First Quantum Minerals Ltd. · TSX:FM

First Quantum Minerals — Q3 2021 Earnings Presentation

32 slides from First Quantum Minerals's earnings presentation, 2021

  1. Slide 1: First Quantum Minerals

    & FIRST QUANTUM MINERALS

  2. 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

  3. Slide 3: Tristan Pascall, Chief Operating Officer

    Tristan Pascall Chief Operating Officer

  4. Slide 4: Q3 2021 Highlights

    Q3 2021 HIGHLIGHTS Total copper production¹ 210k tonnes C1 Cost $1.26 per lb | AISC $1.87 per lb Strong operational performance in Q3 On track to achieve 2021 copper production of First Quantum remains committed to: 800,000-835,000 tonnes at C1 costs $1.25-1.35 - Setting climate change targets by

  5. Slide 5: Environment, Social & Governance (ESG)

    Environment, Social & Governance (ESG) Innovation driving sustainability Economically Viable 2021 Climate Change Commitments Investments  Internal carbon price now integrated into project evaluation  Commencement of reporting aligned to TCFD  Establishment of Scope 1 and 2 GHG emissions absolute

  6. Slide 6: Cobre Panama

    COBRE PANAMA COPPERPRODUCTION1 AND C1 COSTS Quarterly Performance  Copper production improved 7% Q/Q on tonnes milled 1.72 82 82 87  Record gold production of 36,649 ounces 1.38 62 66  C1 cash costs increased 2% Q/Q, higher freight and fuel costs 56 1.34 1.25 1.27  Collar structure prevents expo

  7. Slide 7: Sentinel

    SENTINEL COPPERPRODUCTION1 AND C1 COSTS Quarterly Performance  Production increased 10% Q/Q on improved throughput and 71 61 63 58 60 grades 57 54 1.55 1.50  Copper C1 and AISC costs improved Q/Q by 9% and 4%, 1.36 1.44 1.38 1.37 respectively, on higher production volumes 1.25  AISC of $2.16 per

  8. Slide 8: Kansanshi

    KANSANSHI COPPERPRODUCTION1 AND C1 COSTS Quarterly Performance 59  Production improved 1% Q/Q on higher milled tonnes and 56 54 53 49 50 51 better than expected grades 1.22  Sulphide ore grades came in better than budget while oxide 1.18 1.13 1.09 ore grades continue to be low 1.07 1.04 1.01  C1

  9. Slide 9: Hannes Meyer, Chief Financial Officer

    Hannes Meyer Chief Financial Officer

  10. Slide 10: Financial Overview

    FINANCIAL OVERVIEW Higher metal prices, together with strong operational performance resulted in a significant increase in comparative EBITDA and net earnings, as well as a notable further reduction in net debt. Gross profit of $613 million and comparative Net debt decreased by $449 million this qua

  11. Slide 11: Quarterly Copper Unit Cash Costs

    QUARTERLY COPPER UNIT CASH COSTS Copper C1 cost and AISC at the lower end of guidance range. TOTAL C1 COST AISC 1.40 1.95 1.30 1.80 1.20 Guidance 1.65 1.10 1.91 1.87 1.28 1.29 1.50 1.83 1.24 1.26 1.26 1.77 1.00 1.72 1.07 0.90 1.35 1.48 0.80 1.20 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 2021 YTD Q3 20

  12. Slide 12: Q3 Summary Financial Overview

    Q3 SUMMARY FINANCIAL OVERVIEW Basic earnings per share of $0.44 and comparative earnings per share of $0.29 are $0.40 and $0.20 respectively higher than Q3 2020. $ Million (except per share numbers) Q3 2021 Q2 2021 Q1 2021 Q4 2020 Q3 2020 • Comparative earnings for Sales revenue 1,802 1,847 1,678 1,

  13. Slide 13: Significant Increase in Gross Profit

    SIGNIFICANT INCREASE IN GROSS PROFIT Gross profit for the quarter of $613 million was $267 million higher than Q3 2020, based on improved metal prices, higher contribution from Cobre Panama, but impacted by lower sales in Zambia and at Las Cruces. FM 13

  14. Slide 14: Debt and Liquidity Profile

    DEBT AND LIQUIDITY PROFILE NET DEBT Liquidity update: $ millions Net debt has decreased by14$1.4 • The Company signed a new $2.925 billion Term 7,658 7,545 billion since June 2020. Loan and Revolving Credit Facility (the “Facility”) 7,409 7,062 on 14 October 2021, replacing the existing $2.7 6,751 b

  15. Slide 15: Copper Hedging Program Outlook

    COPPER HEDGING PROGRAM OUTLOOK1,2 Kt $/lb 150.0 Approximately one sixth of expected 4.75 copper sales for the next 12 months 125.0 are hedged to unmargined forward 4.00 and zero cost collar sales contracts, at 100.0 an average floor price and average 85.8 3.25 ceiling price of $3.41/lb and $4.23/lb,

  16. Slide 16: Tristan Pascall, Chief Operating Officer

    Tristan Pascall Chief Operating Officer

  17. Slide 17: Outlook for 2021 & Beyond

    OUTLOOK FOR 2021 & 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 until debt reduction achieved - Top priority for 2021 - Progressing toward 85mtpa - Plan

  18. Slide 18: Cobre Panama 100 Mtpa

    COBRE PANAMA 100 Mtpa Low Risk, Low Cost Growth  Currently underway  Expansion to 100 Mtpa (from 85 Mtpa): - New primary crushed ore screening facility - Additional ball mill (Ball Mill 6) - Process water upgrades - 8 additional ultra-class haul trucks - Developing the Colina pit, overland conveyo

  19. Slide 19: S3 Expansion

    S3 EXPANSION Low Risk, Low Cost Growth  Pending board approval  Expansion by 25 Mtpa to 52 Mtpa to the sulphide ore processing facility at Kansanshi: - 2 x in-pit primary crushers - SAG and ball mill configuration - Smelter capacity increase to 1.65 Mtpa (from 1.38 Mtpa)  Benefits from earthworks

  20. Slide 20: Enterprise

    ENTERPRISE Low Risk, Low Cost Growth  Pending board approval (decision expected year-end 2021)  Enterprise process plant, already built, located and commissioned adjacent to the Sentinel process plant. Additional work required to: - Pre-strip mine – key work stream, will take 12 months - Water div

  21. Slide 21: Las Cruces Underground (CLC UG)

    LAS CRUCES UNDERGROUND (CLC UG) Low Risk, Low Cost Growth  NI 43-101 Technical Report is currently underway and expected to be released by early 2022  Environmental permits received in 2020; mine exploitation permit granted in June 2021  Water concession permit expected to be granted in due cours

  22. Slide 22: Taca Taca, Argentina

    TACA TACA, ARGENTINA Cautious approach to greenfield projects until debt reduction achieved First Quantum incorporates learnings from past projects while ensuring flexibility in order to adapt to the unique circumstances and requirements of each new project.  Taca Taca NI 43-101 Technical Report (M

  23. Slide 23: Appendix

    APPENDIX

  24. Slide 24: Quarterly Net Debt Movement

    QUARTERLY NET DEBT MOVEMENT Year-to-date Quarterly movement from movement from December 31, June 30, 2021 2020 Opening Net Debt ($ million) (6,751) (7,409) Comparative EBITDA 886 2,599 Working capital² (2) 49 Capital expenditure (274) (718) Interest paid (189) (450) Net payments to joint venture (15

  25. Slide 25: 2021 Guidance Updates

    2021 GUIDANCE UPDATES Market guidance for total copper production and C1 cash costs have largely been narrowed. Gold production guidance has been increased. Nickel production and nickel cash costs have been updated. Previous Updated Total copper production guidance has been narrowed to between Produ

  26. Slide 26: 2021 Copper and Gold Production Guidance Update by Site

    2021 COPPER AND GOLD PRODUCTION GUIDANCE UPDATE BY SITE Previous Updated Total copper production guidance has been Copper Production Guidance (‘000 tonnes)1 guidance guidance narrowed to between 800,000 and 835,000 2021 2021 tonnes, with Cobre Panama guidance lower Cobre Panama 310 – 335 320 – 335 e

  27. Slide 27: 2021 Guidance – Interest, Tax, Depreciation and Inventory

    2021 GUIDANCE – INTEREST, TAX, DEPRECIATION AND INVENTORY Interest Interest expense for the quarter ended September 30, 2021 was $171 million and for the first nine months of the year was $544 million. A significant proportion of the Company’s interest expense is incurred in jurisdictions where no t

  28. Slide 28: 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

  29. Slide 29: Non-GAAP Measures Reconciliation

    NON-GAAP MEASURES RECONCILIATION COMPARATIVE EBITDA AND COMPARATIVE EARNINGS Q3 2021 Q3 2020 YTD 2021 YTD 2020 Operating profit 775 257 1,876 338 Depreciation 288 323 860 891 Foreign exchange (gain) loss (180) 60 (146) 193 Other expense 4 1 8 7 Revisions in estimates of restoration provisions at clo

  30. Slide 30: Non-GAAP Measures Reconciliation: C1 and AISC

    NON-GAAP MEASURES RECONCILIATION: C1 and AISC $ million Q3 2021 Q3 2020 YTD 2021 YTD 2020 Cost of sales (1,189) (1,056) (3,549) (2,964) Depreciation 288 323 860 891 By-product credits 214 191 633 478 Royalties 121 75 348 177 Treatment and refining charges (50) (46) (156) (130) Freight costs (13) (12

  31. Slide 31: EBITDA Sensitivity

    EBITDA SENSITIVITY Impact on YTD Actual price/rate EBITDA of a 10% Assumption YTD Sep 2021 change in price/ rate Copper (includes hedge impact) $4.17/lb $222 million Gold $1,800/oz $39 million Nickel (includes hedge impact) $8.18/lb $16 million Zambian kwacha 20.94 ZMW/USD $14 million FM 31

  32. Slide 32: info@fqml.com

    info@fqml.com 416-361-6400 | 1-888-688-6577 TSX FM

First Quantum Minerals — Q3 2021 Earnings Presentation on 6ix