25 slides from Teck Resources Limited Class A's earnings presentation, Feb 9, 2012
Slide 1: Fourth Quarter 2011 Investor Conference Call and Webcast
Fourth Quarter 2011 Investor Conference Call and Webcast February 9, 2012
Slide 2: Forward Looking Information
Forward Looking Information Both these slides and the accompanying oral presentation contain certain forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of the Securities Act (Ontario).
Slide 3: Forward Looking Information
Forward Looking Information The foregoing list of assumptions is not exhaustive. Events or circumstances could cause actual results to differ materially. Factors that may cause actual results to vary include, but are not limited to: adverse developments in business and economic conditions in the pri
Slide 4: Q4 Investor Conference Call Speakers
Q4 Investor Conference Call Speakers Don Lindsay President & CEO Ron Millos SVP Finance & CFO 4
Slide 5: 2011 Highlights: Revenues up 25%, Profit up 47%
2011 Highlights Revenues up 25%, Profit up 47% Record Revenues $ 11,514 million Record Gross Profit $ 5,788 million (before depreciation & amortization) Record Profit $ 2,668 million (attributable to shareholders) Record EBITDA $ 5,459 million 5
Slide 6: 2011 Profit
2011 Profit Earnings per Share (C$) +64% Adjusted Profit 5.00 $4.16 4.00 2011 2010 Profit ($millions) $2,468 $1,503 3.00 2.00 EPS - Basic $4.18 $2.55 $2.54 Diluted $4.16 $2.54 1.00 0.00 2011 2010 6
Slide 7: Q4 Highlights: Adjusted Profit up 20% YoY
Q4 Highlights Adjusted Profit up 20% YoY Revenues $ 2,972 million Gross Profit* $ 1,434 million (before depreciation & amortization) Profit $ 637 million (attributable to shareholders) Adjusted Profit $ 613 million (attributable to shareholders) EBITDA $ 1,304 million 7
Slide 8: Adjusted Profit
Adjusted Profit ($ millions, net of taxes) Q4 ’11 Q4 ’10 Q3 ’11 Profit attributable to $ 637 $ 325 $ 814 Shareholders as reported Asset Sales & Other (1) (2) (24) F/X (gains) losses (14) (25) 15 Derivative (gains) losses (61) (86) (63) Collective Agreement Charge 29 – – Financing, Impairment charges
Slide 9: Coal
Coal Q4 Q4 Q3 Coal - Mt 2011 2010 2011 Production 6.7 6.0 6.0 Sales 5.5 6.0 6.1 Average Realized Price (US$/t) 253 200 285 (C$/t) 259 204 279 Site Costs (C$/t) 65 54 70 Transportation Costs (C$/t) 33 35 31 Financial Results C$ millions Revenue 1,434 1,215 1,717 Gross Profit 891 682 1,094 (before dep
Slide 10: Coal Business Highlights
Coal Business Highlights Key to Achieving Coal Production Targets 78 7 • Q4 production 6.7Mt – increased by 11% YoY 74 Material Moved (millions of BCM) • Q4 material movement of 75 70 MBCM increased by 14% 6 Clean Coal (mt) 66 • 23 new haul trucks & 2 new shovels during 2011 62 5 • Past the peak of
Slide 11: Copper
Copper Q4 Q4 Q3 2011 2010 2011 Copper in Concentrate (kt) Production 69 60 63 Sales 72 55 68 Copper Cathode (kt) Production 20 25 14 Sales 19 26 17 Moly in Concentrate (M lbs) Production 3.9 2.7 2.8 Sales 4.0 2.3 2.6 Financial Results C$ millions Revenue 778 775 808 Gross Profit 339 441 439 (before
Slide 12: Copper Business Highlights
Copper Business Highlights • Q4 production 356ktpa rate • Antamina Expansion project: ‒ Ball mill commissioning ‒ SAG mill Q1 2012 ‒ Flotation March 2012 • Andacollo: ‒ YoY higher operating rate ‒ Ratified new labour agreement 12
Slide 13: Highland Valley Copper
Highland Valley Copper Comparative Costs • Direct site costs down over 7% year-over-year $ millions Q4 2011 Q4 2010 Direct Site Costs $124 $134 Higher reported operating costs: Capitalized Stripping ($14) ($22) ‒ Increased sales volume Change in Inventory $17 ($27) ‒ One-time labour settlement $127
Slide 14: Zinc
Zinc Q4 Q4 Q3 Zinc in Concentrate (kt) 2011 2010 2011 Production 150 153 164 Sales 209 241 194 Refined Zinc (kt) Production 75 70 73 Sales 75 68 69 Lead in Concentrate (kt) Production 22 17 19 Sales 32 41 46 Refined Lead (kt) Production 22 13 20 Sales 21 13 21 Financial Results C$ millions Revenue 7
Slide 15: Zinc Business Highlights
Zinc Business Highlights • Red Dog ‒ Record mill throughput at Red Dog ‒ Commissioning of two IsaMills ‒ Transitioning to Aqqaluk • Trail ‒ Improved plant performance 15
Slide 16: Q4 Investor Conference Call Speakers
Q4 Investor Conference Call Speakers Don Lindsay President & CEO Ron Millos SVP Finance & CFO 16
Slide 17: Q4 2011 – Cash Changes
Q4 2011 – Cash Changes $Millions Cash Flow from Operations 1,248 Working Capital Changes (49) Capital Expenditures / Investments (698) Proceeds from investments & other 71 Debt principal and interest payments (131) Purchase for cancellation of Class B voting shares (171) Distributions to non-control
Slide 18: Final Pricing Adjustments
Final Pricing Adjustments Settlement Outstanding at Outstanding at Adjustment (C$ M) September 30, 2011 December 31, 2011 Before Tax* Copper 149 M lbs $3.24 US$/lb 164 M lbs $3.43 US$/lb $29 Million Zinc 210 M lbs $0.87 US$/lb 184 M lbs $0.83 US$/lb -$9 Million Lead 61 M lbs $0.93 US$/lb 41 M lbs $0
Slide 19: 2012 Guidance
2012 Guidance Production Coal 24.5 – 25.5 M tonnes Coal site costs $72 – 78/ tonne Copper 350 – 375 k tonnes Zinc in Concentrate 580-610 k tonnes Refined Zinc 280 – 290 k tonnes 19
Slide 20: 2012 Capex Guidance
2012 Capex Guidance Sustaining & Other Development Sustaining Development Copper 320 162 Coal 365 165 Zinc 160 60 Energy (incl. Fort Hills Investment) - 260 Corporate 25 - $870 $647 Major Project Spending Quintette 340 QB Phase II 325 HVC Mill Expansion & extension stripping 300 Antamina Expansion 7
Slide 21: Leverage to Strong Commodities
Leverage to Strong Commodities 2011 EBITDA $5.5Bn 2011 Avg EBITDA • Coal US $257/t $25 M / $1 ∆ • Copper US $4.00/lb $7 M / $.01 ∆ • Zinc US $0.99/lb $10 M / $.01 ∆ • $C/$US $0.99 $85 M / $.01 ∆ Vo l u m e a n d c o s t c h a n g e s f r o m 2 0 11 n e e d t o b e t a k e n i n t o account in esti
Slide 22: Q4 Investor Conference Call Speakers
Q4 Investor Conference Call Speakers Ron Millos SVP Finance & CFO Don Lindsay President & CEO 22
Slide 23: Project Developments
Project Developments • Frontier / Equinox Oil Sands Mine Projects DBM Complete and regulatory application filed Q4 2011 • Quintette Coal Mine Feasibility Study Q2 2012 • Quebrada Blanca Phase II Feasibility study Q1 2012 • Relincho Copper Mine Feasibility study Q1 2013 • Fort Hills Phase I Engineeri
Slide 24: Summary
Summary Record annual revenues & gross profit Record annual copper production Record material moved at coal operations Increased semi-annual dividend Bought back shares 24
Slide 25: Fourth Quarter 2011
Fourth Quarter 2011 Investor Conference Call and Webcast February 9, 2012