SECURITIES AND EXCHANGE COMMISSION FORM 10-K405 Annual report pursuant to section 13 and 15(d), Regulation S-K Item 405 Filing Date: 2000-01-26 | Period of Report: 1999-10-31 SEC Accession No. 0000912057-00-002487 (HTML Version on secdatabase.com) FILER DOE RUN RESOURCES CORP Business Address 1801 PARK 270 DR CIK:1061112| IRS No.: 131255630 | State of Incorp.:NY | Fiscal Year End: 1231 ST LOUIS MO 63146 Type: 10-K405 | Act: 34 | File No.: 333-52285 | Film No.: 513877 3144537100 SIC: 1000 Metal mining Copyright © 2012 www.secdatabase.com. All Rights Reserved. Please Consider the Environment Before Printing This Document UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-K (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended OCTOBER 31, 1999 Or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _______ COMMISSION FILE NUMBER 333-52285 THE DOE RUN RESOURCES CORPORATION (Exact name of registrant as specified in its charter) NEW YORK 13-1255630 (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 1801 PARK 270 DRIVE, SUITE 300 ST. LOUIS, MISSOURI 63146 (Address of principal executive offices) (Zip Code) (Registrant's telephone number, including area code) (314) 453 - 7100 Securities registered pursuant to Section 12(b) of the Act: <TABLE> <CAPTION> Title of Each Class Name of Each Exchange on Which Registered ------------------- ----------------------------------------- <S> <C> None Not Applicable </TABLE> Securities registered pursuant to Section 12(g) of the Act: None (Title of Class) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. [ ] YES [X] NO Indicate by check mark if disclosure of delinquent filers pursuant to ITEM 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] Number of shares outstanding of each of the issuer's classes of common stock, as of January 26, 2000: Common stock, $.10 par value 1,000 Shares Aggregate market value of the voting stock held by non-affiliates of the registrant: $0; all shares of the voting stock of the registrant are owned by its parent, DR Acquisition Corp. THE DOE RUN RESOURCES CORPORATION INDEX TO FORM 10-K <TABLE> <CAPTION> PAGE NO. Copyright © 2012 www.secdatabase.com. All Rights Reserved. Please Consider the Environment Before Printing This Document -------- <S> <C> PART I Item 1. Business 1 Item 2. Properties 8 Item 3. Legal Proceedings 11 Item 4. Submission of Matters to a Vote of Security Holders 12 PART II Item 5. Market for Registrant's Common Equity and Related Stockholder Matter 12 Item 6. Selected Financial Data 13 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 14 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 23 Item 8. Financial Statements and Supplementary Data 23 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures 102 PART III Item 10. Directors and Executive Officers of the Registrant 102 Item 11. Executive Compensation 103 Item 12. Security Ownership of Certain Beneficial Owners and Management 106 Item 13. Certain Relationships and Related Transactions 106 PART IV Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K 108 SIGNATURES 111 EXHIBIT INDEX 112 </TABLE> PART I ITEM 1. BUSINESS The Doe Run Resources Corporation (the Company) is a producer of base and precious metals with operations in the United States and Peru. The Company is the largest integrated lead producer in North America and the largest primary lead producer in the western world. In Peru, the Company operates the La Oroya smelter (La Oroya), one of the largest polymetallic processing facilities in the world offering an extensive product mix of non-ferrous and precious metals, including silver, copper, zinc, lead and gold. All of the Company's issued and outstanding capital stock is indirectly owned by The Renco Group, Inc. (Renco). Renco is owned by trusts established by Mr. Ira Leon Rennert, Renco's Chairman and Chief Executive Officer, for himself and members of his family. As a result of such ownership, Mr. Rennert controls the Company and its subsidiaries. The Company owns 100% of Doe Run Cayman Ltd. (Doe Run Cayman), a Cayman Islands corporation. Doe Run Cayman indirectly owns in excess of 99% of the interest in Doe Run Peru S.R.L. (Doe Run Peru) through Doe Run Mining S.R.L. (Doe Run Mining), with a DE MINIMIS number of shares owned by employees of both Doe Run Peru and Empresa Minera del Centro del Peru S.A. (Centromin) pursuant to Peruvian law. Centromin is the Peruvian government entity whose subsidiary held the assets and liabilities of La Oroya which was purchased pursuant to a Subscription Agreement on October 23, 1997 by Doe Run Peru. Doe Run Mining and Doe Run Peru are Peruvian corporations. The Company's business in the United States includes an integrated primary lead operation, a secondary lead operation and lead fabrication operations. In Peru, the Company produces various base metals and precious Copyright © 2012 www.secdatabase.com. All Rights Reserved. Please Consider the Environment Before Printing This Document metals and has a copper mining and milling operation. These operations will be discussed in greater detail in the "overview" sections below. Reference is hereby made to "Item 8. Financial Statements and Supplementary Data", Note 13 to the Company's Consolidated Financial Statements. The Company's business does not involve: 1) seasonal fluctuations, 2) unusual working capital requirements, 3) significant order backlog or 4) federal contracting. OVERVIEW -- U.S. OPERATIONS The Company's U.S. primary lead operation consists of two primary smelters, which obtain concentrates from six mills. The mills are supplied with ore mined from eight production shafts along approximately 40 miles of the Viburnum Trend in southeastern Missouri, one of the world's most productive lead deposits. As of October 31, 1999, the Company's U.S. ore reserves consisted of approximately 65 million proven and probable tons, containing grades of 5.62% lead, 1.13% zinc and .22% copper. The Company also operates a secondary smelter in southeastern Missouri where it produces lead metal from recycled lead-acid batteries and other lead bearing materials. Through its subsidiary, Fabricated Products, Inc. (FPI), the Company produces value-added lead products such as lead oxide, lead sheet and lead bricks at facilities in Arizona, Washington and Texas. These operations permit the Company to participate in and manage the entire lead life cycle from mining lead ore, to producing refined lead metal, to fabricating value-added lead products, to recycling batteries and other materials containing lead. In fiscal 1999, the Company shipped approximately 516,000 tons of refined lead metal and lead alloy products, including recycled lead, representing approximately 28% of North American consumption and 10% of western world consumption. In fiscal 1999, the Company's U.S. operations generated net sales of $342.8 million and a net loss of $31.2 million. Fluctuations in lead and other base metal prices could have a material adverse effect on the results of operations, financial condition and liquidity of the Company. These prices are affected by numerous factors beyond the Company's control, including expectations for inflation, speculative activities, global and regional demand and production, political and economic conditions and production costs in major producing regions. The aggregate effect of these factors is impossible for the Company to predict. The Company, by taking advantage of its extensive polymetallic ore resources, is somewhat able to reduce its exposure to metal price volatility through adjustments to its mining and milling plans to take advantage of prevailing market conditions for lead, zinc and copper. In addition, sales from tolling services, by-products and fabricated products provide the Company with sources of revenue largely independent of lead prices. For the year ended October 31, 1999, approximately 73% of the Company's net sales, inclusive of La Oroya, were derived from tolling services, metals processing and other sources less sensitive to lead metal price fluctuations. The average market price, determined at the London Metal Exchange (LME), for refined lead was $.23 per pound in fiscal 1999. As of December 31, 1999, the LME price for lead had declined to just under $.22 per pound. Over the past two years the price has dropped as new sources of ore have been developed in Australia and Ireland, and as 1 China has increased its lead metal production and exports. Current prices are near historical lows. Management believes that prices will recover from these levels in the next several years, as several large lead producing mines will be depleted of ore. This should bring about a balance or slight deficit in supply versus demand. Over the past ten years, the average price of lead has been approximately $.27 per pound. Management believes that lead prices over the long term will reflect the historical industry average. In spite of low lead prices, the Company's U.S. operations' income from operations was marginally positive in fiscal 1999.