to our shareholders earnings up 20 to 3.06 a share or 1 3,1 75,000 1 6th consecutive dividend increase the fiscal year 1966 was a significant one for your company — signifi cant in terms of current earnings and even more in terms of future income most importantly during the past year our backlog of mineral sales more than doubled so that it now exceeds 1 billion and provides a solid foun dation for continuity of earnings for many years in the future both current results and future prospects benefited from a year of gratifying achievements this year's record earnings up 20 over last year amounted to $ 1 3,175,000 the equivalent of 3.06 a share compared to 1965's figure of 2.56 a share improved earnings from mining interests and construction operations more than offset lower earnings from our land development activities this year consequently we were able to increase our dividend payments to $ 1 . 1 0 a share which was 1 0 per cent above last year this represents the 16th consecutive year in which dividends have been increased and dividends have been paid in each year since 1931 net earnings and dividends 14 millions of dollars 1947 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 35 million refinancing at svi mineral backlog doubled to over 1 billion to provide funds for future growth additional long term borrowings were arranged in december 1965 a refinancing agreement was concluded with the prudential insurance company of america which provides that utah will be able to borrow up to 35,000,000 evidenced by notes bearing interest at 5[/i and due february i 1986 the timing of this refi nancing was fortuitous in view of the subsequent rapid rise in interest rates in keeping with president johnson's program regarding u s bal ance of payments approximately 7 million of financing was arranged in australia on behalf of our blackwater mine and our share of the mount goldsworthy facilities in australia the sizable increase in our mineral backlog from 500 million last year to over 1 billion resulted from the execution of a new fuel agreement covering sales of coal from our navajo property in new mexico sales from our blackwater deposit in queensland australia and three sales of uranium oxide to private users the significance of this sharp rise can be seen on the contract backlog of mineral sales graph shown on the next page the accompanying graph shows our estimate of gross revenues from mining operations excluding marcona and pima for last year and the next five years without taking into account future additions to the contract backlog these revenues will more than double by 1971 backlog of mineral sales as of october 31 gross revenue from mining operations jill mill 1966 67 68 69 70 71 navajo lo supply 6 million tons of coal annually for 1 510,000 kw expansion queensland coking coal contract finalized 13'/i million tons over 10 years beginning in 1 968 authority to prospect over 1,600 square miles solid progress has been made toward making the company's navajo mine the largest single producer of coal in the united states a group of utilities has started constructing two additional generating units adjacent to the mine site — units which will increase total generating capacity from the existing 575,000 kw to 2,085,000 kw this additional capacity will be owned by six member utilities of the west associates and will serve large areas of the southwest the first of the new 755,000 kw generating units will be in operation in early 1 969 and the other unit in early 1970 the fuel supply agreement for the 1,510,000 kw addition which was signed by utah on october 31 1966 will require about 6 million tons of coal annually when added to the present output of 2.5 million tons total production will be approximately 8.5 million tons annually the new agreement by no means exhausts the potential of the company's navajo mine total reserves amount to over 750,000,000 tons of strip pable coal — enough to meet the present electrical energy requirements of greater chicago for fifty years the company's large-scale operations at this mine make its fuel price among the lowest in the united states and its location permits it to serve the utility needs of the growing southwest the second significant addition to our backlog of coal sales was the finalization of an agreement with mitsubishi shoji kaisha ltd one of japan's largest trading companies for the sale of 13,500,000 tons of coking coal over a ten-year period from our blackwater mine now under construction in queensland australia this coal will be consumed by major japanese steel companies and a chemical company the agreement stipulates the commencement of deliveries in 1968 at a rate of 500,000 tons that year 1,000,000 tons in 1969 and 1,500,000 tons yearly there after for the completion of the contract this sale will generate approxi mately 137 million in gross revenue in the same general area of queensland as the blackwater mine utah controls 1,600 square miles of potential coking coal lands under an au thority to prospect