Taseko Reports an 85% Increase IN Adjusted EBITDA* FOR 2021
TASEKO REPORTS AN 85% INCREASE IN ADJUSTED
EBITDA* FOR 2021
This release should be read with the Company's Financial Statements and Management Discussion & Analysis ("MD&A"), available at
www.tasekomines.com
and filed on
www.sedar.com
. Except where
otherwise noted, all currency amounts are stated in Canadian dollars. Taseko's 75% owned Gibraltar Mine is located north of the City of Williams Lake in south-central British Columbia. Production and sales volumes
stated in this release are on a 100% basis unless otherwise indicated.
VANCOUVER, BC
,
Feb. 22, 2022
/CNW/ - Taseko Mines Limited (TSX: TKO) (NYSE American: TGB) (LSE: TKO)
("Taseko" or the "Company") reports Adjusted EBITDA* of
$201 million
for the full-year 2021, an 85% increase over
2020. Revenues for the year were
$433 million
and Adjusted net income* for the year was
$45 million
, or
$0.16
per
share. In the fourth quarter 2021, Taseko generated Adjusted EBITDA* of
$53 million
,
$103 million
of Revenue and
Adjusted net income* of
$13 million
, or
$0.05
per share.
Stuart McDonald
, President and CEO of Taseko, stated, "Realized copper sales of 105 million pounds for the year,
buoyed by a strong average copper price of over
US$4.20
per pound, generated the best financial results in our
Company's history. This was accomplished despite the lagging copper sales in the fourth quarter as a result of major
disruption to transportation infrastructure in southern BC from severe rainstorms in November, which limited our ability
to ship copper concentrate and realize sales."
"At Florence Copper, based on our ongoing dialogue with the US Environmental Protection Agency, we continue to
expect the draft Underground Injection Control ("UIC") permit to be publicly issued very soon, and then a 45-day public
comment period will commence. The UIC is the final permit needed to construct and operate the commercial production
facility, which will be a major new source of low-carbon copper supply for the US market. The detailed engineering
program for the commercial facility is complete and we're well advanced with procurement of key, long-lead items,
which will ensure a rapid and smooth transition into construction."
Mr. McDonald added, "Operationally,
Gibraltar
production in the fourth quarter was impacted by lower grades and
recoveries due to severe winter weather as well as oxidization and pyrite content in the upper benches of the
Gibraltar
pit. Mill operations are being optimized for the new mineralization, and ore quality will improve as mining progresses
deeper into the
Gibraltar
pit this year. For 2022, we expect copper production of 115 million pounds (+/- 5%), with
production weighted to the back half of the year and the first quarter being the lowest production quarter, similar to
2021. Next year mining operations will transition to higher grade zones, and copper production is planned to trend back
toward the life of mine average of 130 million pounds. A new
Gibraltar
reserve update is expected to be completed in
the second quarter."
Mr. McDonald concluded, "Our balance sheet remains healthy with nearly
$300 million
of available liquidity, including
cash on hand and the new
US$50 million
credit facility that was closed in October. In addition, we recently took
advantage of a strengthened copper price to extend our price protection strategy - we now have more than 90% of our
2022 production secured at a minimum price of
US$4.00
per pound. With our strong financial position and robust copper
markets, its ideal timing to be advancing our Florence Copper project to commercial production."
2021 Annual Review
Earnings from mining operations before depletion and amortization* was
$230.4 million
, Adjusted EBITDA* was
$200.7 million
, and cash flows from operations was
$174.8 million
;
Adjusted net income* was
$44.7 million
(
$0.16
per share) and GAAP Net income was
$36.5 million
(
$0.13
per
share) for the year;
Total operating costs (C1)* for the year were
US$1.90
per pound produced;
The
Gibraltar
mine produced 112.3 million pounds of copper and 2.0 million pounds of molybdenum in 2021.
Copper recoveries were 82.4% and copper head grades were 0.23%;
Gibraltar
sold 104.9 million pounds of copper for the year (100% basis) which contributed to record revenue for
Taseko of
$433.3 million
and an increase of 26% over 2020. Average realized copper prices were
US$4.31
per
pound for year, compared to the LME average price of
US$4.23
per pound;
The Company has approximately
$300 million
of available liquidity at
December 31, 2021
, including a cash balance
of
$237 million
and a new
US$50 million
revolving credit facility with National Bank of
Canada
which closed in early
October;
Development costs incurred for Florence Copper were
$57.9 million
in the year and included, detailed engineering
and design of the commercial facility, initial deposits for major processing equipment for the SX/EW plant and
ongoing site operating costs. These activities will allow the Florence project team to efficiently advance into
construction upon receipt of the Underground Injection Control ("UIC") permit; and
In
December 2021
, the Company completed its review of the draft UIC permit and no significant issues were
identified. The EPA continues to advance their review process and the public comment period on the draft UIC
permit is expected to commence shortly after the draft UIC permit is publicly issued.
Fourth Quarter Review
Fourth quarter earnings from mining operations before depletion and amortization* was
$61.9 million
, Adjusted
EBITDA* was
$53.0 million
, Adjusted net income* was
$13.3 million
(
$0.05
per share) and GAAP Net income was
$11.8 million
(
$0.04
per share);
Total operating costs (C1)* for the quarter were
US$1.94
per pound produced;
The
Gibraltar
mine produced 28.8 million pounds of copper and 450 thousand pounds of molybdenum in the fourth
quarter. Copper recoveries were 80.4% and copper head grades were 0.24%;
*Non-GAAP performance measure. See end of news release
Gibraltar
sold 23.8 million pounds of copper in the quarter (100% basis). Due to extreme flooding in southwest
British Columbia
in November which washed out highways and rail infrastructure, transportation options were
impacted which resulted in a build-up of copper concentrate inventory to 9.9 million pounds at year end.
Concentrate inventory should return to more normal levels by the end of the first quarter of 2022;
Average realized copper prices were
US$4.37
per pound in the quarter, which contributed
$103.0 million
of
revenue for Taseko;
Cashflow from operations was
$37.2 million
which was impacted by
$20.5 million
in non-cash working capital
attributed to the higher year-end inventory. Capital expenditures of
$35.2 million
included Florence spend of
$14.8
million
in the quarter;
The Company has recently extended its copper price protection and now has more than 90% of its attributable
production secured for 2022 year at a minimum copper price of
US$4.00
per pound. Fourth quarter Adjusted net
income and Adjusted EBITDA were impacted by a
$6.4 million
realized derivative loss (
$0.02
per share) related to
copper put options that expired in the quarter; and
In
November 2021
,
Gibraltar's
unionized workforce ratified a new, long-term collective bargaining agreement which
will be in place until
May 31, 2024
.
HIGHLIGHTS
Operating Data (Gibraltar - 100% basis)
Three months ended
December 31,
Year ended
December 31,
2021
2020
Change
2021
2020
Change
Tons mined (millions)
23.3
26.4
(3.1)
105.4
98.7
6.7
Tons milled (millions)
7.4
7.5
(0.1)
29.2
30.1
(0.9)
Production (million pounds Cu)
28.8
25.0
3.8
112.3
123.0
(10.7)
Sales (million pounds Cu)
23.8
25.0
(1.2)
104.9
124.0
(19.1)
Financial Data
Three months ended
December 31,
Year ended
December 31,
(Cdn$ in thousands, except for per share amounts)
2021
2020
Change
2021
2020
Change
Revenues
102,972
87,398
15,574
433,278
343,267
90,011
Earnings from mining operations before depletion and amortization
*
61,916
27,062
34,854
230,392
119,026
111,366
Cash flows provided by operations
37,231
20,424
16,807
174,769
106,195
68,574
Adjusted EBITDA
*
52,988
20,478
32,510
200,733
108,229
92,504
Adjusted net income (loss)
*
13,312
(7,473)
20,785
44,745
(26,539)
71,284
Per share - basic ("Adjusted EPS")
*
0.05
(0.03)
0.08
0.16
(0.11)
0.27
Net income (loss) (GAAP)
11,762
5,694
6,068
36,472
(23,524)
59,996
Per share - basic ("EPS")
0.04
0.02
0.02
0.13
(0.09)
0.22
*Non-GAAP performance measure. See end of news release
REVIEW OF OPERATIONS
Gibraltar
mine (75% Owned)
Operating data (100% basis)
Q4 2021
Q3 2021
Q2 2021
Q1 2021
Q4 2020
YE 2021
YE 2020
Tons mined (millions)
23.3
25.2
24.9
32.0
26.4
105.4
98.7
Tons milled (millions)
7.4
7.4
7.2
7.2
7.5
29.2
30.1
Strip ratio
2.2
1.3
2.3
6.0
1.9
2.5
2.0
Site operating cost per ton milled (Cdn$)*
$9.94
$8.99
$9.16
$8.73
$11.67
$9.21
$9.59
Copper concentrate
Head grade (%)
0.24
0.28
0.22
0.19
0.20
0.23
0.24
Copper recovery (%)
80.4
84.2
83.3
81.5
83.3
82.4
84.3
Production (million pounds Cu)
28.8
34.5
26.8
22.2
25.0
112.3
123.0
Sales (million pounds Cu)
23.8
32.4
26.7
22.0
25.0
104.9
124.0
Inventory (million pounds Cu)
9.9
4.9
3.5
3.6
3.4
9.9
3.4
Molybdenum concentrate
Production (thousand pounds Mo)
450
571
402
530
549
1,954
2,269
Sales (thousand pounds Mo)
491
502
455
552
487
2,000
2,239
Per unit data (US$ per pound produced)
*
Site operating costs
*
$2.02
$1.53
$2.02
$2.23
$2.67
$1.91
$1.75
By-product credits
*
(0.30)
(0.25)
(0.25)
(0.27)
(0.14)
(0.27)
(0.13)
Site operating costs, net of by-product credits
*
$1.72
$1.28
$1.77
$1.96
$2.53
$1.64
$1.62
Off-property costs
0.22
0.29
0.25
0.27
0.29
0.26
0.30
Total operating costs (C1)
*
$1.94
$1.57
$2.02
$2.23
$2.82
$1.90
$1.92
Full Year Results
Gibraltar
produced 112.3 million pounds of copper in 2021 compared to 123.0 million in 2020. Copper grade for the
year averaged 0.23% copper, compared to 0.24% in 2020. Copper recoveries for 2021 was 82.4%, compared to
84.3% in 2020.
A total of 105.4 million tons were mined in the year in line with the mine plan and a 7% increase over the prior year
period. The strip ratio increased primarily as a result of the waste mining transitioning into the Pollyanna pit in the first
quarter of 2021 and lower mining rates in 2020 in response to the onset of COVID-19. Pollyanna ore was the primary
mill feed in 2021, and waste stripping activities began in the
Gibraltar
pit in 2021 with first ore being mined in the fourth
quarter.
Total site spending (including capitalized stripping of
$59.9 million
on a 75% basis) was 9% higher than the prior year
due to higher mining rates in 2021. Sustaining capital expenditures at
Gibraltar
(75% basis) were
$27.9 million
for the
year, compared to
$20.3 million
for the prior year due to greater scheduled component replacements in 2021 for the
mining fleet.
*Non-GAAP performance measure. See end of news release
REVIEW OF OPERATIONS - CONTINUED
Molybdenum production was 2.0 million pounds in the year compared to 2.3 million pounds in the prior year.
Molybdenum prices also strengthened in 2021 with an average molybdenum price of
US$15.94
per pound, an increase
of 84% compared to the 2020 average price of
US$8.68
per pound. By-product credits per pound of copper produced
was
US$0.27
in the year compared to
US$0.13
in the prior year.
Off-property costs per pound produced* were
US$0
.26 for the year, which is
US$0.04
lower than the prior year, as the
Company benefited by a 4% reduction in the benchmark treatment and refining charges ("TCRC") in 2021 and realized
lower TCRCs for spot tenders that were delivered at some of the lowest levels ever seen by the
Gibraltar
mine due to
tight copper market conditions.
Total operating costs per pound produced (C1)* were
US$1.90
for the year, a slight decrease compared to the prior
year. The decrease in the C1* costs was primarily due to the higher by-product credits and lower off-property costs,
partially offset by the increase in site costs and the impact of decreased copper production.
Fourth Quarter Results
Copper production in the fourth quarter was 28.8 million pounds and was impacted by lower grades and recoveries
from ore mined in the upper benches of the
Gibraltar
pit. Increased oxidization and pyrite content in this ore has
resulted in lower recoveries which management believes is a short-term issue that will be resolved. Ore quality is
expected to improve as mining progresses deeper into the
Gibraltar
pit. In December, heavy snowfall and temperatures
as low as minus 35 degrees Celsius also impacted mine equipment and mill availabilities, resulting in decreased mill
throughput and a need to draw ore from lower grade stockpiles.
The Company realized 23.8 million pounds of copper sales in the fourth quarter which was lower than copper production
of 28.8 million pounds. Major disruption to the highway and rail infrastructure in southwest
British Columbia
from severe
rainstorms and flooding in November prevented significant production from being delivered to the port for shipping.
Copper concentrate inventories ended the year at 9.9 million pounds.
A total of 23.3 million tons were mined in the fourth quarter. The strip ratio increased over the prior quarter due to
mining activities transitioning into the higher strip ratio
Gibraltar
pit. The mill feed in the fourth quarter came primarily
from Pollyanna but also included ore from the
Gibraltar
pit.
Total site spending (including capitalized stripping of
$12.7 million
on a 75% basis) was 7% higher than the prior quarter
and included retroactive payments from the newly ratified collective bargaining agreement. Sustaining capital
expenditures at
Gibraltar
of
$6.5 million
on a 75% basis included component replacements for the mining fleet, including
scheduled work on the shovels.
Molybdenum production was 450 thousand pounds in the fourth quarter and at an average molybdenum price of
US$18.89
per pound, generated a notable by-product credit per pound of copper produced of
US$0.30
in the fourth
quarter.
*Non-GAAP performance measure. See end of news release
REVIEW OF OPERATIONS - CONTINUED
Off-property costs per pound produced* were
US$0
.22 for the fourth quarter which benefitted from lower copper
pounds sold. The Company also realized lower TCRC in the fourth quarter as two spot tenders were delivered at much
lower TCRC rates than the annual benchmark rate, which reflects the tight physical market for copper concentrate from
overseas smelters.
Total operating costs per pound produced (C1)* were
US$1.94
for the quarter and increased due to the decreased
copper production and higher site costs in the fourth quarter compared to the third quarter.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE
Nothing is more important to Taseko than the safety, health and well-being of our workers and their families. Taseko
places a high priority on the continuous improvement of performance in the areas of employee health and safety at the
workplace and protection of the environment.
In
April 2021
, Taseko published its second Environmental, Social, and Governance ("ESG") report, which includes an
examination of the Company's sustainability performance for 2020. The report is available on the Company's website at
www.tasekomines.com/esg
.
In this report, Taseko has reported Scope 1 and 2 greenhouse gas emissions for the
Gibraltar
mine which show that
the mine ranks in the first quartile of all copper mines globally. When commercial operations at Florence Copper
commences, the Company's combined greenhouse gas emissions intensity will drop even lower, to an estimated 1.53
tonnes of CO2 per tonne of copper equivalent, based on an independent analysis by Skarn Associates.
Gibraltar's
2021 ESG report will be published in the second quarter of 2022.
GIBRALTAR
OUTLOOK
Gibraltar
is expected to produce 115 million pounds (+/- 5%) of copper in 2022 on a 100% basis, with production
weighted to the back half of the year and the first quarter being the lowest production quarter, similar to 2021. The
expected sales of excess copper concentrate inventory carried over from 2021 will bolster earnings in the first quarter
of 2022.
Strong metal prices and US dollar combined with our copper hedge protection continues to provide tailwinds for a
strong financial performance and operating margins at the
Gibraltar
mine over the coming year. Copper prices in 2021
averaged
US$4.23
per pound and are currently around
US$4.50
and molybdenum prices are currently
US$18.78
per
pound, 18% higher than the average price in 2021.
The copper price outlook for 2022 remains quite favorable with limited exchange inventories and ongoing supply
constraints failing to keep up to demand. Many governments are focusing on increased infrastructure investment to
stimulate economic recovery after the pandemic, including green initiatives, which will require new primary supplies of
copper. Although some analysts predict a balanced copper market by 2023 based on known projects currently under
development, most industry analysts are projecting ongoing supply constraints and deficits, which should support higher
copper prices in the years to come.
*Non-GAAP performance measure. See end of news release
GIBRALTAR
OUTLOOK - CONTINUED
The Company has a long track record of purchasing copper price options to manage copper price volatility. This
strategy provides security over the Company's cash flow as it prepares for construction of Florence Copper while
providing significant upside should copper prices continue at these levels or increase further. In particular, the Company
has secured more than 90% of attributable production with copper collars which protect a minimum copper price of
US$4.00
per pound for 2022.
FLORENCE COPPER
The commercial production facility at Florence Copper will be one of the greenest sources of copper for US domestic
consumption, with carbon emissions, water and energy consumption all dramatically lower than a conventional mine. It
is a low-cost copper project with an annual production capacity of 85 million pounds of copper over a 21-year mine life.
With the expected C1* operating cost of
US$1.10
per pound, Florence Copper will be in the lowest quartile of the global
copper cost curve and will have one of the smallest environmental footprints of any copper mine in the world.
The Company has successfully operated a Production Test Facility ("PTF") since 2018 at
Florence
to demonstrate that
the in-situ copper recovery ("ISCR") process can produce high quality cathode while operating within permit conditions.
The next phase of Florence Copper will be the construction and operation of the commercial ISCR facility with an
estimated capital cost of
US$230 million
(including reclamation bonding and working capital) based on the Company's
published 2017 NI 43-101 technical report. At a conservative copper price of
US$3.00
per pound, Florence Copper is
expected to generate an after-tax internal rate of return of 37%, an after-tax net present value of
US$680 million
at a
7.5% discount rate, and an after-tax payback period of 2.5 years.
In December 2020, the Company received the Aquifer Protection Permit ("APP") from the Arizona Department of
Environmental Quality ("ADEQ"). During the APP process, Florence Copper received strong support from local
community members, business owners and elected officials. The other required permit is the UIC permit from the U.S.
Environmental Protection Agency ("EPA"), which is the final permitting step required prior to construction of the
commercial ISCR facility. On
November 22, 2021
, the EPA provided the Company with an initial draft of the UIC permit.
Taseko's project technical team completed its review of the draft UIC permit in early
December 2021
and no significant
issues were identified. Based on ongoing dialogue with the EPA, the Company continues to expect the draft UIC permit
to be publicly issued very soon, and then a 45-day public comment period will commence.
Detailed engineering and design for the commercial production facility is complete and procurement activities are well
advanced with the Company making initial deposits and awarding the key contract for the major processing equipment
associated with the SX/EW plant in 2021. The Company incurred
$58 million
of costs for
Florence
in 2021 including for
the commercial facility activities and also had outstanding purchase commitments of
$38 million
as at
December 31,
2021
to be incurred in 2022. Deploying this strategic capital and awarding key contracts will assist with protecting the
project execution plan, mitigating inflation risk and the potential impact of supply chain disruptions and ensure a smooth
transition into construction once the final UIC permit is received.
At current copper prices, the Company expects to be able to fund construction of the commercial facility from its
existing sources of liquidity and cashflows from Gibraltar.
LONG-TERM GROWTH STRATEGY
Taseko's strategy has been to grow the Company by acquiring and developing a pipeline of complementary projects
focused on copper in stable mining jurisdictions. We continue to believe this will generate long-term returns for
shareholders. Our other development projects are located in British Columbia.
Yellowhead Copper Project
Yellowhead Mining Inc. ("Yellowhead") has an 817 million tonnes reserve and a 25-year mine life with a pre-tax net
present value of
$1.3 billion
at an 8% discount rate using a
US$3.10
per pound copper price based on the Company's
2020 NI 43-101 technical report. Capital costs of the project are estimated at
$1.3 billion
over a 2-year construction
period. Over the first 5 years of operation, the copper equivalent grade will average 0.35% producing an average of
200 million pounds of copper per year at an average C1* cost, net of by-product credit, of
US$1.67
per pound of
copper. The Yellowhead copper project contains valuable precious metal by-products with 440,000 ounces of gold and
19 million ounces of silver with a life of mine value of over
$1 billion
at current prices.
The Company is focusing its current efforts on advancing into the environmental assessment process and is undertaking
some additional engineering work in conjunction with ongoing engagement with local communities including First Nations.
The Company is also collecting baseline data and modeling which will be used to support the environmental assessment
and permitting of the project.
New Prosperity Gold-Copper Project
In late 2019, the Tŝilhqot'in Nation, as represented by Tŝilhqot'in National Government, and Taseko entered into a
confidential dialogue, with the involvement of the Province of
British Columbia
, to try to obtain a long-term resolution to
the conflict regarding Taseko's proposed gold-copper mine currently known as New Prosperity, acknowledging
Taseko's commercial interests and the Tŝilhqot'in Nation's opposition to the project.
The dialogue was supported by the parties' agreement on
December 7, 2019
to a one-year standstill on certain
outstanding litigation and regulatory matters that relate to Taseko's tenures and the area in the vicinity of Teẑtan Biny
(Fish Lake). The standstill was extended on
December 4, 2020
, to continue what was a constructive dialogue that had
been delayed by the COVID-19 pandemic. The dialogue is not complete but it remains constructive, and the parties
have therefore agreed to extend the standstill for a further year so that they and the Province of
British Columbia
can
continue to pursue a long-term and mutually acceptable resolution of the conflict.
Aley Niobium Project
Environmental monitoring and product marketing initiatives on the Aley niobium project continue. The converter pilot test
is ongoing and is providing additional process data to support the design of the commercial process facilities and will
provide final product samples for marketing purposes.
The Company will host a telephone conference call and live webcast on
Wednesday, February 23, 2022
at
11:00 a.m.
Eastern Time
(
8:00 a.m.
Pacific,
4:00 p.m. GMT
) to discuss these results. After opening remarks by management,
there will be a question and answer session open to analysts and investors.
The conference call may be accessed by dialing 416-764-8688 in
Canada
, 888-390-0546 in
the United States
,
08006522435 in the
United Kingdom
, or online at
tasekomines.com/investors/events
.
The conference call will be archived for later playback until
March 9, 2022
and can be accessed by dialing 416-764-
8677
Canada
, 1-888-390-0541 in
the United States
, or online at tasekomines.com/investors/events and using the
passcode 510013#.
Stuart McDonald
President & CEO
No regulatory authority has approved or disapproved of the information in this news release.
NON-GAAP PERFORMANCE MEASURES
This document includes certain non-GAAP performance measures that do not have a standardized meaning prescribed
by IFRS. These measures may differ from those used by, and may not be comparable to such measures as reported
by, other issuers. The Company believes that these measures are commonly used by certain investors, in conjunction
with conventional IFRS measures, to enhance their understanding of the Company's performance. These measures
have been derived from the Company's financial statements and applied on a consistent basis. The following tables
below provide a reconciliation of these non-GAAP measures to the most directly comparable IFRS measure.
Total operating costs and site operating costs, net of by-product credits
Total costs of sales include all costs absorbed into inventory, as well as transportation costs and insurance recoverable.
Site operating costs are calculated by removing net changes in inventory, depletion and amortization, insurance
recoverable, and transportation costs from cost of sales. Site operating costs, net of by-product credits is calculated by
subtracting by-product credits from the site operating costs. Site operating costs, net of by-product credits per pound
are calculated by dividing the aggregate of the applicable costs by copper pounds produced. Total operating costs per
pound is the sum of site operating costs, net of by-product credits and off-property costs divided by the copper pounds
produced. By-product credits are calculated based on actual sales of molybdenum (net of treatment costs) and silver
during the period divided by the total pounds of copper produced during the period. These measures are calculated on
a consistent basis for the periods presented.
(Cdn$ in thousands, unless otherwise indicated) –
75% basis
2021
Q4
2021
Q3
2021
Q2
2021
Q1
2021
YE
Cost of sales
57,258
65,893
74,056
72,266
269,473
Less:
Depletion and amortization
(16,202)
(17,011)
(17,536)
(15,838)
(66,587)
Net change in inventories of finished goods
13,497
762
(4,723)
2,259
11,795
Net change in inventories of ore stockpiles
4,804
6,291
2,259
(8,226)
5,128
Transportation costs
(4,436)
(5,801)
(4,303)
(3,305)
(17,845)
Site operating costs
54,921
50,134
49,753
47,156
201,964
Less by-product credits:
Molybdenum, net of treatment costs
(7,755)
(8,574)
(6,138)
(5,604)
(28,071)
Silver, excluding amortization of deferred revenue
(330)
300
64
(238)
(204)
Site operating costs, net of by-product credits
46,836
41,860
43,679
41,314
173,689
Total copper produced (thousand pounds)
21,590
25,891
20,082
16,684
84,247
Total costs per pound produced
2.17
1.62
2.18
2.48
2.06
Average exchange rate for the period (CAD/USD)
1.26
1.26
1.23
1.27
1.25
Site operating costs, net of by-product credits
(US$ per pound)
1.72
1.28
1.77
1.96
1.64
Site operating costs, net of by-product credits
46,836
41,860
43,679
41,314
173,689
Add off-property costs:
Treatment and refining costs
1,480
3,643
1,879
2,414
9,416
Transportation costs
4,436
5,801
4,303
3,305
17,845
Total operating costs
52,752
51,304
49,861
47,033
200,950
Total operating costs (C1) (US$ per pound)
1.94
1.57
2.02
2.23
1.90
NON-GAAP PERFORMANCE MEASURES - CONTINUED
(Cdn$ in thousands, unless otherwise indicated) –
75% basis
2020
Q4
2020
Q3
2020
Q2
2020
Q1
2020
YE
Cost of sales
79,083
75,969
81,181
83,309
319,542
Less:
Depletion and amortization
(18,747)
(23,894)
(25,512)
(27,148)
(95,301)
Net change in inventories of finished goods
2,087
1,415
(5,753)
1,302
(949)
Net change in inventories of ore stockpiles
6,632
4,186
(50)
603
11,371
Transportation costs
(3,768)
(4,127)
(5,834)
(4,519)
(18,248)
Site operating costs
65,287
53,549
44,032
53,547
216,425
Less by-product credits:
Molybdenum, net of treatment costs
(3,649)
(4,109)
(4,252)
(3,231)
(15,241)
Silver, excluding amortization of deferred revenue
133
(54)
(28)
(354)
(303)
Site operating costs, net of by-product credits
61,771
49,386
39,752
49,962
200,871
Total copper produced (thousand pounds)
18,725
21,658
27,576
24,318
92,277
Total costs per pound produced
3.30
2.28
1.44
2.05
2.18
Average exchange rate for the period (CAD/USD)
1.30
1.33
1.39
1.34
1.34
Site operating costs, net of by-product credits
(US$ per pound)
2.53
1.71
1.04
1.53
1.62
Site operating costs, net of by-product credits
61,771
49,386
39,752
49,962
200,871
Add off-property costs:
Treatment and refining costs
3,284
4,254
5,676
4,956
18,170
Transportation costs
3,768
4,127
5,834
4,519
18,248
Total operating costs
68,823
57,767
51,262
59,437
237,289
Total operating costs (C1) (US$ per pound)
2.82
2.00
1.34
1.82
1.92
Adjusted net income (loss)
Adjusted net income (loss) removes the effect of the following transactions from net income as reported under IFRS:
Unrealized foreign currency gains/losses;
Unrealized gain/loss on derivatives; and
Loss on settlement of long-term debt and call premium, including realized foreign exchange gains.
Management believes these transactions do not reflect the underlying operating performance of our core mining
business and are not necessarily indicative of future operating results. Furthermore, unrealized gains/losses on
derivative instruments, changes in the fair value of financial instruments, and unrealized foreign currency gains/losses
are not necessarily reflective of the underlying operating results for the reporting periods presented.
NON-GAAP PERFORMANCE MEASURES - CONTINUED
(Cdn$ in thousands, except per share amounts)
2021
Q4
2021
Q3
2021
Q2
2021
Q1
2021
YE
Net income (loss)
11,762
22,485
13,442
(11,217)
36,472
Unrealized foreign exchange (gain) loss
(1,817)
9,511
(3,764)
8,798
12,728
Realized foreign exchange gain on settlement of long-
term debt
-
-
-
(13,000)
(13,000)
Loss on settlement of long-term debt
-
-
-
5,798
5,798
Call premium on settlement of long-term debt
-
-
-
6,941
6,941
Unrealized (gain) loss on derivatives
4,612
(6,817)
370
802
(1,033)
Estimated tax effect of adjustments
(1,245)
1,841
(100)
(3,651)
(3,161)
Adjusted net income (loss)
13,312
27,020
9,948
(5,535)
44,745
Adjusted EPS
0.05
0.10
0.04
(0.02)
0.16
(Cdn$ in thousands, except per share amounts)
2020
Q4
2020
Q3
2020
Q2
2020
Q1
2020
YE
Net income (loss)
5,694
987
18,745
(48,950)
(23,524)
Unrealized foreign exchange (gain) loss
(13,595)
(7,512)
(12,985)
29,747
(4,345)
Unrealized (gain) loss on derivatives
586
1,056
3,528
(3,348)
1,822
Estimated tax effect of adjustments
(158)
(285)
(953)
904
(492)
Adjusted net income (loss)
(7,473)
(5,754)
8,335
(21,647)
(26,539)
Adjusted EPS
(0.03)
(0.02)
0.03
(0.09)
(0.11)
Adjusted EBITDA
Adjusted EBITDA is presented as a supplemental measure of the Company's performance and ability to service debt.
Adjusted EBITDA is frequently used by securities analysts, investors and other interested parties in the evaluation of
companies in the industry, many of which present Adjusted EBITDA when reporting their results. Issuers of "high yield"
securities also present Adjusted EBITDA because investors, analysts and rating agencies consider it useful in
measuring the ability of those issuers to meet debt service obligations.
Adjusted EBITDA represents net income before interest, income taxes, and depreciation and also eliminates the impact
of a number of items that are not considered indicative of ongoing operating performance. Certain items of expense are
added and certain items of income are deducted from net income that are not likely to recur or are not indicative of the
Company's underlying operating results for the reporting periods presented or for future operating performance and
consist of:
Unrealized foreign exchange gains/losses;
Unrealized gain/loss on derivatives;
Loss on settlement of long term debt (included in finance expenses) and call premium;
Realized foreign exchange gain on settlement of long-term debt; and
Amortization of share-based compensation expense.
NON-GAAP PERFORMANCE MEASURES - CONTINUED
(Cdn$ in thousands)
2021
Q4
2021
Q3
2021
Q2
2021
Q1
2021
YE
Net income (loss)
11,762
22,485
13,442
(11,217)
36,472
Add:
Depletion and amortization
16,202
17,011
17,536
15,838
66,587
Finance expense (includes loss on settlement of long-
term debt and call premium)
12,072
11,875
11,649
23,958
59,554
Finance income
(218)
(201)
(184)
(75)
(678)
Income tax (recovery) expense
9,300
22,310
7,033
(4,302)
34,341
Unrealized foreign exchange (gain) loss
(1,817)
9,511
(3,764)
8,798
12,728
Realized foreign exchange gain on settlement of long-
term debt
-
-
-
(13,000)
(13,000)
Unrealized (gain) loss on derivatives
4,612
(6,817)
370
802
(1,033)
Amortization of share-based compensation expense
1,075
117
1,650
2,920
5,762
Adjusted EBITDA
52,988
76,291
47,732
23,722
200,733
(Cdn$ in thousands)
2020
Q4
2020
Q3
2020
Q2
2020
Q1
2020
YE
Net income (loss)
5,694
987
18,745
(48,950)
(23,524)
Add:
Depletion and amortization
18,747
23,894
25,512
27,148
95,301
Finance expense
10,575
11,203
10,461
10,771
43,010
Finance income
(47)
(4)
(48)
(150)
(249)
Income tax (recovery) expense
(2,724)
(580)
4,326
(10,118)
(9,096)
Unrealized foreign exchange (gain) loss
(13,595)
(7,512)
(12,985)
29,747
(4,345)
Unrealized (gain) loss on derivatives
586
1,056
3,528
(3,348)
1,822
Amortization of share-based compensation expense
1,242
2,501
1,321
246
5,310
Adjusted EBITDA
20,478
31,545
50,860
5,346
108,229
NON-GAAP PERFORMANCE MEASURES - CONTINUED
Earnings from mining operations before depletion and amortization
Earnings from mining operations before depletion and amortization is earnings from mining operations with depletion and
amortization added back. The Company discloses this measure, which has been derived from our financial statements
and applied on a consistent basis, to provide assistance in understanding the results of the Company's operations and
financial position and it is meant to provide further information about the financial results to investors.
(Cdn$ in thousands)
2021
Q4
2021
Q3
2021
Q2
2021
Q1
2021
YE
Earnings from mining operations
45,714
66,670
36,946
14,475
163,805
Add:
Depletion and amortization
16,202
17,011
17,536
15,838
66,587
Earnings from mining operations before depletion and amortization
61,916
83,681
54,482
30,313
230,392
(Cdn$ in thousands)
2020
Q4
2020
Q3
2020
Q2
2020
Q1
2020
YE
Earnings (loss) from mining operations
8,315
11,811
24,824
(21,225)
23,725
Add:
Depletion and amortization
18,747
23,894
25,512
27,148
95,301
Earnings from mining operations before depletion and amortization
27,062
35,705
50,336
5,923
119,026
Site operating costs per ton milled
(Cdn$ in thousands, except per ton milled amounts)
2021
Q4
2021
Q3
2021
Q2
2021
Q1
2021
YE
Site operating costs (included in cost of sales)
54,921
50,134
49,753
47,156
201,964
Tons milled (thousands) (75% basis)
5,523
5,576
5,429
5,402
21,930
Site operating costs per ton milled
$9.94
$8.99
$9.16
$8.73
$9.21
(Cdn$ in thousands, except per ton milled amounts)
2020
Q4
2020
Q3
2020
Q2
2020
Q1
2020
YE
Site operating costs (included in cost of sales)
65,287
53,549
44,032
53,547
216,415
Tons milled (thousands) (75% basis)
5,594
5,595
5,748
5,622
22,559
Site operating costs per ton milled
$11.67
$9.57
$7.66
$9.52
$9.59
CAUTION REGARDING FORWARD-LOOKING INFORMATION
This document contains "forward-looking statements" that were based on Taseko's expectations, estimates and
projections as of the dates as of which those statements were made. Generally, these forward-looking statements can
be identified by the use of forward-looking terminology such as "outlook", "anticipate", "project", "target", "believe",
"estimate", "expect", "intend", "should" and similar expressions.
Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause
the Company's actual results, level of activity, performance or achievements to be materially different from those
expressed or implied by such forward-looking statements. These included but are not limited to:
uncertainties about the effect of COVID-19 and the response of local, provincial, federal and international
governments to the threat of COVID-19 on our operations (including our suppliers, customers, supply chain,
employees and contractors) and economic conditions generally and in particular with respect to the demand for
copper and other metals we produce;
uncertainties and costs related to the Company's exploration and development activities, such as those associated
with continuity of mineralization or determining whether mineral resources or reserves exist on a property;
uncertainties related to the accuracy of our estimates of mineral reserves, mineral resources, production rates and
timing of production, future production and future cash and total costs of production and milling;
uncertainties related to feasibility studies that provide estimates of expected or anticipated costs, expenditures and
economic returns from a mining project;
uncertainties related to the ability to obtain necessary licenses permits for development projects and project delays
due to third party opposition;
uncertainties related to unexpected judicial or regulatory proceedings;
changes in, and the effects of, the laws, regulations and government policies affecting our exploration and
development activities and mining operations, particularly laws, regulations and policies;
changes in general economic conditions, the financial markets and in the demand and market price for copper, gold
and other minerals and commodities, such as diesel fuel, steel, concrete, electricity and other forms of energy,
mining equipment, and fluctuations in exchange rates, particularly with respect to the value of the U.S. dollar and
Canadian dollar, and the continued availability of capital and financing;
the effects of forward selling instruments to protect against fluctuations in copper prices and exchange rate
movements and the risks of counterparty defaults, and mark to market risk;