Noranda reports fourth quarter earnings of $64 million Net Earnings
for the Year 2003 of $34 million TORONTO, Feb. 11
/PRNewswire-FirstCall/ --
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Investors, analysts and other interested parties can access
Noranda's Supplemental Information Package and its quarterly
teleconference on its website at http://www.noranda.com/ under the
For Investors and Presentations and Webcasts sections. The
teleconference will be held on Wednesday, February 11th 2004 at
8:30 a.m. Eastern Standard Time. To participate by conference call,
dial (416) 641-6714 for local and overseas and 1-800-387-2195 toll
free in North America. All dollar amounts are in U.S. dollars
unless otherwise noted.
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2003 Highlights
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- Returned to profitability in the fourth quarter with net earnings
of $64 million, on the strength of the improved operating base and
metal prices. - Net income of $34 million for 2003, an increase of
$481 million over 2002. - Income generated by operating assets
increased by $295 million or almost 260% for the year. - Achieved
operating goals set for 2003: - set new production records at the
nickel operations, the Lomas Bayas copper mine, the Brunswick zinc
mine and the aluminum smelter and foil plants - renewed eight
collective agreements, including ending an 11-month strike at the
Horne smelter, gaining flexibility in the contract - Capacity
expansions: - enhanced growth opportunities by advancing the
development of new production capacity at the Collahuasi, Lomas
Bayas, Kidd Creek, Montcalm and Koniambo projects - achieved
on-schedule, on-budget completion of the expansion of the Altonorte
smelter and subsequent operation at higher than design capacity
levels - Exploration successes: - Added 11 million tonnes of nickel
resources at Sudbury, Ontario and Raglan, Quebec - Inferred
resources of 11.7 million tonnes at Nickel Rim South (up 87% in
2003) and 6.3 million tonnes at Fraser Morgan (up 158% in 2003) -
Issued debt and equity to strengthen balance sheet and to prepare
for future investment: - reduced net debt by $362 million - net
debt-to-total capitalization ratio at 43% compared to 54% at
year-end 2002.
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Fourth Quarter Year $ millions, except ----------------
---------------- per share information 2003 2002 2003 2002
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Revenues 1,324 887 4,657 3,873
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Income generated by operating assets(x) 236 41 409 114
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Net income (loss) 64 (442) 34 (447)
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Basic and diluted earnings (loss) per common share $0.21 $(1.86)
$0.04 $(1.93)
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Weighted average shares outstanding - 000s 294,432 239,940 261,618
238,824
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(x) Defined as earnings before interest, corporate and general
administration, research, development, exploration, minority
interest, taxes, restructuring costs and gain on sale of
investments Commentary Mr. Derek Pannell, Noranda's President and
CEO stated: "I am particularly pleased with the fourth quarter
results, which are indicative of Noranda's increased ability to
generate significant earnings and cash flow as a result of new
capacity now on stream and improved metal prices. "Earnings in 2004
should be further enhanced as expansion projects are completed and
if current metal prices persist." "Our outlook for 2004 is for
nickel markets to remain strong and the fundamentals for copper and
zinc to continue to improve as higher demand is expected to
outstrip supply and further reduce inventories. Noranda's strategy
is to operate its assets as efficiently as possible and maintain a
healthy financial position that will allow the Company to
capitalize on strategic opportunities and pursue its growth
objectives." FINANCIAL RESULTS Net income was $64 million or $0.21
per common share for the fourth quarter of 2003 and $34 million or
$0.04 per share for the year. Comparably in 2002, the Company
reported a net loss of $442 million or $1.86 per common share in
the fourth quarter and a net loss of $447 million or $1.93 per
common share for the year. The return to profitability in 2003 is
attributed to increased production from recently completed
projects, higher achieved metal prices and cost-saving measures. In
the fourth quarter, prices for all of Noranda's main metals
improved significantly, with nickel leading the group with a 32%
increase over the third quarter of the year, building on a trend
which started at the beginning of 2003. This trend has continued
into 2004 with current prices surpassing year-end price levels,
making the outlook for 2004 very positive.
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Estimated Current Fourth Quarter Year --------- ----------------
---------------- Realized Metal Prices 2004 2003 2002 2003 2002
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(US$ per pound)
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Copper 1.16 0.93 0.72 0.82 0.74
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Nickel 6.90 5.57 3.28 4.40 3.14
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Zinc 0.51 0.47 0.40 0.43 0.40
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Aluminum 0.77 0.68 0.65 0.68 0.65
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Lead 0.41 0.33 0.21 0.27 0.23
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Cobalt 25.00 11.39 6.57 9.42 7.02
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Revenues were higher by 50% and 20% for the fourth quarter and full
year respectively when compared to the same periods in 2002. The
increase is attributed to higher prices for allof the metals that
Noranda produces and higher volumes of nickel, zinc and both
primary and fabricated aluminum. The cost of operations increased
in both the fourth quarter and year when compared to 2002,
reflecting primarily the impact of the stronger Canadian dollar on
costs at the Canadian operations and higher production levels from
recently-completed projects. The cost to purchase raw materials was
higher year-over-year mainly as a result of increased feed
requirements at the expanded Altonortesmelter and higher metal
prices which increased the cost to purchase third-party material.
REVIEW OF OPERATIONS Copper The Copper business, a fully integrated
producer of copper metal and concentrates, generated income from
operating assets of$81 million in the fourth quarter and $160
million for the full year of 2003. This compares to $11 million and
$58 million respectively for the same periods of 2002. The average
LME price for copper, excluding premiums, was $0.93 per pound for
the quarter and $0.81 for the year. This compares to current
trading ranges between $1.10 and $1.16 per pound. The integrated
cost to produce a pound of copper in Noranda's Copper business was
lower at $0.30 per pound when compared to 2002 at $0.34 reflecting
increased profitability at the processing facilities. - Mined
production totaled 360,000 tonnes in 2003. Record production at
Lomas Bayas and higher year-over-year production at Kidd Creek was
offset by the expected lower output at Collahuasi and Antamina.
Higher premiums are expected on the Lomas Bayas sales, in 2004, as
a result of the mine achieving registration on the London Metal
Exchange and Comex during 2003. - Copper anode production from the
Altonorte smelter increased 77% to 260,000 tonnes in 2003 compared
to 2002. The Altonorte smelter is one of the lowest cost smelters
in the world. - Copper cathode production from the Canadian
metallurgical facilities was negatively affected by an Ontario-wide
power outage in August and start-up difficulties following a
scheduled shutdown. - In 2004, mined production is expected to
increase by almost 20% to 430,000 tonnes. The forecast increase is
a result of the completion of the expansion of the Collahuasi
facility, improved access to higher grade ore at the Antamina mine
as the remaining lake residue is removed and initial production
from the Kidd Mine D project. All of these projects are on schedule
for production in the second half of 2004. Nickel The Nickel
business generated income from operating assets of $143 million in
the quarter and $296 million for the full year 2003. This compares
to $28 million and $94 million respectively for the same periods of
2002. The fourth quarter's average LME nickel price of $5.62 per
pound was almost 75% above that of the fourth quarter of 2002.
Nickel is currently trading on the LME in the $6.75 to $7.00 per
pound range compared to the average price for 2003 of $4.37. The
price of cobalt, which is treated as a by- product credit in the
Nickel business, increased by 15% in the fourth quarter and is
currently trading in the $25.00 to $27.00 per pound range. The cash
operating cost to produce a pound of nickel at the INO and Falcondo
facilities was $2.64 and $3.04, respectively. - Mined production of
76,000 tonnes exceeded the level in 2002. Higher output attributed
to better grades at Raglan and a full year of operation at Falcondo
fully offset lower production from the Sudbury mines which resulted
from lower grades, an increase in ore stockpile and mining-related
issues. - The Sudbury smelter established new production records
for annual matte production of nickel and copper at 59,800 tonnes
and 20,800 tonnes respectively. The increase in production is due
to the successful efforts to acquire spot lots of custom feeds,
which more than offset the lower feed volume from the Sudbury
mines. The production and maintenance workers at Sudbury began
strike action on February 1, 2004, following the expiration of the
collective agreement on January 31. - Refined production from the
Nikkelverk refinery totaled 77,200 tonnes, 13% higher than that of
2002. - The pre-strike 2004 forecasts are for 50,400 tonnes of
mined production from INO, 27,000 tonnes of ferronickel from
Falcondo and 75,000 tonnes of refined production from Nikkelverk.
Zinc The Zinc business reported improved results but nevertheless
incurred losses from operating assets, including non-cash
depreciation and depletion, of $5 million for the fourth quarter of
2003 compared to $14 million in the same period last year. For the
full years, the business recorded losses from operating assets of
$68 million for 2003 and $52 million for 2002. The average LME zinc
price was $0.42 per pound in the quarter up from an average of
$0.35 per pound last year. The fully integrated cash cost to
produce a pound of zinc was $0.32 per pound. - Mined production was
9% higher year-over-year at 396,000 tonnes due to record zinc
recovery at the Brunswick mine and higher grades at the Bell Allard
mine. - The Brunswick Smelter restarted operations, as planned, at
the end of October. The smelter operates on an eight-month seasonal
basis treating lead concentrate from the Brunswick mine and
external sulphate residues. - Mine production in 2004 should
approximate the 2003 level as higher planned production at the
Brunswick mine is expected to offset the depletion of economic ore
reserves at the Bell Allard mine. Aluminum The Aluminum business
generated income from operating assets of $2 million in the fourth
quarter of 2003 and $20 million for the full year. In 2002, the
business reported operating income of $3 million for the fourth
quarter and $34 million for the year. The average LME aluminum
price for 2003 was $0.65 per pound, up from $0.61 a year ago.
However, this modest increase in price was offset by the higher
cost of power on a new contract which came into effect in the
second quarter. Noranda's cash cost to produce a pound of aluminum
was $0.55 per pound. - The primary smelter achieved a record
production year, which resulted in higher sales volumes compared to
2002. The market for value-added products was softer during the
year, accounting for only 85% of total sales. - Shipments of foil
products increased 15% in 2003 as the ramp-up of the new foil plant
continued and the Company increased its market share in most
product lines. - Demand for value-added and foil products began to
strengthen in the fourth quarter and is expected to continue to
improve through 2004. The ramp-up of production at the foil plant
will continue in step with the increasing demand and output from
the primary smelter is expected to remain relatively unchanged. New
Production Capacity Under Development Noranda's growth focus
remains on the development of high-quality, world-class copper and
nickel projects that can provide superior returns to shareholders.
In addition to the projects outlined in this release that are
currently under development, Noranda continues to review solid,
low-risk opportunities to expand the mines and extend the copper
ore reserves efficiently with minimal capital investment at the
Collahuasi and Lomas Bayas mining operations. These development
opportunities are generally lower-risk in nature as they are
integrated with current operations in known environments and
geological areas. Similarly, around the Sudbury operations and the
Raglan mine, our exploration efforts have identified several areas
to add to the nickel reserves and further extend the mine life in
these current areas of operation. At Collahuasi, the project to
move the operations from the Ujina pit to the new Rosario open pit
and expand the Ujina concentrator to 110,000 tonnes per day of ore,
up from 70,000 tonnes per day, is on schedule and on budget. The
project is expected to achieve mechanical completion in June 2004.
Construction work was 77% complete by the end of 2003, with the
civil work 100% complete and the mechanical and electrical work
well advanced. The Kidd Creek Mine D project, which will give
access to an additional 10.3 million tonnes of reserves and
stabilize production and costs, progressed on schedule during the
year with the first production expected to begin by the end of
2004. Construction on the Montcalm nickel project located near
Timmins, Ontario was started in the fourth quarter. The project,
with 5.1 million tonnes of resources grading 1.46% nickel and 0.71%
copper, is expected to commence production in the second quarter of
2005 and produce 8,000 tonnes of nickel annually for seven years.
The net capital cost to develop the project, after pre-production
revenues, is estimated at Cdn$100 million, and includes Cdn$19
million for working capital. The return on investment is expected
to be greater than 15%, calculated at conservative long-term nickel
prices. In Sudbury, at our Nickel Rim South expansion, additional
surface drilling continues to define the resource, whichremains
open to the northeast. A decision on the feasibility study for the
exploration program has been delayed until the labour dispute in
Sudbury has been resolved. The total resource estimate now stands
at 11.7 million tonnes grading 1.6% nickel and3.7% copper. Work on
the Koniambo project in New Caledonia continues to advance. The
bankable feasibility study is expected to be completed by the third
quarter of 2004. Discussions with the French Government about the
financing structure of the project continue to progress. In
parallel, work is advancing on the project financing. The partners
intend to be in a position to make a decision regarding the
project's development by the end of 2004. Capital Initiatives At
year end, cash resources stood at $630 million and net debt at $2.7
billion. The net debt-to-equity ratio has improved to 43% from 54%
at the end of 2002. In addition, the Company has over $1 billion of
consolidated undrawn committed bank lines. During the year, the
Company deployed$327 million in high-return investment projects and
$162 for the maintenance of existing operations. The Kidd Mine D
copper mine, the Montcalm nickel project, the expansion of the
Collahuasi copper facility and the Koniambo nickel project were all
advanced toward the production stage. For 2004, the Company is
slated to invest a further $340 million in internal expansions of
current assets with high-invested returns and $255 million in the
maintenance of operations. During the year, Noranda enhanced its
liquidity through various initiatives including: - the sale of its
remaining 11,984,900 Priority Units of the Noranda Income Fund at
Cdn$9.85 per unit to a syndicate of underwriters, generating an
after-tax gain of $28 million - the sale of $350 million of 6%,
12-year notes - the sale of $250 million of 12-year notes by
Noranda's partially- owned subsidiary. The notes, which are
unsecured and bear a coupon rate of 5.375% per annum, mature on
June 1, 2015 -the issue of six million cumulative preferred shares
to the public for gross proceeds of $99 million. The shares pay a
6.50% annual dividend - the issue of 48.5 million new common shares
for net proceeds of $431 million Market Review Copper: The improved
market sentiment for copper was supported by mine disruptions,
smelter cutbacks, strong Asian demand, and declining metal stocks.
The weakening U.S. dollar has had a profound impact on U.S.
dollar-based metal prices and accounted for a substantive part of
the overall increase. China continues to drive global metal demand
and its copper consumption for 2003 is expected to total 3.1
million tonnes, a 22% increase over 2002. Total exchange
inventories dropped 464,500 tonnes to end the year at 793,000
tonnes. This was partially offset as Codelco, a major copper
producer, stockpiled 200,000 tonnes of copper in response to high
exchange inventory levels earlier in the year. Despite the release
of the Codelco stockpile and new, expanded and restarted mine
production planned for the second half of 2004, the overall market
is expected to end in a slight deficit for another year. Continued
strong demand in China, marked improvement in the U.S. economy
coupled with relatively low levels of unused capacity and few new
mine projects, are expected to create further upside for the copper
price and premiums. Nickel: The LME nickel price rose from a low of
$3.27 per pound at the start of the year to $7.55 per pound by year
end with much of the increase occurring in the second half of the
year. Supply-side fundamentals were the main driver behind this
run-up, complemented by the very strong demand for metals in China.
In 2003, world production of nickel grew by only 1.7%, less than
half the growth seen in 2002. Disruptions at producers reduced
supply in the first half of the year. This was followed by a
three-month strike at Inco's Sudbury operations during the summer,
which removed approximately 30,000 tonnes of nickel from the
market. As a robust period of demand growth is forecast in 2004,
the nickel market is expected to remain in significant deficit.
Zinc: Prices in 2003 traded in a narrow range of $0.34 per pound to
$0.37 for the first nine months, before staging a strong recovery
in the fourth quarter to finish the year at $0.46 per pound. The
price improvement is partly attributable to weakness in the U.S.
dollar, as well as bullish investor sentiment for an improved
market outlook in 2004. While global smelting capacity continues to
expand, principally in China, actual refined production levels in
2003 were believed to be unchanged from 2002 levels as a result of
the tight zinc concentrate supply. Demand remains very strong in
China, such that China is now a net importer of zinc. Most analysts
expect that limited mine supply growth combined with higher metal
demand will result in a significant supply deficit in 2004 and
higher average prices than 2003 levels. Aluminum: The aluminum
price ranged from a low of $0.60 per pound to a high of $0.72 per
pound during 2003. The weakness of the U.S. dollar coupled with
speculative fund buying propelled the price to its highest level in
34 months. In 2004, Chinese exports could be affected by the
reduction in export rebates, rising alumina costs and regional
power constraints. Coupled with the anticipated demand growth from
the economic recovery, the aluminum market could be in a more
balanced market position in 2004. Dividends The following dividends
have been declared: Security Dividend Amount Record Date Payable
Date ---------------- ------------------ -----------------
-------------- Common shares Cdn$0.12 per share February 27, 2004
March 15, 2004 Preferred Series F shares Floating rate February 27,
2004 March 12, 2004 Preferred Series F shares Floating rate March
31, 2004 April 12, 2004 Preferred Series F shares Floating rate
April 30, 2004 May 12, 2004 Preferred Series Cdn$0.38125 G shares
per share April 15, 2004 May 1, 2004 Preferred Series Cdn$0.40625 H
shares per share March 15, 2004 March 31, 2004 Outlook "All
indicators suggest that the Chinese industrial production, which
has fuelled the improvement in economies and the metals markets, is
sustainable and that this is the start of a strong upcycle for our
industry. More than ever Noranda is well positioned to benefit as
both our production and financial positions are strong and we have
an enviable pipeline of projects and new capacity that can be
brought on stream relatively quickly and with minimal capital
investment," concluded Mr. Pannell.
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This news release contains forward-looking statements concerning
the Company's business and operations. The Company cautions that,
by their nature, forward-looking statements involverisk and
uncertainty and the Company's actual results could differ
materially from those expressed or implied in such statements.
Reference should be made to the most recent Annual Information Form
for a description of the major risk factors. Noranda is a leading
copper and nickel company with investments in fully-integrated zinc
and aluminum assets. The Company's primary focus is the
identification and development of world-class copper and nickel
mining deposits. It employs 15,000 people atits operations and
offices in 17 countries and is listed on The New York Stock
Exchange and The Toronto Stock Exchange (NRD). Note: This press
release is also available at http://www.noranda.com/. All dollar
amounts are in U.S. dollars unless otherwise noted. ATTACHMENTS
NORANDA INC. CONSOLIDATED RESULTS (US$ millions) Twelve Months
Ended Fourth Quarter December 31 -------------------
------------------- 2003 2002 2003 2002 --------- ---------
--------- --------- Revenues $ 1,324 $ 887 $ 4,657 $ 3,873
--------- --------- --------- --------- Operating expenses Cost of
operations 509 452 2,024 1,879 Purchased raw materials 460 260
1,744 1,390 Depreciation, amortization and reclamation 119 134 480
490 --------- --------- --------- --------- 1,088 846 4,248 3,759
--------- --------- --------- --------- Income generated by
operating assets 236 41 409 114 Interest expense, net 21 27 129 98
Corporate and general administration 19 15 58 58 Research,
development and exploration18 9 51 49 Minority interest in earnings
of subsidiaries 43 12 89 26 --------- --------- --------- ---------
Income (loss) before undernoted 135 (22) 82 (117) Taxes (recovery)
54 (124) 24 (168) Restructuring costs 21 546 62 561 Gain on sale of
investment (4) (2) (38) (63) --------- --------- ---------
--------- Net income (loss) 64 (442) 34 (447) Dividends on
preferred shares and interest on convertible debentures 1 4 24 13
--------- --------- --------- --------- Income (loss) attributable
to common shares $ 63 $ (446) $ 10 $(460) --------- ---------
--------- --------- Basic and diluted earnings (loss) per common
share - $ $ 0.21 $ (1.86) $ 0.04 $ (1.93) --------- ---------
--------- --------- Weighted average shares outstanding, basic -
000s 294,432 239,940 261,618 238,824 Note: Effective July 1, 2003,
Noranda adopted the US dollar as its reporting and functional
currency. This change has been reflected on a retroactive basis.
NORANDA INC. CONSOLIDATED BALANCE SHEETS (US$ millions) Actual
------------------- Dec. 31 Dec. 31 2003 2002 --------- ---------
Assets Current assets Cash and cash equivalents $ 630 $ 293
Accounts receivable 576 476 Metal and other inventories 1,179 896
--------- --------- 2,385 1,665 Operating capital assets 4,682
4,718 Development projects 973 537 Investments and other assets 205
182 --------- --------- $ 8,245 $ 7,102 --------- ---------
Liabilities and equity Current liabilities Accounts and taxes
payable $ 903 $ 720 Debt due within one year 431 335 ---------
--------- 1,334 1,055 Long-term debt 2,893 3,014 Future income
taxes 54 49 Reclamation, pension and other provisions 414 367
Stockholders' interest Interest of other shareholders 914 759
Shareholders' equity 2,636 1,858 --------- --------- $ 8,245 $
7,102 --------- --------- --------- --------- NORANDA INC.
CONSOLIDATED STATEMENTS OF CASHFLOWS (US$ millions) Twelve Months
Ended Fourth Quarter December 31 -------------------
------------------- 2003 2002 2003 2002 --------- ---------
--------- --------- Cash realized from (used for): Operations
Earnings (loss) $ 64 $ (442) $ 34 $ (447) Charges (credits) not
affecting cash: Depreciation and amortization 111 101 447 435
Future income taxes 15 (128) (2) (188) Minority interests in
earnings of subsidiaries 43 12 89 26 Earnings in associates net of
dividends received 2 (1) 7 (2) Other (37) 509 2 524 ---------
--------- --------- --------- 198 51 577 348 Net change in accounts
receivable, inventory and payables (72) 148 (164) 32 ---------
--------- --------- --------- 126 199 413 380 --------- ---------
--------- --------- Investment activities Capital investments (151)
(151) (489) (528) Investments and advances - (55) (24) (116)
Dispositions 8 (1) 99 265 --------- --------- --------- ---------
(143) (207) (414) (379) --------- --------- --------- ---------
Cash before financing activities (17) (8) (1) 1 Financing
activities Long-term debt, including current portion Issued 7 76
717 615 Repaid (89) (17) (807) (373) Issue of shares - common 8 2
439 2 Exercise of stock options - - - (2) Issue of shares -
preferred 1 - 94 - Dividends paid (16) (21) (92) (108) Issue of
shares - minority shareholders, net 16 8 18 8 Dividends paid to
minority shareholders (8) (7) (31) (29) --------- ---------
--------- --------- (81) 41 338 113 --------- --------- ---------
--------- Cash generated (used) (98) 33 337 114 Cash, beginning of
period 728 260 293 179 --------- --------- --------- ---------
Cash, end of period $ 630 $ 293 $ 630 $ 293 --------- ---------
--------- --------- NORANDA INC. PRODUCTION VOLUMES Fourth Quarter
Year Ended Dec. 31 ------------------- ------------------- 2003
2002 2003 2002 --------- --------- --------- --------- Mine
Production (tonnes, except as noted) --------------------------
100% basis, except as noted --------------- Copper Kidd Creek
13,927 12,650 46,409 45,434 Matagami 1,936 1,883 7,829 7,256
Brunswick 1,989 2,394 8,688 8,918 INO 8,057 9,151 35,789 37,550
Antamina (33.75%) 21,229 28,332 85,188 111,599 Collahuasi (44%)
40,375 45,723 168,578 185,014 Lomas Bayas 15,383 15,421 60,427
59,304 Other 4,174 5,119 17,002 19,527 --------- ---------
--------- --------- 107,070 120,673 429,910 474,602 ---------
--------- --------- --------- Zinc Kidd Creek 18,095 24,259 75,528
104,083 Brunswick 72,088 70,600 286,457 277,417 Matagami 30,848
21,728 109,679 84,792 Antamina (33.75%) 31,799 18,176 122,422
77,876 Other 995 2,053 8,045 9,004 --------- --------- ---------
--------- 153,825 136,816 602,131 553,172 --------- ---------
--------- --------- Nickel 11,286 13,776 49,253 52,469 Ferronickel
6,490 6,091 27,227 23,303 Lead 20,365 18,982 77,724 76,177 Silver -
000 ounces Kidd Creek 785 916 2,676 3,671 Brunswick 1,597 1,535
6,172 6,228 Matagami 103 117 396 329 Antamina (33.75%) 549 620
2,293 2,439 Other 39 79 247 268 --------- --------- ---------
--------- 3,073 3,267 11,784 12,935 --------- --------- ---------
--------- Metal Production (tonnes, except as noted)
-------------------------- Refined copper CCR 74,597 59,612 235,425
244,252 Kidd Creek 32,933 36,059 132,364 146,526 Nikkelverk 9,592
9,280 35,852 30,632 Collahuasi (44%) 7,209 6,876 27,895 26,678
Lomas Bayas 15,383 15,421 60,427 59,304 --------- ---------
--------- --------- 139,714 127,248 491,963 507,392 ---------
--------- --------- --------- Copper anodes Gaspe - - - 29,612
Horne 39,125 30,367 132,739 147,020 Kidd Creek 35,874 35,955
131,405 144,094 Altonorte 79,180 43,966 260,971 147,059 ---------
--------- --------- --------- 154,179 110,288 525,115 467,785
--------- --------- --------- --------- Refined zinc Kidd Creek
20,517 38,592 94,719 145,309 CEZ (Noranda Income Fund) (100% -
basis) 69,651 68,388 267,270 271,075 --------- --------- ---------
--------- 90,168 106,980 361,989 416,384 --------- ---------
--------- --------- Refined nickel Nikkelverk 20,568 21,296 77,183
68,530 Falcondo 6,490 6,091 27,227 23,303 --------- ---------
--------- --------- 27,058 27,387 104,410 91,833 ---------
--------- --------- --------- Primary aluminum 60,985 60,496
244,044 236,459 Fabricated aluminum 34,267 31,542 146,716 127,911
Refined lead 12,988 28,348 60,776 90,167 Refined gold - 000 ounces
304 191 1,132 1,030 Refined silver - 000 ounces 7,917 7,963 30,311
40,439 NORANDA INC. SALES VOLUMES & REALIZED PRICES Fourth
Quarter Year Ended Dec. 31 ------------------- -------------------
2003 2002 2003 2002 --------- --------- --------- --------- Metal
Sales (tonnes, except as noted) -------------------------- 100%
basis, except as noted --------------- Copper CCR 71,125 59,318
235,339 271,150 Kidd Creek 23,916 31,370 105,162 110,575 Nikkelverk
16,506 13,764 59,208 54,495 Antamina (concentrates) (33.75%) 22,591
25,812 84,817 113,806 Collahuasi (concentrates) (44%) 30,563 35,899
134,426 142,028 Collahuasi (44%) 9,076 13,858 33,721 45,496 Lomas
Bayas 16,293 15,600 61,289 60,265 --------- --------- ---------
--------- 190,070 195,621 713,962 797,815 --------- ---------
--------- --------- Zinc Kidd Creek 21,307 39,719 110,592 148,418
Antamina (concentrates) (33.75%) 26,928 14,408 100,142 71,632
Brunswick/Matagami (concentrates) 82,873 71,776 335,059 256,949
--------- --------- --------- --------- 131,108 125,903 545,793
476,999 --------- --------- --------- --------- CEZ (Noranda Income
Fund) (100% - basis) 69,212 67,512 265,797 272,952 Nickel 20,468
20,468 78,978 71,153 Ferronickel 6,781 7,164 27,133 21,446 Aluminum
Primary aluminum - shipments 64,795 61,312 246,737 242,289 Norandal
- shipments 34,267 31,542 146,716 127,911 Lead 11,609 30,391 60,452
90,896 Gold - 000 ounces 278 253 1,004 953 Silver - 000 ounces
CCR6,826 8,614 30,870 41,210 Kidd Creek 1,016 1,235 5,323 3,723
Antamina (33.75%) 490 530 1,921 2,210 --------- --------- ---------
--------- 8,332 10,379 38,114 47,143 --------- --------- ---------
--------- Average Realized Prices - ($U.S. per pound, except as
noted) ----------------------------------- Copper 0.93 0.72 0.82
0.74 Nickel 5.57 3.28 4.40 3.14 Ferronickel 5.21 3.19 4.20 3.16
Zinc 0.47 0.40 0.43 0.40 Aluminum 0.68 0.65 0.68 0.65 Lead 0.33
0.21 0.27 0.23 Gold - (US$ per ounce) 396.95 319.49 362.97 308.00
Silver - (US$ per ounce) 5.21 4.52 4.89 4.60 Exchange Rate (US$
(equal sign) Cdn$) 0.76 0.64 0.71 0.64 ------------------------
NORANDA INC. SEGMENTED INFORMATION (US$ millions) Fourth Quarter
2003 ----------------------------------------------- Copper Nickel
Zinc Aluminum Other Total ------- ------- ------- -------- ------
------- Revenues $ 765 410 117 173 (141) $1,324
----------------------------------------------- Operating expenses
Cost of operations 203 127 66 108 5 509 Purchase of raw materials
433 101 37 54 (165) 460 Depreciation, amortization and reclamation
48 39 19 9 4 119 ----------------------------------------------- $
684 267 122 171 (156) $1,088
----------------------------------------------- Income (loss)
generated by operating assets $ 81 143 (5) 2 15 $ 236
----------------------------------------------- Interest expense,
net (21) Corporate and general administration (19) Research,
development and exploration (18) Minority interest in earnings of
subsidiaries (43) ------- Income before undernoted 135 Taxes (54)
Restructuring costs (21) Gain on sale of investment 4 ------- Net
income $ 64 -------
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Capital investments $ 104 41 2 7 (3) $ 151
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Fourth Quarter 2002 -----------------------------------------------
Copper Nickel Zinc Aluminum Other Total ------- ------- -------
-------- ------------- Revenues $ 502 251 72 162 (100) $ 887
----------------------------------------------- Operating expenses
Cost of operations 170 151 53 94 (16) 452 Purchase of raw materials
272 46 15 57 (130) 260 Depreciation, amortization and reclamation
49 26 18 8 33 134 ----------------------------------------------- $
491 223 86 159 (113) $ 846
----------------------------------------------- Income (loss)
generated by operating assets $ 11 28 (14) 3 13 $ 41
----------------------------------------------- Interest expense,
net (27) Corporate and general administration (15) Research,
development and exploration (9) Minority interest in earnings of
subsidiaries (12) ------- Loss before undernoted $ (22) Tax
recovery 124 Restructuring costs (546) Gain on sale of investment 2
------- Net loss $ (442) -------
-------------------------------------------------------------------------
Capital investments $ 72 23 - 19 37 $ 151
-------------------------------------------------------------------------
NORANDA INC. SEGMENTED INFORMATION (US$ millions) Year ended
December 31, 2003 -----------------------------------------------
Copper Nickel Zinc Aluminum Other Total ------- ------- -------
-------- ------ ------- Revenues$2,477 1,297 410 688 (215) $4,657
----------------------------------------------- Operating expenses
Cost of operations 731 586 232 389 86 2,024 Purchase ofraw
materials 1,381 280 175 238 (330) 1,744 Depreciation, amortization
and reclamation 205 135 71 41 28 480
----------------------------------------------- $2,317 1,001 478
668 (216) $4,248 -----------------------------------------------
Income (loss) generated by operating assets $ 160 296 (68) 20 1 $
409 ----------------------------------------------- Interest
expense, net (129) Corporate and general administration (58)
Research, development and exploration (51) Minority interest in
earnings of subsidiaries (89) ------- Income before undernoted $ 82
Taxes (24) Restructuring costs (62) Gain on sale of investment 38
------- Net income $ 34 -------
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Total assets, excluding cash and cash equivalents $4,110 1,668 439
814 584$7,615
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Capital investments $ 326 109 2 22 30 $ 489
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Year ended December 31, 2002
----------------------------------------------- Copper Nickel Zinc
Aluminum Other Total ------- ------- --------------- ------ -------
Revenues $2,067 842 399 662 (97) $3,873
----------------------------------------------- Operating expenses
Cost of operations 691 488 242 349 109 1,879 Purchase of raw
materials 1,109 146 144 241 (250) 1,390 Depreciation, amortization
and reclamation 209 114 65 38 64 490
----------------------------------------------- $2,009 748 451 628
(77) $3,759 ----------------------------------------------- Income
(loss) generated by operating assets $ 58 94 (52) 34 (20) $ 114
----------------------------------------------- Interest expense,
net (98) Corporate and general administration (58) Research,
development and exploration (49) Minority interest in earnings of
subsidiaries (26) ------- Loss before undernoted $ (117) Tax
recovery 168 Restructuring costs(561) Gain on sale of investment 63
------- Net loss $ (447) -------
-------------------------------------------------------------------------
Total assets, excluding cash and cash equivalents $3,612 1,139 511
797 750 $6,809
-------------------------------------------------------------------------
Capital investments $ 257 84 4 41 142 $ 528
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DATASOURCE: Noranda Inc. CONTACT: Denis Couture, Vice-President,
Public Affairs & Communications, (416) 982-7020; Steve Douglas,
Executive Vice-President and Chief Financial Officer, (416)
982-3554
Copyright