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Fourth Quarter & Full Year 2014 Results – Teck Resources Limited

Teck Resources Limited · Feb 12, 2015 · 23 slides

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Slides

  1. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 1
    Fourth Quarter & Full Year 2014 Results February 12, 2015
  2. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 2
    Controlling the Controllables Solid performance met or exceeded guidance - Record coal production - Record throughput at Antamina - Record zinc production at Red Dog Significantly reduced controllable operating costs and planned…
  3. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 3
    Overview - Full Year Results 2014 Results Revenues 8.6 Billion Gross profit 2.9 Billion (before depreciation & amortization) EBITDA 2.3 Billion Profit 362 Million (attributable to shareholders) Adjusted profit*…
  4. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 4
    Solid Delivery Against 2014 Guidance Original Guidance Actual Results Steelmaking Coal Coal production 2627 Mt 26.7 Mt Record coal production Coal site costs C55-60 /t C54 /t1 Coal transportation costs C38-42 /t C38 /t Combined…
  5. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 5
    Overview Quarterly Results Q4 2014 Results Revenues 2.3 Billion Gross profit 757 Million (before depreciation & amortization) EBITDA 582 Million Profit 129 Million (attributable to shareholders) Adjusted profit*…
  6. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 6
    Q4 2014 Operational Highlights Operations performed well - Record coal production overall, and at Elkview and Fording River - Zinc in concentrate and refined zinc production also up - Completed Pend Oreille restart under budget -…
  7. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 7
    Steelmaking Coal Quarterly Results Sales (Mt) Realized Price (C/tonne) Revenue (CM) 6.5 flat 6.5 149 123 963 824 Q4 2013 Q4 2014 Q4 2013 Q4 2014 Q4 2013 Q4 2014 Production (Mt) Unit Costs (C/tonne) Gross Profit1 (CM) 94 91…
  8. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 8
    Met Coal Market Rebalancing; Higher Prices in C Terms Coal Prices By Currency Argus FOB Australia 30 Mt cutbacks announced, slowly being implemented 160 150 Require additional cutbacks to AUS achieve market balance 140 /…
  9. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 9
    Copper Quarterly Results Sales (kt) Realized Price (US/lb) Revenue (CM) 3.26 99 2.98 86 762 656 Q4 2013 Q4 2014 Q4 2013 Q4 2014 Q4 2013 Q4 2014 Production (kt) Total Cash Unit Costs1 (US/lb) Gross Profit2 (CM) 105 1.69…
  10. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 10
    Copper Surplus Forecast Declining Wood Mackenzie Forecast Wood Mackenzie Forecast Refined Copper Surplus 2014 Refined Copper Surplus 2015 900 900 2014 Surplus: 2015 Surplus: 800 1.20% of global demand 800 1.39% of global demand…
  11. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 11
    Zinc Quarterly Results Zinc Sales (kt) Zinc Realized Price (US/lb) Revenue (CM) Conc1 Refined 1.04 179 73 flat 73 775 0.89 147 649 Q4 2013 Q4 2014 Q4 2013 Q4 2014 Q4 2013 Q4 2014 Q4 2013 Q4 2014 Zinc Production (kt) Lead…
  12. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 12
    Zinc Inventories Declining LME Zinc Stocks - 11 Years LME Zinc Stocks Since Dec 2012 120 250 1,400 1,200 1,200 100 200 1,100 1,000 80 thousand tonnes 1,000 thousand tonnes 150 800 60 US/lb US/lb 900 100…
  13. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 13
    Fort Hills Project Update River Water Intake Ore Prep Plant Robson Primary Admin Complex Lodge Separation Cells Primary Extraction Utilities & Cogen Secondary Extraction Column Flotation Bldg Tailings Construction…
  14. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 14
    Fort Hills Economics Robust1 70 WTI & 90 WTI & Fort Hills Free Cash Flow Yield4 Potential Contribution 0.80 0.90 from Fort Hills CAD/USD CAD/USD Sensitivity to WTI Price 25% Tecks share of annual production 13 Mbpa 13 Mbpa…
  15. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 15
    Significant Benefits from Low Oil Prices Low oil price benefits Teck overall in the near-term Reduces operating costs by hundreds of millions of dollars annually1 Accompanied weaker Canadian dollar improves EBITDA by hundreds of…
  16. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 16
    Cash Flow Cash Changes in Q4 2014 3000 +743 (420) 2500 (167) (50) +70 2,029 2000 1,853 Millions 1500 1000 500 0 Cash - start of quarter Cash flow from PP&E, incl. Fort Hills Capitalized stripping Debt interest &…
  17. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 17
    Pricing Adjustments Outstanding at Outstanding at December 31, 2014 September 30, 2014 Pounds (M) US/lb Pounds (M) US/lb Negative pricing adjustments Copper 208 2.86 224 3.04 of 70M in Q4 2014 Zinc 117 0.99 164 1.04 Driven by…
  18. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 18
    Strong Balance Sheet & Liquidity Liquidity of C5B, including C2B cash and unused US3B line of credit Investment Grade Rating 3,000 Debt-to-debt-plus-equity of 31% US300M of notes due to end of 2016 Weighted average maturity 14…
  19. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 19
    2015 Production & Site Cost Guidance Actual 2014 2015 Guidance Steelmaking Coal Coal production 26.7 Mt 26.5-27.5 Mt Coal site costs C54 /t1 C49-53 /t Coal transportation costs C38 /t C37-40 /t Combined coal costs C92 /t C86-93…
  20. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 20
    2015 Capital Expenditures Guidance Major New Mine Capitalized (M) Sustaining Enhancement Development Sub-total Stripping Total Coal 100 45 - 145 490 635 Copper 200 15 105 320 225 545 Zinc 180 - - 180 60 240 Energy - - 910 910 - 910…
  21. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 21
    Leverage to Strong Commodities Production Unit of Estimated Estimated Guidance1 Change Profit2 EBITDA2 Coal 27 Mt US1/tonne 21M / 1 32M / 1 Copper 350 kt US0.01/lb 5M / .01 8M / .01 Zinc 935 kt US0.01/lb 8M / .01 12M /…
  22. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 22
    Near-Term Priorities Controlling the controllables Focused on conserving cash Maintaining a strong financial position 23
  23. Fourth Quarter & Full Year 2014 Results – Teck Resources Limited – slide 23
    Fourth Quarter & Full Year 2014 Results February 12, 2015

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