FIRST QUANTUM MINERALS REPORTS FIRST QUARTER 2023 RESULTS (In United States dollars, except where noted otherwise)
NEWS RELEASE
23-16
April 25, 2023
www.first-quantum.com
FIRST QUANTUM MINERALS REPORTS FIRST QUARTER 2023 RESULTS
(In United States dollars, except where noted otherwise)
Toronto, Ontario ( April 25, 2023 ) - First Quantum Minerals Ltd. (“First Quantum” or “the Company”) (TSX: FM)
today reports results for the three months ended March 31, 2023 (“Q1 2023” or the "first quarter") of net earnings
attributable to shareholders of the Company of $75 million ($0.11 earnings per share) and adjusted earnings1 of
$76 million ($0.11 adjusted earnings per share2).
“The first quarter was difficult with production impacted at our three largest operations. At Cobre Panamá,
production was interrupted by a temporary suspension of exports but returned to full production rates once the
suspension was lifted. Our Zambian operations experienced a seasonal impact, however, the rainy season is
nearing an end. We are focused on improving operational performance and expect production to recover over the
course of the year and, as such, we remain committed to our guidance for 2023,” commented Tristan Pascall,
Chief Executive Officer. “The first quarter also had important milestones, including a refreshed contract with the
Government of Panamá and a new partnership with Rio Tinto to progress the La Granja project in northern Peru.
The Company also successfully executed on two of our brownfield projects. Commissioning of the CP100
Expansion was completed ahead of schedule and remains on track to achieve 100 million tonnes of throughput per
annum by the end of this year and we introduced first ore through the Enterprise nickel plant. Both of these
projects will increase our copper and nickel production, two metals that are critical to the global transition to cleaner
energy.”
Q1 2023 SUMMARY
In Q1 2023, First Quantum reported gross profit of $280 million, EBITDA1 of $518 million, net earnings attributable
to shareholders of $0.11 per share, and adjusted earnings of $0.11 per share2. Relative to the fourth quarter of last
year (“ Q4 2022 ”), first quarter financial results were impacted by lower sales volumes as a result of lower
production that was partially mitigated by lower input costs and stronger realized copper and gold prices.
Total copper production for the first quarter was 138,753 tonnes, a 33% decrease from Q4 2022. The quarter-over-
quarter decrease in production was attributable to a 15-day temporary suspension of production at Cobre Panamá
and the rainy season in Zambia, with Sentinel receiving its highest rainfall in 25 years. Kansanshi continued to
experience lower feed grades across all three circuits.
Copper C1 cash cost 2 of $2.24 per lb for Q1 2023 was $0.38 per lb higher than Q4 2022. While market rates for
fuel and freight were, on average, lower in the first quarter of 2023, these benefits were more than offset by lower
production levels.
2023 guidance on production, C1 cash costs 2, all-in sustaining cost (“AISC”) 2 and capital expenditures that was
previously disclosed on January 16, 2023 remains unchanged. For 2023, copper production is forecast to be
770,000 to 840,000 tonnes. Production is expected to recover for each of the next three quarters, particularly in the
second half of the year. Copper C1 cash costs 1 are guided to be $1.65 to $1.85 per lb. Capital cost guidance for
2023 is $1,600 million.
1 EBITDA and adjusted earnings are non-GAAP financial measures. These measures do not have a standardized meaning prescribed by IFRS and might not be comparable to
similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2 Adjusted earnings per share, copper C1 cash cost (copper C1), and all-in sustaining costs (AISC) are non-GAAP ratios which do not have a standardized meaning prescribed
by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
Q1 2023 OPERATIONAL HIGHLIGHTS
Total copper production for Q1 2023 was 138,753 tonnes, down from the 206,007 tonnes reported in Q4 2022 as
each of the Company's three largest operations had negative production impacts during the period. Copper sales
volumes in Q1 2023 totalled 150,287 tonnes, 11,534 tonnes higher than production.
• Cobre Panamá produced 65,427 tonnes of copper in Q1 2023, a decrease of 24,225 tonnes from the
previous quarter as production was interrupted on February 23, 2023 for 15 days as a result of export
restrictions imposed by the Maritime Port Authority ("AMP"). Following a resolution issued by the AMP,
concentrate loading recommenced on March 9, 2023 with a record number of vessels loaded in March.
Throughput returned to full capacity on March 10, 2023, two days after the restart of operations. Copper
C1 cash cost1 of $1.65 per lb was $0.02 per lb higher than the previous quarter mainly attributable to lower
production levels. The commissioning of the CP100 Expansion was completed in the first quarter and the
annualized throughput rate of 100 million tonnes per annum ("Mtpa") remains on schedule for the end of
the year. 2023 Production guidance for Cobre Panamá remains unchanged at 350,000 to 380,000 tonnes
of copper and 140,000 to 160,000 ounces of gold. For the full year 2023, grades and recoveries are
expected to be broadly consistent with 2022 regardless of the increased processing throughput, with some
fluctuation from quarter to quarter. Construction of the molybdenum plant is progressing well, with
completion of construction and commencement of commissioning expected by the end of 2023 with first
production expected in Q1 2024.
• Kansanshi’s copper production of 28,683 tonnes in Q1 2023 was 6,119 tonnes lower than the previous
quarter due to the seasonal impact of the rainy season and lower feed grades across all three circuits,
particularly from the M11 area at lower elevations in the main pit. Variability of grades in ore stockpiles and
lower grades from narrow-veined regions were the main drivers behind the lower grades. Copper C1 cash
cost1 of $2.88 per lb was $0.07 higher than Q4 2022 mainly due to lower production volumes despite an
improvement in input costs. Production in 2023 is expected to be 130,000 to 150,000 tonnes of copper and
95,000 to 105,000 ounces of gold. Mining fleet deployment changes over the past six months have
enabled the operation to open up mining areas, placing less reliance on variable grade ore stockpiles, as
well as mining cutbacks M15 and M17 at upper elevations in the main pit with historically higher grades,
which will benefit production through the rest of 2023. An extensive drilling campaign is ongoing in areas
associated with vein mineralization prior to mining.
• Sentinel reported copper production of 36,232 tonnes in Q1 2023, 37,177 tonnes lower than the previous
quarter due to the intense rainy season, resulting in the accumulation of water in the Stage 1 pit. Saturated
ground conditions significantly impacted mining rates due to poor road conditions and water in the pit
prevented access to working faces, particularly in the lower benches of Stage 1. Copper C1 cash cost 1 of
$2.70 per lb was $1.15 per lb higher than the preceding quarter reflecting the lower production volumes.
Despite the challenges encountered during the first quarter, copper production for 2023 remains
unchanged at 260,000 to 280,000 tonnes as higher feed grades are expected in the second half of the
year, with grades showing improvement already in April. The current focus on deploying additional
dewatering capacity in Stage 1 to regain access to the high-grade ore is already yielding results early in
the second quarter. The mine plan has been rescheduled, even if total volumes remain substantively the
same and higher grade zones will be dispatched across the remaining three quarters of the year. This is to
be complemented by a change in location of the in-pit ramps to liberate high-grade ore by mining the
saddle zones between Stage 1 and Stage 2. There will also be a redistribution of loading equipment to
better suit working areas and truck fleet capacity is planned to increase in the second quarter with the
commissioning of an additional Liebherr T284, followed by two more in the second half of the year.
• Ravensthorpe payable nickel production of 4,344 tonnes was 106 tonnes lower than the fourth quarter. A
major two week High Pressure Acid Leach train shutdown was performed during February. The shutdown
ran according to schedule with all works being completed on time. Nickel C1 cash cost 1 was $9.34 per lb
relatively unchanged from the preceding quarter. Production guidance for 2023 remains at 23,000 to
28,000 contained tonnes of nickel.
First Quantum Minerals Ltd. 23-16
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1 C1 cash costs (C1) is a non-GAAP ratio which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial measures disclosed
by other issuers. See “Regulatory Disclosures”.
COBRE PANAMÁ UPDATE
During the quarter, the Company continued to engage in good faith discussions with the Government of Panamá
("GOP") and, on March 8, 2023, the Company and the GOP issued a press release announcing that an agreement
was reached on the terms and conditions of the draft of a concession contract (the “Refreshed Concession
Contract”). The Refreshed Contract will have an initial 20-year term with a 20-year extension option and additional
extensions for life of mine. The Refreshed Concession Contract is expected to be presented before the National
Assembly of Panamá in the legislative term that commences on July 1, 2023, after having gone through a public
consultation process and receipt of all required prior governmental approvals.
Once the agreement is signed and passed into law, payments to cover taxes and royalties up to the year-end 2022
of approximately $395 million are expected to be made within 30 days of the Refreshed Concession Contract being
enacted into law. In addition, past due amounts payable for 2023 corporate tax instalments, withholding taxes and
quarterly royalty payments will also be due 30 days after being enacted, without penalty or interest. It is intended
that the charge relating to taxes and royalties up to the year-end 2022 be excluded from 2023 adjusted earnings.
The expected taxes and royalties to the GOP relating to 2023 is $375 million. Any non-profit based top-up tax to
meet the proposed minimum contribution is expected to be recognized within operating profit and impact AISC 1.
The AISC1 guidance range is unchanged and is able to accommodate the expected impact of between $0.00 per lb
to $0.05 per lb. At current consensus pricing, the adjusted effective tax rate for the Group for the full year 2023 is
expected to be between 35% and 40%.
KANSANSHI – CONVERSION OF ZCCM DIVIDEND RIGHTS TO ROYALTY RIGHTS
During the fourth quarter of 2022, an agreement was entered into between KMP and ZCCM-IH to convert ZCCM-
IH's dividend rights in KMP into royalty rights. The transaction was completed on April 4, 2023.
LA GRANJA
On March 30, 2023, the Company entered into an agreement with Rio Tinto to progress the next phase of the La
Granja copper project in northern Peru. La Granja is one of the largest undeveloped copper resources in the world
with a published Inferred mineral resource of 4.32 billion tonnes at 0.51% copper, and has potential for substantial
expansion.
Under the terms of the agreement, the Company will acquire a 55% interest in La Granja for a consideration of
$105 million and will become the operator of the project. The Company will then be responsible for the next $546
million of initial funding. Part of the initial funding will be used to complete a feasibility study, following which the
remaining majority of the initial funding is expected to be spent on construction of the project following a positive
investment decision. The transaction is expected to close before the end of the third quarter.
Work over the initial years is planned to continue to progress community engagement and the feasibility study. The
feasibility study will focus on developing an updated geological resource and reserve model, which will require
additional infill drilling to upgrade Inferred resources to Measured and Indicated categories. Additional metallurgical
studies to establish optimal processing configurations are expected to be carried out in parallel, together with a
high-level project layout and configuration of associated infrastructure requirements and logistical routes.
Further to the agreement on La Granja, First Quantum and Rio Tinto have also entered into a memorandum of
understanding to support co-operation in relation to base metals development opportunities and the sharing of
technology and know-how on certain mining methods, such as the application of trolley-assist and autonomous
mining fleets.
First Quantum Minerals Ltd. 23-16
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1 All-in sustaining costs (AISC) is a non-GAAP ratio which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial measures
disclosed by other issuers. See “Regulatory Disclosures”.
BROWNFIELD PROJECTS
Construction for the CP100 Expansion project was completed seven weeks ahead of schedule and commissioning
was completed in the first quarter. With these facilities now in daily operation, focus has moved onto ramping up
these facilities over the course of the year to achieve a throughput rate of 100 Mtpa by the end of 2023. Significant
progress has been made on the pre-strip work for the Colina pit and earthworks for the associated overland
conveyor and in-pit crushing facility. The first crusher at Colina is expected to be commissioned in 2024.
At the S3 Expansion, detail design is progressing well. Long-lead mining fleet and long-lead process plant
equipment have been ordered with deliveries commencing in the second half of 2023. Overall project procurement
is approximately 25% committed as at the end of the quarter. The majority of the capital spend on the S3
Expansion is expected in late-2023 and 2024.
First ore through the Enterprise nickel plant was achieved on schedule in February 2023. Plant refurbishment,
completion and commissioning activities were completed on schedule. First production of nickel is expected in the
second quarter of 2023 and ramp up to commercial production will continue over the course of 2023, with ramp up
to full plant throughput in 2024. 2023 production guidance for Enterprise is 5,000 to 10,000 contained tonnes of
nickel.
At the Las Cruces Underground Project, the water concession license was granted in March 2023 and all permits
are in place for project approval. The technical and study work on the polymetallic refinery project are expected to
continue with all permits required to carry out the project now granted. The Las Cruces Underground Project is
awaiting Board approval, which is not expected before the end of 2023 and will take into consideration prevailing
economic conditions and the Company's debt reduction objectives.
FINANCIAL HIGHLIGHTS
• Gross profit of $280 million and EBITDA 1 of $518 million for the first quarter were 22% and 20% lower,
respectively, than the fourth quarter of last year due to lower metal sales volumes.
• Cash flows from operating activities of $299 million ($0.43 per share 2) for the quarter were $62 million
higher than the fourth quarter of last year due mainly to working capital movements related to trade and
other receivables.
• Net debt 1 increased by $88 million during the quarter, taking the net debt 1 balance to $5,780 million as at
March 31, 2023. As at March 31, 2023, total debt was $6,878 million (December 31, 2022, total debt was
$7,380 million). The increase in net debt 1 and total debt1 was attributable to timing of working capital cash
flow and continued investment in the business. The Company continues to target a further $1 billion
reduction in debt in the medium term.
• In the first quarter of 2023, the Company redeemed at par an aggregate principal amount of $850 million of
the senior unsecured notes due 2024. $450 million was redeemed on February 25, 2023 and the
remaining $400 million was redeemed on March 28, 2023. Following the redemptions, there are no
outstanding senior unsecured notes due in 2024.
First Quantum Minerals Ltd. 23-16
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1 EBITDA is a non-GAAP financial measures and net debt is a supplementary financial measure. These measures do not have a standardized meaning prescribed by IFRS and
might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”
2 Cash flows from operating activities per share, copper C1 cash cost (copper C1), and copper all-in sustaining cost (copper AISC) are non-GAAP ratios which do not have a
standardized meaning prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
ENVIRONMENT, SOCIAL AND GOVERNANCE (“ESG”)
Reporting - The Company will publish its primary sustainability report, the 2022 ESG Report, in May 2023. The
latest reports can be found in the ESG Analyst Centre on the Company’s website: https://www.first-quantum.com/
English/sustainability/esg-analyst-centre/default.aspx. These include the TCFD-aligned Climate Change Reports,
ESG Reports, Tax Transparency and Contributions to Government Reports, as well as Company’s sustainability
policies.
Innovation driving sustainability - On March 1, 2023, Hitachi Construction Machinery Co. Ltd (“Hitachi”) and the
Company announced a technology partnership for the development of Hitachi Construction Machinery ’s first
battery mining trucks at the Kansanshi mine. As First Quantum seeks to lower the greenhouse gas (“GHG”)
intensity of copper produced, this initiative represents an important milestone towards future commercialization of
battery technology to further decarbonize mining operations, consistent with the Company’s 2025 30% and 2030
50% GHG emissions reduction targets. It is expected that these battery dump trucks will be supplied to Kansanshi
by December 2023 for feasibility trials as part of the commissioning of the Kansanshi S3 Expansion.
Health & Safety - The health and safety of the Company’s employees and contractors is a top priority and the
Company is focused on the continuous strengthening and improvement of the safety culture at all of its operations.
Tragically, on February 1, 2023, there was a fatal road traffic accident in the Sentinel pit involving a dump truck and
a light vehicle. The site emergency response team attended immediately and the relevant local authorities were
notified. This tragic incident is subject to internal and external investigation, as well as a Board review, and the
Company is committed to improve practices from this incident.
First Quantum Minerals Ltd. 23-16
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CONSOLIDATED OPERATING HIGHLIGHTS
QUARTERLY
Q1 2023 Q4 2022 Q1 2022
Copper production (tonnes)1 138,753 206,007 182,210
Cobre Panamá 65,427 89,652 78,337
Kansanshi 28,683 34,802 41,899
Sentinel 36,232 73,409 52,475
Other Sites 8,411 8,144 9,499
Copper sales (tonnes) 150,287 198,912 196,702
Cobre Panamá 70,028 85,330 74,885
Kansanshi2 31,538 32,496 53,240
Sentinel 40,313 71,642 58,550
Other Sites 8,408 9,444 10,027
Gold production (ounces) 47,874 70,493 70,357
Cobre Panamá 23,878 38,302 29,947
Kansanshi 15,960 24,479 32,640
Guelb Moghrein 7,585 7,434 6,912
Other sites 451 278 858
Gold sales (ounces)3 51,941 59,568 76,195
Cobre Panamá 28,853 34,208 30,168
Kansanshi 17,244 16,156 38,828
Guelb Moghrein 5,482 8,601 5,523
Other sites 362 603 1,676
Nickel production (contained tonnes) 5,917 5,705 5,122
Nickel sales (contained tonnes) 5,846 6,840 4,350
Cash cost of copper production (C1) (per lb)4,5 $2.24 $1.86 $1.61
Total cost of copper production (C3) (per lb)4,5 $3.30 $2.79 $2.65
Copper all-in sustaining cost (AISC) (per lb)4,5 $2.87 $2.42 $2.27
1 Production is presented on a contained basis, and is presented prior to processing through the Kansanshi smelter.
2 Sales include third-party sales of concentrate, cathode and anode attributable to Kansanshi (excluding copper anode sales attributable to Trident). Sales exclude the sale of
copper anode produced from third-party concentrate purchased at Kansanshi. Sales of copper anode attributable to third party concentrate purchases were 9,120 tonnes for
the three months ended March 31, 2023 (nil tonnes for the three months ended March 31, 2022).
3 Excludes refinery-backed gold credits purchased and delivered under the precious metal streaming arrangement (see “Precious Metal Stream Arrangement”).
4 Copper all-in sustaining cost (copper AISC), copper C1 cash cost (copper C1), and total cost of copper (copper C3) are non-GAAP ratios, which do not have a standardized
meaning prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
5 Excludes the sale of copper anode produced from third-party concentrate purchased at Kansanshi. Sales of copper anode attributable to third-party concentrate purchases
were 9,120 tonnes for the three months ended March 31, 2023 (nil for the three months ended March 31, 2022).
REALIZED METAL PRICES1
QUARTERLY
Q1 2023 Q4 2022 Q1 2022
Average LME copper cash price (per lb) $4.05 $3.63 $4.53
Realized copper price (per lb) $3.95 $3.56 $4.45
Treatment/refining charges (“TC/RC”) (per lb) ($0.14) ($0.12) ($0.12)
Freight charges (per lb) ($0.02) ($0.04) ($0.04)
Net realized copper price1 (per lb) $3.79 $3.40 $4.29
Average LBMA cash price (per oz) $1,890 $1,728 $1,877
Net realized gold price1,2 (per oz) $1,766 $1,574 $1,772
Average LME nickel cash price $11.79 $11.47 $11.97
Net realized nickel price1,3 $10.25 $13.67 $13.52
1 Realized metal prices are a non-GAAP ratio, do not have standardized meanings under IFRS and might not be comparable to similar financial measures disclosed by other
issuers. See “Regulatory Disclosures” for further information.
2 Excludes gold revenues recognized under the precious metal stream arrangement.
3 The premium to the average LME cash price arose from the timings of sales across the periods, their respective quotation pricing periods and the impact from the
Company’s decision to temporarily suspend its nickel hedging program following the failure of the LME nickel platform in March 2023.
First Quantum Minerals Ltd. 23-16
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CONSOLIDATED FINANCIAL HIGHLIGHTS
QUARTERLY
Q1 2023 Q4 2022 Q1 2022
Sales revenues 1,558 1,832 2,163
Gross profit 280 361 908
Net earnings attributable to shareholders of the Company 75 117 385
Basic earnings per share $0.11 $0.17 $0.56
Diluted earnings per share $0.11 $0.17 $0.56
Cash flows from operating activities 299 237 666
Net debt1 5,780 5,692 5,815
EBITDA2,3 518 647 1,180
Adjusted earnings3 76 151 480
Adjusted earnings per share4 $0.11 $0.22 $0.70
Realized copper price (per lb)4 $3.95 $3.56 $4.45
Net earnings attributable to shareholders of the Company 75 117 385
Adjustments attributable to shareholders of the Company:
Adjustment for expected phasing of Zambian value-added tax (“VAT”) receipts (23) 56 22
Loss on redemption of debt – – –
Total adjustments to EBITDA2 excluding depreciation3 22 6 103
Tax and minority interest adjustments 2 (28) (30)
Adjusted earnings4 76 151 480
1 Net debt is a supplementary financial measure which does not have a standardized meaning under IFRS, and might not be comparable to similar financial measures disclosed
by other issuers. See “Regulatory Disclosures.
2 EBITDA and adjusted earnings are non-GAAP financial measures, which do not have a standardized meaning under IFRS and might not be comparable to similar financial
measures disclosed by other issuers. Adjusted earnings have been adjusted to exclude items from the corresponding IFRS measure, net earnings attributable to shareholders
of the Company, which are not considered by management to be reflective of underlying performance. The Company has disclosed these measures to assist with the
understanding of results and to provide further financial information about the results to investors and may not be comparable to similar financial measures disclosed by other
issuers. The use of adjusted earnings and EBITDA represents the Company’s adjusted earnings metrics. See “Regulatory Disclosures”.
3 Adjustments to EBITDA in 2023 relate principally to foreign exchange revaluations (2022 - foreign exchange revaluations and non-recurring costs relating to previously sold
assets).
4 Adjusted earnings per share, realized metal prices, copper all-in sustaining cost (copper AISC), copper C1 cash cost (copper C1), and total cost of copper (copper C3) are non-
GAAP ratios which do not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See
“Regulatory Disclosures”.
First Quantum Minerals Ltd. 23-16
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COMPLETE FINANCIAL STATEMENTS AND MANAGEMENT’S DISCUSSION AND ANALYSIS
The complete Consolidated Financial Statements and Management’s Discussion and Analysis for the three months
ended March 31, 2023 are available at www.first-quantum.com and at www.sedar.com and should be read in
conjunction with this news release.
CONFERENCE CALL DETAILS
The Company will host a conference call and webcast to discuss the results on Wednesday, April 26, 2023 at 9:00
am (ET).
Conference call and webcast details:
Toll-free North America: 1-800-319-4610
Toll-free International: +1-604-638-5340
Webcast: Direct link or on our website
A replay of the webcast will be available on the First Quantum website.
For further information, visit our website at www.first-quantum.com or contact:
Bonita To, Director, Investor Relations
(416) 361-6400 Toll-free: 1 (888) 688-6577
E-Mail: [email protected]
First Quantum Minerals Ltd. 23-16
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