC00009625 ANACONDA COPPER MINING COMPANY and Subsidiary Companies Consolidated Income Account--Year Ending 31st December, 1924 EXPENSE Metals and Manufactured Products in process and on hand at beginning of year------ _-------------------------------------------------------------------------------- :-------- $46,402,342.61 Ores and Metals Purchased 48,601,217.26 Mining, Reduction and Refining of Metals 41,881,198.30 Manufacturing Expenses, including Selling 56,111,299.65 Cost of Merchandise sold and Operation of Public Service Companies_____ 2,171,563.30 Administration and Federal Taxes-----------l ,_________ : 1,893,190.13 Balance carried down------------------- ------------------- --------------------------------------- 16,052,688.83 $213,113,500.08 Amount charged off this year for Depreciation and Obsolescence___ ________ $4,231,422.51 Interest, including discount on bonds, less income from marketable securities 10,806,001.08 Balance, Net Income: . Carried to foregoing Balance Sheet---------------------------- $6,719,215.49 Apportioned to Minority Interest (Loss)-------------------- 11,673.83 6,707,541.66 $21744965.25 14 PNYC00009626 ANACONDA COPPER MINING COMPANY and Subsidiary Companies Consolidated Income Account--Year Ending 31st December, 1924 INCOME Sales of Metals and Manufactured Products_____________ ___________ $157,657,106.63 Tolls, Royalties, Rentals, etc__: 5,989,509.70 Sales of Merchandise and Revenue from Public Service Companies________ 2,821,285.47 Metals and Manufactured Products in process and on hand at end of year 46,645,598.28 $213,113,500.08 Balance brought down$16,052,688,83 Income from Investments in sundry companies 5,692,276.42 $21,744,965.25 15 1 pHY000009627 Chile Copper Company CAPITAL STOCK December 31, 1924 Authorised, 5,400,000 shares, $25 each . . . . $135,000,000 Issued, 4,391,060 shares, $25 each.................... 109,776,500 Chile Copper Company and Chile Exploration Company OFFICERS Chairman of the Board . . JOHN D. RYAN President...............................CORNELIUS F. KELLEY Vice-President..........................BENJAMIN B. THAYER Vice-President......................... HERMAN C. BELLINGER Secretary and Treasurer. . . CHARLES W. 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 o q u ic a ma t a , Ch il e PNYC00009623 To the Shareholders of Chile Copper Company: Following is, a consolidated report of the operations and activities of your Company, and of its, Subsidiary, Chile Exploration Company, which holds the title to all property in South America, and through Which ,fhe operations are actually conducted. During the year , the Exploration Company operated continuously, producing 212, 323,972 pounds of Electrolytic Copper at a cost delivered Of 7.992 cents per pound, including depreciatioily all 'taxes, interest anil discount on bonds, but not including depletion. There was expended during the year in construction and extensions for capital account the sum of $3,6510,0:15.54: Charges to obsolescence^ profit and loss, bfc., :amounted tp $1,539, 635.51. resulting in a net.increase lih-the book value of assets frOm^ldOllSS,760.9$ at December 31, 1923, to S142,276,090.95 as cf December 31, 1924. On December 31, 1924, your Company had on hand in marketable securities and cash 314,910,945.29. Mining Claim* and Government Concession* During the year 1924 Chile Exploration Company acquired ten additional mining claims and thirty-seven other claims for waste dumps and railroad rights-of-way. The Company's total' holdings of claims in and about Chuquicamata under mining titles as of January 1, 1925, are as follows: Mining Claims Other Claims January 1, 1924 Number of Claims Acres 319 2,174 547 7,712 January 1, 1925 Number of Claims Acres 329 2,231 584 8,117 866 9,886 913 10,348 Mine Two new benches were opened during the year, namely. Benches "A-l" and "E-4." The total length of all bench faces developed as of December 31, 1924, amounted to 33,304 feet This compares with 33,430 feet as of December 31, 1923. Ore mined during the year amounted to a total of 7,227,594 short tons averaging 1.637% copper. The total of all ore shipped from the Mine to the Plant from the start of operations to December 31, 1924, amounts to 36,566777 tons averaging 1.664% copper. 19 PNYC00009629 Waste removal during the year amounted to a total of 3,617,910 short tons averaging 0.41 % copper. In blasting, 22,889 feet of main and auxiliary tunnels and 413,468 feet of chum drill holes were blasted during the year. The drilling equipment Was augmented with ten new churl) drills making a total of forty-five now in operation. To provide for the increased traffic new railway connections are being built to the southern outlets of the lower benches. Plant A total of 7,221,777 short tons of ore was crushed during the year. The average leaching extraction obtained from 681 charges treated was 89.73 % com pared with 90.15% for the previous year. The Sulphuric Add Plant has been razed as it is no longer necessary. The Smelter produced 217,388,000 pounds of copper in marketable shapes during the year. The following tabulation shows a comparison of the results obtained by quarters: 1924 1st quarter 2nd quarter 3rd quarter 4th quarter Year- Ore Crushed 'Sh. Tons 1,767,503 1,761,345 1758,409 1,894,520 7,221,777 Average Crushed Per Day 20,316 21,745 22.765 22,826 % Copper in Ore Leached Sol. Assay 1.630 1.618 1.676 1.621 21,884 1.636 % Ampere Effic. 86.51 87.95 89.90 90.20 % Net Recovery 89.87 87.60 88.97 90.25 88.63 89.20 Pounds Copper Produced 52,818,112 51,072,636 51,088,244 56,665,034 211,644,026 Delivery Adjustments Reclaimed from Anodes Delivered to Anodes___________ Production Available for Market 4286 211,648,312 1,374,992 213,023,304 697,332 212,325,972 Construction The prindpal construction features under way and completed during the year, in addi tion to the mine railway approaches mentioned above, are as follows: The new railroad line, six miles long, was completed to connect the Plant with the system of the Antofagasta & Bolivia Railroad. 20 --PNTCO00C9630-- Eighty 70-ton gondola ore cars and forty air dump waste cars were received, erected, and put into service. , A second solution storage tank, having a capacity of 800 cubic meters, was built at the Electrolytic Tank House. A. new booster type rotary converter, rated at 12,000 amperes at 290 volts, was installed in Sub-Station "A." Two new motor generator sets are also being erected. A. new;, double circuit tower transmission line was installed parallel to the original Tocopilla , transmission: line; between. Kilometer 10 and Chuquicamata, For the time being only one circuit of 3/0 copper has been strung, thus duplicating the original layout. The new line went into service-November 2. A second pipe line. for supplying water for plant needs is being installed, duplicating and paralleling the original: San Pedro line. With the completion of this second line we should have avail'ilble about 16;QOO tons per day of so-called "salt water." The school house in the Chilean village was enlarged 50% as a boys' school and a second school for girls was constructed. In the Chilean village a club house is being built which will serve as a meeting place for all the Chilean societies. Additional workmen's quarters are also being built. In Tocopilla a second traveling screen has been installed at the condenser water intake works. The construction of an additional boiler house and the erection of two new 1350 H. P. boilers is well under way. A housing program, at Tocopilla, is being carried out to provide accommodations on company property for all of the Chilean workmen at the Power Plant These accommoda tions will include bath houses and a suitable company store. Census The average number of inhabitants--men, women and children--in camp during 1924, was 13,339, as compared with 12,732 for 1923. On December 31, 1924, the population of the Chilean village was 12,492, and of the foreign section 1,270, or a total of 13/62. The maxi mum reached was in December, with a total of 13,762. The average working force for 1924 was 5,053 men, of whom 4,705 were on operation and 348 on construction. For December the average working force was 5/37 men, of whom 4,993 were on operation and 242 on construction. The total, number of men on the payroll for December was 6,525. This based on the average working force figure of 5/37 men shows an attendance factor of 80/6%. During the. year we had a 15.5% labor movement. 4,985 men out of a total of 6,525 on the pay roll in December, or 76.3%, received the attendance bonus. These figures do not include men working on Transmission Line or San Pedro pipe tine. 21 There were 1,546 pupils enrolled in the Chilean schools as of December 1, 1924. The average attendance during the year was 1,174. In the foreign school there were 63 pupils enrolled at the close of the term. Tocopilla A total of 331,833,110 K. W. hours was generated, or an average of 37,777 K. W. per hour. . The fuel oil consumption for the year in Tocopilla amounted to 1,087,699.42 barrels, or 374,376,175 pounds, which represents an oil factor of 1.128 lbs. consumed per K. W. H. gen erated, or conversely, 305.07 K. W. H. generated per bariel (42 gal.) of fuel oil. Financial Attached hereto you will find a Consolidated Balance Sheet at the close of business December 31, 1924, together with an Income Statement for the year, both certified to by Messrs. Pogson, Peloubet St Company, Certified Public Accountants? JOHN D. RYAN, Chairman of the Board. CORNELIUS F. KELLEY, President. New York, N. Y., May 4, 1925. 22 P*C0q 0, 09632 CHILE COPPER COMPANY and Subsidiary Companies Consolidated Balance Sheet--31st December, 1924 Fix e d : ASSETS Property Investment________ $99,275,135.85 Plant and Equipment at Mines, Reduction, Works, Power1 Plants, Railroads, Steamships, etc_________ 43.000,955.10 $142276,090.95 Less Reserve for Depreciation of Plant and Equipment 17,060,060.50 $125,216,030.45 , Def er r ed Ch ar g es including discount on bonds __________ Cu r r e n t : Supplies on hand and expenses prepaid_______________ Copper in process and on hand, at cost_____ ._________ Accounts Receivable__________:_______________________ Marketable Securities__ ;,,____________ Cash and Call Loans_______ _____________________ ____ 7,177,186.91 1,646,024.78 5,117,328.70 10,571,437.50 4,339,507,79 3,075,691.43 28,851,485.68 Ca p it a l St o c k : LIABILITIES Authorized--5,400,000 shares of $25.00 each Issued--4,391,060 shares -------------------------- Co l l at e r al Tr u s t Go l d Bo n d ?, due 1932: Authorized--$100,000,000.o6 Issued and Outstanding--Series A, 6ji Convertible___ Res er v e for Renewals and Replacements, Insurance, etc.___ Cu r r e n t : Interest and Taxes accrued,................. ....................... ....... Accounts and Wages payable--:........................................ $157,143,207.56 $109,776,500.00. 35,000,000.00 520,153.03 $738,824.17 3,943,635.19 4,682,459.36 Su r p l u s : Surplus 31st December, 1923-------------------------------------- $6788,807.51 Net Income, per statement annexed___ 11,352,937.66 Distributions to Stockholders. $18,141,745.17 10,977,650.00 7,164,095.17 $157,143207.56 We have crammed 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, 1924, of the Companies ss an aggregate whole and that the accompanying Income Account for the year ending that date is correct as stated. New York, 25th March, 1925. POGSON, PELOUBET ft COMPANY, Certified Public Accountants. 23 PNYC00009633 CHILE COPPER COMPANY and Subsidiary Companies Consolidated Income Account--Year Ending 31st December, 1924 Op e r a t in g Re v e n u e : Copper sold--213,418,014 pounds at an average of 13:255 cents per pound .,----- ---,-- ...... ......... Pr o d u c t io n Co s t ,,_____ _______,_--, $28,289,013.06 11,812,499.38 Op e r a t in g Pr o f it --------------- ,------------- -----------------------Ot h e r In c o me ----------------------- ------------ ---------------------------- 16,476,513.18 1,297,007.53 Ch a r g e s Ag a in s t In c o me : $17,773,520.71 Taxes and Miscellaneous Charges-------------------------------- Interest and Discount on Bonds 2,240,000.00 For Depreciation and Obsolescence of Plant and Equipment --________________________ ______ ____ $1,781,508.14 2,399,074.91 ' 6,420,583.05 Ne t In c o me , carried to Balance Sheet $11,352,937.66 Note.--In order to comply with the Government Income Tax requirements for the purpose of com puting depletion, an additional valuation of the mining property as of 1st March, 1913, has been recorded upon the books of the Company, hut being made for tax purposes only, the result of those entries has been omitted from the current statements. .. . 24 ) PKXCOOOO^