Teck Reports Unaudited Fourth Quarter Results for 201213-4-TR
February 7, 2013 / Download PDF

Download/view Q4 2012 Report (PDF) for the full text of this release.

Excerpt:

Vancouver, BC – Teck Resources Limited (TSX: TCK.A and TCK.B, NYSE: TCK, (“Teck”)) reported annual adjusted profit attributable to shareholders of $1.5 billion, or $2.60 per share, compared with a record $2.5 billion or $4.18 per share in 2011. Fourth quarter adjusted profit attributable to shareholders was $354 million, or $0.61 per share, compared with $613 million, or $1.04 per share, in the fourth quarter of 2011.

"From an operations perspective, 2012 was a good year," said Don Lindsay, President and CEO. “Our copper production was a record, we continued to increase our steelmaking coal production and we obtained new labour agreements for a number of our operations. However, due to uncertain global economic conditions, prices for all of our major products were down compared to last year, which resulted in lower earnings and cash flows than in 2011.”

Highlights and Significant Items

  • Gross profit before depreciation and amortization in 2012 was $4.0 billion compared with a record $5.8 billion in 2011. Gross profit before depreciation and amortization was $961 million in the fourth quarter compared with $1.4 billion in the fourth quarter of 2011.
  • Cash flow from operations, before working capital changes, was $3.2 billion in 2012 compared with a record $4.6 billion last year. Cash flow from operations, before working capital changes, was $722 million in the fourth quarter compared with $1.2 billion a year ago.
  • Profit attributable to shareholders was $811 million in 2012 compared with a record $2.7 billion in 2011. Profit attributable to shareholders was $145 million in the fourth quarter of 2012 compared with $637 million in the same period last year.
  • To date we have reached agreements with our coal customers to sell 6.0 million tonnes of coal in the first quarter of 2013 at an average price of US$159 per tonne. We expect to conclude additional sales over the course of the quarter.
  • Our cash balance was $2.9 billion as at February 6, 2013.
  • In 2012, we produced a record 373,000 tonnes of copper, including 103,000 tonnes in the fourth quarter.
  • We achieved significant cost reductions at our coal operations with site unit operating costs decreasing to $62 per tonne in the fourth quarter, down 17% compared with the first three quarters of 2012.
  • In December, we announced a 12.5% increase in the semi-annual dividend on our Class A common and Class B subordinate voting shares to $0.45 per share.
  • During the fourth quarter, we purchased for cancellation approximately 3.8 million Class B subordinate voting shares for $123 million pursuant to our normal course issuer bid announced in June 2012.
  • Union employees at Antamina ratified a new three-year labour agreement in November.
  • In November we redeemed the last of our high-yield notes. Following the redemption, the average coupon rate on our outstanding notes is 4.8% with an average term to maturity of 16.5 years.
  • On January 23, we were the top ranked Canadian company named to the Global 100 Most Sustainable Corporations for 2013 by media and investment research company Corporate Knights.

Download/view Q4 2012 Report (PDF) for the full text of this release.

Cautionary Statement on Forward-Looking Information

This news release contains certain forward-looking information and forward-looking statements as defined in applicable securities laws. All statements other than statements of historical fact are forward-looking statements. These forward-looking statements, principally under the heading “Outlook,” but also elsewhere in this document, include estimates, forecasts, and statements as to management’s expectations with respect to, among other things, anticipated costs and production at our business units and individual operations and expectation that we will meet our production guidance, sales volume and selling prices for our products (including settlement of coal contracts with customers), plans and expectations for our development projects, including resulting increases in forecast operating costs and costs of product sold, expected production, expected progress, costs and outcomes of our various projects and investments, including but not limited to those described in the discussions of our operations, the sensitivity of our profit to changes in commodity prices and exchange rates, the impact of potential production disruptions, the impact of currency exchange rates, future trends for the company, progress in development of mineral properties, increased coal and copper production as a result of our expansion plans, timing of completion, costs and results of our mill modernization program at Highland Valley Copper, 2013 production guidance for Quebrada Blanca, statements under the heading “Copper Development Projects,” including the expected resubmittal of the environment impact assessment for Quebrada Blanca Phase 2, the timing of the feasibility study and drilling for Relincho, our expectation that coal sales will not be impacted by greater use of shipping terminals other than Westshore terminals, our expectation that average train lengths will increase in 2013, the timing of permit approval, production and anticipated production levels from the Quintette coal mine, timing and results of the Neptune Bulk Terminals capacity expansions, the impact of measures to manage selenium discharges and costs and impacts related thereto, timing of construction of our new acid plant at Trail, the statements under the heading “Energy” regarding timing of sanction, production permitting decisions, timing of final supplemental information requests on our Frontier project and our responses the review process on Frontier thereto, anticipated capital expenditures and demand and market outlook for commodities. These forward-looking statements involve numerous assumptions, risks and uncertainties and actual results may vary materially.

These statements are based on a number of assumptions, including, but not limited to, assumptions regarding general business and economic conditions, the supply and demand for, deliveries of, and the level and volatility of prices of, zinc, copper and coal and other primary metals and minerals as well as oil, and related products, the timing of the receipt of regulatory and governmental approvals for our development projects and other operations, our costs of production and production and productivity levels, as well as those of our competitors, power prices, continuing availability of water and power resources for our operations, market competition, the accuracy of our reserve estimates (including with respect to size, grade and recoverability) and the geological, operational and price assumptions on which these are based, conditions in financial markets, the future financial performance of the company, our ability to attract and retain skilled staff, our ability to procure equipment and operating supplies, positive results from the studies on our expansion projects, our coal and other product inventories, our ability to secure adequate transportation for our products, our ability to obtain permits for our operations and expansions, our ongoing relations with our employees and business partners and joint venturers. Statements concerning our selenium management plan are based on the assumptions, and subject to the factors, described under “Selenium Management.” The foregoing list of assumptions is not exhaustive. Events or circumstances could cause actual results to vary materially.

Factors that may cause actual results to vary materially include, but are not limited to, changes in commodity and power prices, changes in market demand for our products, changes in interest and currency exchange rates, acts of foreign governments and the outcome of legal proceedings, inaccurate geological and metallurgical assumptions (including with respect to the size, grade and recoverability of mineral reserves and resources), unanticipated operational difficulties (including failure of plant, equipment or processes to operate in accordance with specifications or expectations, cost escalation, unavailability of materials and equipment, government action or delays in the receipt of government approvals, industrial disturbances or other job action, adverse weather conditions and unanticipated events related to health, safety and environmental matters), union labour disputes, political risk, social unrest, failure of customers or counterparties to perform their contractual obligations, changes in our credit ratings, unanticipated increases in costs to construct our development projects, difficulty in obtaining permits, inability to address concerns regarding permits of environmental impact assessments, and changes or further deterioration in general economic conditions. Our Fort Hills project is not controlled by us and construction, sanction and production schedules may be adjusted by our partner.

Statements concerning future production costs or volumes, and the sensitivity of the company’s profit to changes in commodity prices and exchange rates are based on numerous assumptions of management regarding operating matters and on assumptions that demand for products develops as anticipated, that customers and other counterparties perform their contractual obligations, that operating and capital plans will not be disrupted by issues such as mechanical failure, unavailability of parts and supplies, labour disturbances, interruption in transportation or utilities, adverse weather conditions, and that there are no material unanticipated variations in the cost of energy or supplies.

We assume no obligation to update forward-looking statements except as required under securities laws. Further information concerning risks and uncertainties associated with these forward-looking statements and our business can be found in our Annual Information Form for the year ended December 31, 2011, filed on SEDAR and on EDGAR under cover of Form 40-F.

Webcast

Teck will host an Investor Conference Call to discuss its Q4/2012 financial results at 11:00 AM Eastern time, 8:00 AM Pacific time, on Thursday, February 7, 2013. A live audio webcast of the conference call, together with supporting presentation slides, will be available at our website at www.teck.com. The webcast is also available at www.earnings.com. The webcast will be archived at www.teck.com

Download/view Q4 2012 Report (PDF) for the full text of this release.

Investor Contact:
Greg Waller
Vice President, Investor Relations and Strategic Analysis
604.699.4014
greg.waller@teck.com

Media Contact: 
Marcia Smith
Senior Vice President, Sustainability and External Affairs
604.699.4616
marcia.smith@teck.com