First Quantum Minerals Ltd. (“First Quantum” or the “Company”) (TSX: FM) today reported results for the three months and year-ended December 31, 2021. For the three months ended December 31, 2021 (“Q4”), the Company reported net earnings attributable to shareholders of the Company of $247 million ($0.36 per share), adjusted earnings1 of $306 million ($0.44 per share), and cash flows from operating activities of $760 million ($1.10 per share). For the year-ended 2021, the Company reported net earnings attributable to shareholders of the Company of $832 million ($1.21 per share), adjusted earnings of $826 million ($1.20 per share), and cash flows from operating activities of $2,885 million ($4.19 per share). “First Quantum’s operations continue to demonstrate resilience in dealing with the challenges brought about by the COVID-19 pandemic and new variants as they emerge. We are in a period of solid cash flow
generation for the Company and while debt reduction remains a priority, we are pleased to cautiously commence increased capital returns to our shareholders with our new dividend framework. We have released our inaugural Climate Change report which recognizes our obligation to mine responsibly and to report on our actions to address climate change,” commented Philip Pascall, Chairman and CEO. “I am grateful for the dedication and commitment of the entire team at First Quantum and for the support of Governments and communities in our host countries. It is with these efforts and this support that First Quantum is placed in a strong position for 2022 and beyond.”
FOURTH QUARTER SUMMARY
• Fourth quarter financial results benefitted from higher sales volumes and a higher realized copper price of $4.08 per lb as the Company’s hedge profile continued to decline, partially offset by higher costs. The Company’s exposure to the strong copper price environment is expected to continue to improve with the declining profile of the hedge book with no new additional copper hedges were
entered into during the fourth quarter. On the basis of continued strong operational performance, the Company anticipates continued strong future cash flow and expects to be in a position to continue its debt reduction program, to advance growth programs, to support Environmental, Social & Governance (“ESG”) initiatives and to cautiously increase dividend payments in 2022.
- Q4 2021 copper production totalled 201,823 tonnes, taking the full year production to 816,435 tonnes, the highest annual copper production in First Quantum’s history. Through advancement of its brownfield portfolio, the Company sees a path to 1 million tonnes of copper production.
- Copper C1 cash costs averaged $1.39 per lb during the quarter. While operating costs are facing inflationary pressures, Q4 2021 was also impacted by higher electricity costs due to regular maintenance shutdown works to Unit 1 of the power station at Cobre Panama. During the quarter, however, there was a non-recurring reduction in provisions at Kansanshi from the Zambian Electricity Supply Corporation Limited (“ZESCO”) arbitration case that was settled in December 2021.
- Cash flow from operating activities was $760 million for Q4 2021 and cumulatively $2,885 million for the full year 2021. Net debt1 decreased by $249 million during the quarter, bringing the balance down to $6,053 million as at December 31, 2021. The Company expects to achieve the previously announced $2 billion debt reduction target in H1 2022 and has increased the short to medium
term target by an additional $1 billion. A new dividend policy was announced on January 17, 2022.