First Quantum Minerals Reports Second Quarter 2017 Results

TORONTO, July 27, 2017 /PRNewswire/ --

(In United States dollars, except where noted otherwise)

First Quantum Minerals Ltd. ("First Quantum" or the "Company", TSX Symbol "FM") today announced a comparative loss^[1] of $18 million ($0.03 per share^[1]) and cash flows from continuing operating activities of $205 million ($0.30 per share^[1]) for the three months ended June 30, 2017.  The comparative loss includes a $97 million loss realized under the copper sales hedge program for which no tax credit is available.

Net loss from continuing operations attributable to shareholders of the Company^[1] amounted to $35 million ($0.05 per share) inclusive of the loss under the sales hedge program for which no tax credit is available.

SECOND QUARTER 2017 HIGHLIGHTS^[2]

• STRONG OPERATING RESULTS:
  • Continued growth in copper production^[3]:
    • 8% over Q2 2016 and 7% over Q1 2017 from the ramp-up of commercial operations at the Sentinel mine and strong production at the Kansanshi mine.
    • Record throughput of 334,269 tonnes of concentrate at the Kansanshi copper smelter.
  • Maintained low unit copper production cost^[4]:
    • Cash cost ("C1") = $1.12 per pound; All-in sustaining ("AISC") = $1.50 per pound; Total cost ("C3") = $1.95 per pound
• MARKET GUIDANCE MAINTAINED: 
  • Previously-disclosed market guidance for total production, production cost and capital expenditures for the years 2017 to 2019 has been maintained however, copper production guidance by operation for 2017 has been adjusted:
    • Kansanshi increased to 248,000 tonnes
    • Sentinel reduced to 185,000 tonnes
    • Las Cruces increased to 72,000 tonnes
• COBRE PANAMA DEVELOPMENT ON TRACK:
  • Advanced to over 58% completion: 
    • Pre-commissioning activities continued on the first 150 MW unit of the power station and associated infrastructure. Power generation into the Panamanian electricity grid now targeted for the first quarter of 2018.
    • Entire project remains scheduled for phased commissioning during 2018, with continued ramp-up over 2019. 
• FINANCIAL:
  • Realized an average price for copper of $2.24 per pound, approximately $0.33 per pound below the average LME price for the period, mainly on account of the copper sales hedge program.
  • As at June 30, 2017, there were unsettled and unmargined copper hedges for 285,000 tonnes with maturities to February 2018 at an average price of $2.34 per pound in addition to zero cost collar unmargined copper sales hedges for 61,000 tonnes at prices ranging from low side (or put) prices of $2.50 per pound to high side (or call) prices of $2.86 per pound with maturities to June 2018.
  • Sales hedge positions outstanding as at July 27, 2017 totaled 359,000 tonnes of copper at an average price of $2.43 per pound.
  • Remained in full compliance with all financial covenants and ended the quarter with $838 million of committed undrawn facilities and $450 million in net unrestricted cash.
  • The process to put in place project financing for the Cobre Panama project continues. Market sounding of banks and export credit agencies was recently undertaken. Total process completion currently targeted for the end of 2017.
  • Continuing to take action to manage operational and price risk and further strengthen the balance sheet. Commenced the process to refinance the existing facilities, aimed at extending the tenor and maintaining liquidity at the corporate level. 
• CORPORATE DEVELOPMENT:
  • Declared an interim dividend of CDN$0.005 per share in respect of the financial year ended December 31, 2017. The dividend will be paid on September 19, 2017 to shareholders of record on August 28, 2017. The ex-dividend date is August 24, 2017.