First Quantum Minerals Ltd. · TSX:FM
First Quantum Minerals — Q4 2020 Earnings Presentation
24 slides from First Quantum Minerals's earnings presentation, February 2021
Slide 1: First Quantum Minerals
& FIRST QUANTUM MINERALS
Slide 2: Cautionary Statement on Forward-Looking Information
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 i
Slide 3: Tristan Pascall, Chief Operating Officer
Tristan Pascall Chief Operating Officer
Slide 4: Q4 & Full Year Operational Highlights
Q4 & FULL YEAR OPERATIONAL HIGHLIGHTS Record Annual Copper Production & Lowest Costs in 4 Years ▸SENTINEL ▸RAVENSTHORPE ▸ Record copper production – over 250kt ▸ Ramp-up continues ▸ Continued cost improvement – Record annual C1 costs ▸ Stronger second half expected with ore from Shoemaker Levy ▸ 57
Slide 5: Climate Change Commitments
CLIMATE CHANGE COMMITMENTS • Identify and manage climate-related physical and financial risks and opportunities • Use less energy, improve efficiency and reduce wastage and emissions through innovation • Prioritize environmentally friendly energy sources • As responsibly as we can we will mine the m
Slide 6: Hannes Meyer, Chief Financial Officer
Hannes Meyer Chief Financial Officer
Slide 7: Overview
OVERVIEW Record annual copper production achieved, with highest ever production at Sentinel and a strong contribution from Cobre Panama, despite the additional challenges faced in the year. Copper production of 779k tonnes was 11% higher Gold production of 265k ounces was 3% higher than 2019 and wit
Slide 8: Q4 Summary – Production
Q4 SUMMARY – PRODUCTION1, 2 Total Copper Production 203k tonnes In line with Q4 2019 ‣ Sentinel achieved quarterly production of 63kt, a 24% ‣ Total gold production was 12% lower than Q4 2019. increase compared to Q4 2019. ‣ Cobre Panama produced 25koz of gold in the ‣ Cobre Panama set new quarterly
Slide 9: Quarterly Unit Cash Costs
QUARTERLY UNIT CASH COSTS Full year copper C1 cash cost of $1.21/lb, lowest level in four years Full year C1 and AISC and $0.10/lb lower than 2019. comfortably within guidance TOTAL C1 COST AISC 1.73 1.77 1.24 1.30 1.28 1.64 1.20 1.21 1.62 1.63 1.07 1.48 Guidance Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2
Slide 10: Q4 Summary Financial Overview
Q4 SUMMARY FINANCIAL OVERVIEW Comparative earnings per share of $0.08, 51% higher than Q4 2019 $ Million (except per share numbers) Q4 2020 Q3 2020 Q2 2020 Q1 2020 Q4 2019 • Comparative earnings for the Revenue 1,601 1,402 1,014 1,182 1,284 fourth quarter of $53 million Gross Profit 443 346 141 147
Slide 11: Changes to Q4 Comparative EBITDA
CHANGES TO Q4 COMPARATIVE EBITDA 1,2 42% increase in Q4 comparative EBITDA from higher revenues and lower cash costs 2 1 Comparative EBITDA is not a GAAP measure, a reconciliation to GAAP is presented in the appendix. 2 Underlying comparative EBITDA is shown after impact of market metal prices and f
Slide 12: Debt and Liquidity Profile
DEBT AND LIQUIDITY PROFILE DEBT MATURITY AS AT DECEMBER 31, 2020 $ millions October 2020 Re-financing 1,600 1,500 1,350 On October 1, 2020 the 1,200 Company completed the 1,000 offering of $1.5 billion of 850 Senior Notes due 2027. 600 561 Proceeds were used to partially repay the Company’s exis
Slide 13: Copper Hedging Program Outlook
COPPER HEDGING PROGRAM OUTLOOK¹ Approximately 40% of expected copper sales for the next 12 months hedged 175.0 3.50 $/lb Kt ‣ The Company has unmargined 150.0 3.25 nickel forward sales contracts and 122.0 collars for 2,251 tonnes at an 125.0 3.00 average price of $6.96 per lb 105.8 outstanding with
Slide 14: Appendix
APPENDIX
Slide 15: Quarterly Net Debt Movement
QUARTERLY NET DEBT MOVEMENT Quarterly Annual movement from movement from September 30, December 31, 2020 2019 Opening Net Debt ($ million) (7,545) (7,675) Comparative EBITDA 725 2,152 Working capital (79) (203) Capital expenditure (172) (610) Interest paid (85) (574) Acquisition of Korea Panama Mini
Slide 16: 2021–2023 Guidance – Production and Cost
2021 – 2023 GUIDANCE – PRODUCTION AND COST Guidance provided below is based on a number of assumptions and estimates as of December 31, 2020, including among other things, assumptions about metal prices and anticipated costs and expenditures. Guidance involves estimates of known and unknown risks, u
Slide 17: 2021–2023 Guidance – Capital Expenditure
2021 – 2023 GUIDANCE – CAPITAL EXPENDITURE Capital spending in 2020 was $65 million lower than guidance of $675 million. Capital expenditure of $950 million is expected in 2021 and 2022, which includes $40 million in each year on the smelter expansion at Kansanshi. 2021 and 2022 also includes a tota
Slide 18: 2021–2023 Guidance – Production by Operation
2021 – 2023 GUIDANCE – PRODUCTION1 BY OPERATION Copper production guidance (000’s tonnes) 2021 2022 2023 Cobre Panama 300 – 330 310 – 340 330 – 360 Kansanshi 210 – 225 200 – 210 210 – 220 Sentinel 230 – 250 265 – 280 270 – 290 Other sites2 45 30 10 Gold production guidance (000’s ounces) 2021 2022 2
Slide 19: 2020 Guidance – Interest, Tax and Depreciation
2020 GUIDANCE – INTEREST, TAX AND DEPRECIATION Interest Net interest expense for the year ended December 31, 2020, was $738 million. A significant proportion of the Company’s interest expense is incurred in jurisdictions where no tax credit is recognized. Interest expense for the full year 2021 is e
Slide 20: Precious Metal Stream Arrangement
PRECIOUS METAL STREAM ARRANGEMENT • Cobre Panama gold and silver revenues consist of revenues derived from the sale of metals produced by the mine, and also revenues recognized from the amortization of the precious metal stream arrangement. • Stream gold and silver revenues are indexed to copper sol
Slide 21: Non-GAAP Measures Reconciliation
NON-GAAP MEASURES RECONCILIATION COMPARATIVE EBITDA AND COMPARATIVE EARNINGS Q4 2020 Q3 2020 Q4 2019 FY 2020 FY 2019 Operating profit 357 257 69 695 474 Depreciation 326 323 290 1,217 907 Impairment charges, write-off of assets and other costs - - 99 - 112 associated with the mine interruption at La
Slide 22: Non-GAAP Measures Reconciliation: C1 and AISC
NON-GAAP MEASURES RECONCILIATION: C1 and AISC $ million Q4 2020 Q4 2019 FY 2020 FY 2019 Cost of sales (1,158) (1,025) (4,122) (3,277) Depreciation 326 290 1,217 907 By-product credits 181 165 659 464 Royalties 93 61 270 219 Treatment and refining charges (52) (58) (182) (164) Freight costs (20) (14)
Slide 23: EBITDA Sensitivity
EBITDA SENSITIVITY Impact on YTD Actual price/rate EBITDA of a 10% Assumption YTD December change in price/ 2020 rate Copper (includes hedge impact) $2.79/lb $192 million Gold $1,770/oz $44 million Nickel (includes hedge impact) $6.25/lb $2 million Zambian kwacha 18.29 ZMW/USD $20 million FM 23
Slide 24: Contact: info@fqml.com, TSX FM
info@fqml.com 416-361-6400 | 1-888-688-6577 TSX FM
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