25 slides from Teck Resources Limited Class A's proxy contest presentation, Apr 10, 2023
Slide 1: The Choice For Shareholders: Separation and Increased Optionality to Maximize Value vs. Status Quo
The Choice For Shareholders: Separation and Increased Optionality to Maximize Value vs. Status Quo April 10, 2023
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains certain forward-looking information and forward-looking statements as defined in applicable securities laws (collectively referred to as forward-looking statements). These forward-looking statements relate to future events or our future performan
Slide 3: Exclusive Focus of Management and The Board is on Maximizing Shareholder Value
Exclusive Focus of Management and The Board is on Maximizing Shareholder Value With Greatest Certainty For further information regarding the separation, Teck shareholders should refer to the Notice of Meeting and Management Proxy Circular, which is available under Teck’s profile on SEDAR at www.seda
Slide 4: Teck's Pending Separation Maximizes Value Creation Opportunity
Teck’s Pending Separation Maximizes Value Creation Opportunity Unlocks Significant Value for Teck Shareholders Teck Metals Elk Valley Resources Global Base Metals Miner with Unparalleled Copper Growth World-Class Steelmaking Coal Producer ✓• Provides Teck shareholders with optionality between two wo
Slide 5: Teck's Pending Separation Creates Value for Shareholders
Teck’s Pending Separation Creates Value for Shareholders Teck Metals Elk Valley Resources (EVR) High-quality, low-cost base metals producer in the World’s second largest exporter of seaborne Americas, focused on copper steelmaking coal World-class Canadian steelmaking coal producer Industry-leading
Slide 6: Teck Metals Positioned to be the "Go-To" Company in Base Metals
Teck Metals Positioned to be the “Go-To” Company in Base Metals Industry Leading Growth Rapidly Increasing Scale Substantial Re-Rate Potential Copper Production Growth1 Copper Production (kt)1 EV / EBITDA (22A-26E CAGR) (2024E) (2024E) 22 % 571 +111% from 2022 4.6 x 3% 1,905 9.6 x 3% 1,043 6.4 x 2%
Slide 7: Elk Valley Resources is Designed for Public Market Success
Elk Valley Resources is Designed for Public Market Success EVR Common Equity is Sized for Public Markets and EVR Asset Quality and FCF Resilience Should Lead to Based on Attributable Financial Profile | 2022A Premium Trading vs. Sector Peers Steelmaking Coal TCS EVR Common Equity 5.0 x Legend (100%)
Slide 8: Teck's Plan Creates Immediate Value Opportunity, Underpinned by Market Support
Teck’s Plan Creates Immediate Value Opportunity, Underpinned by Market Support ACTIONABLE & BOARD APPROVED Fully Class A ~8 Weeks Due Diligence Optimized Stakeholders No Regulatory Shareholder Teck’s Plan Complete Separation Aligned Hurdles Support To Structure Implement P P P P P “An elegant soluti
Slide 9: Observations on Glencore's Unsolicited, Rejected Proposal
Observations on Glencore’s Unsolicited, Rejected Proposal
Slide 10: Glencore's Thermal Coal and Oil Marketing Dilute Teck's World-Class Copper and Zinc Assets
Glencore’s Thermal Coal and Oil Marketing Dilute Teck’s World-Class Copper and Zinc Assets Shift in Mix to Less Desirable Assets Would Undermine Re-Rating Metals Coal Teck ✓ Cu: 571kt 2024E 2024E Today 1 EBITDA ✓ Steelmaking Coal: 25Mt EBITDA Mix Mix ✓ Zn: 624kt Cu: 387kt (▼32%) Steelmaking Coal:
Slide 11: Glencore Consistently Lags in Value Creation
Glencore Consistently Lags in Value Creation Total Shareholder Return Since Xstrata Takeover 1,2 Total Shareholder Return Since Glencore IPO 1,3 Glencore Has Materially Underperformed Since the Xstrata Takeover Glencore Has Lagged Peers on TSR Since IPO Rio Tinto 177% Rio Tinto 106% Base Metals Teck
Slide 12: Market Values Teck as a Diversified Miner and Glencore in Line with Coal Peers
Market Values Teck as a Diversified Miner and Glencore in Line with Coal Peers Glencore Business Mix and Coal-Like Trading Multiple Create Greater Challenges for a Re-Rate EV / 2024E EBITDA Multiples 1 7.4x 6.4x 5.4x 4.8x 4.6x 4.1x 3.1x 3.3x 3.1x 3.1x 1.7x 1.2x Base Metals Average (excl. Freeport-Mc
Slide 13: Glencore Does Not Have a Coherent Plan to Exit Coal
Glencore Does Not Have a Coherent Plan to Exit Coal Glencore’s Proposal is a Poor Copy of Teck’s Strategy There is No Market for Thermal Coal at Scale One-Sided Strategic Rationale Majority of Glencore CoalCo EBITDA Derived from Thermal Coal Teck Shareholders Teck Shareholders • No benefit to Teck s
Slide 14: Glencore's Synergies are Ill-Defined, Overstated and Challenging to Realize
Glencore’s Synergies are Ill-Defined, Overstated and Challenging to Realize Exaggerated, Unrealistic and Insufficient to Offset Dilution Glencore’s Identified Synergies are Highly Uncertain Glencore’s purported US$4.25 – 5.25bn NPV in • Glencore 2020 Estimate: US$75mm – 100mm p.a. → Glencore 2023 Es
Slide 15: Glencore's Proposal Exposes Teck Shareholders to Significant Jurisdictional and Portfolio Risk
Glencore’s Proposal Exposes Teck Shareholders to Significant Jurisdictional and Portfolio Risk Glencore Operates in Some of the World’s Most Challenging Countries 1,2 Glencore Carries Significant Portfolio Risk 2,3 DRC, Equatorial Guinea, Kazakhstan and Russia are among the most challenging 100% of
Slide 16: Glencore Penalties of US$1.75bn in 2022 Alone
Glencore Penalties of US$1.75bn in 2022 Alone In the News for the Unresolved Litigation Glencore’s Regulatory and Enforcement Actions in 2022 Wrong Reasons from Leading Investors “The Commodities Giant Country Regulator Commentary Penalty / Fine Glencore Will Pay $1.1B To Settle Bribery And Price-Fi
Slide 17: Significant ESG Misalignment Between Teck and Glencore
Significant ESG Misalignment Between Teck and Glencore ESG Index Teck Glencore #21 #581 ‘AA’ Rating ‘BBB’ Rating B- (Prime) Rating C (Not Prime) Rating 1 Decile Rank 4 Decile Rank 61st in diversified metals 3rd in diversified metals mining mining Source: S&P Global, MSCI, ISS ESG, Sustainalytics 1.
Slide 18: Glencore's Proposal is Highly Uncertain; Potentially 2+ Years to Complete
Glencore’s Proposal is Highly Uncertain; Potentially 2+ Years to Complete “On the antitrust, of course, there's more work to be done. It's early days. We have done some cursory work.” - Gary Nagle, CEO of Glencore (April 3, 2023) Extensive DD Required on Glencore Requires approvals in many Two-step
Slide 19: Teck Board Unanimously Recommends that Shareholders Vote FOR the Separation
Teck Board Unanimously Recommends that Shareholders Vote FOR the Separation
Slide 20: A Vote For the Pending Separation Maximizes Value Creation Opportunity and Certainty
A Vote For the Pending Separation Maximizes Value Creation Opportunity and Certainty for Teck Shareholders Vote For Announced Separation Failure To Approve Announced Separation ✓ Creates two world-class, pure-play Meaningfully limits strategic mining companies with greater choice optionality for s
Slide 21: Teck's Pending Separation Maximizes Shareholder Value with Greatest Certainty
Teck’s Pending Separation Maximizes Shareholder Value with Greatest Certainty 21
Slide 22: Appendix
Appendix Teck
Slide 23: Industry-Leading Copper Growth
Industry-Leading Copper Growth Teck Metals has a robust near-term and long-term growth pipeline Near Term (2023-2028) Medium Term (2029-2033) Longer Term (2034+) Industry-leading suite +450% Schaft Creek of options diversified (100%) ~2.2 Mt by geography, scale, Nueva Mesaba Future QB +350% Unión (5
Slide 24: Teck Has a Superior Portfolio of Copper Growth Projects
Teck Has a Superior Portfolio of Copper Growth Projects ~1,600 kt ~1,225 kt Project Prod. Project Prod. ✓ First production 2023 QB2, QBME 460 kt Collahuasi ~175 kt ? Water capital intensity & More (Chile) (100%) ✓ Designed for multiple brownfield (Chile) (44%) ? Arsenic content expansions ? Remote l
Slide 25: Non-GAAP Financial Measures
Non-GAAP Financial Measures Our financial results are prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board. This presentation includes reference to certain non-GAAP financial measures, which are not measures recogniz