Sherritt International Corporation · TSX:S
Sherritt International — Q4 2024 Earnings Presentation
41 slides from Sherritt International's earnings presentation, Feb 6, 2025
Slide 1: Q4 2024 Conference Call
Sherritt International Corporation Q4 2024 Conference Call Review of Financial and Operational Results February 6, 2025 SHERRITT.COM • TSX: S
Slide 2: Presenters
Presenters Leon Binedell President & CEO Yasmin Gabriel CFO Elvin Saruk COO 2
Slide 3: Forward-Looking Statements
Forward-Looking Statements This presentation contains certain forward-looking statements. Forward-looking statements U.S. government policy toward Cuba, including the U.S. embargo on Cuba and the Helms- opportunity will be successful, commercially viable, completed on time or on budget, or will can
Slide 4: Highlights Full Year 2024
Highlights Full Year 2024 → Full year nickel sales increased 22%. Fourth quarter nickel sales was the highest quarterly level in 2 years → Strong cobalt and fertilizer production → NDCC(1) decreased 18% on 15% lower MPR/lb(2) and higher nickel sales → Phase two of expansion is advancing for 2025 ram
Slide 5: Nickel Price Fourth Quarter 2024 Developments
Nickel Price Fourth Quarter 2024 Developments Nickel Reference Price(1) US$10.00 Q4 2024 Fourth Quarter 2024 Key Market Developments US$8.00 → October 15, 2024: Indonesia cuts permit allowance for key foreign-owned nickel mine protecting smaller local miners from nickel price decline → November 5, 2
Slide 6: Review of Operations
Review of Operations 6 Boca de Jaruco, Cuba
Slide 7: Metals Fourth Quarter Highlights
Metals Fourth Quarter Highlights Q4 2024 Q4 2023 2024 2023 Mixed sulphides Production Volume (tonnes)(1) → Higher production benefitting from the new Slurry Preparation Plant. Navigated external challenges in Cuba Mixed Sulphides 3,552 3,514 15,847 15,084 with power outages, adverse weather, earthqu
Slide 8: Metals Fourth Quarter Net Direct Cash Costs (NDCC)
Metals Fourth Quarter Net Direct Cash Costs (NDCC) (1) Fourth Quarter 2024 Results Year-Over-Year Change Mining, processing and refining(2) NDCC(1) (US$/lb of Nickel Sold) → 14% lower MPR/lb costs due to: 31% Decrease YoY → Lower input commodity prices, maintenance costs and the impact of higher nic
Slide 9: Moa JV Expansion Update
Moa JV Expansion Update Phase two: Processing Plant → Piping installation and internal brick lining of vessels continuing → Pre-commissioning activities started → Expenditures deferred to Q1 2025 – ramp up to commence thereafter → Minor debottlenecking to occur concurrent with ramp up → Following ra
Slide 10: Metals 2025 Guidance
Metals 2025 Guidance Production (100% basis) → Higher nickel and cobalt production on better mixed sulphides Finished Nickel (tonnes) Finished Cobalt (tonnes) availability following ramp up of phase two expansion 31,000 – 33,000 3,300 – 3,600 2,876 3,206 → Production to be weighted to the latter par
Slide 11: Power Fourth Quarter Results
Power Fourth Quarter Results Electricity production → Lower electricity production due to nationwide power outage in Cuba and subsequent frequency control at Varadero facility → New gas well brought online in Q4 to provide additional production Q4 2024 Q4 2023 2024 2023 Unit operating cost(1) Operat
Slide 12: Power 2025 Guidance
Power 2025 Guidance Production (33⅓% basis) Electricity (GWh) Electricity Production 816 775 – 825 745 → Non-Varadero production will be higher as a result of better gas and equipment availability → Unit operating cost(1) to decrease as major maintenance work completed in 2024 2023 2024 2025E → Vara
Slide 13: Financial Highlights
Financial Highlights Fort Saskatchewan, Alberta 13
Slide 14: Financial Performance Fourth Quarter Results
Financial Performance Fourth Quarter Results Fourth quarter financial performance key drivers: Q4 2024 Q4 2023 2024 2023 Sales Volumes Average-Realized Prices(1) Financial Results ($ millions) Nickel 23% 8% Revenue(2) 45.7 34.8 158.8 223.3 Cobalt 17% 29% Fertilizers 14% 21% Combined revenue(
Slide 15: Available Liquidity in Canada Fourth Quarter Update
Available Liquidity in Canada Fourth Quarter Update Fourth quarter changes include $32.0M → Cash received from Cobalt Swap $23.7M (in addition to $6.1M in cobalt) → Dividend from Energas $7.0M ($13.0M for 2024) → Settlement of in-the-money nickel put options $4.7M $62.4M → Interest on Second Lien No
Slide 16: Summary
Summary Fort Saskatchewan, Alberta 16
Slide 17: Sustainability 2024 Highlights
Sustainability 2024 Highlights → Completed comprehensive safety strategy sessions with each of its operations, hired additional health and safety personnel, and refocused attention on felt leadership, supervisor competencies, and contractor safety → Maintained and verified conformity with LME’s Trac
Slide 18: Fourth Quarter 2024 Strengthening Our Position for Long-Term Upside
Fourth Quarter 2024 Strengthening Our Position for Long-Term Upside → Successfully delivered strong 2024 operating performance against challenging external backdrop and continued adverse market conditions for nickel and cobalt → Announced 2025 guidance with further strength in operating performance
Slide 19: Q&A Discussion
Q&A Discussion sherritt
Slide 20: Sherritt International Corporation
SHERRITT INTERNATIONAL CORPORATION 22 Adelaide West, Suite 4220 Toronto, Ontario, Canada M5H 4E3 Tom Halton, Director, Investor Relations and Corporate Affairs Telephone: S E P T E M B 416.935.2451 ER 2024 | Toll -Free: 1.800.704.6698 Email: investor@sherritt.com SHERRITT.COM • TSX: S
Slide 21: Appendix: Guidance, Forward-looking estimates and Non-GAAP measures
APPENDIX Guidance, Forward-looking estimates and Non-GAAP and other financial measures 21
Slide 22: 2025 Guidance
Guidance 2025 Guidance 2024 Actual 2025 Guidance Production Volumes Metals: Moa Joint Venture (100% basis) Finished Nickel (t) 30,331 31,000 – 33,000 Finished Cobalt (t) 3,206 3,300 – 3,600 Electricity (GWh, 33 ⅓% basis) 816 775 – 825 Unit Operating Costs(1) Metals – NDCC(1) (US$/lb) $5.94 $5.75 – $
Slide 23: Guidance (continued)
Guidance (continued) Metals Nickel and cobalt production are both expected to increase in 2025 compared to 2024 primarily due to the enhanced availability of mixed sulphides from the Moa mine site to the refinery, following the completion, ramp up and debottlenecking of the phase two expansion. To m
Slide 24: Forward-looking estimates
Forward-looking estimates Cobalt Swap distributions The Moa JV’s cash and cobalt distributions to the Corporation are determined based on available cash in excess of liquidity requirements. Determinants of liquidity include anticipated nickel and cobalt prices and sales volumes, planned spending on
Slide 25: Non-GAAP and other financial measures
Non-GAAP and other financial measures 25
Slide 26: Combined revenue
Combined revenue The Corporation uses combined revenue as a measure to help management assess the Corporation’s financial performance across its core operations. Combined revenue includes the Corporation’s consolidated revenue, less Oil and Gas revenue, and includes the revenue of the Moa JV within
Slide 27: Adjusted EBITDA
Adjusted EBITDA The Corporation defines Adjusted EBITDA as (loss) earnings from operations and joint venture, which excludes net finance expense, income tax expense and loss from discontinued operations, net of tax, as reported in the financial statements for the period, adjusted for: depletion, dep
Slide 28: Adjusted EBITDA (continued)
Adjusted EBITDA (continued) 2023 $ millions, for the three months ended December 31 (Restated) Adjustment Corporate for Moa Oil and and Joint Metals(1) Power Gas Other Venture Total (Loss) earnings from operations and joint venture per financial statements $ (22.0) $ 5.9 $ (23.3) $ (5.1) $ 1.1 $ (43
Slide 29: Adjusted EBITDA (continued)
Adjusted EBITDA (continued) 2023 $ millions, for the year ended December 31 (Restated) Adjustment Corporate for Moa Oil and and Joint Metals(2) Power Gas Other Venture Total (Loss) earnings from operations and joint venture per financial statements $ (2.1) $ 20.7 $ (30.2) $ (31.6) $ (0.2) $ (43.4) A
Slide 30: Average-realized price
Average-realized price Average-realized price is generally calculated by dividing revenue by sales volume for the given product in a given segment. The average-realized price for power excludes frequency control, by-product and other revenue, as this revenue is not earned directly for power generati
Slide 31: Average-realized price (continued)
Average-realized price (continued) $ millions, except average-realized price and sales volume, for the three months ended December 31 2023 Metals Adjustment for Moa Joint Nickel Cobalt Fertilizer Power Other(1) Venture Total Revenue per financial statements $ 84.1 $ 15.2 $ 23.1 $ 14.0 $ 4.1 $ (107.7
Slide 32: Average-realized price (continued)
Average-realized price (continued) $ millions, except average-realized price and sales volume, for the year ended December 31 2023 Metals Adjustment for Moa Joint Nickel Cobalt Fertilizer Power Other(1) Venture Total Revenue per financial statements $ 379.6 $ 104.8 $ 93.3 $ 47.1 $ 28.1 $ (442.2) $ 2
Slide 33: Unit operating cost/Net direct cash cost (NDCC)
Unit operating cost/Net direct cash cost (NDCC) With the exception of Metals, which uses NDCC, unit operating cost is generally calculated by dividing cost of sales as reported in the financial statements, less depreciation, depletion and amortization in cost of sales, the impact of impairment losse
Slide 34: Unit operating cost/Net direct cash cost (continued)
Unit operating cost/Net direct cash cost (continued) $ millions, except unit cost and sales volume, for the three months ended December 31 2023 Adjustment for Moa Metals Power Other(1) Joint Venture Total Cost of sales per financial statements $ 146.6 $ 7.1 $ 28.6 $ (122.2) $ 60.1 Less: Depletion, d
Slide 35: Unit operating cost/Net direct cash cost (continued)
Unit operating cost/Net direct cash cost (continued) $ millions, except unit cost and sales volume, for the year ended December 31 2023 Adjustment for Moa Metals Power Other(1) Joint Venture Total Cost of sales per financial statements $ 601.4 $ 22.7 $ 57.8 $ (416.4) $ 265.5 Less: Depletion, depreci
Slide 36: Adjusted net earnings/loss from continuing operations and per share
Adjusted net earnings/loss from continuing operations and adjusted net earnings/loss from continuing operations per share The Corporation defines adjusted net earnings/loss from continuing operations as net earnings/loss from continuing operations less items not reflective of the Corporation’s curre
Slide 37: Adjusted net earnings/loss from continuing operations (continued)
Adjusted net earnings/loss from continuing operations and adjusted net earnings/loss from continuing operations per share (continued) 2024 2023 For the three months ended December 31 $ millions $/share $ millions $/share Net loss from continuing operations $ (22.5) $ (0.06) $ (53.4) $ (0.13) Adjusti
Slide 38: Adjusted net earnings/loss from continuing operations (continued)
Adjusted net earnings/loss from continuing operations and adjusted net earnings/loss from continuing operations per share (continued) 2024 2023 For the year ended December 31 $ millions $/share $ millions $/share Net loss from continuing operations $ (73.1) $ (0.18) $ (64.3) $ (0.16) Adjusting items
Slide 39: Spending on capital
Spending on capital The Corporation defines spending on capital for each segment as property, plant and equipment and intangible asset expenditures on a cash basis adjusted to the accrual basis in order to account for assets that are available for use by the Corporation and the Moa Joint Venture pri
Slide 40: Spending on capital (continued)
Spending on capital (continued) $ millions, for the three months ended December 31 2023 Total Adjustment derived from Combined for Moa financial Metals Power Other(1) total Joint Venture statements Property, plant and equipment expenditures(2) $ 17.6 $ 1.3 $ -$ 18.9 $ (13.4) $ 5.5 Intangible asset e
Slide 41: Spending on capital (continued)
Spending on capital (continued) $ millions, for the year ended December 31 2023 Total Adjustment derived from Combined for Moa financial Metals Power Other(1) total Joint Venture statements Property, plant and equipment expenditures(2) $ 57.0 $ 3.2 $ 0.2 $ 60.4 $ (40.3) $ 20.1 Intangible asset expen
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