Falconbridge 6-K Current report (foreign)

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Exhibit 99.1

NORANDA INC.

QUARTERLY FINANCIAL STATEMENTS

MARCH 31, 2005

NORANDA INC.

CONSOLIDATED RESULTS

(US$ millions, unaudited)

	Three months ended March 31
	2005		2004
Revenues	$	1,976	$	1,653
Operating expenses
Cost of operations		628		464
Purchased raw materials		775		711
Depreciation, amortization and accretion		118		117
		1,521		1,292
Income generated by operating assets		455		361
Interest expense, net		32		29
Corporate and general administration		17		13
Research, development and exploration		12		7
Minority interest in earnings of subsidiaries		94		79
Income before undernoted		300		233
Other expense (income)		1		(5	)
Tax expense		123		86
Net Income	$	176	$	152
Dividends on preferred shares		3		4
Net Income attributable to common shares	$	173	$	148
Basic earnings per common share	$	0.58	$	0.50
Diluted earnings per common share	$	0.57	$	0.49
Basic weighted average number of shares — 000s		296,856		295,595
Diluted weighted average number of shares — 000s		304,815		303,524

NORANDA INC.

CONSOLIDATED BALANCE SHEETS

(US$ millions, unaudited)

		Mar. 31, 2005		Dec. 31, 2004
Assets
Current assets
	Cash and cash equivalents	$	1,000	$	884
	Accounts receivable		957		948
	Metals and other inventories		1,471		1,436
			3,428		3,268
Operating capital assets			4,892		4,870
Development projects			1,134		1,166
Investments and other assets			328		324
		$	9,782	$	9,628
Liabilities and Equity
Current Liabilities
	Accounts and taxes payable	$	1,242	$	1,265
	Debt due within one year		591		570
			1,833		1,835
Long-term debt			2,574		2,736
Preferred share liabilities			121		122
Future income taxes			371		304
Asset retirement obligation, pension and other provisions			600		595
Stockholders' interests:
	Interests of other shareholders		1,296		1,197
	Shareholders' equity		2,987		2,839
		$	9,782	$	9,628

NORANDA INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(US$ millions, unaudited)

			Three months ended March 31
			2005			2004
Cash realized from (used for):
Operations
	Net income		$	176		$	152
	Charges (credits) not affecting cash:
	Depreciation and amortization			125			106
	Future taxes			75			43
	Minority interest			94			79
	Foreign exchange, and other			(19	)		(32	)
				451			348
	Net change in accounts receivable, inventories and payables			(66	)		(88	)
Cash from operations				385			260
Investment activities
	Capital investments			(110	)		(124	)
	Investments and advances			(3	)		10
	Proceeds on dispositions			3			2
Cash used in investment activities				(110	)		(112	)
Financing activities
	Long-term debt, including current portion
		Issued		13			28
		Repaid		(154	)		(44	)
	Issue of shares — common			8			13
	Dividends paid			(33	)		(30	)
	Issue of shares — minority shareholders			16			11
	Dividends paid to minority shareholders			(9	)		(8	)
				(159	)		(30	)
Increase in cash and cash equivalents				116			118
Cash and cash equivalents, beginning of period				884			501
Cash and cash equivalents, end of period			$	1,000		$	619

NORANDA INC.

SALES VOLUMES & REALIZED PRICES

					First Quarter
				100% basis, except as noted
					2005	2004
Metal Sales (tonnes, except as noted)
	Copper
		Copper business
			CCR		69,052	84,986
			Kidd Creek		23,360	10,272
			Horne — (concentrates)		—	17,605
			Antamina — (concentrates)	(33.75%)	30,020	11,609
			Collahuasi — (concentrates)	(44%)	35,976	11,957
			Collahuasi	(44%)	6,686	5,914
			Lomas Bayas		17,505	15,935
			Alnorte — (anodes)		31,198	55,097
					213,797	213,375
		Nikkelverk			15,477	13,197
					229,274	226,572
	Zinc
		Copper business
			Kidd Creek		40,932	26,525
			Antamina — (concentrates)	(33.75%)	15,150	14,219
					56,082	40,744
		Zinc business
			Brunswick/Matagami — (concentrates)		60,129	74,134
					116,211	114,878
	Nickel				21,266	18,118
	Ferronickel				6,515	6,777
	Aluminum
		Primary Aluminum — shipments			61,810	60,745
		Norandal — shipments			45,614	42,388
	Lead				21,723	21,211
	Gold — 000 ounces				184	236
	Silver — 000 ounces
		CCR			8,314	9,326
		Kidd Creek			1,483	1,004
		Antamina		(33.75%)	380	423
					10,177	10,753
Average Realized Prices — (US$ per pound, except as noted)
	Copper				1.54	1.17
	Nickel				7.03	6.88
	Ferronickel				6.70	6.80
	Zinc				0.63	0.52
	Aluminum				0.92	0.79
	Lead				0.49	0.41
	Gold — (US$ per ounce)				434.59	403.55
	Silver — (US$ per ounce)				7.17	6.33
Exchange Rate (US$1 = Cdn$1)					0.82	0.76

NORANDA INC.

PRODUCTION VOLUMES

					First Quarter
				100% basis, except as noted
					2005	2004
Mine Production (tonnes, except as noted)
	Copper
		Copper business
			Kidd Creek		11,155	9,296
			Antamina	(33.75%)	31,030	25,557
			Collahuasi	(44%)	46,974	35,369
			Lomas Bayas		16,323	15,728
					105,482	85,950
		Matagami			—	1,856
		Brunswick			1,272	1,842
		INO			8,561	5,585
		Other			3,321	4,430
					118,636	99,663
	Zinc
		Zinc business
			Brunswick		67,067	73,580
			Matagami		—	26,674
					67,067	100,254
		Kidd Creek			27,426	20,792
		Antamina		(33.75%)	20,172	22,469
		Other			2,588	1,544
					117,253	145,059
	Nickel				14,050	11,161
	Ferronickel				6,474	7,999
	Lead				18,893	20,287
	Silver — 000 ounces
		Copper business
			Kidd Creek		827	1,194
			Antamina	(33.75%)	922	653
					1,749	1,847
		Brunswick			1,486	1,602
		Matagami			—	114
		Other			66	50
					3,301	3,613
Metal Production (tonnes, except as noted)
	Refined copper
		Copper business
			CCR		66,989	78,160
			Kidd Creek		31,460	33,722
			Collahuasi	(44%)	6,813	6,152
			Lomas Bayas		16,323	15,728
					121,585	133,762
		Nikkelverk			8,952	9,746
					130,537	143,508
	Copper anodes
		Horne			33,062	43,234
		Kidd Creek			34,444	33,500
		Altonorte			58,105	63,850
					125,611	140,584
	Refined zinc
		Kidd Creek			37,965	28,458
	Refined nickel
		Nikkelverk			21,456	18,859
		Falcondo			6,474	7,999
					27,930	26,858
	Primary aluminum				61,373	61,220
	Fabricated Aluminum				45,614	42,388
	Refined lead				21,594	25,148
	Refined gold — 000 ounces				213	269
	Refined silver — 000 ounces				8,210	10,123

NORANDA INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Millions of US dollars, except as otherwise indicated)
(Unaudited)

1.     ACCOUNTING POLICIES

These unaudited interim consolidated financial statements have been prepared using disclosure standards appropriate for interim financial statements and do not contain all the explanatory notes, descriptions of accounting policies or other disclosures required by Canadian generally accepted accounting principles for annual financial statements. Such notes, descriptions of accounting policies and other disclosures have been included in the Company's 2004 annual consolidated financial statements except as discussed in Note 2 below. Accordingly, these unaudited interim consolidated financial statements should be read in conjunction with the Company's audited annual consolidated financial statements and the accompanying notes included in the 2004 Annual Report.

2.     CHANGE IN ACCOUNTING STANDARDS

Effective January 1, 2005, Noranda adopted the new Canadian Institute of Chartered Accountants (CICA) recommendations for presentation of convertible debentures and preferred shares (CICA 3860) and variable interest entities (AcG -15).

a)

Convertible Debentures

The principal amount of Noranda's outstanding convertible debentures of Cdn$150 due on April 30, 2007 was previously classified as an equity instrument due to the Company's ability to settle principal payment by issuance of its shares. In accordance with amended standard under CICA 3860, Noranda has presented the liability component of its convertible debentures as long term debt and the equity component as contributed surplus. The liability represents the present value of the principal payment of the debentures and the equity component represents the fair value of the holder's conversion feature. The stated interest payments and accretion expense from adjusting the time value of the principal of the debentures over time are recorded as interest expense in the consolidated statement of earnings.

The cumulative impact of the adoption of the standard on January 1, 2005 was to decrease retained earnings by $43, increase liability component of convertible debentures by $98, decrease equity by $46 and decrease cumulative translation adjustment by $9. Adoption of the new standard reduced earnings by $1 and $1 for the three months ended March 31, 2005 and March 31, 2004 respectively.

b)

Preferred Shares Series H

Noranda has $Cdn150 of cumulative preferred shares, series H, which provide the holders with an entitlement to convert the shares to Noranda common shares after a specified date and were previously reported as equity instruments in accordance with its legal form. As a result of the new accounting recommendations under CICA 3860 on presentation of financial instruments, the preferred shares have been reclassified as liabilities because their conversion feature represents a fixed obligation to Noranda. The dividends paid are reported as interest expense in the consolidated statement of earnings.

The cumulative impact of the adoption of the standard on January 1, 2005 was to decrease retained earnings by $14, increase liabilities by $122, decrease equity by $99 and decrease cumulative translation adjustment by $9. Adoption of the new standard reduced earnings by $1 for the three months ended March 31, 2005 (2004 — nil).

c)

Variable Interest Entities ("VIEs")

Effective January 1, 2005, Noranda adopted the recommendations of AcG-15 which details the requirements on the consolidation of VIEs. VIEs include entities where the equity invested is considered insufficient to finance the entity's activities without additional subordinated financial support from other parties. AcG-15 requires Noranda to consolidate VIEs if the investment it holds in these entities and/or the relationship it has with them result in it being exposed to a majority of their expected losses, being able to benefit from a majority of their expected residual returns, or both.

As a result of the new standard, Noranda has consolidated a customer securitization vehicle, which has purchased trade accounts receivable from Noranda. The cumulative impact of the consolidation of the vehicle on January 1, 2005 was to increase current assets by $17 and increase current liabilities by $17 with no impact on opening retained earnings. The impact of the adopting AcG-15 on the balance sheet as at March 31, 2005 and consolidated statement of earnings for the quarter ended March 31, 2005 is nominal and no new significant VIEs were identified during the quarter.

3.     STOCK-BASED COMPENSATION

During the first quarter, the Company granted 841,200 stock options at a price of CDN$21.66 per share. These options have a 10-year term, vesting 20% per year over the first five years. The compensation expense associated with this stock option series was calculated using the Black-Scholes valuation model, assuming a 8-year term, 25% volatility, a weighted-average expected dividend of 2.23% annually and an interest rate of 4.15%, and is being charged against net income over its vesting period.

Corporate and general administration, for the three months ended March 31, 2005, include compensation costs of $1 (2004 — $1), relating to outstanding options.

4.     EXCHANGE GAINS AND LOSSES ON HEDGES OF FOREIGN-DENOMINATED EXPOSURES

The majority of Noranda's products are denominated in US dollars or indexed to US dollar prices. In addition, operating costs of Noranda's assets are also denominated in their local currency and exposed to exchange volatility. Noranda hedges its Canadian dollar costs using foreign currency exchange contracts.).

Noranda's operating costs for the three months ended March 31, 2005 include realized exchange gains from the settlement of various cost hedge contracts of $ 20 (2004 — $25).

Hedges of other foreign currency denominated monetary assets and liabilities, generated a gain of $1 for the three ended March 31, 2005 (2004 — $5).

5.     CAPITALIZED INTEREST

During the three months ended March 31, 2005, Noranda capitalized $9 of interest costs associated with projects under development (2004 — $10).

6.     SHAREHOLDERS' EQUITY

NORANDA INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
($ US millions)

			March 31, 2005				December 31, 2004
			Shares (000)	Amount			Shares (000)	Amount
Share capital
	Authorized — an unlimited number of Preferred, Common and Participating shares
	Issued:
	Common Shares
	Balance, beginning of year		296,970	$	2,107		295,228	$	2,084
		Issued on exercise of stock options	502		8		1,704		22
		Issued under dividend re-investment	16		—		38		1
	Balance, end of period		297,488	$	2,115		296,970	$	2,107
	Preferred Shares, Series F Balance beginning of year and end of period		3,246		59		3,246		59
	Preferred Shares, Series G Balance beginning of year and end of period		8,754		137		8,754		137
Contributed Surplus
	Equity component of the convertible debentures				42				42
	Stock option valuation				4				3
	Balance end of period				46				45
Basic weighted average number of shares — 000's					296,856				296,246
Diluted weighted average number of shares — 000's					304,815				304,122
Retained earnings (deficit):
	Balance beginning of year, as previously reported			$	288			$	(130	)
	Change in accounting policy:
	Reclassification of convertible debenture and preferred shares series H (Note 2)				(57	)			(38	)
	As restated			$	231			$	(168	)
	Net income				176				521
	Dividends: Common				(29	)			(110	)
	Preferred				(3	)			(12	)
	Balance end of period				375				231
Currency translation and other at end of period					255				260
Total shareholders' equity				$	2,987			$	2,839

7.     SEGMENTED INFORMATION

Noranda has four operating segments: Copper, Nickel, Zinc and Aluminum. Inter-segment sales and purchases are made at market prices and trade terms. Operating results and identifiable assets are presented below:

	Three Months ended March 31, 2005
	Copper		Nickel		Zinc		Aluminum		Other			Total
Revenues	$	980	$	538	$	119	$	297	$	42		$	1,976
Operating expenses
Cost of operations		254		173		50		139		12			628
Purchase of raw materials		440		142		54		111		28			775
Depreciation, amortization and accretion		55		20		9		12		13			118
	$	749	$	344	$	113	$	262	$	53		$	1,521
Income (loss) generated by operating assets	$	231	$	194		6	$	35	$	(11	)	$	455
Interest expense, net													(32	)
Corporate and general administration													(17	)
Research, development and exploration													(12	)
Minority interest in earnings of subsidiaries													(94	)
Income before undernoted												$	300
Tax expense													(123	)
Other expense													(1	)
Net income												$	176
Total assets, excluding cash and short-term investments	$	4,550	$	2,047	$	394	$	1,008	$	783		$	8,782
Capital investments	$	48	$	48	$	1	$	7	$	6		$	110

	Three Months ended March 31, 2004 (Note 2)
	Copper		Nickel		Zinc		Aluminum		Other			Total
Revenues	$	844	$	481	$	85	$	204	$	39		$	1,653
Operating expenses
Cost of operations		195		140		34		109		(8	)		464
Purchase of raw materials		462		122		31		70		20			711
Depreciation, amortization and accretion		48		32		18		9		10			117
	$	705	$	294	$	83	$	188	$	22		$	1,292
Income generated by operating assets	$	139	$	187		2	$	16	$	17		$	361
Interest expense, net													(29	)
Corporate and general administration													(13	)
Research, development and exploration													(7	)
Minority interest in earnings of subsidiaries													(79	)
Income before undernoted												$	233
Tax expense													(86	)
Other expense													5
Net income												$	152
Total assets, excluding cash and short-term investments	$	4,241	$	1,763	$	436	$	838	$	754		$	8,032
Capital investments	$	74	$	34	$	1	$	6	$	9		$	124

8.     POST-EMPLOYMENT BENEFITS

Post-employment benefit expenses for the three months ended March 31, 2005 and 2004 are summarized as follows:

	Three Months
Period Ending March 31,	2005		2004
Defined benefit plans	$	13	$	12
Defined contribution plans		2		2
Other benefits plans		7		7
	$	22	$	21

9.     SUBSEQUENT EVENTS

On April 26, 2005, Noranda has increased the maximum number of common shares issuable under the Stock Option Plan by 5 million.

On April 28, 2005, Noranda repurchased 63.4 million of the Noranda common shares in exchange for 50 million of three new series of preference shares of Noranda with an aggregate stated capital of $1,250. In accordance with the amended CICA 3860, these preferred shares will be accounted for as liabilities.

On May 6, 2005, Noranda announced the results of its previously announced merger offer dated March 9, 2005 to Falconbridge Limited ("Falconbridge") minority common shareholders whereby the Company offered to exchange 1.77 Noranda common shares for each outstanding Falconbridge common share that the Company currently does not own. 58.5 million Falconbridge common shares, representing 78% of the shares held by the minority shareholders, were validly deposited under the offer. Noranda has proceeded to take up all shares validly deposited, and will issue payment for these shares on or before May 11, 2005, increasing its ownership to 91% of the outstanding Falconbridge common shares. The Company intends to proceed to acquire any remaining Falconbridge common shares not tendered to the merger.

10.   COMPARATIVE FIGURES

The comparative consolidated financial statements have been reclassified from statements previously presented to conform to the presentation of the 2005 consolidated statements.

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Exhibit 99.1

NORANDA INC. CONSOLIDATED RESULTS (US$ millions, unaudited)
NORANDA INC. CONSOLIDATED BALANCE SHEETS (US$ millions, unaudited)
NORANDA INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (US$ millions, unaudited)
NORANDA INC. SALES VOLUMES & REALIZED PRICES
NORANDA INC. PRODUCTION VOLUMES