NOTE 5 — REVENUE RECOGNITION:

On January 1, 2018, the Company adopted FASB Accounting Standards Codification Topic 606 (“ASC 606”), Revenue from Contracts with Customers. Upon adoption by the Company, no cumulative effect adjustment was required to be recognized, as the adoption of the standard has not resulted in a change to the way the Company recognizes its revenue.

The Company’s net sales were $3,678.4 million in the six months ended June 30, 2018, compared to $3,113.8 million in the same period of 2017. The geographic breakdown of the Company’s sales is as follows (in millions):

	Three Months Ended June 30, 2018
	Mexican Open-Pit		Mexican IMMSA Unit		Peruvian Operations		Corporate & Elimination			Consolidated
The Americas:
Mexico	$	328.1	$	109.3	$	—	$	(18.8	)	$	418.6
United States	270.9		0.6		56.9		—			328.4
Peru	—		—		106.5		—			106.5
Brazil	—		9.7		64.4		—			74.1
Chile	—		—		23.6		—			23.6
Other American countries	13.8		1.6		0.2		—			15.6
Europe:
Switzerland	116.7		17.8		30.6		—			165.1
Italy	4.7		8.0		78.1		—			90.8
Spain	44.2		—		—		—			44.2
Other European countries	69.9		5.8		22.4		—			98.1
Asia:
Singapore	140.2		—		146.6		—			286.8
Japan	29.1		—		104.0		—			133.1
Other Asian countries	43.5		0.3		8.5		—			52.3

Total	$	1,061.1	$	153.1	$	641.8	$	(18.8	)	$	1,837.2

	Three Months Ended June 30, 2017
	Mexican Open-Pit		Mexican IMMSA Unit			Peruvian Operations		Corporate & Elimination			Consolidated
The Americas:
Mexico	$	263.6	$	87.5		$	2.2	$	(17.6	)	$	335.7
United States	194.1		11.9			36.4		—			242.4
Peru	—		0.4			82.4		—			82.8
Brazil	—		12.1			43.8		—			55.9
Chile	—		—			18.1		—			18.1
Other American countries	14.2		0.7			0.1		—			15.0
Europe:
Switzerland	134.5		2.5			23.7		—			160.7
Italy	8.5		3.4			66.7		—			78.6
Spain	35.2		—			—		—			35.2
Other European countries	77.1		6.4			17.5		—			101.0
Asia:
Singapore	114.0		(0.1		)	127.6		—			241.5
Japan	8.1		—			93.1		—			101.2
Other Asian countries	50.5		0.1			11.1		—			61.7

Total	$	899.8	$	124.9		$	522.7	$	(17.6	)	$	1,529.8

	Six Months Ended June 30, 2018
	Mexican Open-Pit		Mexican IMMSA Unit		Peruvian Operations		Corporate & Elimination			Consolidated
The Americas:
Mexico	$	696.9	$	220.7	$	—	$	(38.4	)	$	879.2
United States	519.3		5.5		98.4		—			623.2
Peru	—		—		200.0		—			200.0
Brazil	—		22.3		127.3		—			149.6
Chile	—		—		59.6		—			59.6
Other American countries	26.4		2.3		1.2		—			29.9
Europe:
Switzerland	199.0		27.1		74.4		—			300.5
Italy	13.1		13.5		160.3		—			186.9
Spain	88.7		—		—		—			88.7
Other European countries	121.7		10.5		48.1		—			180.3
Asia:
Singapore	284.1		—		279.0		—			563.1
Japan	73.3		—		219.3		—			292.6
Other Asian countries	107.2		0.5		17.1		—			124.8

Total	$	2,129.7	$	302.4	$	1,284.7	$	(38.4	)	$	3,678.4

	Six Months Ended June 30, 2017
	Mexican Open-Pit		Mexican IMMSA Unit		Peruvian Operations		Corporate & Elimination			Consolidated
The Americas:
Mexico	$	564.1	$	176.0	$	2.2	$	(38.1	)	$	704.2
United States	460.7		23.6		58.4		—			542.7
Peru	—		0.8		169.9		—			170.7
Brazil	—		24.0		89.3		—			113.3
Chile	—		—		51.3		—			51.3
Other American countries	31.1		1.7		6.3		—			39.1
Europe:
Switzerland	225.7		5.8		26.1		—			257.6
Italy	14.2		8.5		143.5		—			166.2
Spain	65.4		—		—		—			65.4
Other European countries	127.3		13.6		36.3		—			177.2
Asia:
Singapore	255.6		1.4		263.1		—			520.1
Japan	34.6		—		182.1		—			216.7
Other Asian countries	73.3		0.3		15.7		—			89.3

Total	$	1,852.0	$	255.7	$	1,044.2	$	(38.1	)	$	3,113.8

The following table presents information regarding the sales value by reporting segment of the Company’s significant products for the three and six months ended June 30, 2018 and 2017 (in millions):

	Three Months Ended June 30, 2018
	Mexican Open-Pit		Mexican IMMSA Unit		Peruvian Operations		Corporate & Elimination			Consolidated
Copper	$	911.7	$	15.9	$	571.9	$	(11.0	)	$	1,488.5
Molybdenum	73.9		—		30.6		—			104.5
Zinc	—		94.8		—		—			94.8
Silver	48.1		23.9		18.4		(7.1		)	83.3
Other	27.4		18.5		20.9		(0.7		)	66.1

Total	$	1,061.1	$	153.1	$	641.8	$	(18.8	)	$	1,837.2

	Three Months Ended June 30, 2017
	Mexican Open-Pit		Mexican IMMSA Unit		Peruvian Operations		Corporate & Elimination			Consolidated
Copper	$	788.4	$	8.0	$	467.8	$	(8.1	)	$	1,256.1
Molybdenum	42.7		—		24.4		—			67.1
Zinc	—		76.4		—		0.3			76.7
Silver	42.9		20.2		19.9		(7.5		)	75.5
Other	25.8		20.3		10.6		(2.3		)	54.4

Total	$	899.8	$	124.9	$	522.7	$	(17.6	)	$	1,529.8

	Six Months Ended June 30, 2018
	Mexican Open-Pit		Mexican IMMSA Unit		Peruvian Operations		Corporate & Elimination			Consolidated
Copper	$	1,821.1	$	27.1	$	1,135.9	$	(22.2	)	$	2,961.9
Molybdenum	164.9		—		75.9		—			240.8
Zinc	—		189.8		—		(0.1		)	189.7
Silver	90.7		44.5		33.8		(14.6		)	154.4
Other	53.0		41.0		39.1		(1.5		)	131.6

Total	$	2,129.7	$	302.4	$	1,284.7	$	(38.4	)	$	3,678.4


	Six Months Ended June 30, 2017

	Mexican Open-Pit		Mexican IMMSA Unit		Peruvian Operations		Corporate & Elimination			Consolidated

Copper	$	1,616.6	$	18.9	$	925.4	$	(19.0	)	$	2,541.9
Molybdenum	96.6		—		63.3		—			159.9
Zinc	—		155.7		—		—			155.7
Silver	90.4		39.9		33.9		(14.9		)	149.3
Other	48.4		41.2		21.6		(4.2		)	107.0

Total	$	1,852.0	$	255.7	$	1,044.2	$	(38.1	)	$	3,113.8

The following table presents information regarding the opening and closing balances of receivables by reporting segment of the Company for the six months ended June 30, 2018 (in millions):

	Mexican Open-Pit		Mexican IMMSA Unit		Peruvian Operations		Corporate & Elimination		Consolidated
As of June 30, 2018:
Trade receivables	$	503.3	$	62.9	$	247.0	$	—	$	813.2
Related parties	67.4		—		—		8.8		76.2

As of December 31, 2017:
Trade receivables	$	556.2	$	79.7	$	254.7	$	—	$	890.6
Related parties	18.0		—		—		8.1		26.1

Provisionally priced sales: At June 30, 2018, the Company has recorded provisionally priced sales of copper at average forward prices per pound, and molybdenum at the June 30, 2018 market price per pound. These sales are subject to final pricing based on the average monthly London Metal Exchange (“LME”), or New York Commodities Exchange (“COMEX”), copper prices and Dealer Oxide molybdenum prices in the future month of settlement.

Following are the provisionally priced copper and molybdenum sales outstanding at June 30, 2018:

	Sales volume (million lbs.)	Priced at (per pound)		Month of settlement
Copper	31.3	$	2.96	July through September 2018
Molybdenum	10.0	$	10.60	July through September 2018

The provisional sales price adjustment included in accounts receivable and net sales at June 30, 2018 includes negative adjustments of $2.1 million and $13.8 million for copper and molybdenum, respectively.

Management believes that the final pricing of these sales will not have a material effect on the Company’s financial position or results of operations.