First Quantum Minerals Ltd. · TSX:FM
First Quantum Minerals — FY2021 Earnings Presentation
43 slides from First Quantum Minerals's earnings presentation, February 2022
Slide 1: Responsible Growth: Q4 and Full Year 2021 Financial and Operating Results
TSX FM RESPONSIBLE GROWTH Q4 and Full Year 2021 Financial and Operating Results
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: Opening Remarks
Cobre Panama CLOSING REMARKS OPENING REMARKS Tristan Pascall, Chief Operating Officer
Slide 4: Q4 and Full Year 2021 Highlights
Q4 AND FULL YEAR 2021 HIGHLIGHTS Q4 2021 Highlights New Developments Adjusted EPS¹ improves 52% quarter-over-quarter to $0.44 Completed the sale of a 30% equity interest in Ravensthorpe to POSCO for cash consideration of $240 million Copper production down 4% quarter-over-quarter to 201,823 tonnes o
Slide 5: First Quantum Minerals ESG at a Glance
FIRST QUANTUM MINERALS ESG AT A GLANCE Actions on Climate Biodiversity Environment Water Reforestation Change Net Positive Impact 0 67% 3,420 -50% Commitment to Level 4 or 5 incidents in 2020 Water reuse across our Hectares reforested in GHG emissions reduction by or 2021 operations in 2020, <1% wat
Slide 6: Cobre Panama
COBRE PANAMA Quarterly Performance COPPER PRODUCTION AND C1 CASH COSTS Production down 8% quarter-over-quarter on expected lower ore grades and unplanned 7-day shutdown of Unit 2 of the power plant 1.72 87 82 82 80 Record monthly copper production achieved in October 62 66 1.57 1.38 Planned maintena
Slide 7: Kansanshi
KANSANSHI Quarterly Performance COPPER PRODUCTION AND C1 CASH COSTS Production up 2% quarter-over-quarter on higher ore grades, partially offset by lower throughput 56 59 54 53 51 52 49 50 C1 cash costs¹ down 26% quarter-over-quarter due to a non-recurring 1.22 1.18 benefit from a reduction on opera
Slide 8: Sentinel
SENTINEL Quarterly Performance COPPER PRODUCTION AND C1 CASH COSTS Production up slightly quarter-over-quarter on record quarterly throughput 71 rates equivalent to 60 Mtpa 61 63 60 60 57 58 54 Installation of fourth in-pit crusher completed in December 2021; 1.55 1.50 1.51 Commissioning completed i
Slide 9: Three-Year Guidance
THREE-YEAR GUIDANCE Production Cobre Panama: Includes the CP100 Expansion; Production to ramp-up and exit 2023 at 100 Mtpa Kansanshi: Limited S3 production in 2024 (S3 production to ramp up in 2025); Development and timing still subject to Board approval Enterprise: First nickel production in 2023;
Slide 10: Three-Year Guidance: Production, Cost and Capex
THREE-YEAR GUIDANCE PRODUCTION GUIDANCE COST AND CAPEX GUIDANCE 2022 2023 2024 Copper Cost Guidance ($/lb) 2022 2023 2024 Cobre Panama 330 - 360 350 - 380 370 - 400 C1 cash cost ¹ 1.30 - 1.50 1.30 - 1.50 1.25 - 1.45 Kansanshi 190 - 210 190 - 210 205 - 220 AISC ¹ 1.90 - 2.05 1.90 - 2.05 1.85 - 2.00 S
Slide 11: Financial Overview
Cobre Panama Mill FINANCIAL OVERVIEW Hannes Meyer, Chief Financial Officer
Slide 12: Financial Overview
FINANCIAL OVERVIEW Significant increaseFinancial The First Quantum in net earnings Policy and EBITDA¹, as well as a notable further reduction in net debt¹. Gross profit of $2,562 million and EBITDA¹ of C1 cash cost of $1.30/lb for the year. $3,684 million for the full year. • $0.09/lb higher than 20
Slide 13: Q4 Summary Financial Overview
Q4 SUMMARY FINANCIAL OVERVIEW Basic earnings per share of $0.36 and adjusted earnings per share of $0.44 are $0.35 and $0.36 higher than Q4 The First 2020, Quantum Financial respectively, a functionPolicy of higher metal prices, together with strong operational performance. $ Million (except per sha
Slide 14: The First Quantum Approach to Financial Policy Statement
THE FIRST QUANTUM APPROACH TO FINANCIAL POLICY STATEMENT The First Quantum Financial Policy The Financial Policy Focus Debt reduction Complete target of $2 billion debt reduction by • Commitment to reduce total debt to levels appropriate H1 2022 for our business Decrease debt by a further $1 billion
Slide 15: Copper Cash Cost
COPPER CASH COST Full year copper The First QuantumC1Financial cash costPolicy and AISC of $1.30/lb and $1.88/lb achieved the midpoint of the guidance range COPPER C1 CASH COST ($/lb) COPPER AISC ($/lb) 1.40 2.10 1.30 1.95 1.20 1.80 1.10 1.39 1.65 1.29 1.30 2.05 1.28 1.26 1.00 1.24 1.91 1.87 1.88 1.
Slide 16: Significant Increase in Gross Profit
SIGNIFICANT INCREASE IN GROSS PROFIT Gross profit was 77% higher than Q4 2020, based on improved metal prices, but impacted by increased cash The First costs andQuantum Financial Policy higher royalties. $ million 16
Slide 17: Net Debt Evolution
NET DEBT¹ EVOLUTION Cobre Panama Peak Commercial Net debt Production 7,675 7,615 7,658 7,579 7,545 7,409 4.8x 4.8x 4.5x 4.6x 7,062 $1.6B 3.9x 6,751 Reduction $ Million 3.4x 2.8x 6,302 6,053 2.2x 1.9x 1.6x Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 19 19 20 20 20 20 21 21 21 21 Net Debt Leverage • Net debt¹ decre
Slide 18: Debt Maturity and Hedge Profile
DEBT MATURITY AND HEDGE PROFILE 2,383 Pro forma debt maturity profile 545 Refinancing has removed all material debt $ Million 1,455 1,500 1,305 488 maturities to April 2023. 455 1,000 455 Single Net debt¹ to EBITDA¹ covenant ratio set at 283 1,350 1,500 1,000 850 1,000 3.5 times over the Facility te
Slide 19: Closing Remarks
Cobre Panama CLOSING REMARKS CLOSING REMARKS Tristan Pascall, Chief Operating Officer
Slide 20: Outlook for 2022 and Beyond
OUTLOOK FOR 2022 AND BEYOND The Path Forward – focus on debt reduction and brownfield projects 1. Capital Allocation 2. Brownfield 3. Greenfield Debt Reduction Cobre Panama Ramp-up Cautious approach to greenfield • Progressing toward 85 Mtpa until debt reduction achieved • Remains a priority • On tr
Slide 21: CP100 Expansion
CP100 EXPANSION Currently underway Expansion to 100 Mtpa (from 85 Mtpa) • Process water upgrades • 2 m diameter, 9 km long pipeline from the tailings storage facility decant area to the process water tank • Additional ball mill (Ball Mill 6) • Provides a second ball mill into milling train three • N
Slide 22: S3 Expansion
S3 EXPANSION Benefits from earthworks, concrete already having been completed Expansion of existing sulphide processing facilities to 53 Mtpa (from 25 Mtpa) • Additional concentrator capacity • An additional SAG and ball mill • Construction of overland conveyor • Flowsheet based on existing copper s
Slide 23: Enterprise
ENTERPRISE 4 Mtpa processing circuit was mainly constructed in 2014 as part of Sentinel Minimal infrastructure is proposed at Enterprise • Mined ore to be hauled to the Sentinel processing plant Initial mining activity will focus on pre-strip of oxide and transitional ore The proposed mine plan span
Slide 24: Las Cruces Underground Project
LAS CRUCES UNDERGROUND PROJECT Benefits from existing team, workforce and infrastructure Indicative details (not included in 3-year guidance) • 3-4 year development • Mine life >15 years • Annual production ~45 ktpa CuEq Environmental permits received in 2020; Mine exploitation permit received in 20
Slide 25: Summary of Brownfield Projects
SUMMARY OF BROWNFIELD PROJECTS COBRE PANAMA CP100 KANSANSHI S3 ENTERPRISE LAS CRUCES UNDERGROUND Commodity Cu, Au, Ag, Mo Cu, Au Ni Cu, Zn, Pb, Ag Mine Type Open Pit Open Pit Open Pit Underground Production 50-60 ktpa Cu 100 ktpa Cu 30 ktpa Ni 45 ktpa CuEq • Strong team in place • Strong team in pla
Slide 26: Upcoming Events in 2022
UPCOMING EVENTS IN 2022 February 15, 2022 Q4/21 FINANCIAL AND OPERATING RESULTS (Conference call February 16, 2022) April 26, 2022 Q1/22 FINANCIAL AND OPERATING RESULTS (Conference call April 27, 2022) May 5, 2022 ANNUAL GENERAL MEETING (Virtual) July 26, 2022 Q2/22 FINANCIAL AND OPERATING RESULTS (
Slide 27: Appendix
Cobre Panama Mill Appendix
Slide 28: Cobre Panama, Including CP100
Cobre Panama, Including CP100 Ownership Location Mine Type Processing Rate 90% First Quantum Colon Province, Panama Open Pit 85 Mtpa Sulphide circuit 10% KOMIR 25km from coast where Cu-Au-Ag-Mo Porphyry CP100 Expansion to 100 wholly owned power plant Mtpa (2024) and port are located Production C1 Ca
Slide 29: Kansanshi, including S3 Expansion
Kansanshi, including S3 Expansion Ownership Location Mine Type Processing Rate 80% First Quantum Solwezi, Zambia Open Pit 7 Mtpa Oxide circuit Vein deposit; Primary 8 Mtpa Mixed circuit 20% ZCCM-IH sulphide, mixed 15 Mtpa Sulphide circuit supergene and oxide Adjacent 1.35 Mtpa smelter S3 25 Mtpa Exp
Slide 30: Sentinel and Enterprise
Sentinel and Enterprise Ownership Location Mine Type Processing Rate 100% First Quantum Kalumbila, Zambia Open Pit Sentinel: 62 Mtpa Sulphide circuit 150 km west of Kansanshi Sentinel: primary sulphide copper Enterprise 4 Mtpa sulphide circuit subject to board Enterprise: hydrothermal approval sulph
Slide 31: Taca Taca
Taca Taca 275,000 <$1.40/Lb Cu 32 Years US$3.6 Billion Tonnes of Cu C1 Cash Costs¹ Mine Life Capital Per Year (Peak) Investment 50 - 200 Megawatts of Renewable Energy Copper (ktpa) Gold (kozpa) Molybdenum (ktpa) 300 K Tonnes (Cu, Mo) or Ounces (Au) 250 200 150 100 50 0 -3 -2 -1 1 2 3 4 5 6 7 8 9 10
Slide 32: Haquira Overview
HAQUIRA OVERVIEW Community Meeting Large scale porphyry copper project in Apurímac, Southern Peru Acquired in December 2010 Drilling campaign planned for 2022/2023 to expand and better understand resource Focus on community and environmental aspects Haquira Property Layout Source: Haquira PEA NI 43-
Slide 33: Haquira Overview
HAQUIRA OVERVIEW Community Meeting Large scale porphyry copper project in Apurímac, Southern Peru Acquired in December 2010 Drilling campaign planned for 2022/2023 to expand and better understand resource Focus on community and environmental aspects Haquira Property Layout Source: Haquira PEA NI 43-
Slide 34: Quarterly Net Debt Movement
QUARTERLY NET DEBT MOVEMENT Quarterly Year-to-date movement from movement from September 30, December 31, 2021 2020 Opening Net debt¹ ($ million) (6,302) (7,409) EBITDA¹ 1,085 3,684 Working capital² (161) (112) Capital expenditure (277) (995) Interest paid (73) (525) Net payments to joint venture (1
Slide 35: 2022 – 2024 Guidance
2022 – 2024 GUIDANCE Guidance The First Quantum across 2022- Financial 2024 presents Policy continued copper production growth. Production Guidance1 2022 2023 2024 Production guidance includes expansion to 100 Mtpa at Cobre Panama, some Kansanshi S3 production in 2024, Copper (‘000 tonnes) 810 – 880
Slide 36: 2022 – 2024 Copper, Gold and Nickel Production Guidance by Operation
2022 – 2024 COPPER, GOLD AND NICKEL PRODUCTION GUIDANCE BY OPERATION¹ Guidance for the upcoming three years is provided annually as part of year-end reporting. On a quarterly basis, The First Quantum guidance Financial for the current yearPolicy will b updated as necessary or re-affirmed. Commission
Slide 37: 2022 – 2024 Capex Guidance
2022 – 2024 CAPEX GUIDANCE Capital The Firstexpenditure guidancePolicy Quantum Financial supports investment in brownfield projects to add incremental value at our existing mines. Guidance • Over the three year period approximately $1.0 billion relates to Kansanshi and $830 million to Cobre Panama.
Slide 38: 2022 Guidance - Interest, Tax and Depreciation
2022 GUIDANCE - INTEREST, TAX AND DEPRECIATION Interest • Interest on debt expense for the year ended December 31, 2021, was $532 million and is expected to be approximately $470 million in 2022. Interest on debt excludes interest accrued on related party loans to Cobre Panama and Ravensthorpe, a fi
Slide 39: 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 40: Non-GAAP Measures Reconciliation EBITDA and Adjusted Earnings
NON-GAAP MEASURES RECONCILIATION EBITDA¹ AND ADJUSTED EARNINGS¹ Guidance $ Million for the (except upcoming per share three years is provided annually numbers) as part of Q4 2021 year-end reporting. Q4 2020 YTD 2021 OnYTD a quarterly 2020 basis, The First Quantum Financial Policy guidance for the cu
Slide 41: Non-GAAP Measures Reconciliation C1 and AISC
NON-GAAP MEASURES RECONCILIATION C1 AND AISC Guidance $ million for the upcoming three years is provided annually as part ofQ4 Q4 2021 year-end 2020 reporting. YTD 2021 On a quarterly YTD 2020 basis, The First Quantum Financial Policy guidance for the current year will b updated as necessary or re-a
Slide 42: EBITDA Sensitivity
EBITDA SENSITIVITY Guidance for the upcoming three years is provided annually as part of year-end reporting. On a quarterly basis, The First Quantum guidance Financial for the current yearPolicy will b updated as necessary or re-affirmed. Impact on YTD Actual price/rate EBITDA¹ of a 10% Assumption Y
Slide 43: First Quantum Minerals Ltd.
TSX FM First Quantum Minerals Ltd. info@fqml.com 416-361-6400 1-888-688-6577
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