(In United States dollars, except where noted otherwise)
TORONTO, Feb. 14, 2019 /PRNewswire/ -- First Quantum Minerals Ltd. ("First Quantum" or the "Company") (TSX: FM) today reported comparative earnings1 of $182 million ($0.26 per share1), net earnings attributable to shareholders of the Company1 of $198 million ($0.29 per share) and cash flows from operating activities of $338 million ($0.49 per share1) for the three months ended December 31, 2018 ("Q4").
For the full year 2018, the Company reports comparative earnings1 of $487 million ($0.71 per share1), net earnings attributable to shareholders of the Company1 of $441 million ($0.64 per share1) and cash flows from operating activities of $1,980 million ($2.88 per share1).
FOURTH QUARTER AND FULL YEAR 2018 SUMMARY:
CEO'S COMMENTS
"2018 was a very important year for the Company with the development of Cobre Panama nearing completion. We achieved record production for the year, ahead of target, and in line with the expected low unit production costs. Much of this was due to a 17% increase in production at Sentinel," noted Philip Pascall, Chairman and CEO. "Our financial results for the quarter and the full year reflect this strong operating performance through the year."
"2019 will be another important year for the Company. With Cobre Panama starting operation, and the continuing steady production from our existing mines, we expect significantly higher output. I appreciate and laud our staff and employees for what was accomplished in 2018 and look forward to another exciting and productive year," Mr. Pascall concluded.
OPERATING HIGHLIGHTS
Three months ended | Full year ended | |||
(U.S. dollars where applicable) | 2018 | 2017 | 2018 | 2017 |
COPPER | ||||
- Production2 (tonnes) | 158,304 | 154,319 | 605,853 | 573,963 |
- Sales4 (tonnes) | 156,212 | 151,905 | 596,513 | 580,130 |
- Cost of production3: | ||||
o AISC (per lb) | $1.68 | $1.76 | $1.74 | $1.65 |
o C1 (per lb) | $1.23 | $1.30 | $1.28 | $1.23 |
o C3 (per lb) | $2.04 | $2.16 | $2.11 | $2.05 |
- Realized price (per lb) | $2.83 | $2.50 | $2.84 | $2.33 |
GOLD | ||||
- Production (ounces) | 48,039 | 51,904 | 185,414 | 199,736 |
- Sales (ounces) | 53,221 | 50,723 | 193,072 | 201,376 |
FINANCIAL HIGHLIGHTS
Three months ended | Full year ended | |||
(U.S. dollars millions, except where noted otherwise) | 2018 | 2017 | 2018 | 2017 |
Sales revenues Gross profit
Net earnings (loss) attributable to shareholders of the Company Basic and diluted earnings (loss) per share
Comparative EBITDA1 Comparative earnings (loss)1 Comparative earnings (loss) per share1
Cash flow from operating activities |
1,054 280
198
$0.29
481 182 $0.26
338 |
885 117
(115)
($0.17)
318 (36) ($0.05)
203 |
3,966 978
441
$0.64
1,737 487 $0.71
1,980 |
3,310 335
(316)
($0.46)
1,154 (111) ($0.16)
914 |
1 Net earnings (loss) attributable to shareholders of the Company has been adjusted to exclude items which are not reflective of underlying performance to arrive at comparative earnings (loss). Comparative earnings (loss), comparative earnings (loss) per share, comparative EBITDA and cash flows per share are not measures recognized under IFRS and do not have a standardized meaning prescribed by IFRS. The Company has disclosed these measures to assist with the understanding of results and to provide further financial information about the results to investors. Refer to the "Regulatory Disclosures" section in the MD&A for the year ended December 31, 2018 for further information. | |
2 Production is presented on a copper contained basis, and is presented prior to processing through the Kansanshi smelter. | |
3 AISC, C1 and C3 costs per pound are not recognized under IFRS. Refer to the "Regulatory Disclosures" section in the MD&A for the year ended December 31, 2018 for further information. C1, C3 and AISC costs exclude third-party concentrate purchased at Kansanshi. C1, C3 and AISC costs for Q3 2018 have been revised from amounts previously disclosed to exclude the $0.03 per pound impact of third-party concentrate purchased. | |
4 Copper sales exclude the sale of copper anode produced from third-party concentrate purchased at Kansanshi. Sales of copper anode attributable to third-party concentrate purchases were 5,884 tonnes and 7,349 tonnes for the three months and year ended December 31, 2018, respectively. Q3 2018 copper sales have been adjusted to exclude copper anode sales of 1,465 tonnes attributable to third-party concentrate purchased. |
Other
Production and Cost Outlook
(000's) | 2019 | 2020 | 2021 |
Total Copper (tonnes) | 700 – 735 | 840 – 870 | 820 |
Cobre Panama – Copper2 (tonnes) | 140 - 175 | 270 - 300 | 300 |
Copper2 (tonnes) – excluding Cobre Panama | 560 | 570 | 520 |
Gold (ounces) – excluding Cobre Panama | 185 | 180 | 170 |
Zinc (tonnes) | 12 | 2 | - |
Production guidance for Las Cruces reflects the land slippage in January 2019, with lost production currently estimated at 25,000 tonnes in 2019. Production at Las Cruces for 2020 has also been reduced by a further 25,000 tonnes from amounts previously disclosed as certain high grade ore is no longer planned to be mined as part of the open pit operation. The open pit mining operations are expected to be completed in the second half of 2020.
In terms of quarterly phasing of annual production, it is expected that production at Zambian operations will be at its lowest in the first quarter. The first and second quarters will also be impacted by lower production at Las Cruces following the land slippage.
The wet season in Zambia generally starts in November and continues through April, with the heaviest rainfall normally experienced in the months of December, January, February and March. As a result of the wet season, pit access and the ability to mine ore is lower in the first quarter of the year than other quarters and the cost of mining is higher.
Cash costs and AISC guidance in the tables below does not include any costs in respect of Cobre Panama.
Copper | 2019 | 2020 | 2021 |
C13 (per lb) | $1.20 - $1.40 | $1.20 - $1.40 | $1.20 - $1.40 |
AISC3 (per lb) | $1.70 - $1.85 | $1.70 - $1.85 | $1.70 - $1.85 |
Increase in AISC guidance reflects higher Zambian royalty and gold sales levy rates effective January 1, 2019. This has increased AISC by $0.05 per lb in all three years. It is expected that a Zambian sales tax will be introduced from April 1, 2019, and that this will result in increased C1 and AISC unit costs. However, guidance given excludes the impact of the sales tax as the rate to be introduced has not yet been confirmed by the Government of the Republic of Zambia.
CONFERENCE CALL & WEBCAST
Conference call and webcast details are as follows:
Date: | February 15, 2019 |
Time: | 9:00 am (EST); 2:00 pm (GMT); 6:00 am (PST) |
Webcast: | |
Dial in: | North America: (toll free) (877) 291-4570 |
North America and international: 1 (647) 788-4919 | |
United Kingdom: (toll free) 0-800-051-7107 | |
Replay: | Available from noon (EST) on February 15, 2019 until 11:59 pm (EST) on March 3, 2019. |
North America: (toll free) (800) 585-8367 | |
North America and international: 1 (416) 621-4642 | |
Passcode: | 5469795 |
COMPLETE FINANCIAL STATEMENTS AND MANAGEMENT'S DISCUSSION AND ANALYSIS
The complete consolidated financial statements and Management's Discussion and Analysis for the year ended December 31, 2018 are available at www.first-quantum.com and should be read in conjunction with this news release.
On Behalf of the Board of Directors of First Quantum Minerals Ltd.
G. Clive Newall
President
For further information visit our website at www.first-quantum.com.
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION
Certain statements and information herein, including all statements that are not historical facts, contain forward-looking statements and forward-looking information within the meaning of applicable securities laws. The forward-looking statements include estimates, forecasts and statements as to the Company's expectations of production and sales volumes, and expected timing of completion of project development at Cobre Panama and Enterprise and are subject to the impact of ore grades on future production, the potential of production disruptions (including at Cobre Las Cruces as a result of the land slippage in January 2019), capital expenditure and mine production costs, the outcome of mine permitting, other required permitting, the outcome of legal proceedings which involve the Company, information with respect to the future price of copper, gold, nickel, zinc, pyrite, cobalt, iron and sulphuric acid, estimated mineral reserves and mineral resources, First Quantum's exploration and development program, estimated future expenses, exploration and development capital requirements, the Company's hedging policy, and goals and strategies. Often, but not always, forward-looking statements or information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate" or "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.
With respect to forward-looking statements and information contained herein, the Company has made numerous assumptions including among other things, assumptions about continuing production at all operating facilities, the price of copper, gold, nickel, zinc, pyrite, cobalt, iron and sulphuric acid, anticipated costs and expenditures and the ability to achieve the Company's goals. Forward-looking statements and information by their nature are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or information. These factors include, but are not limited to, future production volumes and costs, the temporary or permanent closure of uneconomic operations, costs for inputs such as oil, power and sulphur, political stability in Zambia, Peru, Mauritania, Finland, Spain, Turkey, Panama, Argentina and Australia, adverse weather conditions in Zambia, Finland, Spain, Turkey, Mauritania and Panama, labour disruptions, potential social and environmental challenges, power supply, mechanical failures, water supply, procurement and delivery of parts and supplies to the operations, and the production of off-spec material.
See the Company's Annual Information Form for additional information on risks, uncertainties and other factors relating to the forward-looking statements and information. Although the Company has attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements or information, there may be other factors that cause actual results, performances, achievements or events not to be anticipated, estimated or intended. Also, many of these factors are beyond First Quantum's control. Accordingly, readers should not place undue reliance on forward-looking statements or information. The Company undertakes no obligation to reissue or update forward-looking statements or information as a result of new information or events after the date hereof except as may be required by law. All forward-looking statements and information made herein are qualified by this cautionary statement.
North American contact: Lisa Doddridge, Director, Investor Relations, Tel: (416) 361-3752, Toll Free: 1 (888) 688-6577, E-Mail: lisa.doddridge@fqml.com; United Kingdom contact: Clive Newall, President, Tel: +44 140 327 3484, E-Mail: clive.newall@fqml.com