First Quantum Minerals Ltd. · TSX:FM
First Quantum Minerals — Q3 2023 Earnings Presentation
45 slides from First Quantum Minerals's earnings presentation, Oct 25, 2023
Slide 1: Responsible Growth: Q3 2023 Financial and Operating Results
TSX FM RESPONSIBLE GROWTH Q3 2023 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 Panamá OPENING REMARKS Tristan Pascall, Chief Executive Officer
Slide 4: Q3 2023 Highlights
Q3 2023 HIGHLIGHTS Recent Developments TOTAL COPPER PRODUCTION • Cobre Panamá mining concession contract enacted into law in Panamá 221,550t 18% increase from Q2 2023 attributable • Record quarterly copper production and sales and lowest cost quarter for the year • First nickel concentrate sale from
Slide 5: Cobre Panamá Update
COBRE PANAMÁ UPDATE October 20, 2023 - President Laurentino Cortizo sanctioned Bill 1100 into Law 406 and published in the Official Gazette. The enactment of Law 406 marks the final step in revising the legal framework for the Cobre Panamá mine Payments to cover taxes and royalties up to the year-en
Slide 6: 2023 Updated Guidance
2023 UPDATED GUIDANCE • Guidance lowered for copper, gold and nickel production to reflect YTD performance and outlook for the remainder of the year • Guidance for total capital expenditure lowered based on timing of capitalized stripping, shifting a portion to 2024 PRODUCTION GUIDANCE COST AND CAPE
Slide 7: Delivering ESG Programs in Q3
DELIVERING ESG PROGRAMS IN Q3 Supplier Development Promoting Biodiversity Mobile Coverage Health and Safety Program Supporting Education Campaign Building local business capacity by 19 wild animals donated to the Minera Panamá, with the support of The team at Cobre Panamá launched working with the b
Slide 8: Operational Overview
Sentinel OPERATIONAL OVERVIEW Rudi Badenhorst, Chief Operating Officer
Slide 9: Cobre Panamá
COBRE PANAMÁ Q3 2023 COPPER PRODUCTION 2023 Outlook 112,734t 25% higher than Q2 2023 attributable to • Production guidance for copper narrowed, gold lowered • FY 2023 grades and recoveries to be consistent with 2022 higher grades and higher tonnes milled • Expansion to 100 Mtpa remains on schedule f
Slide 10: Kansanshi
KANSANSHI Q3 2023 COPPER PRODUCTION 2023 Outlook 39,600t • Production guidance for copper narrowed, gold lowered 14% higher than Q2 2023 attributable to • Mining fleet deployment has opened up mining areas; Less reliance on mining higher grade material stockpiles • Continued focus on M15 and M17; Hi
Slide 11: Trident (Sentinel & Enterprise)
TRIDENT (SENTINEL & ENTERPRISE) Q3 2023 COPPER PRODUCTION 2023 Outlook 63,805t 18% higher than Q2 2023 due to higher • Production guidance for copper and nickel lowered for 2023 • Focus will remain on blast quality to improve fragmentation and mine-to-mill grades; Mining, crushing and milling impact
Slide 12: Other Mines
OTHER MINES Las Cruces 2023 PRODUCTION: 3,900t Cu Çayeli Q3 2023 PRODUCTION: 2,636t Cu Completed re-processing of tailings in June 2023; Q3 2023 C1 CASH COST1: $1.80 per lb Cu Final sale of copper cathodes in July 2023; 2023 PRODUCTION GUIDANCE: 11Kt Cu, 3kt Zn All permits required for approval of t
Slide 13: Financial Overview
Kansanshi Smelter FINANCIAL OVERVIEW Ryan MacWilliam, Chief Financial Officer
Slide 14: Q3 2023 Revenues and Costs
Q3 2023 REVENUES AND COSTS REALIZED COPPER PRICE1 (per lb) Despite copper price weakness, strong increase in revenue due to record production $3.70 Down 1% quarter-over-quarter 7.00 450 LME, COMEX, SHFE Copper inventories (kt) 400 6.00 REVENUE ~410kt 350 Copper C1 cash cost¹ ($/lb) 5.00 $2 billion 3
Slide 15: Copper C1 Cash Cost
COPPER C1 CASH COST¹ Lower unit cash costs driven by improved production and higher by-product credits. Key consumables costs continued to decrease. Fuel prices expected to increase in Q4 as Brent Crude oil is on the rise. $0.29 per lb lower cash costs Fixed costs (e.g Electricity) Freight 60% -$0.0
Slide 16: Q3 2023 Earnings and EBITDA
Q3 2023 EARNINGS AND EBITDA¹ EBITDA¹ Very strong EBITDA¹ and EPS increase quarter-over-quarter driven by higher copper sales volumes. $969 million Up 71% quarter-over-quarter EBITDA¹ ($ millions) ADJUSTED EPS¹ ($/share) NET EARNINGS ATTRIBUTABLE TO 0.52 SHAREHOLDERS OF THE COMPANY 969 $325 million 6
Slide 17: EBITDA Waterfall
EBITDA¹ WATERFALL EBITDA¹ $401 million higher than Q2 2023 driven by higher copper sales External Factors (-$13 million) Internal Factors (+$413 million) +$3 Fuel (Price) +$3 Sulphur (Price) -$23 Copper +$8 Explosives (Price) -$4 Nickel 2 ¹ EBITDA is a non-GAAP financial measure which does not have
Slide 18: Quarterly Net Debt Movement
QUARTERLY NET DEBT1 MOVEMENT Net debt1 decreased by $13 million during the quarter primarily due to higher EBITDA1 generation, partially offset by increased capex, unfavourable working capital movements and the La Granja asset acquisition ¹ Net debt is a supplementary financial measure and EBITDA is
Slide 19: Debt Maturity Profile
DEBT MATURITY PROFILE As at September 30, 2023 1,793 255 1,500 - 1,300 $ millions 488 1,000 - 625 1,500 1,300 170 1,050 1,000 228 455 228 2023 2024 2025 2026 2027 2028 2029 2030 2031 Senior Notes Term Loan Trident Facility Funding includes $1,300 million committed Revolving Credit Facility expiring
Slide 20: Closing Remarks
CP100 Screening Plant CLOSING REMARKS Tristan Pascall, Chief Executive Officer
Slide 21: CP100 Expansion
CP100 EXPANSION Completed CP100 Expansion Works • Process water upgrades • Addition of Ball Mill 6 • New primary screening facility and two new bypass feeders Progress and Outlook • Exit 2023 at a consistent rate of 100 Mtpa New Colina pit, drilling to blast for overland conveyor and access road to
Slide 22: S3 Expansion
S3 EXPANSION S3 Expansion Works Progress-To-Date Outlook • Additional concentrator capacity • Board approval in May 2022 • Majority of capital spend expected in 2024 • Additional SAG and ball mill • Overall project procurement ~55% committed and • Production expected to commence in H2 90% of all mec
Slide 23: Enterprise
ENTERPRISE Enterprise Works Progress-To-Date Outlook • Main workstream is pre-strip • Board approval in May 2022 • Additional flotation capacity construction is progressing towards • 4 Mtpa processing circuit • Ancillary infrastructure developments, i.e. commissioning in early 2024 mainly constructe
Slide 24: Capital Allocation - 2023 and Beyond
CAPITAL ALLOCATION - 2023 AND BEYOND Focus on debt reduction, consistent operational performance and execution of brownfield expansions 1. Balance Sheet 2. Brownfield 3. Greenfield Debt Reduction Cobre Panamá CP100 Expansion Cautious approach to greenfield • Remains a priority • On track for 100 Mtp
Slide 25: Upcoming Events
UPCOMING EVENTS January 15, 2024 • 2023 PRELIMINARY PRODUCTION, 2024-2026 GUIDANCE February 20, 2024 • Q4 2023 FINANCIAL AND OPERATING RESULTS (Conference call February 21, 2024) April 23, 2024 • Q1 2024 FINANCIAL AND OPERATING RESULTS (Conference call April 24, 2024) May 9, 2024 • ANALYST/INVESTOR
Slide 26: Appendix
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Slide 27: Copper Cash Cost and AISC
COPPER CASH COST¹ AND AISC¹ The First Reduced Quantum quarterly Financial copper C1 cashPolicy cost¹ and AISC¹ of $1.42/lb and $2.02/lb, respectively, driven by higher production COPPER C1¹ ($/lb) COPPER AISC¹ ($/lb) 2.24 2.87 2.64 1.98 2.42 1.82 1.86 2.34 2.02 1.42 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q
Slide 28: Financial Summary
FINANCIAL SUMMARY Financials The Firstimproved Quantum onFinancial the back of higher sales volumes and lower C1 cash costs¹. Cash flows from operating activities are Policy lower than the prior quarter due to unfavourable movements on working capital $ millions (except per share numbers) Q3 2023 Q2
Slide 29: Cobre Panamá – The Refreshed Concession Contract
COBRE PANAMÁ – THE REFRESHED CONCESSION CONTRACT On October 20, 2023, the National Assembly in Panamá approved Bill 1100, being the proposal for approval of the Refreshed Concession Contract for the Cobre Panamá mine, in the third debate of the plenary session with a vote of 47 in favour out of a to
Slide 30: Precious Metal Stream Arrangement
PRECIOUS METAL STREAM ARRANGEMENT • Cobre Panamá gold and silver revenues consist of revenues derived from the sale of metals produced by the mine, as well as revenues recognized from the amortization of the precious metal stream arrangement • Stream gold and silver revenues are indexed to copper so
Slide 31: Non-GAAP EBITDA and Adjusted Earnings Reconciliation
NON-GAAP EBITDA¹ AND ADJUSTED EARNINGS¹ RECONCILIATION $ millions (except per share numbers) Q3 2023 Q2 2023 Q3 2022 Operating profit 585 252 289 Depreciation 323 301 320 Foreign exchange (gain) loss 23 (15) (26) Restructuring expense3 31 - - Other expense 8 3 3 Royalty payable to ZCCM-IH2 - 18 - Re
Slide 32: Non-GAAP Measures Reconciliation C1 and AISC
NON-GAAP MEASURES RECONCILIATION C12 AND AISC2 $ millions Q3 2023 Q2 2023 Q3 2022 Cost of sales¹ (1,369) (1,386) (1,425) Depreciation 323 301 320 By-product credits 152 99 145 Royalties 92 103 83 Treatment and refining charges (79) (66) (57) Freight costs (7) (8) (11) Finished goods 20 1 35 Other4 1
Slide 33: EBITDA Sensitivity
EBITDA¹ SENSITIVITY The First Quantum Financial Policy Impact of 10% change Actual price/rate in price/rate on Assumption September 2023 YTD September 2023 YTD EBITDA¹ Copper $3.89/lb $448 million Gold $1,931/oz $30 million Nickel $10.38/lb $39 million Zambian kwacha 19.25 ZMW/USD $19 million 1 EBIT
Slide 34: Cobre Panamá, Including CP100 Expansion
COBRE PANAMÁ, INCLUDING CP100 EXPANSION Ownership Mine Type Processing Rate CP100 Expansion 90% First Quantum Open Pit 85 Mtpa Sulphide circuit Expansion to 100 Mtpa 10% KOMIR Cu-Au-Ag-Mo Porphyry (End of 2023) P&P Reserves M&I Resources Inferred Resources 2,843.6 Mt 3,375.6 Mt 1,087.3 Mt 0.38% Cu 0
Slide 35: Cobre Panamá
COBRE PANAMÁ On October 20, 2023, the Government of Principal economic terms: Panamá sanctioned Bill 1100 into Law 406 and this was subsequently published in the • Payment by MPSA of $375 million plus an additional $20 Official Gazette million to cover taxes and royalties up to the year-end 2022 • P
Slide 36: Kansanshi, Including S3 Expansion
KANSANSHI, INCLUDING S3 EXPANSION Ownership Mine Type Processing Rate S3 Expansion 80% First Quantum Open Pit Adjacent 1.38 Mtpa S3 25 Mtpa Expansion smelter 20% ZCCM-IH Vein deposit, mixed (First production H2 2025) 27 Mtpa circuit (oxide, supergene and oxide Smelter expansion to 1.6 Mtpa mixed, su
Slide 37: Kansanshi Pit Development
KANSANSHI PIT DEVELOPMENT M18 M16 M17 Source: Kansanshi 43-101 Technical Report June 2020 37
Slide 38: Trident (Sentinel & Enterprise)
TRIDENT (SENTINEL & ENTERPRISE) Ownership Mine Type Sentinel Processing Enterprise Processing 100% First Quantum Open Pit 62 Mtpa Sulphide circuit 4 Mtpa Sulphide circuit Sentinel: Copper First ore Q1 2023 Enterprise: Nickel First nickel concentrate Q2 SENTINEL & 2023 ENTERPRISE First sale Q3 2023 P
Slide 39: Sentinel Pit Development
SENTINEL PIT DEVELOPMENT Source: Trident 43-101 Technical Report March 2020 39
Slide 40: 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 kt CuEq • Environmental permits received in 2020; Mine exploitation permit received i
Slide 41: Summary of Brownfield Projects
SUMMARY OF BROWNFIELD PROJECTS COBRE PANAMÁ plus CP100 KANSANSHI plus 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 Total Production 400 ktpa Cu 250 ktpa Cu 30 ktpa Ni 45 ktpa CuEq • Strong team in place • Stro
Slide 42: Taca Taca
TACA TACA 275,000 Low 32 Years US$3.6 Billion Tonnes of Cu C1 Cash Costs Mine Life Capital Per Year (Peak) Investment • 50 - 200 Megawatts of Renewable Energy • Received a second set of observations to the ESIA in June 2023 and submitted responses in October 2023; Approval of the ESIA is expected in
Slide 43: La Granja
LA GRANJA La Granja is one of the largest undeveloped copper resources in the world, with potential to support a multi-decade open-pit operation • Large copper project in northern Peru • Located in the district of Querocoto in the northern region of Cajamarca, Peru, approximately 90 kilometres north
Slide 44: Haquira Overview
HAQUIRA OVERVIEW • Large scale porphyry copper project in Apurímac, Southern Peru • Acquired in December 2010 • One of the world’s major undeveloped copper deposits • M&I resource of 3.7 million tonnes of contained copper equivalent plus an inferred resource of 2.4 million tonnes of copper equivalen
Slide 45: First Quantum Minerals Ltd.
First Quantum Minerals Ltd. info@fqml.com 416-361-6400 1-888-688-6577 TSX FM
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