Imperial Reports First Quarter 2024 Financial Results
imperialmetals.com
News Release
Imperial Reports First Quarter 2024 Financial Results
Vancouver | May 13, 2024 | Imperial Metals Corporation (the “Company”) (TSX:III) reports financial results for the three
months ended March 31, 2024.
QUARTER HIGHLIGHTS
FINANCIAL
Adjusted EBITDA increased by $4.4 million to $10.3 million in Q1 2024 compared to $5.9 million in Q1 2023.
Total revenue was $84.6 million in the March 2024 quarter compared to $92.7 million in the 2023 comparative quarter.
In the March 2024 quarter, Mount Polley mine had 1.3 concentrate shipments (2023-1.4 concentrate shipments). The Red
Chris mine (100% basis) had 4.0 concentrate shipments (2023-2.4 concentrate shipments).
Variations in revenue are impacted by the timing and quantity of concentrate shipments, metal prices and exchange rates,
and period end revaluations of revenue attributed to concentrate shipments where copper and gold prices will settle at a
future date.
The London Metals Exchange cash settlement copper price per pound averaged US$ 3.83 in the March 202 4 quarter
compared to US$4.05 in the 202 3 comparative quarter. The LBMA (London Bullion Market Association) cash settlement
gold price per troy ounce averaged US$ 2,072 in the March 202 4 quarter compared to US$1,888 in the 202 3 comparative
quarter. The average US/CDN Dollar exchange rate was 1.349 in the March 202 4 quarter, 0.22% lower than the exchange
rate of 1.352 in the March 202 3 quarter. In CDN Dollar ter ms the average copper price in the March 202 4 quarter was
CDN$5.17 per pound compared to CDN$5.48 per pound in the 2023 comparative quarter, and the average gold price in the
March 2024 quarter was CDN$2,795 per ounce compared to CDN$2,553 per ounce in the 2023 comparative quarter.
A negative revenue revaluation in the March 202 4 quarter was $ (0.2) million as compared to a $5.9 million of positive
revenue revaluation in the 202 3 comparative quarter. Revenue revaluations are the result of the metal price on the
settlement date and/or the current period balance sheet date being higher or lower than when the revenue was initially
recorded or the metal price at the last balance sheet date and finalization of contained metal as a result of final assays.
Net loss for the March 2024 quarter was $9.2 million ($0.06 per share) compared to net loss of $7.3 million ($0.05 per share)
in the 2023 comparative quarter. The increase in net loss of $1.9 million was primarily due to the following factors:
• Loss from mine operations was $1.5 million in March 2024 quarter, which is an improvement of $0.1 million in comparison
to a loss of $1.6 million in March 2023 comparative quarter.
• Idle mine cost went from $2.1 million in March 2023 to $1.9 million in the March 2024 quarter.
• Interest expense increased from $6.0 million in March 2023 to $10.5 million in March 2024, increasing net loss by $4.5
million.
• Tax recovery went from $4.4 million in March 2023 to $6.6 million in March 2024, decreasing net loss by $2.2 million.
The average US/CDN Dollar exchange rate in the March 202 4 quarter was 1.349 compared to an average of 1. 352 in the
2023 comparative quarter.
Capital expenditures including leases were $36.2 million in the March 2024 quarter, an increase of $11.9 million from $24.3
million in the 2023 comparative quarter. The March 2024 quarter expenditures included $ 16.5 million in exploration, $7.3
million on stripping costs, $2.9 million for tailings dam construction and $9.5 million of other capital.
At March 31, 202 4, the Company had not hedged any copper, gold or US/CDN Dollar exchange. Quarterly revenues will
fluctuate depending on copper and gold prices, the US/CDN Dollar exchange rate, and the timing of concentrate sales,
which is dependent on concentrate production and the availability and scheduling of transportation.
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OPERATIONS
During the quarter ended March 31, 2024, Imperial’s consolidated m etal production was 12.35 million pounds copper (Q1
2023-10.16 million pounds copper) and 12,861 ounces gold (Q1 2023-13,129 ounces gold).
Mount Polley Mine
Mount Polley metal production for the f irst quarter of 202 4 was 7,355,191 pounds copper and 10,009 ounces gold,
compared to 8,347,899 pounds copper and 10,349 ounces gold produced during the fourth quarter of 2023. Mill throughput
was up 20.3%, with 1.67 million tonnes being treated compared with 1.39 million tonnes treated in the first quarter of 2023.
Copper production in the first quarter 2024 was up by 10.1% because of the increase in throughput which offset low er
grade and recovery compared to first quarter of 2023.
Tailing removal from the Springer Pit were 84% completed at the end of March 2024 and are expected to be completely
removed by early May 2024. Stripping for Phase 5 pushback of the Springer pit mined approximately 1.7 million tonnes of
waste by the end of March 2024.
Three Months Ended
March 31
Three Months Ended
March 31
2024 2023
Ore milled - tonnes 1,671,505 1,389,636
Ore milled per calendar day - tonnes 18,368 15,440
Grade % - copper 0.25 0.27
Grade g/t - gold 0.28 0.31
Recovery % - copper 79.4 81.1
Recovery % - gold 66.0 71.5
Copper - 000’s pounds 7,355 6,678
Gold - ounces 10,009 9,980
At Mount Polley, a diamond drilling program started on March 3 , 2024 which focused on two goals. The first is to test for
mineralization around the perimeter of the planned Springer pit where there are gaps in the 3 -dimensional mineralization
model. The second goal is to follow -up on last year’s successful drilling in the Springer zone by filling gaps in the drilling of
the zone and by continuing to test the zone at depth. The first two drill holes of this program have been completed and the
third is in progress. About 1,800 metres of drilling were completed by the end of the quarter.
Exploration, development, and capital expenditures in the first quarter of 2024 were $15.8 million compared to $4.8 million
in the 2023 comparative quarter.
Red Chris Mine
Red Chris production (100%) for the first quarter of 2024 was 16,660,225 pounds copper and 9,507 ounces gold compared
to 11,589,689 pounds copper and 10,496 ounces gold during the same quarter of 2023.
In the 2024 first quarter, Red Chris copper production was up 44% compared to the same quarter in 2023 and down 9% for
gold compared to the same quarter of 2023. The increase in copper production was a result of a 33% increase in copper
grade (0.431% vs 0.325%) and an 8% increase in recovery (83.4% vs. 77.4%). The drop in gold production in the first quarter
2024 was the result of lower gold grade (0.263 g/t gold vs 0.311 g/t gold) being treated compared to the same quarter last
year.
Imperial’s 30% portion of Red Chris mine for the first quarter of 2024 was 4,998,000 pounds copper and 2,852 ounces gold.
imperialmetals.com
100% Red Chris mine production Three Months Ended
March 31
Three Months Ended
March 31
2024 2023
Ore milled - tonnes 2,100,354 2,090,772
Ore milled per calendar day - tonnes 23,081 23,231
Grade % - copper 0.43 0.32
Grade g/t - gold 0.26 0.31
Recovery % - copper 83.4 77.4
Recovery % - gold 53.6 50.2
Copper - 000’s pounds 16,660 11,590
Gold - ounces 9,507 10,496
Imperial’s 30% share of exploration, development, and capital expenditures were $ 20.4 million in the March 2024 quarter
compared to $19.4 million in the 2023 comparative quarter.
Block Cave Decline and Drilling Progress
The underground development has continued with total of 9,220 metres (including all vent drives) completed. The decline
to access the extraction level (Nagha decline) had advanced 4,372 metres as of March 31, 2024. Development work on the
conveyor declines advanced 1,541 metres on legs two and three by quarter end.
Huckleberry Mine
Huckleberry operations ceased in August 2016 and the mine remains on care and maintenance status.
Site personnel continue to focus on maintaining site access, water management, maintenance of site infrastructure and
equipment, and mine permit compliance. Work is also planned in 2024 to investigate and update the tailings facility design
for Huckleberry.
For the March 202 4 quarter, Huckleberry incurred idle mine costs comprised of $ 1.7 million in operating costs and $ 0.3
million in depreciation expense compared to $1.8 million in operating cost and $0.3 million in depreciation expense in the
comparable quarter of 2023.
TECHNICAL INFORMATION
The technical and scientific information related to the Company’s mineral projects has been reviewed and approved by
Brian Kynoch, P.Eng., President of Imperial Metals, and a designated Qualified Person as defined by NI 43 -101.
Jim Miller-Tait, P.Geo. Vice President Exploration with Imperial Metals, is the designated Qualified Person as defined by
National Instrument 43-101 for the Red Chris, Mount Polley and Huckleberry mines exploration programs.
imperialmetals.com
EARNINGS AND CASH FLOW
Select Quarter Financial Information
Three Months Ended March 31
expressed in thousands of dollars, except share and per share amounts 2024 2023
Operations:
Total revenues $84,568 $92,664
Net loss $(9,165) $(7,253)
Net loss per share $(0.06) $(0.05)
Diluted loss per share $(0.06) $(0.05)
Adjusted net loss (1) $(9,165) $(7,255)
Adjusted net loss per share (1) $(0.06) $(0.05)
Adjusted EBITDA(1) $10,279 $5,923
Cash earnings (1)(2) $10,301 $5,404
Cash earnings per share (1)(2) $0.06 $0.03
Working capital (deficiency)
deficiency
$(159,132) $(88,980)
Total assets $1,426,794 $1,316,087
Total debt (including current portion)(3) $359,551 $227,761
(1) Refer to Non-IFRS Financial Measures for further details.
(2) Cash earnings 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 earnings per share is defined as cash earnings divided by the weighted average
number of common shares outstanding during the year.
(3) Total debt consists of banker’s acceptances, convertible and non-convertible debentures, loans and leases.
NON-IFRS FINANCIAL MEASURES
The Company reports on four non-IFRS financial measures: adjusted net loss, adjusted EBITDA, cash earnings and cash cost
per pound of copper produced, which are described in detail below. The Company believes these measures are useful to
investors because they are included in the measures that are used by management in assessing the financial performance
of the Company.
Adjusted net loss, adjusted EBITDA, cash earnings and cash cost per pound of copper are not standardized financial
measures under IFRS and might not be comparable to similar financial measures disclosed by other issuer s.
Adjusted Net Loss and Adjusted Net Loss Per Share
Adjusted net loss is derived from operating net loss by removing the gains or loss, resulting from acquisition and disposal
of property, mark to market revaluation of derivative instruments not related to the current period, net of tax, unrealized
foreign exchange gains or losses on long term debt, net of tax and other non-recurring items. Adjusted net loss in the March
2024 quarter was $9.2 million ($0.06 per share) compared to an adjusted net loss of $7.3 million ($0.05 per share) in the
2023 comparative quarter. We believe t hat the presentation of Adjusted Net Loss helps investors better understand the
results of our normal operating activities and the ongoing cash generating potential of our business .
Adjusted EBITDA
Adjusted EBITDA in the March 202 4 quarter was $10.3 million compared to $5.9 million in the 2023 comparative quarter.
We define Adjusted EBITDA as net income (loss) before interest expense, taxes, depletion, and depreciation, and as adjusted
for certain other items.
imperialmetals.com
Cash Earnings and Cash Earnings Per Share
Cash earnings in the March 2024 quarter was $10.3 million compared to $5.4 million in the 2023 comparative quarter. Cash
earnings per share was $0.06 in the March 2024 quarter compared to $0.03 in the 2023 comparative quarter.
Cash earnings and cash earnings per share are measures used by the Company to evaluate its performance; however, they
are not terms recognized under IFRS . We believe that the presentation of cash earnings and cash earnings per share is
appropriate to provide additional information to investors about how well the Company can earn cash to pay its debts and
manage its operating expenses and investment. Cash earnings is defined as cash flow from operations before the net change
in non-cash working capital balances, income and mining taxes paid, and interest paid. Cash earnings per share is the same
measure divided by the weighted average number of common shares outstanding during the year.
Cash Cost Per Pound of Copper Produced
Management uses this non-IFRS financial measure to monitor operating costs and profitability. The Company is primarily a
copper producer and therefore calculates this non -IFRS financial measure individually for its two operating copper mines,
Mount Polley and Red Chris (30% share), and on a composite basis for these mines.
Variations from period to period in the cash cost per pound of copper produced are the result of many factors including:
grade, metal recoveries, amount of stripping charged to operations, mine and mill operating conditions, labour and other
cost inputs, transportation and warehousing costs, treatment and refining costs, the amount of by -product and other
revenues, the US$ to CDN$ exchange rate and the amount of copper produced .
Calculation of Cash Cost Per Pound of Copper Produced
expressed in thousands, except cash cost per pound of copper produced Three Months Ended March 31, 2024
Mount Polley Red Chris Composite
Cash cost of copper produced in US$ $12,559 $20,945 $33,504
Copper produced – 000’s pounds 7,355 4,998 12,353
Cash cost per lb copper produced in US$ $1.71 $4.19 $2.71
expressed in thousands, except cash cost per pound of copper produced Three Months Ended March 31, 2023
Mount Polley Red Chris Composite
Cash cost of copper produced in US$ $16,229 $19,683 $35,912
Copper produced – 000’s pounds 6,678 3,477 10,155
Cash cost per lb copper produced in US$ $2.43 $5.66 $3.54
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For detailed information, refer to Imperial’s 20 24 First Quarter Management’s Discussion and Analysis available on
imperialmetals.com and sedarplus.ca.
imperialmetals.com
About Imperial
Imperial is a Vancouver based exploration, mine development and operating company with holdings that include the Mount
Polley mine (100%), the Huckleberry mine (100%), and the Red Chris mine (30%). Imperial also holds a portfolio of 23 greenfield
exploration properties in British Columbia.
Company Contacts
Brian Kynoch | President | 604.669.8959
Darb S. Dhillon | Chief Financial Officer | 604.669.8959
Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this news release are not statements of historical fact and are “forward-looking” statements. Forward-
looking statements relate to future events or future performance and reflect Company management’s expectations or beliefs regarding
future events and include, but are not limited to, specific statements regarding the Company’s expectations with respect to completion
of the removal of tailings from the Springer Pit by early May 2024; plans to complete the diamond drilling program, including, but not
limited to, the filling of gaps in the drilling of the Springer Zone by drilling to test the zone at depth; plans to investigate and update the
Huckleberry mine tailings facility design in 2024; and more general statements regarding the Company’s expectations with respect to
its business and operations; metal pricing and demand; fluctuation of revenues; progress and advancement of the Red Chris block cave
decline; metal production guidance and estimates; and expectations regarding the usefulness of non-IFRS financial measures including
adjusted net income (loss), adjusted EBITDA, cash earnings and cash cost per pound of copper.
In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is
expected", "outlook", "budget", "scheduled", "estimates", "forecasts", "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", "would", "might" or "will
be taken", "occur" or "be achieved" or the negative of these terms or comparable terminology. By their very nature forward-looking
statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or
achievements of the Company to be materially different from any future results, performance or achievements expressed or implied
by the forward-looking statements.
In making the forward-looking statements in this news release, the Company has applied certain factors and assumptions that are
based on information currently available to the Company as well as the Company’s current beliefs and assumptions. These factors and
assumptions and beliefs and assumptions include, the risk factors detailed from time to time in the Company’s interim and annual
financial statements and management’s discussion and analysis of those statements, and the risk factors detailed in the Company’s
Annual Information Form, all of which are filed and available for review on SEDAR + at sedarplus.ca. Although the Company has
attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in
forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or
intended, many of which are beyond the Company’s ability to control or predict. There can be no assurance that f orward-looking
statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in s uch
statements. Accordingly, readers should not place undue reliance on forward-looking statements and all forward-looking statements
in this news release are qualified by these cautionary statements.