Teck Resources Limited Class A · TSX:TECK.A
Teck Resources Limited Class A — Q3 2024 Earnings Presentation
32 slides from Teck Resources Limited Class A's earnings presentation, Oct 24, 2024
Slide 1: Third Quarter 2024 Conference Call
Change photo THIRD QUARTER 2024 CONFERENCE CALL October 24, 2024
Slide 2: Caution Regarding Forward-Looking Statements
CAUTION REGARDING FORWARD-LOOKING STATEMENTS Both these slides and the accompanying oral presentation contain certain forward-looking information and forward-looking statements as defined in applicable securities laws (collectively referred to as forward-looking statements). These statements relate
Slide 3: Agenda
AGENDA Third Quarter 2024 Overview Third Quarter 2024 Results Closing Remarks and Q&A 3
Slide 4: Third Quarter 2024 Overview
THIRD QUARTER 2024 OVERVIEW Jonathan Price President and Chief Executive Officer Photo: Red Dog Operations. 4
Slide 5: Q3 2024 Highlights
Q3 2024 HIGHLIGHTS Transformed to a pure-play energy transition metals company Transformed portfolio to focus on energy transition metals – closed sale of EVR on July 11th Strong returns to shareholders of $720M in Q3 2024, with >$1.3B in YTD to October 23rd Strong balance sheet with $1.5B of debt r
Slide 6: Continued Focus on Safety and Sustainability Leadership
CONTINUED FOCUS ON SAFETY AND SUSTAINABILITY LEADERSHIP Strong safety performance year-over year Safety & Health Teck-Operated High Potential Incident Performance1 • We are deeply saddened by an employee fatality at Antamina (per 200k hours worked) in July High Potential Incident Frequency Serious H
Slide 7: Update on QB Ramp-Up
UPDATE ON QB RAMP-UP Higher QB copper production quarter-over-quarter Plant Throughput Performance Near Design Rates Focus on Improving Cu Recovery & On-Line Time Pre-commissioning / Ramp-up 100 Commissioning 2 SAG mills & 4 ball mills Achieved design capacity Design recovery rates 86-92% 90 180 80
Slide 8: Updated 2024 Guidance
UPDATED 2024 GUIDANCE Reflects revised operational outlook and narrowed guidance ranges Zinc Strong operational performance at Red Dog drove an improvement in our zinc net cash unit cost* guidance, which declined (US$0.10/lb) to US$0.45–0.55/lb No change to Red Dog zinc production guidance Impact of
Slide 9: Progress on Value-Accretive Near-Term Copper Projects
PROGRESS ON VALUE-ACCRETIVE NEAR-TERM COPPER PROJECTS Low capital-intensity, high-returning copper projects QB Optimization Highland Valley San Nicolás Zafranal and Debottlenecking Mine Life Extension (Cu-Mo-Ag | Brownfield | Tarapacá | 60%) (Cu-Mo | Brownfield | British Columbia | 100%) (Cu-Zn Ag-A
Slide 10: Third Quarter 2024 Results
THIRD QUARTER 2024 RESULTS Crystal Prystai Executive Vice President and Chief Financial Officer 10
Slide 11: Q3 2024 Financial Performance
Q3 2024 FINANCIAL PERFORMANCE Significant cash returns to shareholders Significant improvement in financial • Returned $720M to shareholders in Q3 2024; performance in Q3 2024 vs. Q3 2023, total of >$1.3B year-to-date to October 23rd excluding Trail Operations impairment − $322M in dividends Gross p
Slide 12: Q3 2024 Profitability
Q3 2024 PROFITABILITY Adjusted EBITDA more than doubled Profitability ($M) Profit (Loss) from Continuing Operations before Taxes Net Finance Expense D&A Adjustments Controllable Non-Controllable Adjusted EBITDA* 72 $986 276 12 Adjusted 225 53 EBITDA* Adjustments reflect $417 (69) 1094 the post-tax 6
Slide 13: Copper Segment
COPPER SEGMENT Another consecutive record quarter of copper production, driven by QB ramp up Highlights in Q3 2024 vs. Q3 2023 Performance in Q3 2024 vs. Q3 2023 • Increased profitability driven by higher sales volumes, Realized Production Sales Revenue Net Cash Gross Profit* Gross Profit Price Unit
Slide 14: Zinc Segment
ZINC SEGMENT Another strong quarter at Red Dog Highlights in Q3 2024 vs. Q3 2023 Performance in Q3 2024 vs. Q3 2023 • Increased profitability reflects higher prices, by-product Realized Production Concentrate Sales Concentrate Revenue Net Cash Gross Profit* Gross Profit credits as well as lower trea
Slide 15: Resilient Balance Sheet
RESILIENT BALANCE SHEET Significant cash returns to shareholders and debt reduction NET CASH Term notes outstanding are long dated (US$M)1 DEBT REDUCTION POSITION* in Q3 2024 as at September 30, 2024 253 177 188 195 167 113 $1.8B US$1.5B 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 20
Slide 16: Closing Remarks
CLOSING REMARKS Jonathan Price President and Chief Executive Officer 16
Slide 17: Responsible Growth and Value Creation
RESPONSIBLE Driven by our purpose and values, we will grow to become one of the world’s leading providers of GROWTH AND responsibly-produced energy transition metals VALUE CREATION Balancing growth with cash returns to shareholders Our strategy is focused around four pillars: METALS FOR THE VALUE-DR
Slide 18: Delivering on Strategy
DELIVERING ON STRATEGY Executing across all four strategic pillars Metals for the Energy Transition Value-driven Growth YTD gross profit before D&A*, % Base metals in portfolio: Shareholder returns YTD: Total growth capital YTD 75% (excluding QB): copper 25% 100% >$1.3B $302M zinc Core Excellence Re
Slide 19: Continuing to Create Value for Shareholders
CONTINUING TO CREATE VALUE FOR SHAREHOLDERS Transformed portfolio to focus on energy transition metals Focus on driving strong operational and financial performance Good progress on QB and nearing final stages of ramp-up Progressing with record shareholder returns - $3.25B authorized in 2024 Financi
Slide 20: Third Quarter 2024 Q&A
THIRD QUARTER 2024 Q&A Jonathan Price President and Chief Executive Officer 20
Slide 21: Appendix
APPENDIX 21
Slide 22: Short-Term Copper Market Fundamentals
SHORT-TERM COPPER MARKET FUNDAMENTALS Concentrate tightness impacting metal production • Global mine production below expectations Global Mine Production Continues to Slip Forecast Mine Production Disruption Forecast − 2023 below by >2.7 Mt 23,000 2024 2025 Thousand Tonnes − 2024 estimates now down
Slide 23: Long-Term Copper Market Fundamentals
LONG-TERM COPPER MARKET FUNDAMENTALS Significant demand growth; constrained supply; higher prices • Copper exploration spending peaked over a Long-Term Total Copper Demand2 (Mt) decade ago Non-Energy Transition Specific Energy Transition • Near-term quality mine projects limited; 60 >$150B investmen
Slide 24: Short-Term Zinc Market Fundamentals
SHORT-TERM ZINC MARKET FUNDAMENTALS Mine closures pushed market into concentrate tightness • Low zinc prices forced mine closures last year Drivers of Concentrate Deficit1 (kt) 2025 mine forecast • Concentrate tightness most severe on record below 2024 guidance 13,500 +738 13,412 • 2024 global mine
Slide 25: Long-Term Zinc Market Fundamentals
LONG-TERM ZINC MARKET FUNDAMENTALS Weak prices and underinvestment are expected to drive longer-term shortages • Lack of investment in new mines expected to slow Long-Term Total Zinc Demand1 (Mt) mine growth by 2026 Zone of Balance Zinc Balance Zinc Supply Zinc Demand • Global mine production flat s
Slide 26: Copper Guidance
COPPER GUIDANCE Includes Quebrada Blanca Copper in Concentrate Production1,2 (kt) Net Cash Unit Costs*,1,3 (US$/lb) Quebrada Blanca Highland Valley Antamina (22.5%) Carmen de Andacollo 510-590 550-620 (was 550-620) 530-600 1.90-2.30 420-455 50-60 45-55 1.87 (was 435-500) 50-60 80-90 90-100 85-95 1.5
Slide 27: Zinc Guidance
ZINC GUIDANCE Zinc in Concentrate Production1,2 (kt) Net Cash Unit Costs*,1,3 (US$/lb) Red Dog Sales1,4 (kt) Red Dog Antamina (22.5%) 252 644 0.55 0.45-0.55 565-630 555-615 (was 0.55-0.65) 104 45-60 0.44 465-525 95-105 155-185 55-65 400-445 540 520-570 35-45 460-510 410-460 365-400 2023 2024E 2025E
Slide 28: Sensitivities
SENSITIVITIES Estimated Effect of Changes on our Annualized Profitability1 ($M) Estimated Effect on Adjusted Profit (Loss) 2024 Mid-Range from Continuing Operations Estimated Effect on Production Estimates2 Attributable to Shareholders3 Adjusted EBITDA*, (kt) Changes ($M) 3($M) US$ exchange C$0.01 $
Slide 29: Settlement Pricing Adjustments
SETTLEMENT PRICING ADJUSTMENTS Simplified Settlement Pricing Adjustment Model Total Reported Settlement Pricing Adjustments (Pre-tax settlement pricing adjustment in C$M) (Pre-tax settlement pricing adjustment in C$M) 300 Q3 2024 Outstanding at Outstanding at Quarterly Pricing 230 September 30, 2024
Slide 30: Endnotes
ENDNOTES SLIDE 6: CONTINUED FOCUS ON SAFETY AND SUSTAINABILITY LEADERSHIP SLIDE 26: COPPER GUIDANCE 1. Represents a 55% reduction in work hours year-to-date compared to the same period last year due to the sale of the steelmaking 1. As at October 23, 2024. See Teck’s Q3 2024 press release for furthe
Slide 31: Non-GAAP Financial Measures and Ratios
NON-GAAP FINANCIAL Our financial results are prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International MEASURES Accounting Standards Board. This presentation includes reference to certain non-GAAP financial measures and non-GAAP ratios, which are n
Slide 32: Third Quarter 2024 Conference Call
Change photo THIRD QUARTER 2024 CONFERENCE CALL October 24, 2024