Teck Resources Limited Class A · TSX:TECK.A
Teck Resources Limited Class A — Q1 2009 Earnings Presentation
30 slides from Teck Resources Limited Class A's earnings presentation, Apr 21, 2009
Slide 1: 1st Quarter 2009 Investor Conference Call and Webcast
1st Quarter 2009 I Investor t C Conference f Call C ll andd W Webcast b t April p 21,, 2009
Slide 2: Forward Looking Information
Forward Looking Information Both these slides and the accompanying oral presentation contain certain forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward- looking information within the meaning of the Securities Act (Ontario)
Slide 3: Forward Looking Information
Forward Looking Information These forward-looking statements involve numerous assumptions, risks and uncertainties and actual results may vary materially. These statements are based on a number of assumptions, including, but not limited to, assumptions regarding general business and economic conditi
Slide 4: Q1 Investor Conference Call Speakers
Q1 Investor Conference Call • Speakers D Don Li Lindsay d P President id t & CEO Ron Millos SVP Finance & CFO 4
Slide 5: 1st Quarter 2009 Highlights
1st Quarter 2009 Highlights • Cash Operating Profit $765 million • Net Earnings $241 million • Tax T refunds f d off $801 million illi • Cash Balance $ $1.6 Billion • US$300 million in Asset sales announced • Debt re-scheduling amendment agreement reached h d 5
Slide 6: 1st Quarter 2009 Earnings
1st Quarter 2009 Earnings Earnings* Q1 Earnings per Share (C$) 1.00 Q1 Q1 Q4 2009 2008 2008 Net Earnings* Earnings $229 $344 $(603) 0.50 0 50 ($millions) $0.78 EPS $0.47 $0.78 $(1.27) $0.47 0.00 2009 2008 * Net Earnings (loss) from Continuing Operations 6
Slide 7: Improved Operating Results
Improved Operating Results ($millions) Q1 ‘08 Q1 ‘09 • Revenues $1,542 $1,708 +10.8% • Operating profit $549 $765 +28.8% before depreciation p and p pricing g adjustments j • Operating Margin 36% 45% 7
Slide 8: Comparative Earnings
Comparative Earnings ($ millions, net of taxes) Q1 ’09 Q1 '08 Q4 '08 Earnings as Reported $241 $345 $(607) Derivative (gains) losses 24 - (156) I Impairment i t Charges Ch - - 844 Asset Sales & Other (168) (8) 94 F/X / Losses osses 203 03 - - Tax Items (30) (11) (39) Adjusted Net Earnings 270 326 13
Slide 9: Fx Impact on Debt
Fx Impact on Debt C$/US$ Actual C$ @ March 31st 1.26 1.22 Total Debt $13.2B $12.8B Equity $11.3B $11.4B Debt Ratio 54% 53% Fx Gain (Loss) $(203)M Nil After tax Earnings $241 M $444 Per share $0.47 $0.91 9
Slide 10: Quarterly Average Prices
Quarterly Average Prices US$ CDN$ Q1 '09 Q1 '08 Q1 '09 Q1 '08 Copper ($/lb) $1 56 $1.56 $3 54 $3.54 $1 93 $3.54 $1.93 $3 54 - 45% Zinc ($/lb) $0.53 $1.10 $0.66 $1.10 - 40% Lead ($/lb) $0 53 $0.53 $1 31 $1.31 $0 66 $1.31 $0.66 $1 31 - 50% Coal ($/t) $ 204 $ 96 $ 237 $ 96 + 147% CAD / USD $1 24 $1.24
Slide 11: Quarterly Metal Prices
Quarterly Metal Prices Copper – LME Stocks & Price 200 600 Stocks Qtr end $1.83 Price 500 180 400 160 Qtr avg $1.56 300 Lead – LME Stocks & Price 200 65 70 Stocks 140 Qtr end $0.58 $0 58 60 Price 100 60 Qtr open $1.39 50 120 0 55 Qtr avg $0.53 40 Jan Feb Mar 50 30 Zinc – LME Stocks & Price 20 65 500
Slide 12: Operating Profit
Operating Profit Before Depreciation p & Pricing g Adjustments j Q1 2009 Q1 2008 Gold Coal Gold 2% Copper 4% 2% 22% Zinc 31% Copper 63% Zinc 8% Coal 68% 12
Slide 13: Coal
Coal Q1 Q1 Q4 2009 2008 2008 Coal – Mt * P d ti Production 4.0 4 0 3.1 3 1 4.4 4 4 Sales 3.7 3.0 3.9 Average Price (US$/tonne) 204 96 247 (C$/ (C$/tonne) ) 237 96 285 C$ millions Financial Results Revenue 874 221 1,063 , Operating Profit 519 26 516 (Before Depreciation) * Direct and indirect shares.
Slide 14: Copper
Copper Q1 Q1 Q4 Copper in Concentrate– Concentrate kt 2009 2008 2008 Production 47 45 56 Sales 56 43 60 Copper Cathode – kt Production 27 26 28 Sales 27 25 27 Moly in Concentrate – M lbs Production 1.9 1.6 2.1 Sales 1.8 1.6 1.8 Financial Results C$ millions Revenue 447 716 145 Operating Profit 168 3
Slide 15: Zinc
Zinc Q1 Q1 Q4 2009 2008 2008 Zinc in concentrate – kt Production 167 175 149 Sales 130 135 199 Refined Zinc – kt Production 58 74 65 Sales 57 73 60 Lead in Concentrate – kt Production 33 39 28 Sales 1 3 60 Refined Lead – kt Production 19 26 21 17 24 20 S l Sales Financial Results C$ millions Revenue
Slide 16: Gold
Gold Q1 Q1 Q4 2009 2008 2008 Pogo (40%) Grade (g/tonne) 17.1 15.8 18.2 Production (k oz) 36 33 36 Cash Costs (US$/oz) 500 546 464 C$ millions Financial Results Revenue 39 32 34 Operating Profit 18 13 14 (Before Depreciation) 16
Slide 17: Q1 Investor Conference Call Speakers
Q1 Investor Conference Call • Speakers D Li Don Lindsay d P id t & CEO President Ron Millos SVP Finance & CFO 17
Slide 18: Final Pricing Revenues
Final Pricing Revenues Outstanding from Q4 & Settled in Q1 Valued Settled Revenue Adj. (C$ M) M lbs US$/lb M lbs US$/lb Before Tax* After Tax* Copper 164 $1.40 151 $1.53 21 Zinc 195 $0.54 195 $0.53 (2) Lead 45 $0 42 $0.42 45 $0.51 $0 51 3 Other 0 Total $22 $14 Adjustments on Sales within Q1 $51 $29
Slide 19: 1st Quarter 2009 - Cash Changes
1st Quarter 2009 - Cash Changes $Millions Cash Flow from Operations 560 Working Capital Changes 567 Repayment of Debt (82) Capital Expenditures (132) Investments (232) Proceeds from Asset Sales & Other 95 Exchange & Other 6 Cash & STI Increase 782 19
Slide 20: Hedges
Hedges Currency • US$39 million @ C$1.02 / $US maturing in April Copper • 45 million illi pounds d att M h 31st att US$1.69/lb March US$1 69/lb • 38 million pounds added in April at US$2.05/lb • 83 million pounds (~ 50% of production) thru July at US$1 US$1.86/lb 86/lb 20
Slide 21: Q1 Investor Conference Call Speakers
Q1 Investor Conference Call • Speakers R Mill Ron Millos SVP Finance Fi & CFO Don Lindsay President & CEO 21
Slide 22: Andacollo Concentrate Project
Andacollo Concentrate Project j 22
Slide 23: Andacollo Concentrate Project
Andacollo Concentrate Project 23
Slide 24: Andacollo Concentrate Project
Andacollo Concentrate Project 24
Slide 25: Corporate Developments cont'd
Corporate Developments cont’d cont d Fort Hills • Lease terms extended to 2019 • $330 million investment commitment 2009 • $226 million spent Q1 • $100 million remaining for 2009 • Strategic g alternatives being g explored p 25
Slide 26: Corporate Developments cont'd: Gold Asset Sales
Corporate Developments cont’d cont d Gold Asset Sales • Lobo-Marte US$141 million proceeds • Hemlo Sold - US$65 million - Q2 close expected • Andacollo Gold stream S ld ~US$265 Sold US$265 million illi - Q2 close l expected t d 26
Slide 27: Corporate Developments cont'd: Gold Asset Sales
Corporate Developments cont’d cont d Gold Asset Sales • Pogo Advanced discussions • Morelos,, Turkey y Exploration p Strong expressions of interest Indicative offers received Advanced discussions with potential purchasers underway 27
Slide 28: Debt Re-scheduling
Debt Re-scheduling • Commitment letter to amend terms • US$4.4 billion of 2009 payments deferred • Bridge facility extended to October 30 30, 2011 • Term facility extended to December 31, 2012 (in billions of U.S. dollars) 2009 2010 2011 2012 Total Amended mandatory payments $1 1.862 862 $1 1.075 07
Slide 29: Summary
Summary • Good operating cash flow generation • Asset sale programs progressing • Tax refunds generate substantial cash • Debt being reduced • Debt D bt amended d d tto provide id flflexibility ibilit • Positioned to re-establish strong balance sheet 29
Slide 30: 1st Quarter 2009 Investor Conference Call and Webcast
1st Quarter 2009 I Investor t C Conference f Call C ll andd W Webcast b t April p 21,, 2009