Taseko Reports
$63 Million of Adjusted EBITDA for
Third Quarter 2023
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 87.5% 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, Nov.
1, 2023 -- Taseko Mines Limited (TSX: TKO) (NYSE American: TGB)
( LSE: TKO) ("Taseko" or the "Company") reports third quarter
2023 Adjusted EBITDA* of $63 million
and Earnings from mining operations before depletion and
amortization* of $65 million.
Adjusted net earnings* for the quarter were $20 million, or $0.07 per share.
Gibraltar produced 35
million pounds of copper and 369 thousand pounds of molybdenum in
the third quarter, 26% and 60% higher than the second quarter,
respectively. Improved production was a result of higher grades,
throughput and recoveries. Higher production, of both copper and
molybdenum, drove Total operating costs (C1)* down 17% to
US$2.20 per pound.
Adjusted EBITDA* increased by 182% over the prior quarter
despite third quarter sales volumes being impacted by a port
workers strike in July. The excess inventory at the end of the
third quarter is expected to be shipped and sold in the fourth
quarter.
Stuart McDonald, President
and CEO of Taseko, commented "In the third quarter a major
milestone was achieved at our Florence Copper project; receipt of
the final Underground Injection Control permit from the US
Environmental Protection Agency ("EPA"). This week the EPA
confirmed that no appeals or objections have been received and that
the permit is now effective. This is a great result and evidence of
the quality and integrity of the project.
We are now preparing for construction and site preparation
will begin later in the fourth quarter. Florence financing
discussions are well advanced and the additional financings
are expected to close in early 2024, and then wellfield drilling
will commence."
Mr. McDonald continued, "We are pleased with Gibraltar's performance in the third quarter.
Copper head grade increased to 0.26% in the period as the lower
benches of the Gibraltar pit
provided the higher grades and more consistent mineralized zones we
expected. Mill performance was also strong as copper
recoveries averaged 85% and the softer ore in the Gibraltar pit helped to achieve a throughput
rate over 87,000 tons per day, 10% higher than the first half of
2023. The Gibraltar pit will
continue to be our main source of ore through the middle of 2024,
providing us with predictable and consistent mill feed. The
operation remains on track to meet the original 2023 production
guidance of 115 million pounds of copper (+/-5%)."
We continue to have our copper put protection in place
US$3.75 per pound until the end of
the year, and we now have a minimum price of US$3.25 per pound protected for the first quarter
of 2024." concluded Mr. McDonald.
Third Quarter Review
- In September, the U.S. Environmental Protection Agency
("EPA") issued the Final Underground Injection Control ("UIC")
permit for the Florence Copper Project and the permit became
effective on October 31, 2023. The
Company now has all key permits in place to commence construction
of the commercial production facility at Florence;
- Third quarter earnings from mining operations before
depletion and amortization* was $65.4
million, Adjusted EBITDA* was $62.7
million, and cash flows from operations were $27.0 million;
- GAAP net income was $0.9
million (nil per share) and Adjusted net income* was
$19.7 million ($0.07 per share) after normalizing for unrealized
foreign exchange and derivative losses;
- Gibraltar produced 35.4
million pounds of copper for the quarter, a 26% improvement over
the prior quarter as a result of higher grades, improved recoveries
and increased mill throughput;
- Copper head grades in the quarter improved to 0.26% as
mining progressed deeper into the Gibraltar pit and the lower benches provided
the expected improvement in ore grade and quality;
- Molybdenum grades also increased in the period, resulting
in a 60% increase in quarterly molybdenum production;
- Gibraltar sold 32.1
million pounds of copper in the third quarter (100% basis). The
B.C. port workers labour strike in early July caused shipping
delays and a build-up of Gibraltar
copper concentrate inventory. As a result, third quarter sales
volumes lagged production by three million pounds, and the excess
inventory is expected to be shipped and sold in the fourth
quarter;
- Total site costs* in the third quarter were $102.0 million on a 100% basis, $3.4 million lower than the previous quarter due
to lower explosive and grinding media use, contractor services, and
repairs and maintenance costs. C1 costs were US$2.20 per pound in the
quarter;
- On October 25, 2023, the
Company received the first US$20
million tranche of its US$25
million equipment loan commitment from Bank of America for
Florence Copper; and
- The Company had a closing cash balance of $82 million at September
30, 2023.
*Non-GAAP performance measure.
See end of news release |
Highlights
Operating Data (Gibraltar
– 100% basis) |
Three months ended
September 30, |
Nine months
endedSeptember 30, |
|
2023 |
2022 |
Change |
2023 |
2022 |
Change |
Tons mined (millions) |
16.5 |
23.2 |
(6.7) |
64.0 |
65.7 |
(1.7) |
Tons milled
(millions) |
8.0 |
8.2 |
(0.2) |
22.4 |
23.0 |
(0.6) |
Production (million pounds
Cu) |
35.4 |
28.3 |
7.1 |
88.5 |
70.3 |
18.2 |
Sales (million pounds
Cu) |
32.1 |
26.7 |
5.4 |
84.8 |
75.8 |
9.0 |
Financial
Data |
Three months ended
September 30, |
Nine months
endedSeptember 30, |
(Cdn$ in thousands, except for
per share amounts) |
2023 |
2022 |
Change |
2023 |
2022 |
Change |
Revenues |
143,835 |
89,714 |
54,121 |
371,278 |
290,991 |
80,287 |
Earnings from mining operations
before depletion and
amortization* |
65,445 |
18,570 |
46,875 |
134,248 |
68,564 |
65,684 |
Cash flows provided by
operations |
26,989 |
12,115 |
14,874 |
88,257 |
82,212 |
6,045 |
Adjusted
EBITDA* |
62,695 |
34,031 |
28,664 |
120,972 |
73,854 |
47,118 |
Net income (loss)
(GAAP) |
871 |
(23,517) |
24,388 |
15,301 |
(23,696) |
38,997 |
Per share – basic
("EPS") |
- |
(0.08) |
0.08 |
0.05 |
(0.08) |
0.13 |
Adjusted net income
(loss)* |
19,659 |
4,513 |
15,146 |
20,371 |
(5,423) |
25,794 |
Per share – basic ("adjusted
EPS")* |
0.07 |
0.02 |
0.05 |
0.07 |
(0.02) |
0.09 |
*Non-GAAP performance measure.
See end of news release |
Review of Operations
Gibraltar
mine
Operating data (100%
basis) |
Q3
2023 |
Q2
2023 |
Q1
2023 |
Q4
2022 |
Q3
2022 |
Tons mined (millions) |
16.5 |
23.4 |
24.1 |
22.9 |
23.2 |
Tons milled
(millions) |
8.0 |
7.2 |
7.1 |
7.3 |
8.2 |
Strip ratio |
0.4 |
1.5 |
1.9 |
1.1 |
1.5 |
Site operating cost per ton
milled (Cdn$)* |
$12.39 |
$13.17 |
$13.54 |
$13.88 |
$11.33 |
Copper
concentrate |
|
|
|
|
|
Head grade
(%) |
0.26 |
0.24 |
0.22 |
0.22 |
0.22 |
Copper recovery
(%) |
85.0 |
81.9 |
80.7 |
83.4 |
77.1 |
Production (million
pounds Cu) |
35.4 |
28.2 |
24.9 |
26.7 |
28.3 |
Sales (million
pounds Cu) |
32.1 |
26.1 |
26.6 |
25.5 |
26.7 |
Inventory (million
pounds Cu) |
8.8 |
5.6 |
3.7 |
5.4 |
4.2 |
Molybdenum
concentrate |
|
|
|
|
|
Production (thousand
pounds Mo) |
369 |
230 |
234 |
359 |
324 |
Sales (thousand
pounds Mo) |
370 |
231 |
225 |
402 |
289 |
Per unit data (US$ per
pound produced)* |
|
|
|
|
|
Site operating
costs* |
$2.10 |
$2.43 |
$2.94 |
$2.79 |
$2.52 |
By-product
credits* |
(0.23) |
(0.13) |
(0.37) |
(0.40) |
(0.15) |
Site operating costs, net of
by-product credits* |
$1.87 |
$2.30 |
$2.57 |
$2.39 |
$2.37 |
Off-property costs |
0.33 |
0.36 |
0.37 |
0.36 |
0.35 |
Total operating costs
(C1)* |
$2.20 |
$2.66 |
$2.94 |
$2.75 |
$2.72 |
Operations Analysis
Third Quarter Review
Gibraltar produced 35.4
million pounds of copper for the third quarter, a 26% increase over
the second quarter due to higher mill throughput, ore grade and
recoveries. The lower benches of the Gibraltar pit are providing the expected
higher grades and more consistent mineralized zones. Mill
throughput was 8.0 million tons for the period averaging 87,000
tons per day, which is above nameplate capacity and 10% higher than
the average throughput in the first half of the year.
Copper head grades of 0.26% were higher than recent
quarters as ore quality improved in the lower benches of the
Gibraltar pit, in line with
management expectations. Copper recoveries in the third
quarter were 85.0%, improved over previous quarters with the
increasing head grades.
*Non-GAAP performance measure. See end of news
release
Operations Analysis - Continued
A total of 16.5 million tons were mined in the third
quarter which was lower than recent quarters due to longer haul
distances from the lower benches of the Gibraltar pit. Total site costs* at
Gibraltar of $102.0 million were $3.4
million lower than the previous quarter. Ore
stockpiles increased by 2.9 million tons in the third
quarter.
Molybdenum generated a by-product credit of US$0.23 per pound of copper produced in the
third quarter. Molybdenum production increased by 60% over
the second quarter due to the higher grade and consistency in mill
operations. The molybdenum price increased from the second
quarter's average price of US$21.30
per pound to an average of US$23.76
per pound.
Off-property costs per pound produced* were US$0.33 which is lower than the recent quarters
as copper sales lagged production.
Total operating costs per pound produced (C1)* were
US$2.20 for the third quarter,
compared to US$2.72 in the same
period in 2022 mainly attributed to the higher production and with
other key variances summarized in the bridge graph
below:
Gibraltar Outlook
Mining is well established in the lower benches of the
Gibraltar pit and the operation
remains on track to meet the original production guidance of 115
million pounds of copper (+/-5%). The Gibraltar pit will continue to be the main
source of mill feed through to the middle of 2024. The excess
inventory at the end of the third quarter of 2023 as a result of
the B.C. port workers strike is expected to be shipped and sold
before the end of this year.
*Non-GAAP performance measure.
See end of news release |
Gibraltar Outlook - Continued
Mill 2 is scheduled to be down for two weeks in the first
quarter of 2024 for a component replacement. The in-pit
crusher for Mill 1 is planned to be relocated in the second quarter
of 2024 with an estimated remaining cost of $9 million. The approximate three-week downtime
associated with the crusher move will align with a maintenance
shutdown that is required for Mill 1. No other significant
capital projects are planned for Gibraltar in 2024.
Our copper hedge protection continues to provide stable
operating margins at the Gibraltar
mine amidst copper price volatility. Copper prices in the third
quarter averaged US$3.79 per pound,
compared to the year-to-date average of US$3.89 and the 2022 average of US$3.99 per pound. The Company currently has
copper price collar contracts in place that secure a minimum copper
price of US$3.75 per pound for 21
million pounds of copper for the fourth quarter and copper price
put contracts in place that secure a minimum copper price of
US$3.25 per pound for 21 million
pounds of copper during the first quarter of 2024.
Florence Copper
On September 14, 2023, the
Company received the final UIC permit from the EPA, and the UIC
permit became effective on October
31, 2023. The Company now has all the key permits in
place and is preparing to commence construction of the commercial
production facility. The next steps include procurement of
materials and supplies and finalizing agreements with key
contractors, including the general contractor for the solvent
extraction and electrowinning ("SX/EW") plant and the drilling
contractors for the wellfield development. Site preparation
and clearing for the initial wellfield, plant and infrastructure
will commence in the fourth quarter and the Company has started the
hiring of additional management and site personnel positions for
the construction and operations teams.
Detailed engineering and design for the commercial
production facility is substantially completed and procurement
activities are well advanced. Major processing equipment
associated with the SX/EW plant has been procured and delivered to
the Florence site. The Company
incurred $45.0 million of capital
expenditures at the Florence
project in the first nine months of 2023.
The Company is also advancing Florence project level financing to fund
construction activities. On October
25, 2023, the Company closed the first US$20 million tranche of its US$25 million equipment loan commitment from Bank
of America. The Company's financial adviser, Endeavour Financial,
has been leading the origination of additional finance commitments
for Florence Copper. Discussions are well advanced and the
Company is targeting additional funding commitments of
approximately US$100 million in
royalties and debt at Florence Copper, in addition to the
commitments already received from Mitsui and Bank of
America.
In March 2023, the Company
announced the results of recent technical work and updated
economics for the Florence Copper project. The Company has filed a
new technical report entitled "NI 43-101 Technical Report Florence
Copper Project, Pinal County,
Arizona" dated March 30, 2023
(the "Technical Report") on SEDAR. The Technical Report was
prepared in accordance with NI 43-101 and incorporates updated
capital and operating costs for the commercial production facility
and refinements made to the operating models, based on the
Production Test Facility ("PTF") results.
Florence Copper - Continued
The technical work completed by Taseko in recent years has
been extensive and has de-risked the project significantly. The PTF
operated successfully over an 18-month period and provided a
valuable opportunity to test operational controls and strategies
which will be applied in future commercial operations. In addition,
a more sophisticated leaching model has been developed and
calibrated to the PTF wellfield performance. This detailed modeling
data, along with updated costing, has been used to update
assumptions for the ramp up and operation of the commercial
wellfield and processing facility.
Florence Copper Project Highlights:
- Net present value of US$930
million (after-tax at an 8% discount rate)
- Internal rate of return of 47% (after-tax)
- Payback period of 2.6 years
- Operating costs (C1) of US$1.11 per pound of copper
- Annual production capacity of 85 million pounds of LME
grade A cathode copper
- 22 year mine life
- Total life of mine production of 1.5 billion pounds of
copper
- Total estimated initial capital cost of US$232 million remaining
- Long-term copper price of US$3.75 per pound
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 preparing to advance 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.
Long-term Growth Strategy -
Continued
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, in order to
obtain a long-term resolution of the conflict regarding Taseko's
proposed copper-gold mine previously known as New Prosperity,
acknowledging Taseko's commercial interests and the Tŝilhqot'in
Nation's opposition to the project.
This dialogue has been supported by the parties'
agreement, beginning December 2019,
to a series of one-year standstills on certain outstanding
litigation and regulatory matters relating to Taseko's tenures and
the area in the vicinity of Teẑtan Biny (Fish Lake). The standstill
agreement was most recently extended for a fourth one-year term in
December 2022, with the goal of
providing time and opportunity for the Tŝilhqot'in Nation and
Taseko to negotiate a final resolution.
The dialogue process has made tangible progress in the
past 12 months but is not complete. In agreeing to extend the
standstill through 2023, the Tŝilhqot'in Nation and Taseko
acknowledge the constructive nature of discussions to date, and the
future opportunity to conclude a long-term and mutually acceptable
resolution of the conflict that also makes an important
contribution to the goals of reconciliation in Canada.
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 has also
initiated lab testwork on flowsheet development to produce niobium
oxide from floatation concentrate at Aley to supply the growing
market for niobium-based batteries.
The Company will host a telephone
conference call and live webcast on Thursday, November 2, 2023 at
11:00 a.m. Eastern Time (8:00 a.m. Pacific) to discuss these
results. After opening remarks by management, there will be a
question and answer session open to analysts and investors.
To join the conference call without operator assistance, you may
pre-register at https://bit.ly/Taseko-Q3-rapidconnect to
receive an instant automated call back just prior to the start of
the conference call. Otherwise, the conference call may be accessed
by dialing 888-390-0546 toll free, 416-764-8688 in Canada, or
online at tasekomines.com/investors/events.
The conference call will be archived for later playback until
November 16, 2023 and can be accessed by dialing 888-390-0541
toll free, 416-764-8677 in Canada, or online
at tasekomines.com/investors/events/ and using the
entry code 154098#. |
Stuart McDonald
President & CEO
Non-GAPP 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 (except for Q1, Q2 and Q3
2023) |
2023Q31 |
2023Q21 |
2023Q11 |
2022Q4 |
2022Q3 |
Cost of sales |
94,383 |
99,854 |
86,407 |
73,112 |
84,204 |
Less: |
|
|
|
|
|
Depletion and
amortization |
(15,993) |
(15,594) |
(12,027) |
(10,147) |
(13,060) |
Net change in inventories
of finished goods |
4,267 |
3,356 |
(399) |
1,462 |
2,042 |
Net change in inventories
of ore stockpiles |
12,172 |
2,724 |
5,561 |
18,050 |
3,050 |
Transportation
costs |
(7,681) |
(6,966) |
(5,104) |
(6,671) |
(6,316) |
Site operating costs |
87,148 |
83,374 |
74,438 |
75,806 |
69,920 |
Oxide ore stockpile
reclassification from capitalized stripping |
- |
(3,183) |
3,183 |
- |
- |
Less by-product
credits: |
|
|
|
|
|
Molybdenum, net of
treatment costs |
(9,900) |
(4,018) |
(9,208) |
(11,022) |
(4,122) |
Silver, excluding
amortization of deferred revenue |
290 |
(103) |
(160) |
263 |
25 |
Site operating costs, net of
by-product credits |
77,538 |
76,070 |
68,253 |
65,047 |
65,823 |
Total copper produced (thousand
pounds) |
30,978 |
24,640 |
19,491 |
20,020 |
21,238 |
Total costs per pound
produced |
2.50 |
3.09 |
3.50 |
3.25 |
3.10 |
Average exchange rate for the
period (CAD/USD) |
1.34 |
1.34 |
1.35 |
1.36 |
1.31 |
Site operating costs, net
of by-product credits (US$ per pound) |
1.87 |
2.30 |
2.59 |
2.39 |
2.37 |
Site operating costs, net of
by-product credits |
77,538 |
76,070 |
68,253 |
65,047 |
65,823 |
Non-GAPP Performance
Measures - ContinuedAdd off-property costs: |
|
|
|
|
Treatment and refining
costs |
6,123 |
4,986 |
4,142 |
3,104 |
3,302 |
Transportation
costs |
7,681 |
6,966 |
5,104 |
6,671 |
6,316 |
Total operating costs |
91,342 |
88,022 |
77,499 |
74,822 |
75,441 |
Total operating costs
(C1) (US$ per pound) |
2.20 |
2.66 |
2.94 |
2.75 |
2.72 |
1 Q1, Q2 and Q3
2023 includes the impact from the March 15, 2023 acquisition of
Cariboo from Sojitz, which increased the Company's Gibraltar mine
ownership from 75% to 87.5%. |
Total Site Costs
Total site costs are comprised of the site operating costs
charged to cost of sales as well as mining costs capitalized to
property, plant and equipment in the period. This measure is
intended to capture Taseko's share of the total site operating
costs incurred in the quarter at the Gibraltar mine calculated on a consistent
basis for the periods presented.
(Cdn$ in thousands, unless
otherwise indicated) –75% basis (except for Q1, Q2 and Q3
2023) |
2023Q31 |
2023Q21 |
2023Q11 |
2022Q4 |
2022Q3 |
Site operating costs |
87,148 |
83,374 |
74,438 |
75,806 |
69,920 |
Add: |
|
|
|
|
|
Capitalized stripping
costs |
2,083 |
8,832 |
12,721 |
3,866 |
1,121 |
Total site costs – Taseko
share |
89,231 |
92,206 |
87,159 |
79,672 |
71,041 |
Total site costs – 100%
basis |
101,978 |
105,378 |
112,799 |
106,230 |
94,721 |
1 Q1, Q2 and Q3
2023 includes the impact from the March 15, 2023 acquisition of
Cariboo from Sojitz, which increased the Company's Gibraltar mine
ownership from 75% to 87.5%. |
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 gain/loss;
- Unrealized gain/loss on derivatives; and
- Finance and other non-recurring costs.
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-GAPP Performance Measures -
Continued
(Cdn$ in thousands, except per
share amounts) |
2023Q3 |
2023Q2 |
2023Q1 |
2022Q4 |
Net income
(loss) |
871 |
9,991 |
4,439 |
(2,275) |
Unrealized foreign
exchange (gain) loss |
14,582 |
(10,966) |
(950) |
(5,279) |
Unrealized (gain) loss on
derivatives |
4,518 |
(6,470) |
2,190 |
20,137 |
Finance and other
non-recurring costs |
1,244 |
1,714 |
- |
- |
Estimated tax effect of
adjustments |
(1,556) |
1,355 |
(591) |
(5,437) |
Adjusted net income
(loss) |
19,659 |
(4,376) |
5,088 |
7,146 |
Adjusted
EPS |
0.07 |
(0.02) |
0.02 |
0.02 |
(Cdn$ in thousands, except per
share amounts) |
2022Q3 |
2022Q2 |
2022Q1 |
2021Q4 |
Net income
(loss) |
(23,517) |
(5,274) |
5,095 |
11,762 |
Unrealized foreign
exchange (gain) loss |
28,083 |
11,621 |
(4,398) |
(1,817) |
Unrealized (gain) loss on
derivatives |
(72) |
(30,747) |
7,486 |
4,612 |
Estimated tax effect of
adjustments |
19 |
8,302 |
(2,021) |
(1,245) |
Adjusted net income
(loss) |
4,513 |
(16,098) |
6,162 |
13,312 |
Adjusted
EPS |
0.02 |
(0.06) |
0.02 |
0.05 |
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 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;
- Amortization of share-based compensation expense;
and
- Non-recurring other expenses
Non-GAPP Performance Measures -
Continued
(Cdn$ in thousands) |
2023Q3 |
2023Q2 |
2023Q1 |
2022Q4 |
Net income
(loss) |
871 |
9,991 |
4,439 |
(2,275) |
Add: |
|
|
|
|
Depletion and
amortization |
15,993 |
15,594 |
12,027 |
10,147 |
Finance
expense |
14,285 |
13,468 |
12,309 |
10,135 |
Finance income |
(322) |
(757) |
(921) |
(700) |
Income tax
expense |
12,041 |
678 |
3,356 |
1,222 |
Unrealized foreign
exchange loss (gain) |
14,582 |
(10,966) |
(950) |
(5,279) |
Unrealized loss (gain) on
derivatives |
4,518 |
(6,470) |
2,190 |
20,137 |
Amortization of
share-based compensation expense |
727 |
417 |
3,609 |
1,794 |
Non-recurring other
expenses |
- |
263 |
- |
- |
Adjusted
EBITDA |
62,695 |
22,218 |
36,059 |
35,181 |
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.
|
Three months
ended
September 30, |
Nine months ended
September 30, |
(Cdn$ in thousands) |
2023 |
2022 |
2023 |
2022 |
Earnings from mining
operations |
49,452 |
5,510 |
90,634 |
26,729 |
Add: |
|
|
|
|
Depletion and
amortization |
15,993 |
13,060 |
43,614 |
41,835 |
Earnings from mining
operations before depletion and amortization |
65,445 |
18,570 |
134,248 |
68,564 |
Non-GAPP Performance Measures -
Continued
Site operating costs per ton milled
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 Company's site operations
on a tons milled basis.
(Cdn$ in thousands, except per
ton milled amounts) |
2023Q31 |
2023Q21 |
2023Q11 |
2022Q4 |
2022Q3 |
Site operating costs
(included in cost of sales) – Taseko
share |
87,148 |
83,374 |
74,438 |
75,806 |
69,920 |
Site operating costs –
100% basis |
99,598 |
95,285 |
95,838 |
101,075 |
93,226 |
Tons milled
(thousands) |
8,041 |
7,234 |
7,093 |
7,282 |
8,229 |
Site operating costs per
ton milled |
$12.39 |
$13.17 |
$13.54 |
$13.88 |
$11.33 |
1 Q1, Q2 and Q3
2023 includes the impact from the March 15, 2023 acquisition of
Cariboo from Sojitz, which increased the Company's Gibraltar mine
ownership from 75% to 87.5%. |
No regulatory authority has approved or disapproved of the
information in this news release.
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;
- the risk of inadequate insurance or inability to obtain
insurance to cover mining risks;
- the risk of loss of key employees; the risk of changes in
accounting policies and methods we use to report our financial
condition, including uncertainties associated with critical
accounting assumptions and estimates;
- environmental issues and liabilities associated with
mining including processing and stock piling ore; and
- labour strikes, work stoppages, or other interruptions
to, or difficulties in, the employment of labour in markets in
which we operate mines, or environmental hazards, industrial
accidents or other events or occurrences, including third party
interference that interrupt the production of minerals in our
mines.
For further information on Taseko, investors should review
the Company's annual Form 40-F filing with the United States
Securities and Exchange Commission www.sec.gov and home
jurisdiction filings that are available
at www.sedar.com.
Cautionary Statement on Forward-Looking
Information
This discussion includes certain statements that may be
deemed "forward-looking statements". All statements in this
discussion, other than statements of historical facts, that address
future production, reserve potential, exploration drilling,
exploitation activities, and events or developments that the
Company expects are forward-looking statements. Although we
believe the expectations expressed in such forward-looking
statements are based on reasonable assumptions, such statements are
not guarantees of future performance and actual results or
developments may differ materially from those in the
forward-looking statements. Factors that could cause actual
results to differ materially from those in forward-looking
statements include market prices, exploitation and exploration
successes, continued availability of capital and financing and
general economic, market or business conditions. Investors
are cautioned that any such statements are not guarantees of future
performance and actual results or developments may differ
materially from those projected in the forward-looking
statements. All of the forward-looking statements made in
this MD&A are qualified by these cautionary statements.
We disclaim any intention or obligation to update or revise any
forward-looking statements whether as a result of new information,
future events or otherwise, except to the extent required by
applicable law. Further information concerning risks and
uncertainties associated with these forward-looking statements and
our business may be found in our most recent Form 40-F/Annual
Information Form on file with the SEC and Canadian provincial
securities regulatory authorities.
For further information on Taseko, please see the
Company's website at www.tasekomines.com or contact: Brian Bergot, Vice President, Investor Relations
– 778-373-4554, toll free 1-800-667-2114