CHAMPION IRON REPORTS RECORD NET INCOME, EPS AND EBITDA FOR ITS FY2022 FIRST QUARTER Net income of $224.3M, EPS of $0.44 and EBITDA of $405.7M; Phase II expansion remains on track for completion by mid-2022 and redeems $60.0M of its outstanding preferred shares
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PRESS RELEASE
CHAMPION IRON REPORTS RECORD NET INCOME, EPS AND EBITDA FOR ITS
FY2022 FIRST QUARTER
Net income of $224.3M, EPS of $0.44 and EBITDA of $405.7M; Phase II expansion remains on track for completion
by mid-2022 and redeems $60.0M of its outstanding preferred shares
Montréal, July 28, 2021 - Champion Iron Limited (TSX: CIA) (ASX: CIA) (OTCQX: CIAFF) (“Champion” or the “Company”) is pleased to announce
operational and financial results for the first quarter ended June 30, 2021.
Conference Call Details
Champion will host a conference call and webcast on July 29, 2021 at 8:30 AM EDT (Montréal Time) / 10:30 PM AEST (Sydney time) to discuss
the results for first quarter ended June 30, 2021. Call details are outlined at the end of this press release.
1. Highlights
Health & Safety
• An employee recordable injury frequency rate of 2.7, which is in line with Québec's open-pit industry standards; and
• Fully operational COVID-19 laboratory and measures maintained in line with the Government of Québec (the “Government”) directives
to mitigate risks related to COVID-19.
Financial
• Revenues of $545.4M for the three-month period ended June 30, 2021, compared to $244.6M for the same period in 2020;
• Record EBITDA1 of $405.7M for the three-month period ended June 30, 2021, compared to $130.2M for the same period in 2020;
• Record net income of $224.3M for the three -month period ended June 30, 2021 (EPS of $0.44), compared to $75.6M for the same
period in 2020 (EPS of $0.16);
• Cash flow from operating activities before change in working capital items of $248.4M for the three -month period ended
June 30, 2021, compared to $82.5M for the same period in 2020. Cash used in operating activities totalled $261.1M for the current
period and included income and mining taxes payment, resulting in net cash outflow from operations of $12.6 M, compared to net
cash flow from operations of $75.3M for the same period in 2020;
• Redemption of $60.0M of Quebec Iron Ore Inc. (“QIO”), the Company's subsidiary, preferred shares on June 30, 2021 held by Cai sse de
dépôt et placement du Québec, expected to reduce future dividend payments and overall cost of capital; and
• Cash on hand 1 and restricted cash of $466.7M and receivables of $283.3M as at June 30, 2021, compared $680.5M and $98.8M,
respectively, as at March 31, 2021.
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Operations
• New 3-year collective agreement reached on June 23, 2021, maintaining the Company's strong partnership with its workers;
• Production of 1,936,000 wmt of high -grade 66.3% iron ore (“Fe”) concentrate for the three -month period ended June 30, 2021,
compared to 1,798,800 wmt of high-grade 66.5% Fe iron ore concentrate for the same period in 2020;
• Fe recovery rate of 82.9% for the three-month period ended June 30, 2021, compared to 82.3% for the same period in 2020; and
• Free on Board (''FOB'') total cash cost 1 of $60.1/dmt (US$48.9/dmt) (C1) for the three -month period ended June 30, 2021, compared
to $58.4/dmt (US$42.2/dmt) for the same period in 2020 mainly due to increased costs of the scheduled and completed semi-annual
maintenance program.
Growth and Development
• Acquisition of the Kamistiatusset iron ore project (the “Kami Project”) and commencement of work related to revising the project's
scope and its feasibility study; and
• Completion of the acquisition of the Lac Lamêlée property and the 1.5% net smelter retur n royalty on the Company’s Moiré Lake
property and Fermont Properties portfolio.
Phase II Expansion Project (“Phase II”) Milestones
• Construction work is progressing as planned, with more than 300 individuals actively working on the Phase II project, whi ch is
expected to be completed by mid-2022; and
• Capital expenditures of $77.9M and advance payments to Société Ferroviaire et Portuaire de Pointe-Noire (“SFPPN”) and Quebec North
Shore and Labrador Railway (“QNS&L”) totalling $40.3M were incurred in the th ree-month period ended June 30, 2021, with $288.6M
invested to date.
Champion’s CEO, Mr. David Cataford, said: “We owe another strong quarterly financial result to our workforce dedicated to the success of our
Company. Through their efforts and with an increased focus on reducing global emissions in the steelmaking industry, Champion is benefiting
from the rising demand and premium pricing for Bloom Lake’s high -grade iron ore. I am also pleased to report that our Phase II expansion
project, which is expected to double our nameplate capacity, remains on target for completion by mid-2022.”
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2. Response to the COVID-19 Pandemic
Since the beginning of the pandemic, the Company has consistently and proactively deployed several measures in its efforts to mitigate risks
related to COVID-19, in line with or exceeding Government guidelines.
In a collective effort to improve immunity against COVID -19, including the Company's ongoing participation in the Côte -Nord Industry
Vaccination Center, the Québec vaccination campaign is progressing rapidly. According to daily data published on the website of the Institut
National de Santé Publiqu e du Québec, approximately 73% of Québec's population has received a first dose of vaccine and 63% are considered
adequately vaccinated as at July 25, 2021.
Although the Company is managing its operations to mitigate risks related to COVID-19, given the significant uncertainty regarding the ultimate
impact that the pandemic will have on the overall economy and the demand for iron ore concentrate, the extent to which it cou ld impact
operations and cash flows in the future remains uncertain and will depend on future developments, such as the duration of the pandemic, the
emergence of variants, the efficacy and availability of vaccines and regulatory actions to contain the virus.
There has been no material change to the estimated impacts of the COVID -19 pandemic on the Company’s ongoing and future operations and
results since the filing of the 2021 annual MD&A on May 27, 2021. Refer to section 4 of the annual MD&A for the year ended Ma rch 31, 2021. The
Company's full COVID-19 plan is available on its website at www.championiron.com.
3. Bloom Lake Phase II Update
The Phase II project aims to double Bloom Lake's nameplate capacity to 15 Mtpa of 66.2% Fe iron ore concentrate by completing the
construction of the second plant which was partially built by the mine's former owner. Based on the new optimized mine plan, the Bloom Lake
mining rate would also be increased to accelerate the supply of ore to the expanded facilities, while maintaining a life of m ine (“LoM”) of
20 years. On June 20, 2019, the Company announced the findings of the Bloom Lake Feasibility Study (the “Feasibility Study”), including proven
and probable mineral reserve estimates of 807.0 Mt (346.0 Mt of proven reserves and 461.0 Mt of probable reserves) at an average grade of
29.0% Fe.
During the three-month period ended June 30, 2021, $77,925,000 in capital expenditures and $40,338,000 in advance payments were incurred
for the Phase II project, with $288,580,000 invested to date, including $30,549,000 in advance payments to SFPPN and $25,000, 000 to
QNS&L.
The Company had total cash on hand 1 and restricted cash of $466,711,000 as at June 30, 2021. In addition, the Company maintains a total
undrawn credit facility of US$220,000,000, a master lease agreement for an amount up to US$75,000,000 in connection with the financing of
Phase II mining equipment and a seven -year loan agreement with Fonds de Solidarité des Travailleurs du Québec of $75,000,000, of which
$45,000,000 remains undrawn as at June 30, 2021. Investments of $85,000,000 related to required upgrades at SFPPN, included in the overall
Phase II capital expenditures, will be partially financed through a term loan of up to $70,000,000 signed on July 21, 2021 with Fonds du
développement économique du Québec. Based on the foregoing and using ongoing operational cash flows, the Company is now fully funded for
the construction of the Phase II project which is scheduled for completion by mid-2022.
Milestones
In connection with the construction work that is progressing as planned, there are currently more than 300 employees, consult ants and
subcontractors on -site to meet the Bloom Lake Phase II completion objectives. Project milestones that were achieved and related works
undertaken during the three-month period ended June 30, 2021 include:
• Commencement of load-out conveyors’ installation;
• Mechanical and electrical installation of the mill recirculation conveyors;
• Erection of structure steel in the milling and screening area;
• Excavation of the crushed ore conveyors’ bunker;
• Continuation of piping installation inside the plant;
• Continuation of electrical work; and
• Delivery of some major mining equipment.
The progression of construction work accelerated significa ntly in May and should continue to increase and reach its peak during the second
fiscal quarter until October 2021. The ongoing hiring campaign to support the Phase II expansion is progressing as planned an d the project is
scheduled for completion by mid-2022.
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Bloom Lake Phase II reserves are based on the technical report entitled “Bloom Lake Mine – Feasibility Study Phase II”, prepared pursuant to
National Instrument 43 -101 – Standards of Disclosure for Mineral Projects (“NI-43-101”) and the Joint Ore Res erves Committee (“JORC”) Code
(2012 edition) by BBA Inc., Soutex and WSP Canada Inc., having an effective date of June 20, 2019 and filed on August 2, 2019 . Bloom Lake
Phase II mineral reserves include Bloom Lake Phase I mineral reserves as of the effectiv e date of the mineral reserve estimate reported in the
Feasibility Study. The Company is not aware of any new information or data that materially affects the information included in the Feasibility
Study and confirms that all material assumptions and techn ical parameters underpinning the estimates in the Feasibility Study continue to
apply and have not materially changed. The Feasibility Study is available under the Company's filings at www.sedar.com, on the ASX at
www.asx.com.au or the Company's website at www.championiron.com.
4. Bloom Lake Mine Operating Activities
Three Months Ended
June 30,
2021 2020 Variance
Operating Data
Waste mined and hauled (wmt) 4,699,500 2,612,800 80 %
Ore mined and hauled (wmt) 5,643,900 4,682,600 21 %
Material mined and hauled (wmt) 10,343,400 7,295,400 42 %
Strip ratio 0.83 0.56 48 %
Ore milled (wmt) 5,227,200 4,604,600 14 %
Head grade Fe (%) 29.6 31.3 (5 %)
Fe recovery (%) 82.9 82.3 1 %
Product Fe (%) 66.3 66.5 — %
Iron ore concentrate produced (wmt) 1,936,000 1,798,800 8 %
Iron ore concentrate sold (dmt) 1,974,700 1,758,800 12 %
Financial Data (in thousands of dollars)
Revenues 545,408 244,574 123 %
Cost of sales 120,846 107,338 13 %
Other expenses 14,560 9,541 53 %
Net finance costs 4,387 1,145 283 %
Net income 224,339 75,556 197 %
EBITDA1 405,739 130,162 212 %
Statistics (in dollars per dmt sold)
Gross average realized selling price 279.7 149.2 87 %
Net average realized selling price1 276.2 139.1 99 %
Total cash cost (C1 cash cost)1 60.1 58.4 3 %
All-in sustaining cost1 72.6 64.8 12 %
Cash operating margin1 203.6 74.3 174 %
Operational Performance
On March 24, 2020, the Company announced the ramp down of its operations following Government directives in response to the COVID -19
pandemic. Operations gradually ramped up following the Government's announcement in April 2020 that mining activities were to be
considered a "priority service" in Québec. Early actions implemented by the Company in response to the COVID-19 pandemic minimized impacts
on the Company and its operations.
During the three -month period ended June 30, 2021, operational activities were impacted by a scheduled and completed semi-annual
maintenance program. The next semi-annual maintenance is scheduled for the third quarter of the 2022 fiscal year.
In the current period, the Company and its mine site workers agreed on the terms of a new 3 -year collective agreement on June 23, 2021,
maintaining the Company's strong mutually beneficial partnership with its workers. The negotiation process did not affec t the Company's
operations.
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In the three-month period ended June 30, 2021, 10,343,400 tonnes of material were mined and hauled, compared to 7,295,400 tonnes for the
same period in 2020, an increase of 42%. This increase in material mined and hauled is at tributable to the negative impact of the COVID -19
pandemic on several of the Company's other activities in the comparative period and to a higher strip ratio as per the mine plan in connection
with the preparation for the Phase II project operations. The increase in material movement was enabled by the Company's ongoing mining
equipment rebuild program, which provided a higher equipment utilization rate and additional equipment availability, and the commissioning of
an additional haul truck during the second quarter of the 2021 fiscal year.
The strip ratio increased to 0.83 for the three-month period ended June 30, 2021, compared to 0.56 for the same period in 2020. The strip ratio
is consistent with the mine plan for this period of the year.
The iron or e head grade for the three- month period ended June 30, 2021 was 29.6%, compared to 31.3% for the same period in 2020. The
decrease in head grade is attributable to the presence of some lower -grade ore being sourced and blended from different pits, when com pared
to the prior year, which was anticipated and is in line with the mining plan and the LoM head grade average.
The Bloom Lake plant processed 5,227,200 tonnes of ore during the three -month period ended June 30, 2021, compared to 4,604,600 tonnes
for the same period in 2020, representing an increase of 14%. The higher throughput is attributable to the combination of the COVID-19 imposed
ramp-down in the comparative period and the higher mill throughput rate for the recently completed quarter. The contin uous improvements
and operational innovations saw the Company increase throughput stability and reach a higher level of mill productivity, enabling the Company
to capitalize on elevated iron ore prices.
Bloom Lake produced 1,936,000 wmt of 66.3% Fe high -grade iron ore concentrate during the three -month period ended June 30, 2021, an
increase of 8%, compared to 1,798,800 wmt of 66.5% Fe for the same period in 2020. The higher production is attributable to t he mining of
higher ore tonnages, and both higher throughput and recovery performance at the plant.
5. Financial Performance
A. Revenues
During the three -month period ended June 30, 2021, 1,974,700 tonnes of high -grade iron ore concentrate were sold at the CFR China gross
average realized price of US$228.3/dmt, before provisional sales adjustments and shipping costs. The gross average realized selling price of
US$228.3/dmt represents a premium of 14.2% over the benchmark IODEX 62% Fe CFR China Index (“P62”) price, compared to a premi um of
15.5% for the same period in 2020. The gross average realized selling price reflects the sales at a determined price, as well as the fo rward price
of US$232.3 at the expected settlement date for 1,156,100 tonnes which were in transit at the end of the period. The gr oss average realized
selling price of US$228.3/dmt is lower for the quarter, compared to the average IODEX 65% Fe CFR China Index (“P65”) of US$232.3/dmt. The
difference is due to the fact that 25% to 40% of iron ore sales are not subject to provisional pr icing and are based on backward -looking iron ore
prices, which were approximately US$40/dmt lower than the current spot price.
Further to recent discounting, required to compete with low pellet pricing and Chinese domestic concentrates priced lower tha n seaborne ones,
the Company now has the ability to fully benefit from the premium pricing of its high -grade product and, in some cases, realizing a
supplementary premium to the index. The Company believes that global carbon emissions reduction efforts will s upport the demand for high -
grade raw materials including concentrates and pellets. As such, the Company expects its iron ore concentrate pricing to cont inue tracking the
P65 index in the long term. In addition, the Company should continue to benefit from t he current period prices for its contracted volumes based
on previous months' P65 prices in the upcoming fiscal period ending September 30, 2021. Other factors influencing the Company ’s realized
price included the increasing demand for low silica and alumi na products, due to rising coking coal prices and falling levels of iron ore
inventories at Chinese ports, further tightening iron ore availability.
During the three -month period ended June 30, 2021, the global economic recovery, rising fuel prices and decreased vessel availability
contributed to the rising sea freight index, when compared to the previous quarter. As a result, the Company paid higher frei ght costs in the
three-month period ended June 30, 2021, compared to the same period in 2020. The fre ight costs variation relative to the Baltic Exchange C3
index during the period is mainly due to the timing of the vessels' booking.
During the three-month period ended June 30, 2021, the final price was established for the 1,007,000 tonnes of iron ore th at were in transit as
at March 31, 2021. Accordingly, during the three -month period ended June 30, 2021, provisional pricing adjustments of $60,895,000 were
recorded as additional revenues for the 1,007,000 tonnes, representing a positive impact of US$25.3/dmt for the period.
After taking into account sea freight costs of US$28.1/dmt and the provisional sales adjustment of US$25.3/dmt, the Company o btained a net
average realized selling price 1 of US$225.5/dmt (CA$276.2/dmt) for its high -grade iron ore deli vered to the end customer. Revenues totalled
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$545,408,000 for the three -month period ended June 30, 2021 compared to $244,574,000 for the same period in 2020. The increase is
attributable to a higher net average realized selling price1 and higher tonnages of iron ore concentrate being sold.
For the three-month period ended June 30, 2021, the Company sold 1,974,700 tonnes of iron ore concentrate shipped to 6 customers located in
China, Japan and South Korea.
B. Cost of Sales
Cost of sales represents mining , processing, and mine site -related general and administrative ("G&A") expenses. For the three -month period
ended June 30, 2021, the cost of sales totalled $120,846,000, compared to $107,338,000 for the same period in 2020.
During the three-month period e nded June 30, 2021, the total cash cost 1 or C1 cash cost 1 per tonne, excluding specific and incremental costs
related to COVID -19, totalled $60.1/dmt, compared to $58.4/dmt for the same period in 2020. The total cash cost 1 for the period was higher
mainly due to increased costs of the scheduled and completed maintenance program.
C. Net Income & EBITDA1
For the three-month period ended June 30, 2021, the Company generated a record net income of $224,339,000 (EPS of $0.44), compared to
$75,556,000 (EPS of $0.16) for the same period in 2020. The increase in net i ncome is mainly due to higher gross profit and improved
production resulting in more iron ore concentrate sold, partially offset by higher income and mining taxes from increased taxable income.
For the three -month period ended June 30, 2021, the Company g enerated record EBITDA 1 of $405,739,000, including non -cash share-based
payments, representing an EBITDA margin 1 of 74%, compared to $130,162,000, representing an EBITDA margin 1 of 53% for the same period in
2020. The variation in EBITDA1 period over period is primarily due to the greater revenue from higher net average realized selling price1.
D. All-In Sustaining Cost1 (“AISC”) and Cash Operating Margin1
During the three-month period ended June 30, 2021, the Company realized an AISC1 of $72.6/dmt, compared to $64.8/dmt for the same period
in 2020. The variation is due to higher total cash cost 1 and higher sustaining capital expenditures related to higher stripping and mining
activities and higher investments made in tailings lifts. St ripping and mining activities were negatively impacted by the reduced level of
operations at the onset of the COVID -19 pandemic in the three -month period ended June 30, 2020. During the three -month period ended
June 30, 2021, the Company performed preventi ve work on the dykes. Refer to section 7 - Cash Flows - Purchase of Property, Plant and
Equipment.
Deducting the AISC1 of $72.6/dmt from the net average realized selling price 1 of $276.2/dmt, the Company generated a cash operating margin 1
of $203.6/dmt f or each tonne of high -grade iron ore concentrate sold during the three- month period ended June 30, 2021, compared to
$74.3/dmt for the same period in 2020. The variation is essentially attributable to a higher net average realized selling price1.
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6. Exploration Activities and Regional Growth
Exploration Activities
During the three-month period ended June 30, 2021, the Company maintained all of its properties in good standing and did not enter into any
farm-in/farm-out arrangements. During the three -month period ended June 30, 2021, the Company incurred $743,000 in exploration and
evaluation expenditures, compared to $76,000 for the same period in 2020. During the three -month period ended June 30, 2021, the
exploration expenditures mainly consisted of c osts associated with minor exploration work and preliminary work related to updating the Kami
Project feasibility study. In the comparative period, exploration expenditures related to the acquisition costs of staking ad ditional exploration
claims and the fees required to maintaining all of the Company's properties.
Acquisition of the Kami Project
On April 1, 2021, the Company completed the acquisition of the Kami Project and certain related contracts. The Kami Project a nd the related
mining properties are located in the Labrador Trough geological belt in southwestern Newfoundland, near the Québec border. Refer to note 5 -
Acquisition of the Kami Project of the condensed interim consolidated financial statements for the three-month period ended June 30, 2021.
The Kami Project is a high -grade iron ore project near available infrastructure, situated only a few kilometers south -east of the Company's
operating Bloom Lake Mine. Alderon Iron Ore Corp. ("Alderon"), the Kami Project's former owner, previously disc losed historical resources
estimated at 1,274.5 Mt of measured and indicated resources (536.9 Mt measured and 737.6 Mt indicated) and proven and probabl e reserves of
517.2 Mt (392.7 Mt proven and 124.5 Mt probable). The historical Kami Project resource est imates are based on the NI 43 -101 technical report
entitled “Feasibility Study of the Rose Deposit and Resource Estimate for the Mills Lake Deposit of the Kamistiatusset (Kami) Iron Ore Property,
Labrador” prepared for Alderon Iron Ore Corp. by BBA Inc., S tantec and Watts, Griffis and McOuat Ltd. dated January 9, 2013 and having an
effective date of December 17, 2012. The historical Kami Project reserve estimates are based on the NI 43 -101 technical report entitled
“Updated Feasibility Study of the Kamistiatusset (Kami) Iron Ore Property, Labrador” prepared for Alderon Iron Ore Corp. by BBA Inc., Gemtec
Ltd., Watts, Griffis and McOuat Ltd. and Golder Associates Ltd. dated October 31, 2018 and having an effective date of Septem ber 26, 2018.
Kami Project miner al resources include Kami Project mineral reserves. The historical mineral resources and reserves mentioned are strictly
historical in nature, are non -compliant with NI 43 -101 and the JORC Code (2012 edition) and should therefore not be relied upon. A qual ified
person or competent person has not done sufficient work to upgrade or classify the historical estimates as current "mineral r esources",
"mineral reserves" or "ore reserves", as such terms are defined in NI 43 -101 and the JORC Code (2012 edition), and it is uncertain whether,
following evaluation and/or further exploration work, the historical estimates will be able to be reported as mineral resourc es, mineral reserves
or ore reserves in accordance with NI 43 -101 or the JORC Code (2012 edition). Champion is not treating the historical estimates as current
mineral resources, mineral reserves or ore reserves. These reserves and resources are not material mining projects and are for properties
adjacent to or near the Company's existing mining tenements and therefore the reports on these mineralizations have not been prepared in
accordance with the JORC Code (2012 edition) and the ASX Listing Rules. As stated above, the Company has initiated work to re vise the Kami
Project's scope and update the feasibility study.
Alderon completed an updated feasibility study on the Kami Project in September 2018. The Company is currently revising the K ami Project's
scope and has initiated work intended to update the feasibility study, which is expected to be c ompleted in the second half of 2022, as part of
the Company's strategy to evaluate its growth alternatives within its property portfolio.
Acquisition of Exploration Property from Fancamp Exploration Ltd. (“Fancamp”)
On July 12, 2021, the Company completed the acquisition of the Lac Lamêlée property and a 1.5% net smelter royalty interest on the Company's
Moiré Lake property and the Company' s Fermont property portfolio, including the O’Keefe -Purdy, Harvey -Tuttle, and Consolidated Fire Lake
North properties from Fancamp.
The Lac Lamêlée property adds an additional 74.7 Mt of historical indicated resources and 229.3 Mt of historical inferred resources, with the
project located adjacent to the Company's existing development properties south of Bloom Lake. The historical Lac Lamêlée resource
estimates are based on the NI 43 -101 technical report entitled “NI 43 -10 Technical Report and Mineral Resource Estimate on the Lac Lamêlée
South Resources Quebec - Canada” by Met-Chem, a division of DRA Americas Inc. dated July 28, 2017 and having an effective date of January
26, 2017. The historical mineral resources mentioned are strictly histori cal in nature, are non -compliant with NI 43 -101 and the JORC Code
(2012 edition) and should therefore not be relied upon. A qualified person or competent person has not done sufficient work t o upgrade or
classify the historical estimates as current "mineral resources", "mineral reserves" or "ore reserves", as such terms are defined in NI 43-101 and
the JORC Code (2012 edition), and it is uncertain whether, following evaluation and/or further exploration work, the historic al estimates will be
able to be repo rted as mineral resources, mineral reserves or ore reserves in accordance with NI 43 -101 or the JORC Code (2012 edition).
Champion is not treating the historical estimates as current mineral resources, mineral reserves or ore reserves. These reserves and resources
are not material mining projects and are for properties adjacent to or near the Company's existing mining tenements and there fore the reports
on these mineralizations have not been prepared in accordance with the JORC Code (2012 edition) and the ASX Listing Rules.
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Consideration paid to Fancamp included $1,300,000 in cash, an undertaking in favour of Fancamp to make future finite production payments
on a fixed amount of future iron ore production payable once certain production thresholds have been reached with respect to the Lac Lamêlée,
Moiré Lake and Fermont property portfolio properties.
Concurrently with the transaction, the Company also staked 11 additional claims directly adjacent to the Lac Lamêlée property.
Notes
1. The historical Lac Lam êlée resource estimates are based on the NI 43 -101 technical report entitled “NI 43 -10 Technical Report and Mineral Resource Estimate on the Lac
Lamêlée South Resources Quebec - Canada” by Met-Chem, a division of DRA Americas Inc. dated July 28, 2017 and h aving an effective date of January 26, 2017. The historical
mineral resources mentioned are strictly historical in nature, are non -compliant with NI 43 -101 and the JORC Code (2012 edition) and should therefore not be relied upon. A
qualified person or competent person has not done sufficient work to upgrade or classify the historical estimates as current "mineral resources", "mi neral reserves" or "ore
reserves", as such terms are defined in NI 43 -101 and the JORC Code (2012 edition), and it is uncertain whe ther, following evaluation and/or further exploration work, the
historical estimates will be able to be reported as mineral resources, mineral reserves or ore reserves in accordance with NI 43-101 or the JORC Code (2012 edition). Champion is
not treating the historical estimates as current mineral resources, mineral reserves or ore reserves. These reserves and resources are not material mining projects and are for
properties adjacent to or near the Company's existing mining tenements and therefore the repor ts on these mineralization s have not been prepared in accordance with the
JORC Code (2012 edition) and the ASX Listing Rules.
2. The historical Consolidated Fire Lake resource estimates are based on the NI 43-101 technical report entitled “Preliminary Feasibility Study of the West and East Pit Deposits of
the Fire Lake North Project” by BBA Inc., P&E Mining Consultants Inc. and Rail Cantech Inc. dated February 22, 2013 and having an effective date of January 25, 2013. The
historical mineral resources mentioned are strictly historical in nature, are non -compliant with NI 43 -101 and the JORC Code (2012 edition) and should therefore not be relied
upon. A qualified person or competent person has not done sufficient work to upgrade or classify the historical estimates as current “mineral resources”, “mineral reserves” or
“ore reserves”, as such terms are defined in NI 43 -101 and the JORC Code (2012 edition), and it is uncertain whether, following evaluation and/or further exploration work, the
historical estimates will be able to be reported as mineral resources, mineral reserves or ore reserves in accordance with NI 43-101 or the JORC Code (2012 edition). Champion
Iron Limited is not treating the historical estimates as current mineral resources, mineral reserves or ore reserves. These reserves and resources are not material mining
projects and are for properties adjacent to or near Champio n Iron Limited’s existing mining tenements and therefore the reports on these mineralizations have not been
prepared in accordance with the JORC Code (2012 edition) and the ASX Listing Rules.
3. The historical Quinto Claims resource estimates are based on the NI 43-101 technical reports entitled “Mineral Resource Technical Report, Peppler Project, Quebec” (as regards
Peppler Lake), “Mineral Resource Technical Report, Lamelee Project, Quebec” (as regards Lamêlée) and “Mineral Resource Techni cal Report, Hobdad P roject, Quebec” (as
regards Hobdad), each prepared by G H Wahl & Associates Consulting dated February 15, 2013 and having an effective date of December 31, 2012. The historical mineral
resources mentioned are strictly historical in nature, are non -compliant with NI 43- 101 and the JORC Code (2012 edition) and should therefore not be relied upon. A qualified
person or competent person has not done sufficient work to upgrade or classify the historical estimates as current “mineral resources”, “mineral reserves” or “ore reserves”, as
such terms are defined in NI 43-101 and the JORC Code (2012 edition), and it is uncertain whether, following evaluation and/or further exploration work, the historical estimates
will be able to be reported as mineral resources, mine ral reserves or ore reserves in accordance with NI 43 -101 or the JORC Code (2012 edition). Champion Iron Limited is not
treating the historical estimates as current mineral resources, mineral reserves or ore reserves. These reserves and resources are not m aterial mining projects and are for
properties adjacent to or near Champion Iron Limited’s existing mining tenements and therefore the reports on these mineralizations have not been prepared in accordance with
the JORC Code (2012 edition) and the ASX Listing Rules.
4. The historical Harvey Tuttle resource estimates are based on the NI 43 -101 technical report entitled “Technical Report and Resource Estimate on the Harvey -Tuttle Property
Québec, Canada” by P&E Mining Consultants Inc. dated April 13, 2011 and having an effective date of February 25, 2011. The historical mineral resources mentioned are strict ly
historical in nature, are non-compliant with NI 43-101 and the JORC Code (2012 edition) and should therefore not be relied upon. A qualified person or competent person has not
done sufficient work to upgrade or classify the historical estimates as current “mineral resources”, “mineral reserves” or “o re reserves”, as such terms are defined in NI 43 -101
and the JORC Code (2012 editio n), and it is uncertain whether, following evaluation and/or further exploration work, the historical estimates will be able to be reported as
mineral resources, mineral reserves or ore reserves in accordance with NI 43-101 or the JORC Code (2012 edition). Champion Iron Limited is not treating the historical estimates
as current mineral resources, mineral reserves or ore reserves. These reserves and resources are not material mining projects and are for properties adjacent to or near
Champion Iron Limited’s existing mining tenements and therefore the reports on these mineralizations have not been prepared in accordance with the JORC Code (2012 edition)
and the ASX Listing Rules.
5. Certain resources mentioned are foreign estimates from an Australian perspective.