Moody's: Phelps Dodge stable

Moody's Investors Service said it changed Phelps Dodge's outlook to stable from negative and affirmed all of Phelps Dodge's existing ratings.

Among the ratings affirmed are Phelps Dodge Corp.'s senior unsecured notes, debentures and IRBs at Baa3, shelf registration for senior unsecured debt at prospective Baa3, and preferred stock and junior convertible preferred stock at prospective Ba2.

Moody's said the change to a stable outlook reflects the improved fundamentals in the copper market and Moody's expectation that Phelps Dodge will evidence solid strengthening in earnings and debt protection measures in 2004, and maintain its focus on debt reduction and the management of debt in its capital structure.

The stable outlook also acknowledges Phelps Dodge's focus on free cash generation and management of its debt profile during the recent difficult copper market environment and consequent improvement in debt protection measures. The outlook also considers the success of the company's Quest for Zero program, which has helped lower its costs.

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