We’re growing and profitable, and are in a very strong financial position.

Growth

We have been growing steadily since 2000. With our acquisition of Las Cruces in 2005 and increased production at Çayeli, we expect a 50 percent increase in copper production by 2010. If we proceed with the Cobre Panama project, production could more than triple by 2017.

Long-term value

Our share price this year increased almost threefold, starting at $23 per share in January and ending the year at $64 per share. This was consistent with our peers, since we all benefitted from a recovering economy, higher metal prices and an increasingly positive outlook for commodities.

Our share price was below our peer group by a cumulative 24 percent in 2009. The markets were extremely volatile in 2009 and certain larger companies in the mining index experienced even greater volatility which affects benchmarking against our peers.

We underperformed our peer group by a cumulative 20 percent over the five years ending December 31, 2009, but outperformed the market every year before 2009. We believe this year’s underperformance is a short term phenomena as we expect our near term growth with Las Cruces and our significant leverage to copper with Cobre Panama will drive a stronger growth profile than many of our peers.

Financial strength

Our financial objective is to ensure we have the cash and debt capacity to support our strategy to grow responsibly as a base metal mining company, providing superior returns to shareholders.

Our strategy is to ensure that we have sufficient liquidity in the form of cash and committed credit facilities to finance our operating requirements and the growth projects we have identified. We manage our debt levels by ensuring that, even at the low point in the metal price cycle, our operations can provide adequate debt coverage.

Key financial measures

We use the following key financial measures to assess our financial condition and liquidity:

	as at June 30, 2010	as at December 31, 2009
Current Ratio	3.9 to 1	4.2 to 1
Gross debt to total equity (1)	1%	1%
Net working captial balance (millions)	$502	$609
Cash balance including long-term bonds (millions)	$757	$634
(1) Gross debt includes long-term debt and the current portion of long-term debt, less the non-recourse note owing from Las Cruces to its non-controlling shareholder.

Highlights

The table below shows our financial and operating highlights for the three and six months ended June 30, 2010.

Key Financial Data	three months ended June 30			six months ended June 30
	2010	2009	change	2010	2009	change
FINANCIAL HIGHLIGHTS (thousands, except per share amounts)
Sales
Gross sales	$215,051	$213,042	+1%	$466,610	$452,194	+ 3%
Net income
Net income	$48,436	$66,528	- 27%	$128,307	$117,855	+ 9%
Net income per share	$0.86	$1.37	- 37%	$2.29	$2.43	- 6%
Cash flow
Cash flow provided by operating activities	$80,289	$90,596	- 11%	$171,866	$107,693	+ 60%
Cash flow provided by operation activities per share (1)	$1.43	$1.86	- 23%	$3.06	$2.22	+ 38%
Capital spending (2)	$11,014	$86,263	- 87%	$32, 835	$181,122	- 82%
OPERATING HIGHLIGHTS
Production (3)
Copper (tonnes)	22,500	19,200	+ 17%	43,700	39,300	+ 11%
Zinc (tonnes)	20,600	17,500	+ 18%	39,300	32,800	+ 20%
Gold (ounces)	36,700	50,600	- 27%	76,900	129,400	- 41%
Pyrite (tonnes)	137,700	132,200	+ 4%	335,200	323,000	+ 4%
Cash costs
Copper (US $ per pound) (4)	$0.47	$0.52	- 10%	$0.43	$0.55	- 22%
(1) Calculated as cash flow provided by operating activities divided by average shares outstanding for the period. (2) For the six months ended June 30, 2010, this includes capital spending of $41 million at Cobre Panama and $29 million at Las Cruces reduced by positive cash flow from pre-operating costs net of revenues and working capital changes at Las Cruces of $53 million. For the six months ended June 30, 2009 this includes $119 million of capital spending at Las Cruces (mainly for construction). (3) Inmet's share. (4) Copper cash cost per pound is a non-GAAP measure – see Supplementary financial information on pages 32 and 33 of Inmet's second quarter report for the three months ended June 30, 2010.

The table below shows our financial and operating highlights for each of the last three years.

Financial Highlights			2009	2008	2007	change (2008 to 2009)
(millions, except per share amounts)
Sales
Gross sales			$984	$945	$1,104	+ 4%
Net income
Net income			$269	$217	$418	+ 24%
Net income per share			$5.14	$4.49	$8.65	+ 14%
Cash flow
Cash flow provided by operating activities			$323	$325	$427	- 1%
Cash flow provided by operation activities per share (1)			$6.17	$6.72	$8.85	- 8%
Financial Condition			Dec 31 2009	Dec 31 2008	Dec 31 2007	Change (2008 to 2009)
Current ratio			4.2 to 1	2.4 to 1	5.6 to 1	+ 75%
Gross debt to total equity			1%	19%	13%	- 18%
Net working capital balance (millions)			$609	$475	$855	+ 28%
Cash balance including long-term bonds (millions)			$634	$573	$841	+ 11%
Shareholders' equity (millions)			$2,238	$1,868	$1,392	+ 20%
Operating Highlights	2009		2008	2007	Change (2008 to 2009)
Production (2)
Copper (tonnes)	83,600		80,500	79,300	+ 4%
Zine (tonnes)	78,000		75,400	85,100	+ 3%
Gold (ounces)	228,400		244,100	223,300	- 6%
Cash Costs (3)
Copper (US $ per pound)	$0.44		$0.52	$0.20	- 15%
Gold (US $ per ounce)	$182		$417	$421	- 56%
(1) Cash flow provided by operating activities divided by average shares outstanding for the period. (2) Inmet’s share. (3) Cash cost per pound of copper and cash cost per ounce of gold are non-GAAP measures – see Supplementary information on pages 71 and 72 of Inmet's 2009 annual report.

Gross sales

Çayeli
In 2009, 61 percent of Çayeli’s revenue was from copper and 33 percent was from zinc.

Pyhäsalmi
In 2009, 48 percent of Pyhäsalmi’s revenue was from copper, 31 percent was from zinc and 21 percent was from pyrite.

Troilus
In 2009, 79 percent of Troilus’s revenue was from gold and 20 percent was from copper.

Ok Tedi
In 2009, 64 percent of Ok Tedi’s revenue was from copper and 34 percent was from gold.