Phelps Dodge Has 64% Drop In 4th-quarter Profit

Phoenix-based Phelps Dodge Corp.'s fourth-quarter profit plunged 64 percent due to production shortfalls, the negative impact of a copper price-protection plan and other factors. The company warned in mid-January that fourth-quarter results would fall significantly below projections and Phelps Dodge's shares, which are up 12 percent so far this year, fell only $1.60, or 1 percent, after the Jan. 31 earnings report. About 25 percent of the company's copper production is under a hedge program, which protects the company if the price of copper falls below 95 cents per pound, and penalizes it if it rises above $1.65.