Imperial Reports 2018 Financial Results
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News Release
Imperial Reports 2018 Financial Results
Vancouver | March 29, 2019 | Imperial Metals Corporation (the “Company”) (TSX:III) reports financial results for its fiscal
year ended December 31, 2018.
Select Annual Financial Information Years Ended December 31
expressed in thousands, except share and per share amounts 2018 2017 2016
Total revenues $360,173 $453,113 $428,218
Net income (loss) $(125,595) $77,113 $(54,080)
Net income (loss) per share $(1.06) $0.82 $(0.66)
Diluted income (loss) per share $(1.06) $0.82 $(0.66)
Adjusted net loss (1) $(84,763) $(62,626) $(56,784)
Adjusted net loss per share (1) $(0.71) $(0.66) $(0.69)
Adjusted EBITDA(1) $33,268 $88,457 $106,624
Working capital deficiency $789,470 $238,269 $89,108
Total assets $1,573,903 $1,723,768 $1,527,778
Total debt (including current portion) $871,268 $852,378 $835,365
Cash flow (1)(2) $143,449 $88,381 $107,591
Cash flow per share (1)(2) $1.21 $0.94 $1.32
(1) Refer to Non-IFRS Financial Measures in the Management’s Discussion & Analysis.
(2) Cash flow is defined as the cash flow from operations before the net change in non-cash working capital balances, income and mining taxes, and
interest paid. Cash flow per share is defined as Cash flow divided by the weighted average number of common shares outstanding during the year.
Select Items Affecting Net Income (Loss) (presented on an after-tax basis) Years Ended December 31
expressed in thousands 2018 2017
Net income (loss) before undernoted items $(26,923) $(6,182)
Interest expense (57,249) (55,887)
Foreign exchange gain (loss) on non-current debt (36,949) 29,280
Impairment of mineral properties (79,719) -
Gain on bargain purchase of Huckleberry and revaluation
of equity investment in Huckleberry - 109,818
Settlement and insurance recoveries 74,949 -
Gain on sale of Sterling 296 641
Share of loss in Huckleberry - (557)
Net Income (Loss) $(125,595) $77,113
Revenues decreased to $360.2 million in 2018 compared to $453.1 million in 2017, a decrease of $92.9 million or 20.5%.
Revenue from the Red Chris mine in 2018 was $255.7 million compared to $289.1 million in 2017. Revenue from the Mount
Polley mine in 2018 was $104.4 million compared to $163.5 million in 2017. There were 12.0 concentrate shipments in 2018
from the Red Chris mine (2017-15.0 concentrate shipments) and 3 .0 concentrate shipments from the Mount Polley mine in
2018 (2017-4.7 concentrate shipments). Variations in revenue ar e impacted by the timing and quantity of concentrate
shipments, metal prices and exchange rates, and period end revaluations of revenue attributed to concentrate shipments where
metal prices will settle at a future date.
Net loss for 2018 was $125.6 million ($1.06 per share) compared to net income of $77.1 million ($0.82 per share) in 2017.
The majority of decrease in net income of $202.7 million was primarily due to the following factors:
Loss from mine operations went from income of $19.5 million in 2017 to a loss of $33.0 million in 2018, an increase in net
loss of $52.5 million.
Interest expense increased from $75.5 million in 2017 to $78.4 million in 2018, an increase to net loss of $2.9 million.
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Foreign exchange gain on current and non-current debt went from a gain of $30.2 million in 2017 to a loss of $36.9 million
in 2018, an increase in net loss of $67.1 million.
Impairment on mineral properties went from $nil in 2017 to $109.2 million in 2018, an increase in net loss of $109.2 million.
A gain on bargain purchase of Huckleberry and revaluation of equity investment in Huckleberry of $109.8 million in 2017
compared to $nil in 2018, an increase in net loss of $109.8 million.
Rehabilitation costs of $0.2 million in 2018 compared to $5.8 million in 2017, a decrease in net loss of $5.6 million.
Other income totalled $108.1 million in 2018 largely due to the settlement of $106.2 million, net of costs pertaining to the
August 4, 2014 tailings dam breach at the Mount Polley Mine (“M ount Polley Breach”) compared to an expense of $0.3
million in 2017, a decrease in net loss of $107.8 million.
An income and mining tax recovery of $38.1 million in 2018 comp ared to a recovery of $10.6 million in 2017, a decrease
in net loss of $27.5 million.
The 2018 net loss included foreign exchange loss related to changes in CDN$/US$ exchange rate of $38.4 million compared
to foreign exchange gain of $30.4 million in 2017. The $38.4 million foreign exchange loss in 2018 is comprised of a $36.4
million loss on the Senior Notes, a $0.6 million loss on short term loans, and a $1.4 million loss on operational items. The
average CDN$/US$ exchange rate in the 2018 was 1.296 compared to an average of 1.298 in 2017.
Cash flow was $143.4 million in 2018 compared to cash flow of $ 88.4 million in 2017. Cash flow is a measure used by the
Company to evaluate its performance, however, it is not a term recognized under IFRS. The Company believes Cash flow is
useful to investors and it is one of the measures used by management to assess the financial performance of the Company.
Capital expenditures were $77.0 million in 2018, down from $92. 9 million in 2017. The 2018 expenditures included $34.8
million for tailings dam construction, $35.7 million on equipment and components and $6.5 million for other capital items.
At December 31, 2018 the Company had $18.6 million in cash (Dec ember 31, 2017-$51.9 million). The Company has
classified $603.6 million of its non-current debt as current at December 31, 2018 (December 31, 2017-$213.9 million).
NON-IFRS FINANCIAL MEASURES
The Company reports four non-IFRS financial measures: adjusted net income, adjusted EBITDA, cash flow and cash cost
per pound of copper produced which are described in detail belo w. The Company believes these measures are useful to
investors because they are included in the measures that are us ed by management in assessing the financial performance of
the Company.
Adjusted net income, adjusted EBITDA, and cash flow are not gen erally accepted earnings measures and should not be
considered as an alternative to net income (loss) and cash flow s as determined in accordance with IFRS. As there is no
standardized method of calculating these measures, these measur es may not be directly comparable to similarly titled
measures used by other companies.
Adjusted Net Loss and Adjusted Net Loss per Share
Adjusted net loss in 2018 was $84.8 million ($0.71 per share) c ompared to an adjusted net loss of $62.6.million ($0.66 per
share) in 2017. Adjusted net income or loss shows the financial results excluding the effect of items not settling in the current
period and non-recurring items. Adjusted net income or loss is calculated by removing the gains or loss, resulting from
acquisition and disposal of property, mark to market revaluatio n of derivative instruments not r elated to the current period,
net of tax, unrealized foreign exchange gains or losses on non-current debt, net of tax.
Adjusted EBITDA
Adjusted EBITDA in 2018 was $33.3 million compared to $88.5 million in 2017. We define Adjusted EBITDA as net income
(loss) before interest expense, taxes, depletion and depreciation, and as adjusted for certain other items.
Cash Flow and Cash Flow Per Share
Cash flow in 2018 was $143.5 million compared to $88.4 million in 2017. Cash flow per share was $1.21 in 2018 compared
to $0.94 in 2017.
Cash flow and cash flow per share are measures used by the Company to evaluate its performance however they are not terms
recognized under IFRS. Cash flow is defined as cash flow from operations before the net change in non-cash working capital
balances, income and mining taxes, and interest paid and cash f low per share is the same measure divided by the weighted
average number of common shares outstanding during the year.
Cash Cost Per Pound of Copper Produced
The Company is primarily a coppe r producer and therefore calcul ates this non-IFRS financial m easure individually for its
three copper mines, Red Chris, Mount Polley and Huckleberry, and on a composite basis for these mines.
Variations from period to period in the cash cost per pound of copper produced are the resu lt of many factors including:
grade, metal recoveries, amount of stripping charged to operations, mine and mill operating conditions, labour and other cost
inputs, transportation and warehousing costs, treatment and refining costs, the amount of by-product and other revenues, the
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US$ to CDN$ exchange rate and the amount of copper produced. Id le mine costs during the periods when the Huckleberry
mine was not in operation have been excluded from the cash cost per pound of copper produced.
Calculation of Cash Cost Per Pound of Copper Produced
expressed in thousands, except cash cost per pound of copper produced
Year Ended December 31, 2018
Red Mount
Chris Polley Composite
Cash cost of copper produced in US$ $141,223 $29,032 $170,255
Copper produced – pounds 60,349 14,974 75,323
Cash cost per lb copper produced in US$ $2.34 $1.94 $2.26
Year Ended December 31, 2017
Red Mount
Chris Polley Composite
Cash cost of copper produced in US$ $143,891 $44,183 $188,073
Copper produced – pounds 74,636 19,071 93,707
Cash cost per lb copper produced in US$ $1.93 $2.32 $2.01
DEVELOPMENTS DURING 2018
Red Chris Mine
Fourth quarter metal production was 15.57 million pounds copper and 12,366 ounces gold, an increase of 15% and 41%
respectively from the 13.55 million pounds copper and 8,741 oun ces gold produced in the third quarter of 2018. Metal
recoveries in the fourth quarter were 76.21% copper and 50.57% gold, compared to 74.92% copper and 45.65% gold in the
third quarter of 2018. Annual recoveries for 2018 were 75.60% for copper and 47.13% for gold.
Annual metal production for 2018 was 60.35 million pounds coppe r and 41,935 ounces gold, both at 97% of the revised
production targets. The mill achieved 97.4% of design capacity, treating an average of 29,228 tonnes per calendar day.
Annual Production for the Years Ended December 31 2018 2017
Ore milled - tonnes 10,668,313 10,378,181
Ore milled per calendar day - tonnes 29,228 28,433
Grade % - copper 0.339 0.413
Grade g/t - gold 0.259 0.233
Recovery % - copper 75.60 79.01
Recovery % - gold 47.13 43.00
Copper – 000’s pounds 60,349 74,636
Gold – ounces 41,935 33,416
Silver – ounces 103,634 133,157
The five haul trucks from Huckleberry mine were fully operation al within the first quarter of 2018. The newly procured
electric hydraulic shovel was operational in the third quarter of 2018.
In the third and fourth quarters of 2018, the Company used its own resources for the construction of the tailings impoundment
area because the independent contractors constructing the taili ngs impoundment area were redirected to respond to the
wildfires in the local region. This diversion of primary mine operations hauling units to the tailings impoundment area resulted
in a lower productivity in mining operations during those periods.
MillSlicer was installed on the SAG mill in July 2018 to improve overall control of the mill. This vibration-based signal is in
addition to the electronic ear, bearing pressure and mill power used in controlling mill fill level. Expectations from the
increased response time of these new signals is improved production and mill liner life.
Work was initiated on the diagnosing of the high clay ore in th e mineralized faults present in the Main zone and East zone,
with results integrated into operational recovery models in adv ance of the 2019 Production Plan. Segregation of faulted
material for plant-scale batch processing of fault material com menced in the fourth quarter of 2018, with the first planned
plant-scale ‘baseline’ run in January 2019.
Work advanced on the underground resource conceptualization in conjunction with Golder Associates. In the second quarter
of 2018, a geotechnical hole was completed to gather geotechnical information regarding the proposed block cave; notably,
this hole also intersected significant copper and gold mineralization below the East zone pit. Work on a preliminary economic
assessment of the block cave potential, incorporating the information from the geotechnical drill hole, was initiated in 2018
by Golder Associates.
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In the 2018 third quarter, the m anagement structure at Red Chri s mine was reorganized. Randall Thompson, Imperial Vice
President Operations, was appointed as Red Chris Mine General M anager, with a mandate to direct improvements of the
mine operations.
Exploration, development and capital expenditures were $62.9 million in 2018 compared to $57.8 million in 2017.
Mount Polley Mine
Fourth quarter metal production was 3.18 million pounds copper and 7,983 ounces gold. Mill throughput averaged 17,467
tonnes per calendar day during the 2018 fourth quarter. Metal recoveries in the fourth quarter were 39.05% copper and 59.71%
gold. The mill treated an average of 16,975 tonnes per calendar day while achieving recoveries of 52.89% copper and 67.25%
gold.
Annual metal production for 2018 was 14.97 million pounds copper and 37,120 ounces gold, respectively 96% and 94% of
the revised production targets.
Milling of low grade stockpiles is targeted to continue until M ay 2019, at which time the mine will be placed on care and
maintenance until the economics of mining at Mount Polley improve.
Annual Production for the Years Ended December 31 2018 2017
Ore milled - tonnes 6,195,760 6,723,188
Ore milled per calendar day - tonnes 16,975 18,420
Grade % - copper 0.207 0.199
Grade g/t - gold 0.277 0.322
Recovery % - copper 52.89 64.53
Recovery % - gold 67.25 68.93
Copper – 000’s pounds 14,974 19,071
Gold – ounces 37,120 48,009
Silver – ounces 33,458 36,626
Dredging of tailings, deposited in the Springer pit in 2015-2016 to allow for restart of milling operations prior to repair of the
tailings storage facility, commenced in early 2018. Mining operations in the Cariboo pit were completed in late 2018, and the
mill relied on feed from the low grade stockpiles since that ti me. Dredging work in the Springer pit was suspended for the
winter.
The South Springer is an area with potential to significantly increase mineral resource estimates. The mineralization is under
the saddle separating the Cariboo and Springer Phase 6 pits, which presents an ideal location for additional low stripping ratio
reserves, assuming planned drilling is positive. With the configuration of the Cariboo pit providing an excellent platform to
conduct exploration drilling, follow up on 2012 drilling is planned for a future date.
During the spring of 2018 a four hole diamond drill program was completed totalling 953.12 m. The holes were drilled in the
Saddle area between the Springer and Cariboo pits to confirm mi neralization in this area for future mining plans. This
information has been incorporated into the mine’s block model.
In early 2018, Mount Polley was in mediation with USW Local 1-2017 to renew a collective agreement which had terminated
December 31, 2017. Mediation efforts proved unsuccessful, and o n May 23, 2018 Mount Polley initiated a lock out of its
employees, following which unionized employees began strike action. Following further negotiations, in August 2018 unionized
employees voted 79% to accept a new three year contract, effective as at January 1, 2018.
In November 2018, the legal action for damages arising from the Mount Polley Breach was settled among all parties to the
action, in consideration of net payments to the Company totaling approximately CDN$108 million. This settlement represents
compromises of disputed claims and does not constitute an admission of liability on the part of any party to the action.
Exploration, development, and capital expenditures were $13.3 million in 2018 compared to $27.7 million in 2017.
Huckleberry Mine
Huckleberry mine ceased mine operations in August 2016, and remains on care and maintenance.
A preliminary plan to restart the mine has been developed, and will be under consideration for implementation, at such time
when the economics of mining improve. In the interim, the Company will develop exploration programs designed to expand
the resource.
Ruddock Creek Project
The Ruddock Creek lead-zinc project is operated by way of a joi nt venture with Imperial, Mitsui Mining and Smelting Co.
Ltd. and Itochu Corporation. Imperial operates the project thro ugh its wholly owned subsidiary Ruddock Creek Mining
Corporation. Japan Oil, Gas and Metals National Corporation agreed to fund Imperial’s share of the 2018 drill program and
upon the completion of the program has the assignable right to be vested in an approximate 1.57% Participating Interest in
the joint venture. At that time Imperial’s interest will reduce to approximately 48.43%.
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Drill results from the first surface diamond drill hole RD-18-V41 at the Ruddock Creek Project were reported in September
2018 (of a planned three hole program targeting the deep extens ion of the V-Zone). Results f rom the first surface diamond
drill hole RD-18-V41, included 21.7 m grading 16.99% zinc, 3.44% lead and 2.41 g/t silver, which included 10.4 m grading
25.70% zinc, 5.41% lead and 3.44 g/t silver. The drill hole targeted the V-Zone mineralization 425 m below surface and about
300 m below the deepest previous mineralized intercept in the zone. Drill hole RD-18-V41 was collared near the valley floor
of Oliver Creek at an elevation of approximately 1,191 m above sea level and drilled to a final depth of 828.8 m.
The V-Zone is located near the western edge of the Ruddock Creek massive sulphide horizons, which have an indicated strike
length of about five km, and is approximately two km west of the Creek Zone, the nearest zone of detailed drilling. Little or
no exploration drilling has been conducted along the intervenin g section of the horizon. The V-Zone strikes east-west and
dips at about 70° to the north. The zone had been traced with s urface showings and by shallo w drilling for a horizontal
distance of about 700 m, and with this recent intersection, to a depth of approximately 425 m. Due to the steep terrain, long
nearly flat drill holes from near the valley bottom were designed to test the zone at depth. Hole RD-18-V41 was drilled using
an underground diamond drill rig bolted to a road accessible cliff face at an azimuth of 27° and a dip of plus 10°. Core size
was HQ to a depth of 450 m. When the core size was reduced to NQ size, the hole was drilled to a final depth of 828.8 m.
The decision to drill test the V-Zone at such a depth beneath t he nearest intercept was supported by the highly predictable
nature of the zinc-lead mineralization intercepted in the shall ower helicopter supported surface diamond drill holes,
electromagnetic and magnetic geophysical anomalies, and a re-in terpretation of the geology. The V-Zone in hole RD-18-
V41, which was projected to be intersected at a depth of 750 m, was intercepted at 751.5 m, confirming the anticipated
predictability of the zone at depth. The highest grades previously intersected in the V-Zone were in holes RD-12-V38, which
intercepted 17.77% zinc and 3.72% lead over a true width of approximately 7.6 m, and RD-12-V40, which intercepted 10.00%
zinc and 1.80% lead over a true width of approximately 10.9 m.
Drill hole RD-18-42, drilled at -10° below RD-18-41 to a final depth of 1,003.9 m, targeted the mineralization 300 m below
the intersection in hole RD-18-41, at an estimated in hole dept h of 834 m. Unfortunately, the hole intersected a late stage
pegmatite dyke or sill from a depth of 805-956 m with no significant base metal mineralization intersected.
Drill hole RD-18-43, drilled at 0° (flat) in between RD-18-41 and 42 to a final depth of 831.5 m, targeted the mineralization
120 m below the intersection in hole RD-18-41 at an estimated i n hole depth of 790-800 m. The favorable calc-silicate host
rock was intersected from 747-775 m w i t h n a r r o w 2 - 1 0 c m , s t r i n ger semi-massive sphalerite-galena mineralized bands
intersected but not comparable to the intersection in hole RD-18-41. The best two intervals intersected were 6.31% zinc, 0.5%
lead and 11.0 g/t silver over 0.5 m from 751.44 m to 751.94 m, grading 5.89% zinc and 0.04% lead over 0.5 m from 767.18
m to 767.68 m. The intervals are approximately true thickness.
SJ Geophysics completed an in-hole EM and Magnetic survey in ho le RD-18-43 but holes RD-18-41 and 42 were not able
to be surveyed due to hole conditions. The survey outlined a significant off-hole EM and Magnetic response for such a zinc
rich system in the area of the favorable calc-silicate host and stringer style zinc-lead mineralization.
Jim Miller-Tait, P.Geo., VP Exploration is the designated Qualified Person as defined by National Instrument 43-101 for the
exploration program, and has reviewed and approved disclosure r elating to drill hole RD-18-V41. Ruddock Creek samples
for the 2018 drilling reported were analyzed at Bureau Veritas Mineral Laboratories in Vancouver, British Columbia. A full
QA/QC program using blanks, standards and duplicates was completed.
Plans for further exploration of the western edge of the massiv e sulphide horizons have been developed and are being
discussed with our joint venture partners.
FOURTH QUARTER RESULTS
Revenue in the fourth quarter of 2018 was $91.7 million compared to $140.5 million in 2017. Sales revenue is recorded when
title for concentrate is transferred on ship loading. Variation s in revenue are impacted by the timing and quantity of
concentrate shipments, metal prices and exchange rates, and per iod end revaluations of revenue attributed to concentrate
shipments where copper and gold prices will settle at a future date along with finalization of contained metals as a result of
final assays.
The Company recorded a net loss of $44.3 million ($0.37 per share) in the fourth quarter of 2018 compared to net loss of $2.1
million ($0.02 per share) in the prior year quarter. The fourth quarter of 2017 involved $35.0 million of the net income related to
the finalization of the gain on bargain purchase of Huckleberry and revaluation of equity investment in Huckleberry.
Expenditures for exploration and ongoing capital projects at Mount Polley, Red Chris and Huckleberry totaled $14.2 million
during the three months ended December 31, 2018 compared to the expenditures for exploration and ongoing capital projects
at Mount Polley, Red Chris and Sterling which totaled $17.3 million in the 2017 comparative quarter.
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OUTLOOK
Corporate and Operations
At December 31, 2018 the Company had not hedged any copper, gol d or CDN$/US$ exchange. Quarterly revenues will
fluctuate depending on copper and gold prices, the CDN$/US$ exchange rate, and the timing of concentrate sales, which is
dependent on concentrate production and the availability and scheduling of transportation.
The 2018 annual base and precious metals production from the Red Chris and Mount Polley mines was 75.32 million pounds
copper and 79,056 ounces gold.
On March 10, 2019, Imperial entered into an agreement to sell a 70% interest in the Red Chris mine to Newcrest for US$806.5
million in cash. Imperial and Newcrest will form a joint venture for the operation of the Red Chris mine going forward, with
Newcrest acting as operator. This joint venture partnership wil l enable Imperial to unlock significant value at Red Chris by
leveraging Newcrest’s unique technical expertise in block cavin g operations. With a stronger financial position and highly
actionable path to exploiting the underground mining potential of Red Chris, Imperial will be in a much stronger position to
create value and opportunities for its shareholders, stakeholders and the Tahltan Nation. The closing is expected to occur in
the third quarter of 2019, with an outside date for closing of August 15, 2019.
Imperial announced on January 7, 2019 that due to declining copper prices, Mount Polley operations would be suspended.
Exploration
Imperial has interests in various other early stage exploration properties, and sufficient work will be conducted to keep these
properties in good standing.
At Mount Polley, future additional diamond drilling is planned in the vicinity of the Springer pit to infill areas where
information is lacking and additional mineralization may be present. And, a program of ground magnetometer surveying will
continue in conjunction with targeted areas of soil sampling, prospecting and geological mapping.
At Huckleberry, the Company will develop exploration programs designed to expand the resource.
At Ruddock Creek, plans for further exploration of the western edge of the massive sulphide horizons have been developed
and are being discussed with our joint venture partners.
Development
The 2019 Red Chris production plan was developed following an i n-depth review of historic data, with key assumptions
being identified and validated against past performance. The plan reflects a lower mining rate as compared to 2018 (105,000
tonnes per day vs. 130,000 tonnes per day). The metal for 2019 was estimated by a similar application of historic data for
incorporation of mill availability, throughput (tonnes per operating hour) and recovery.
In February 2019, extreme cold t emperatures resulted in freezin g of available water beyond expectations. There was
sufficient free water to maintain operations, however only at a reduced rate (24,785 tonnes per day vs 30,000 tonnes per
day). The poor quality of the water available also had a negati ve impact on copper recoveries. Operations are returning to
normal, as volumes of run-off increase, and as ice thaws with the warmer early Spring temperatures.
At Mount Polley, extreme cold winter temperatures impacted Mount Polley mill throughput during the latter part of January
and all of February 2019. Freezing ore in chutes and stockpiles limited the milling rates. During February 2019, only 9,764
dry metric tonnes were treated per calendar day milled (versus 17,531 dry metric tonnes during February 2018). Since then,
warmer Spring temperatures have helped to improve mill throughput, however, to achieve the production targets, throughput
during April and May will need to increase.
Milling of low grade stockpiles are targeted to continue until May 2019, at which time the mine will be placed on care and
maintenance until the economics of mining at Mount Polley impro ve. There will be no impact to ongoing environmental
monitoring and remediation programs.
At Huckleberry, a preliminary plan to restart the mine has been developed, and will be under consideration for
implementation, at such time when the economics of mining improve.
- - -
For detailed information, refer to Imperial’s 2018 Annual Report available on imperialmetals.com and sedar.com.
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Earnings Announcement Conference Call
April 1, 2019 at 8:00am PDT | 11:00pm EDT
Management will discuss the Company’s 2018 Financial Results.
To participate in the earnings announcement conference call dial toll-free
833.231.8250 (North America) or 647.689.5116 (International).
A recording of the conference call will be available for playback until April 8, 2019
by calling 855.859.2056 (North America-toll free) playback code 5188586
About Imperial
Imperial is a Vancouver based exploration, mine development and operating company. The Company, through its
subsidiaries, owns the Red Chris, Mount Polley and Huckleberry copper mines in British Columbia. Imperial also holds a
50% interest in the Ruddock Creek lead/zinc property. Imperial recently announced an agreemen t with Newcrest to sell a
70% interest in Red Chris to Newcrest for US$806.5 million, while retaining a 30% interest in the mine. The Company and
Newcrest will form a joint venture for the operation of the Red Chris mine going forward, w ith Newcrest acting as the
operator.
Company Contacts
Brian Kynoch | President | 604.669.8959
Andre Deepwell | Chief Financial Officer | 604.488.2666
Sabine Goetz | Shareholder Communications | 604.488.2657 | [email protected]
Forward-Looking Information & Risks Notice
The information in this news release provides a summary review of the Company’s operations and financial position as at and fo r
the year ended December 31, 2018, and has been prepared based o n information available as at March 29, 2019. Except for
statements of historical fact relating to the Company, certain information contained herein constitutes forward-looking information
which are prospective in nature and reflect the current views and/or expectations of Imperial. Often, but not always, forward-looking
information can be identified by the use of statements such as "plans", "expects" or "does not expect", "is expected", "schedu led",
"estimates", "forecasts", "projects", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and
phrases or statements that certain actions, events or results "may", "could", "should", "would", "might" or "will" be taken, occur or
be achieved. Such information in this document includes, without limitation, statements regarding: expectations that the agreement
to sell a 70% interest in the Company’s Red Chris mine to Newcr est will successfully close and within necessary time frames,
resulting in the joint venture between the parties for the oper ation of the Red Chris asset going forward, with Newcrest actin g as
operator; the 2019 production targets for the Red Chris and Mou nt Polley mines; expectations that Red Chris mine operations ar e
expected to return to normal as run-off water volumes increase due to the warmer early Spring temperatures; expectations that
milling of the low grade stockpiles at Mount Polley will contin ue until May 2019, at which time that mine will be put on care and
maintenance until the economics of mining at Mount Polley impro ve; consideration for implementation of a preliminary plan to
restart the Huckleberry mine at such time when the economics of mining improve; costs and timing of current and proposed
exploration and development, including plans to conduct future additional diamond drilling at Mount Polley in the vicinity of the
Springer pit and ground magnetometer surveying, and plans to further explore the western edge of the massive sulphide horizons at
Ruddock Creek; production and marketing; capital expenditures; adequacy of funds for projects and liabilities; the receipt of
necessary regulatory permits, approvals or other consents; outc ome and impact of litigation; cash flow; working capital
requirements; the requirement for additional capital; results of operations, production, revenue, margins and earnings; future prices
of copper and gold; future foreign currency exchange rates and impact; future accounting changes; and future prices for marketable
securities.
Forward-looking information is not based on historical facts, but rather on then current expectations, beliefs, assumptions, estimates
and forecasts about the business and the industry and markets i n which the Company operates, including, but not limited to,
assumptions that: the agreement to sell a 70% interest in the C ompany’s Red Chris mine to Newcrest will successfully close and
within necessary time frames, enabling the Company to satisfy its debt obligations and repay its credit facilities as they become due;
the Company will have access to capital as required and will be able to fulfill its funding obligations as the Red Chris minority joint
venture partner; the Company will be able to advance and comple te remaining planned rehabilitation activities within expected
timeframes; there will be no significant delay or other materia l impact on the expected timeframes or costs for completion of
rehabilitation of the Mount Polley mine and implementation of M ount Polley’s long term water management plan; the Company’s
initial rehabilitation activities at Mount Polley will be successful in the long term; all required permits, approvals and arrangements
to proceed with planned rehabilitation and Mount Polley’s long term water management plan will be obtained in a timely manner;
there will be no material operational delays at the Red Chris mine; equipment will operate as expected; there will not be significant
power outages; there will be no material adverse change in the market price of commodities and exchange rates; the Red Chris mine
will achieve expected production outcomes (including with respe ct to mined grades and mill recoveries and access to water as
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needed). Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. We
can give no assurance that the forward-looking information will prove to be accurate.
Forward-looking information involves known and unknown risks, uncertainties and other factors which may cause Imperial’s actual
results, revenues, performance or achievements to be materially different from any future resu lts, performance or achievements
expressed or implied by the statements constituting forward-looking information.
Important risks that could cause Imperial’s actual results, revenues, performance or achievements to differ materially from Imperial’s
expectations include, among other things: the risk that the agreement to sell a 70% interest in the Company’s Red Chris mine to Newcrest
will not successfully close and within necessary time frames, jeopardizing the Company’s ability to satisfy its debt obligations and repay
its credit facilities as they become due, and undermining the Company’s ability to continue as a going concern; the risk that the Company’s
ownership of the Red Chris mine may be diluted over time should it not have access to capital as required and will not be able to meet its
funding obligations as the Red Chris minority joint venture partner; that additional financing that may be required may not be available
to Imperial on terms acceptable to Imperial or at all; uncertainty regarding the outcome of sample testing and analysis being conducted
on the area affected by the Mount Polley Breach; risks relating to the timely receipt of necessary approvals and consents to proceed with
the rehabilitation plan and Mount Polley’s long term water management plan; risks relating to the remaining costs and liabilities and any
unforeseen longer-term environmental consequences arising from the Mount Polley Breach; uncertainty as to actual timing of completion
of rehabilitation activities and the implementation of Mount Polley’s long term water management plan; risks relating to the impact of
the Mount Polley Breach on Imperial’s reputation; the quantum of claims, fines and penalties that may become payable by Imperial and
the risk that current sources of funds are insufficient to fund liabilities; risks that Imperial will be unsuccessful in defending against any
legal claims or potential litigation; risks of protesting activity and other civil disobedience restricting access to the Company’s properties;
failure of plant, equipment or processes to operate in accordance with specifications or expectations; cost escalation, unavailability of
materials and equipment, labour unrest, power outages, and natural phenomena such as weather conditions and water shortages negatively
impacting the operation of the Red Chris mine; changes in commodity and power prices; changes in market demand for our concentrate;
inaccurate geological and metallurgical assumptions (including with respect to the size, grade and recoverability of mineral reserves and
resources); and other hazards and risks disclosed within the Management’s Discussion and Analysis for the year ended December 31,
2018, and other public filings, which are available on Imperial’s profile at sedar.com. For the reasons set forth above, investors should
not place undue reliance on forward-looking information. Imperial does not undertake to update any forward-looking information, except
in accordance with applicable securities laws.