Higher metal prices boost Phelps Dodge, Asarco profits

Higher copper prices in 1987 had a marked impact on the annual earnings of two American producers, Phelps Dodge and Asarco Inc.

Phelps Dodge’s primary metals segment, consisting mainly of copper-producing operations, reports earnings last year of $224.2 million(US) compared with $68.8 million in 1986. During the fourth quarter in 1987, the segment reports earnings of $124.3 million compared with $15.1 million for the same period in 1986.

The company reports the New York Commodity Exchange spot price for copper cathodes averaged $1.05 during the fourth quarter and 77.8 cents for the year, compared with 59.4 cents and 61.6 cents , respectively, in 1986.

Phelps Dodge’s share of mine production in 1987 totalled 468,900 tons copper; sales from mine production amounted to 459,000 tons during the year. At year-end, long- term debt totalled $398.2 million, with the company holding $156.1 million in cash and short-term investments. Capital expenditures of about $190 million are planned for 1988.

Asarco reports earnings in 1987 of $297.3 million compared with $9.1 million the previous year. During the fourth quarter, earnings were $70.3 million compared with $28.2 million in 1986.

In addition to high prices for copper, silver and lead (a fourth metal mined by the company, zinc, did not perform as well, with the average price of the metal declining during the fourth quarter), Asarco attributes its improved earnings to lower costs and interest charges.