Lundin Mining Fourth Quarter and Full Year 2023 Results
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NEWS RELEASE
Lundin Mining Fourth Quarter and Full Year 2023 Results
Vancouver, February 21, 2024 (TSX: LUN; Nasdaq Stockholm: LUMI) Lundin Mining Corporation (“Lundin Mining” or
the “Company”) today reported its fourth quarter and full year 2023 financial results. Unless stated otherwise, r esults are
presented on a 100% basis and Caserones results are from July 13, 2023.
Jack Lundin, President and CEO commented, "2023 was a milestone year for the Company. We finished the year generating
a record $3.4 billion in revenues and achieved our best-ever quarterly and full year copper production which we forecast to
further increase by over 15% in 2024. Our 2023 financial performance was strong with $1.4 billion in adjusted EBITDA1, $345
million in free cash flow from operations1 and we returned $206 million to our shareholders in dividends.
“The Company’s record copper production was driven by our strategic acquisition of a majority interest in Chile’s Caserones
copper mine, as well as organically through our expansion project at Neves-Corvo, which also contributed to record fourth
quarter zinc production for the Company. Going forward, we will be disciplined in our growth plans and capital allocation as
we continue to optimize assets and operational efficiencies to drive down costs.
“At Josemaria, we're derisking the project via optimization and trade-off studies that aim to enhance the overall value of the
Project. We are concurrently continuing to explore potential partnership opportunities and actively working towards
establishing stability agreements in Argentina.”
Fourth Quarter Highlights
• Copper Production: Consolidated production of 103,337 tonnes of copper in the fourth quarter, a quarterly record
for the Company and an increase of over 80% on the same quarter in the previous year.
• Other Production: During the quarter, a total of 50,719 tonnes of zinc, 3,729 tonnes of nickel and approximately
44,000 ounces of gold were produced. The zinc expansion project ("ZEP") at Neves -Corvo contributed to record
quarterly zinc volumes being produced.
• Revenue: $1,060.0 million in the fourth quarter.
• Adjusted EBITDA1: $419.7 million generated during the quarter.
• Adjusted Earnings1: Net earnings attributable to shareholders of the Company were $38.8 million ($0.05 per share)
in the fourth quarter with adjusted earnings of $79.7 million ($0.10 per share).
• Cash Generation: Cash provided by operating activities 1 was $306.1 million and free cash flow from operations was
$116.8 million, which included a working capital build of $56.0 million.
Full Year 2023 Highlights
• Copper Production: Record copper production of 314,798 tonnes of copper for the full year which is above the
midpoint of originally-published2 2023 annual copper production guidance.
• Revenue: $3,392.1 million for the full year.
• Adjusted EBITDA: $1,363.5 million generated during the full year.
• Adjusted Earnings: Net earnings attributable to shareholders of the Company were $241.6 million ($0.31 per share)
in 2023 and adjusted earnings of $336.2 million ($0.44 per share).
1 These are non -GAAP measures. Please refer to the Company's discussion of non -GAAP and other performance measures in its Management's Discussion
and Analysis ("MD&A") for the year ended December 31, 2023 and the Reconciliation of Non -GAAP measures section at the end of this news release.
2 Guidance as outlined in the news release ‘Lunding Mining Announces Closing of the Acquisition of Majority interest in the Caserones Mine in Chile and
Commitments for New $800 Millon Term Loan’ dated July 13, 2023 and 'Lundin Mining Announces 2022 Production Results & Provides 2023 Guidance” dated
January 12, 2023.
• Cash Generation: During the year, cash provided by operating activities1 was $1,016.6 million and free cash flow from
operations1 amounted to $345.1 million, which included a working capital build of $7.6 million.
• Balance Sheet: To fund the Caserones acquisition, the Company obtained a term loan in July 2023 of a principal
amount of $800.0 million with an additional $400.0 million accordion option, maturing July 2026 ("Term Loan"). As at
December 31, 2023, the Company had a net debt balance of $946.2 million, excluding lease liabilities.
• Growth: The Company acquired a 51% interest in the Caserones copper mine on July 13, 2023 which added an
additional 120,000 to 130,000 tonnes of copper2 to the Company's production profile on a 100% basis. The acquisition
adds another long-life asset in a tier one jurisdiction, which is strategically located in the Vicuña District.
• Leadership: Jack Lundin assumed the role of CEO in the fourth quarter of 2023. During the year several senior
leadership changes took place to add financial, technical and operational capacity to the team as the Company's head
office relocated to Vancouver.
Summary Financial Results
Three months ended
December 31,
Twelve months ended
December 31,
US$ Millions (except per share amounts) 2023 2022 2023 2022
Revenue 1,060.0 811.4 3,392.1 3,041.2
Gross profit 188.9 155.2 652.4 762.6
Attributable net earningsa 38.8 145.6 241.6 426.9
Net earnings 66.8 145.3 315.2 463.5
Adjusted earnings a,b,c 79.7 191.5 336.2 482.8
Adjusted EBITDAb,c 419.7 353.7 1,363.5 1,292.5
Basic and diluted earnings per share ("EPS")1 0.05 0.19 0.31 0.56
Adjusted EPSa,b,c 0.10 0.25 0.44 0.63
Cash provided by operating activities 306.1 156.9 1,016.6 876.9
Adjusted operating cash flowb 362.0 289.1 1,024.2 992.9
Adjusted operating cash flow per shareb 0.47 0.38 1.33 1.30
Free cash flow from operationsb 116.8 (35.7) 345.1 381.4
Free cash flowb 61.2 (124.3) 13.5 34.1
Cash and cash equivalents 268.8 191.4 268.8 191.4
Net (debt) cash excluding lease liabilitiesb (946.2) 16.3 (946.2) 16.3
Net (debt) cashb
(1,223.4) (10.9) (1,223.4) (10.9)
a. Attributable to shareholders of Lundin Mining Corporation.
b. These are non-GAAP measures. Please refer to the Company's discussion of non -GAAP and other performance measures in its Management's Discussion
and Analysis for the year ended December 31, 2023 and the Reconciliation of Non -GAAP Measures section at the end of this news release.
c. Q2 2023 amounts have been adjusted from those presented in the Company's MD&A for the three and six months ended June 30, 202 3.
• For the year ended December 31, 2023 the Company generated revenue of $3,392.1 million (2022 - $3,041.2 million),
gross profit of $652.4 million (2022 - $762.6 million) and adjusted EBITDA of $1,363.5 million (2022 - $1,292.5 million).
Financial results include the contribution from the acquisition of the Caserones copper mine ("Caserones") located in
Chile, from the closing date of the transaction on July 13, 2023.
• Net earnings attributable to shareholders of the Company were $38.8 million ($0.05 per share) in the fourth quarter,
and were impacted by higher interest expenses and increased deferred tax on foreign exchange revaluation of non-
monetary assets at the Josemaria Project in Argentina.
1 These are non-GAAP measures. Please refer to the Company's discussion of non -GAAP and other performance measures in its Management's Discussion
and Analysis ("MD&A") for the year ended December 31, 2023 and the Reconciliation of Non -GAAP measures section at the end of this news release.
2 Represents Caserones 2024 production guidance as outlined in the news release 'Lundin Mining Provides 2024 Guidance & Announces 2023 Production
Results' dated January 14, 2024.
• Adjusted earnings1 attributable to shareholders of the Company for the twelve months ended December 31, 2023 of
$336.2 million ($0.44 per share) were $146.6 million lower than the prior year after adjusting for the non -cash
revaluation of derivative contracts, fair value adjustments relating to the Caserones acquisition and deferred tax
relating to foreign exchange translation and a Chilean mining royalty rate change, among other things.
• Cash and cash equivalents as at December 31, 2023 were $268.8 million. Cash provided by operating activities of
$1,016.6 million in the year ended December 31, 2023 was used to fund investing activities of $1,674.5 million .
Investing activities in the year included $648.6 million net cash paid at closing for the acquisition of Caserones,
consisting of $796.6 million upfront cash consideration after adjustments, net of $148 million cash and cash
equivalents held by SCM Minera Lumina Copper Chile ("Lumina Copper") at closing on a 100% basis. Cash generated
from financing activities was $728.6 million, which was comprised primarily of the proceeds from the Term Loan to
finance the Caserones acquisition.
• Free cash flow1 for the three months ended December 31, 2023 of $61.2 million was $185.5 million higher than the
prior year comparable period and benefited from the inclusion of Caserones cash flows as well as higher gross profit
overall at the operations.
• As at February 21, 2024, the Company had a cash balance of approximately $4 46.7 million and a net debt balance
excluding lease liabilities of approximately $851.4 million.
Operational Performance
Total Production
(Contained metal)a 2023 2022
YTD Q4 Q3 Q2 Q1 Total Q4 Q3 Q2 Q1
Copper (t)b 314,798 103,337 89,942 60,057 61,462 249,659 56,552 63,930 64,096 65,081
Zinc (t) 185,161 50,719 49,774 36,115 48,553 158,938 44,308 40,327 41,912 32,391
Nickel (t) 16,429 3,729 4,290 4,686 3,724 17,475 4,096 4,379 4,719 4,281
Gold (koz)b 149 44 35 34 36 154 36 45 39 34
Molybdenum (t)b 2,024 928 1,096 — — — — — — —
a. Tonnes (t) and thousands of ounces (koz)
b. Candelaria and Caserones production is on a 100% basis. Caserones results are from July 13, 2023.
Candelaria (80% owned): Candelaria produced, on a 100% basis, 152,012 tonnes of copper, approximately 90,000 ounces
of gold and 1.5 million ounces of silver in concentrate during the year. Copper production was consistent with the prior year
due to higher throughput being offset by lower grades and recoveries. Gold productio n was higher than in the prior year
due to higher throughput and grades. Both metals were within the most recently disclosed 2023 production guidance
ranges. Total production costs were higher than the prior year primarily due to inflationary cost increases and unfavourable
foreign exchange. Copper cash cost1 of $2.07/lb was within the most recently disclosed 2023 cash cost guidance range.
Caserones (51% owned): Caserones produced 65,210 tonnes of copper and 2,024 tonnes of molybdenum on a 100% basis
during the year, from the acquisition closing date of July 13, 2023 to the end of the year. Both metals met or exceeded the
most recently disclosed 2023 production guidance ranges due to strong throughput, grade and recoveries. Copper cash cost
of $1.99/lb was slightly below the low end of the most recently disclosed cash cost guidance range as a result of higher
production.
Chapada (100% owned): Chapada produced 45,719 tonnes of copper and approximately 59,000 ounces of gold, with copper
production remaining consistent to the prior year and gold production being negatively impacted by lower grade,
throughput, and recoveries. Both metals were within the most recently disclosed 2023 production guidance ranges. Total
production costs were lower than the prior year due to lower sales volumes. Full year copper cash cost of $2.27/lb was below
the low end of the most recently disclosed cash cost guidance.
1 These are non-GAAP measures. Please refer to the Company's discussion of non -GAAP and other performance measures in its Management's Discussion
and Analysis ("MD&A") for the year ended December 31, 2023 and the Reconciliation of Non -GAAP measures section at the end of this news release.
Eagle (100% owned): Eagle’s production of 16,429 tonnes of nickel and 13,600 tonnes of copper were near the higher ends
of recently disclosed 2023 production guidance ranges but lower than that in the prior year due to planned lower grades.
Total production costs were lower than the prior year due to lower sales volumes. Nickel cash cost 1 of $2.16/lb was within
the most recently disclosed 2023 cash cost guidance range but higher than the prior year as a result of lower grade, lower
by-product credits and higher repair and maintenance costs.
Neves-Corvo (100% owned): Neves-Corvo produced 33,823 tonnes of copper and 108,812 tonnes of zinc during the year.
Zinc production increased significantly from the prior year due to higher throughput as a result of the zinc expansion project
("ZEP"). Copper production also increased due to higher throughput and production of both metals was within the most
recently disclosed 2023 production guidance ranges. Total production costs were lower than in the prior year despite higher
sales, primarily due to lower input costs, in particular lower electricity and diesel prices, partially offset by unfavourable
foreign exchange. Copper cash cost1 of $2.37/lb for the year exceeded the most recently disclosed 2023 cash cost guidance
range and was higher than in the prior year primarily due to lower zinc by -product credits, higher treatment and refining
charges, and unfavourable foreign exchange.
Zinkgruvan (100% owned): Zinc production of 76,349 tonnes was consistent with the prior year, but slightly below the most
recently disclosed 2023 production guidance range. Installation of a sequential flotation system during the year achieved
improved recoveries, but a longer than anticipated ramp -up limited mill availability and reduced recoveries, limiting
production of both lead and zinc. Lead production of 26,284 tonnes was also lower than in the prior year. Total production
costs and sales volumes wer e consistent with the prior year and zinc cash cost 1 of $0.43/lb was below the most recently
disclosed 2023 cash cost guidance range but higher than in the prior year, primarily due to lower by-product credits.
1 These are non-GAAP measures. Please refer to the Company's discussion of non -GAAP and other performance measures in its Management's Discussion
and Analysis ("MD&A") for the year ended December 31, 2023 and the Reconciliation of Non -GAAP measures section at the end of this news release.
Outlook
Production, cash cost, capital expenditures and exploration investment guidance for 2024 remains unchanged from the
most recently reported guidance as outlined in the news release 'Lundin Mining Provides 2024 Guidance & Announces 2023
Production Results" dated January 14, 2024.
2024 Production and Cash Cost Guidance
Guidancea
(contained metal) Production Cash Cost ($/lb)b
Copper (t) Candelaria (100%) 160,000 - 170,000 1.60 – 1.80c
Caserones (100%) 120,000 - 130,000 2.60 – 2.80
Chapada 43,000 - 48,000 1.95 – 2.15d
Eagle 9,000 - 12,000
Neves-Corvo 30,000 - 35,000 1.95 – 2.15c
Zinkgruvan 4,000 - 5,000
Total 366,000 - 400,000
Zinc (t) Neves-Corvo 120,000 - 130,000
Zinkgruvan 75,000 - 85,000 0.45 – 0.50c
Total 195,000 - 215,000
Nickel (t) Eagle 10,000 - 13,000 2.80 – 3.00
Gold (koz) Candelaria (100%) 100 - 110
Chapada 55 - 60
Total 155 - 170
Molybdenum (t) Caserones (100%) 2,500 - 3,000
a. Guidance as outlined in the news release 'Lundin Mining Provides 2024 Guidance & Announces 2023 Production Results" dated January 14, 2024.
b. Cash costs are based on various assumptions and estimates, including but not limited to: production volumes, commodity pri ces (Cu: $3.75/lb, Zn:
$1.10/lb,Pb: $0.90/lb, Au: $1,800/oz, Mo: $20.00/lb, Ag: $23.00/oz ), foreign exchange rates (€/USD: 1.05, USD/SEK:10.50, USD/CLP:850, USD/BRL:5.00) and
production costs. Cash cost is a non-GAAP measure - see section 'Non-GAAP and Other Performance Measures' of the Company's Management's
Discussion and Analysis for the year ended December 31, 2023 and the Reconci liation of Non-GAAP Measures section at the end of this news release.
c. 68% of Candelaria's total gold and silver production are subject to a streaming agreement and silver production at Zinkgru van and Neves-Corvo are also
subject to streaming agreements. Cash costs are calculated based on receipt of approximately $429/oz g old and $4.28/oz to $4.68/oz silver.
d. Chapada's cash cost is calculated on a by-product basis and does not include the effects of its copper stream agreements. Effects of the copper stream
agreements are reflected in copper revenue and will impact realized price per pound.
2024 Capital Expenditure Guidancea,b
($ millions)
Candelaria (100% basis) 300
Caserones (100% basis) 205
Chapada 110
Eagle 25
Neves-Corvo 125
Zinkgruvan 75
Other —
Total Sustaining 840
Josemaria (expansionary) 225
Total Capital Expenditures 1,065
a. Guidance as outlined in the news release 'Lundin Mining Provides 2024 Guidance & Announces 2023 Production Results" dated January 14,
2024.
b. Sustaining capital expenditure is a supplementary financial measure, and expansionary capital expenditure is a non -GAAP measure – see section
'Non-GAAP and Other Performance Measures' of the Company's Management's Discussion and Analysis for the year en ded December 31, 2023 and the
Reconciliation of Non-GAAP Measures section at the end of this news release.
2024 Exploration Investment Guidance
Total exploration expenditure guidance for 2024 is $48.0 million.
Exploration: Exploration drilling campaigns are underway at Caserones, Josemaria, Chapada and Zinkgruvan. Drilling at
Caserones is targeting the Angelica target and Caserones sulphide deep target with three rigs. Initial holes are underway at
Josemaria's Cumbre Verde target, and additional roads are being developed to gain access to higher priority areas. At
Chapada, drilling is focused on higher grade corridors within known areas of mineralization that could contribute higher
grades to the mine plan. At Zinkgruvan, drilling with six rigs is focused on extending multiple deposits, with the priority on
the high-grade Borta Barkom area.
Senior Leadership Appointments
The Company would also like to announce the executive appointments of Patrick Merrin as Executive Vice President,
Technical Services and Joel Adams as Vice President, Commercial.
Patrick Merrin
Mr. Merrin was appointed Executive Vice President, Technical Services and brings over 25 years of international experience
in mining and metals including 10 years in executive and senior technical, project and operating roles. Mr. Merrin was
appointed CEO of Copper Mountain Mining prior to its acquisition in 2024. He has also worked as Senior Vice President
Canadian Operations with Newcrest Mining, COO of Mining with the Washington Companies and Senior Vice President of
Canadian Operations with Goldcorp. Ea rlier in his career he also held positions with Hudbay Minerals, Xstrata and Anglo
American.
Mr. Merrin holds a Bachelor of Chemical Engineering from McGill University, a Master of Business Administration from the
Rotman School of Business at the University of Toronto and is a registered Professional Engineer (Ontario).
Joel Adams
Mr. Adams was appointed Vice President, Commercial and will lead Lundin Mining’s commercial strategy. He has more than
15 years of experience as a base metal trader and in logistics management.
Prior to joining Lundin Mining, Joel was a Portfolio Manager with Balyasny Asset Management where he was focused on
commodity trading. In addition, Mr. Adams was a senior base metals trader at Trafigura and prior to that held diverse roles
within Glencore's base metals business from 2010 to 2020 as a senior member of the copper division in Switzerland.
Joel holds a Bachelor’s degree in International Business from the University of Colorado.
About Lundin Mining
Lundin Mining is a diversified Canadian base metals mining company with projects and operations in Argentina, Brazil, Chile,
Portugal, Sweden and the United States of America, primarily producing copper, zinc, nickel and gold.
The information in this release is subject to the disclosure requirements of Lundin Mining under the EU Market Abuse
Regulation. The information was submitted for publication, through the agency of the contact persons set out below on
February 21, 2024 at 15:30 Pacific Standard Time.
For further information, please contact:
Stephen Williams, Vice President, Investor Relations +1 604 806 3074
Robert Eriksson, Investor Relations Sweden: +46 8 440 54 40
Technical Information
The scientific and technical information in this press release has been prepared in accordance with the disclosure standards
of National Instrument 43 -101 (“NI 43 -101”) and has been reviewed by Arman Barha, P .Eng., Vice President, Technical
Services, a "Qualified Person" under NI 43 -101. Mr. Barha has verified the data disclosed in this release and no limitations
were imposed on his verification process.
Reconciliation of Non-GAAP Measures
The Company uses certain performance measures in its analysis. These performance measures have no standardized
meaning within generally accepted accounting principles under International Financial Reporting Standards and, therefore,
amounts presented may n ot be comparable to similar data presented by other mining companies. For additional details
please refer to the Company’s discussion of non -GAAP and other performance measures in its Management’s Discussion
and Analysis for the year ended December 31, 2023 which is available on SEDAR+ at www.sedarplus.ca.
Cash Cost per Pound and All -in Sustaining Costs can be reconciled to Production Costs on the Company's Consolidated
Statement of Earnings as follows:
Twelve months ended December 31, 2023
Operations Candelaria Caserones Chapada Eagle Neves-
Corvo
Zinkgruvan
($000s, unless otherwise
noted)
(Cu) (Cu) (Cu) (Ni) (Cu) (Zn) Total
Sales volumes (Contained
metal):
Tonnes 144,473 66,075 43,761 13,339 32,054 65,344
Pounds (000s) 318,508 145,670 96,476 29,407 70,667 144,059
Production costs
2,086,108
Less: Royalties and other (66,237)
Inventory fair value
adjustment
(39,945)
1,979,926
Deduct: By-product credits (699,915)
Add: Treatment and
refining
183,328
Cash cost 660,160 290,553 219,278 63,457 167,424 62,467 1,463,339
Cash cost per pound
($/lb)
2.07 1.99 2.27 2.16 2.37 0.43
Add: Sustaining capital 380,112 83,880 72,291 22,201 102,621 53,358
Royalties — 15,820 8,568 22,994 3,949 —
Reclamation and
other closure
accretion and
depreciation
9,258 2,560 7,836 11,331 5,387 3,744
Leases & other 13,325 47,944 4,999 4,100 553 427
All-in sustaining cost 1,062,855 440,757 312,972 124,083 279,934 119,996
AISC per pound ($/lb) 3.34 3.03 3.24 4.22 3.96 0.83