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INCOME TAXES: (Tables)

12 Months Ended

Dec. 31, 2018

INCOME TAXES:

Components of the provision for income taxes

(in millions)		2018			2017			2016
U.S. federal and state:
Current		$	2.6		$	—		$	—
Deferred			(13.0)			686.2			(109.4)
Uncertain tax positions			—			16.2			20.3
			(10.4)			702.4			(89.1)
Foreign (Peru and Mexico):
Current			1,102.4			951.7			625.0
Deferred			(38.5)			(60.7)			(34.8)
			1,063.9			891.0			590.2
Total provision for income taxes		$	1,053.5		$	1,593.4		$	501.1

Schedule of source of income

(in millions)		2018			2017			2016
Earnings by location:
U.S.		$	(2.3)		$	(1.5)		$	(1.9)
Foreign
Peru			441.8			284.6			(85.7)
Mexico			2,149.9			2,019.6			1,343.6
			2,591.7			2,304.2			1,257.9
Earnings before taxes on income		$	2,589.4		$	2,302.7		$	1,256.0

Reconciliation of the statutory income tax rate to the effective tax rate

The reconciliation of the statutory income tax rate to the effective tax rate for the three years ended December 31, 2018, is as follows (in percentage points):

		2018		2017		2016
Expected tax at U.S. statutory rate		21.0	%	35.0	%	35.0	%
Foreign tax at other than statutory rate, net of foreign tax credit benefit (1)		13.9		0.6		2.0
Percentage depletion		(2.1)		(2.9)		(2.7)
Other permanent differences		0.4		5.2		—
Change in 2017 valuation allowance on U.S. deferred tax assets, foreign tax credits and U.S. tax effect on Peruvian deferred		7.5		26.9		—
Additional valuation allowance on 2018 U.S. deferred tax assets, foreign tax credits and U.S. tax effect on Peruvian deferred		1.0		—		—
Decrease in 2017 U.S. deferred tax asset due to tax rate changes		(0.2)		4.8		—
U.S. one time transition tax on accumulated foreign earnings		0.4		2.4		—
Increase (decrease) in unrecognized tax benefits for uncertain tax positions		—		0.7		0.2
Repatriated foreign earnings		—		(2.0)		3.6
Amounts (over) / under provided in prior years		(1.3)		(0.1)		(0.5)
Other		0.1		(1.4)		2.3
Effective income tax rate		40.7	%	69.2	%	39.9	%

(1) Foreign tax at other than statutory rates, net of foreign tax credit benefit, also includes the effects of permanent differences in Peru and Mexico, that are determined at the local statutory rate.

Schedule of deferred tax assets and liabilities

		At December 31,
(in millions)		2018			2017
Assets:
Inventories		$	61.5		$	47.0
Capitalized exploration expenses			11.1			9.5
U.S. foreign tax credit carryforward, net of FIN 48 liability			483.4			280.2
U.S. tax effect of Peruvian deferred tax liability			165.1			174.1
Provisions			155.0			152.6
Mexican tax on consolidated dividends			14.8			14.5
Deferred workers participation			27.0			3.0
Accrued salaries, wages and vacations			9.1			7.2
Sales price adjustment (PUI)			2.7			—
Social responsibility expenses			2.1			2.1
Deferred charges			6.1			—
Valuation allowance on U.S. deferred tax assets, foreign tax credits and U.S. tax effect on Peruvian deferred			(819.1)			(619.6)
Other			10.1			1.6
Total deferred tax assets			128.9			72.2
Liabilities:
Property, plant and equipment			(137.3)			(130.3)
Deferred charges			—			(16.9)
Unremitted foreign earnings			—			—
Sales price adjustment (PUI)			—			(0.4)
Other			(0.4)			(5.3)
Total deferred tax liabilities			(137.7)			(152.9)
Total net deferred tax (liabilities) / assets		$	(8.8)		$	(80.7)

Summary of expiry of foreign tax credits

Year		Amount
2022			51.5
2023			69.2
2024			102.0
2025			189.5
2026			104.8
2028			172.1
Total		$	689.1

Schedule of reconciliation of amount of unrecognized tax benefits

The total amount of unrecognized tax benefits in 2018, 2017 and 2016, was as follows (in millions):

		2018			2017			2016
Unrecognized tax benefits, opening balance		$	214.5		$	304.0		$	400.0
Gross increases—tax positions in prior period			—			(89.5)			3.9
Gross increases—current-period tax positions			—			—			23.3
Decreases related to settlements with taxing authorities			—			—			(123.2)
			—			(89.5)			(96.0)
Unrecognized tax benefits, ending balance		$	214.5		$	214.5		$	304.0

Summary of tax years remaining open to examination and adjustment in major tax jurisdictions

Peru:		2013 and all subsequent years
U.S.:		2011 and all subsequent years
Mexico:		2013 and all subsequent years

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