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
volumes stated in this release are on a 100% basis unless otherwise
indicated.
VANCOUVER, Feb. 22, 2017 /CNW/ - Taseko Mines Limited
(TSX: TKO; NYSE MKT: TGB) ("Taseko" or the "Company") reports
financial results for 2016. For the three months ended December 31, 2016 Taseko had net income of
$5.1 million or $0.02 per share, and adjusted net income of
$16.4 million or $0.07 per share.
Russell Hallbauer, President and
CEO of Taseko, commented, "The $49.7
million of cash flow from operations in the fourth quarter
demonstrates the cash generating ability of Gibraltar, even at a copper price well below
the current price. Site spending has remained consistent over the
past eight quarters and the impact of increased metal production on
unit costs was immediate and contributed to a US$0.46 per pound decline in site operating
costs, from the third quarter, to US$1.12 per pound. Site costs also
benefitted from a full quarter of molybdenum production and the
associated by-product credit from molybdenum sales. These
factors, combined with moderately higher off property costs this
quarter, resulted in total operating costs (C1)* of US$1.48 per pound. We expect site spending to
remain stable throughout 2017."
Mr. Hallbauer added, "During the quarter, the copper price
rallied to roughly US$2.50 per pound
from the US$2.00 to US$2.20 where it
traded for most of 2016. Our realized sales price in the fourth
quarter, excluding the positive impact from prior-period pricing
adjustments, was US$2.47 per pound.
In a period of a few months, our operating margin increased from
US$0.26 per pound to over
US$1.00 (C$1.31) per pound. Since year end, the price of
copper has continued to climb, averaging US$2.65 year-to-date, and this will further
improve our operating margin."
"The strong finish to 2016, after another challenging year for
the copper sector, and the positive momentum so far in 2017 is very
exciting for the Company. With the general market sentiment that
higher prices should remain in 2017, combined with Gibraltar's higher production and lower costs,
we expect a very successful year ahead. With our improved balance
sheet today plus increased cash flows we expect in 2017 we will be
in a strong position to address our debt obligations, well in
advance of the 2019 maturity dates," concluded Mr. Hallbauer.
Fourth Quarter 2016 Highlights
- Earnings from mining operations before depletion and
amortization* were $46.6 million,
compared to $2.2 million in the same
period 2015;
- For the fourth quarter, adjusted EBITDA was $44.5 million and cash flow from operations was
$49.7 million;
- The Company's cash balance at the end of 2016 was $89.0 million;
- Net earnings were $5.1 million or
$0.02 per share, compared to a loss
of $23.4 million, or ($0.11) loss per share, in the same quarter
2015;
- Site operating costs, net of by-product credits* were
US$1.12 per pound produced and total
operating costs (C1)* were US$1.48
per pound produced, down 26% and 20%, respectively, from the fourth
quarter of 2015;
- Site operating cost per ton milled* was $9.13, a fifth consecutive quarter below the
$10 internal benchmark cost due to a
continued focus on spending and operational efficiencies;
- Copper production at Gibraltar
was 40.7 million pounds (100% basis), an increase of 23% over the
same period 2015. The Gibraltar
molybdenum facility, which was restarted in September, produced 800
thousand pounds of molybdenum;
- Total sales for the quarter were 40.4 million pounds of copper
and 800,000 pounds of molybdenum;
- In December, the United States Environmental Protection Agency
(EPA) issued the final required permit, the Underground Injection
Control (UIC) permit, to construct and operate the Phase 1 Test
Facility at Taseko's Florence Copper Project in Florence, Arizona; and
- For the third straight year (2016), Gibraltar has received the John Ash Safety
Award presented by the Ministry of Energy and Mines. This
prestigious award goes to the mining operation in British Columbia with the lowest
injury-frequency rate that has worked at least one million hours
during the year.
*Non-GAAP performance
measure. See end of news release.
|
HIGHLIGHTS
Financial
Data
|
Three months
ended
December 31,
|
Year ended
December 31,
|
(Cdn$ in thousands,
except for per share amounts)
|
2016
|
2015
|
Change
|
2016
|
2015
|
Change
|
Revenues
|
94,628
|
61,412
|
33,216
|
263,865
|
289,298
|
(25,433)
|
Earnings from mining
operations before depletion and amortization*
|
46,617
|
2,155
|
44,462
|
54,715
|
50,834
|
3,881
|
Earnings (loss) from
mining operations
|
37,393
|
(10,674)
|
48,067
|
1,776
|
1,320
|
456
|
Net income
(loss)
|
5,113
|
(23,441)
|
28,554
|
(31,396)
|
(62,352)
|
30,956
|
|
Per share - basic
("EPS")
|
0.02
|
(0.10)
|
0.12
|
(0.14)
|
(0.28)
|
0.14
|
Adjusted net income
(loss)*
|
16,404
|
(13,112)
|
29,516
|
(31,860)
|
(15,531)
|
(16,329)
|
|
Per share - basic
("adjusted
EPS")*
|
0.07
|
(0.06)
|
0.13
|
(0.14)
|
(0.08)
|
(0.06)
|
EBITDA*
|
32,312
|
(9,162)
|
41,474
|
39,520
|
8,196
|
31,324
|
Adjusted
EBITDA*
|
44,477
|
1,415
|
43,062
|
41,628
|
55,555
|
(13,927)
|
Cash flows provided
by operations
|
49,663
|
1,859
|
47,804
|
33,853
|
51,695
|
(17,842)
|
|
|
|
|
|
|
|
|
|
Operating Data
(Gibraltar - 100% basis)
|
Three months
ended
December 31,
|
Year ended
December 31,
|
|
2016
|
2015
|
Change
|
2016
|
2015
|
Change
|
Tons mined
(millions)
|
18.5
|
21.3
|
(2.8)
|
87.6
|
93.7
|
(6.1)
|
Tons milled
(millions)
|
7.3
|
7.3
|
-
|
29.5
|
30.6
|
(1.1)
|
Production (million
pounds Cu)
|
40.7
|
33.1
|
7.6
|
133.3
|
142.2
|
(8.9)
|
Sales (million pounds
Cu)
|
40.4
|
33.7
|
6.7
|
131.1
|
142.5
|
(11.4)
|
*Non-GAAP performance
measure. See end of news release.
|
REVIEW OF OPERATIONS
Gibraltar mine (75%
Owned)
|
|
|
|
|
|
|
|
Operating Data
(100% basis)
|
Q4
2016
|
Q3
2016
|
Q2
2016
|
Q1
2016
|
Q4
2015
|
YE
2016
|
YE
2015
|
Tons mined
(millions)
|
18.5
|
21.5
|
26.2
|
21.5
|
21.3
|
87.6
|
93.7
|
Tons milled
(millions)
|
7.3
|
7.4
|
7.2
|
7.5
|
7.3
|
29.5
|
30.6
|
Strip
ratio
|
1.1
|
1.0
|
2.4
|
1.7
|
2.4
|
1.5
|
2.4
|
Site operating cost
per ton milled (CAD$)
|
$9.13
|
$9.47
|
$9.67
|
$9.59
|
$9.41
|
$9.47
|
$9.83
|
Copper
concentrate
|
|
|
|
|
|
|
|
|
Grade (%)
|
0.319
|
0.259
|
0.252
|
0.228
|
0.269
|
0.264
|
0.272
|
|
Recovery
(%)
|
87.0
|
85.9
|
84.1
|
84.4
|
84.9
|
85.5
|
85.1
|
|
Production (million
pounds Cu)
|
40.7
|
33.1
|
30.6
|
28.8
|
33.1
|
133.2
|
141.2
|
|
Sales (million pounds
Cu)
|
40.4
|
29.8
|
30.3
|
30.5
|
33.7
|
131.1
|
141.4
|
|
Inventory (million
pounds Cu)
|
5.6
|
5.4
|
2.1
|
1.9
|
3.4
|
5.6
|
3.4
|
Molybdenum
concentrate
|
|
|
|
|
|
|
|
|
Production (thousand
pounds Mo)
|
764
|
185
|
-
|
-
|
-
|
949
|
963
|
|
Sales (thousand
pounds Mo)
|
798
|
105
|
-
|
-
|
-
|
903
|
1,003
|
Silver (in copper
concentrate)
|
|
|
|
|
|
|
|
|
Sales (thousand ozs
Ag)
|
77
|
56
|
59
|
57
|
63
|
249
|
293
|
Per unit data (US$
per pound)*
|
|
|
|
|
|
|
|
|
Site operating
costs*
|
$1.23
|
$1.64
|
$1.77
|
$1.81
|
$1.55
|
$1.58
|
$1.65
|
|
By-product
credits*
|
(0.11)
|
(0.06)
|
(0.03)
|
(0.03)
|
(0.03)
|
(0.06)
|
(0.06)
|
Site operating, net
of by-product credits*
|
$1.12
|
$1.58
|
$1.74
|
$1.78
|
$1.52
|
$1.52
|
$1.59
|
Off-property
costs
|
0.36
|
0.31
|
0.33
|
0.33
|
0.33
|
0.33
|
0.37
|
Total operating costs
(C1)*
|
$1.48
|
$1.89
|
$2.07
|
$2.11
|
$1.85
|
$1.85
|
$1.96
|
*Non-GAAP performance
measure. See end of news release.
|
OPERATIONS ANALYSIS
Fourth quarter results
Despite challenging weather conditions in the fourth quarter,
Gibraltar mill throughput was 7.3
million tons of ore, a similar amount to the previous quarters in
2016. A total of 18.5 million tons were mined during the
quarter, at a strip ratio of 1.1. A total of 2.4 million tons
of ore was added to stockpile in the period. In addition, the
copper head grade for the fourth quarter increased to 0.32%,
slightly better than planned.
Copper recovery also increased to 87% compared to 86% in the
previous quarter, as a result of higher head grade and continued
improvements in operating practices. The higher head grades and
recoveries resulted in copper production of 41 million pounds for
the fourth quarter, a 23% increase over the third quarter of
2016.
The fourth quarter was the first full quarter that the
molybdenum plant has operated since it was restarted in
September. A total of 0.8 million pounds of molybdenum were
produced in the quarter, with recoveries averaging approximately
50%.
The total site spending has been maintained at a consistent and
low level in recent quarters. Site operating cost per ton
milled* was $9.13 in the fourth
quarter of 2016, which is lower than recent quarters due to
increased capitalized stripping.
Site operating costs per pound produced* decreased to
US$1.12 in the fourth quarter of 2016
from US$1.58 in the third quarter of
2016 primarily as a result of increased copper production.
The higher molybdenum by-product credit and increase in capitalized
stripping allocation also contributed to the lower unit cost in the
fourth quarter.
Off-property costs were US$0.36
per pound for the fourth quarter of 2016, which is higher than
recent quarters as a higher portion of shipments were made to the
Company's joint venture partner at benchmark terms, as opposed to
Gibraltar's normal treatment and
refining costs which are lower than benchmark terms.
Total operating costs (C1) per pound* decreased to US$1.48 from US$1.89 in the third quarter of 2016 as a result
of increased copper production.
Full-year results
Gibraltar's copper production
in 2016 was 133 million pounds, a 6% decrease over 2015 due to
lower average head grade and mill throughput.
Site operating costs* for the year were US$1.58 per pound of copper produced, a 4%
reduction from 2015, as the Company realized a full year of benefit
from the cost saving initiatives implemented in the prior
year. These initiatives included a mine optimization based on
a new mine plan, workforce reduction and rationalization, and
vendor engagement resulting in decreased cost of supplies and
services. The benefit of these cost savings resulted in lower
unit costs in 2016, even though copper production was 6% lower than
the previous year.
Off property costs were US$0.33
per pound of copper produced, an 11% reduction over 2015 as a
result of new long-term contracts for treatment and refining costs
and ocean freight.
Total operating costs (C1)* fell to US$1.85 per pound for the year, compared to
US$1.96 per pound in 2015.
*Non-GAAP performance
measure. See end of news release.
|
Health and Safety Milestones
The health, safety, and well-being of our employees, contractors
and their families is a priority for Taseko and Gibraltar management. Actual performance is a
reflection of that commitment.
For the third straight year (2016), Gibraltar has received the John Ash Safety
Award presented by the Ministry of Energy and Mines. This
prestigious award goes to the mining operation in British Columbia with the lowest
injury-frequency rate that has worked at least one million hours
during the year.
TSM Initiatives
Taseko is a member of the Mining Association of Canada and the Mining Association of
British Columbia. Both of these
organizations require members to participate in a program known as
Towards Sustainable Mining ("TSM") which encourages companies to
work towards best management practice standards through
self-regulation and reporting on key performance areas. These areas
include:
- Energy Use and Greenhouse Gas Emissions Management;
- Biological Diversity Conservation Management;
- Aboriginal and Community Outreach;
- Tailings Management;
- Health and Safety; and
- Crisis Management Planning.
- Taseko and Gibraltar's
performance and reporting on performance in all of the areas was
verified by an external auditor as being at a level of industry
best practice. Further details can be found on the Taseko
website.
GIBRALTAR
OUTLOOK
Average head grade is expected to be approximately 0.30% in
2017.
Overall, Gibraltar has achieved
a stable level of operations consistent with the updated reserve
model published in 2015 and the Company continues to focus on
further improvements to operating practices to reduce unit costs.
During September 2016, the molybdenum
circuit at Gibraltar was
successfully restarted, and will continue to contribute by-product
credits in future periods.
The Canadian dollar is expected to remain at a substantial
discount to the US dollar. A weak Canadian dollar contributes to
improved operating margins at Gibraltar as approximately 80% of mine
operating costs are paid in Canadian dollars.
REVIEW OF PROJECTS
Taseko's strategy has been to grow the Company by leveraging
cash flow from the Gibraltar Mine to assemble and develop a
pipeline of projects. We continue to believe this will generate the
best, long-term returns for shareholders. Our development projects
are located in British Columbia
and Arizona and represent a
diverse range of metals, including gold, copper and niobium. Total
expenditures on projects in 2016 consisted of $5.0 million at the Florence Copper project,
$1.7 million on New Prosperity, and
$0.8 million on the Aley Project.
Taseko will continue to take a prudent approach to spending on
development projects.
Florence Copper Project
The Florence Copper project is currently in the final stages of
permitting for the Production Test Facility ("PTF"). The PTF will
include a well field comprised of thirteen (four injection and nine
recovery) commercial scale production wells and numerous
monitoring, observation and point of compliance wells, and also an
integrated demonstration scale solvent extraction and
electrowinning plant.
During 2016, the Company worked with the Arizona Department of
Environmental Quality ("ADEQ") in connection with the amendment to
the Temporary Aquifer Protection Permit ("APP"), and with the U.S.
Environmental Protection Agency ("EPA") in connection with the
Underground Injection Control ("UIC") permit.
On August 2, 2016, the Company
announced the receipt from the ADEQ of the APP permit. This permit
was issued following a public comment period earlier in 2016, and
confirms the ADEQ has completed its substantive review and is
satisfied with the conditions under which the PTF can operate. In
December 2016, the EPA issued the
final required permit, the UIC permit, to construct and operate the
PTF. Opposing parties have appealed both the APP and the UIC
permits granted, but we expect that the regulatory authorities will
successfully defend their thorough processes. Both of these
two permits are required for construction and operation of the
PTF.
On January 16, 2017, the Company
announced that completed technical work on the Florence Copper
Project has resulted in a significant improvement in project
economics. The NI 43-101 technical report documenting these results
will be filed on www.sedar.com within 45 days.
Project Highlights:
- Pre-tax net present value of US$920
million at a 7.5% discount rate;
- Pre-tax internal rate of return of 44% with a 2.3 year
payback;
- Operating costs of US$1.10 per
pound LME grade cathode copper;
- Total life of mine production in excess of 1.7 billion pounds
of copper;
- Average annual production of 81 million pounds of copper for
the life of mine;
- 21 year mine life;
- Total pre-production capital cost of US$200 million; and
- Long-term copper price of US$3.00
per pound.
*Non-GAAP performance
measure. See end of news release.
|
New Prosperity Project
The two Judicial Reviews initiated by Taseko were heard in
federal court over a five day period in the week of January 30, 2017. Both Judicial Reviews
focus on the principles of administrative and procedural
fairness. Taseko's allegation is that the Government of
Canada, through the conduct of the
environmental assessment and the decisions which resulted from it,
failed in their obligation to uphold those fundamental principles.
A decision is expected from the court within six to nine
months.
On February 12, 2016, Taseko
announced that it had filed a civil claim in the BC Supreme Court
against the Canadian federal government. The claim seeks damages in
relation to the February 25, 2014
decision concerning the New Prosperity Project in that the
Government of Canada and its
agents failed to meet the legal duties that were owed to Taseko and
that in doing so they caused and continue to cause damages,
expenses and loss to Taseko.
Taseko is proceeding with its request to amend the British Columbia environmental assessment
certificate for the New Prosperity Project. In addition, Taseko has
filed a Notice of Work ("NOW") with the Ministry of Energy &
Mines which will allow the Company to gather information to advance
mine permitting under the British Columbia Mines Act.
The Company will host
a telephone conference call and live webcast on Thursday, February
23, 2017 at 11:00 a.m. Eastern Time (8:00 a.m. Pacific) to discuss
these results. The conference call may be accessed by dialing
(877) 303-9079 in Canada and the United States, or (970) 315-0461
internationally.
The conference call will be archived for later playback until March
2, 2017 and can be accessed by dialing (855) 859-2056 in Canada and
the United States, or (404) 537-3406 internationally and using the
passcode 69507435.
|
Russell Hallbauer
President and 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. Site operating costs is calculated
by removing net changes in inventory and depletion and amortization
and transportation costs from cost of sales. Site operating costs,
net of by-product credits is calculated by removing 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.
|
|
|
|
Three months
ended
December 31,
|
Year ended
December 31,
|
(Cdn$ in thousands,
unless otherwise indicated) – 75% basis
|
2016
|
2015
|
2016
|
2015
|
Cost of
sales
|
57,235
|
72,086
|
262,089
|
287,978
|
Less:
|
|
|
|
|
|
Depletion and
amortization
|
(9,224)
|
(12,829)
|
(52,939)
|
(49,514)
|
|
Net change in
inventory
|
7,582
|
(4,216)
|
16,738
|
3,971
|
|
Transportation
costs
|
(5,358)
|
(3,858)
|
(16,507)
|
(17,129)
|
Site operating
costs
|
50,235
|
51,183
|
209,381
|
225,306
|
Less by-product
credits:
|
|
|
|
|
|
Molybdenum
|
(3,689)
|
78
|
(4,400)
|
(5,036)
|
|
Silver
|
(1,018)
|
(1,046)
|
(3,988)
|
(3,795)
|
Site operating costs,
net of by-product credits
|
45,528
|
50,215
|
200,993
|
216,475
|
Total copper produced
(thousand pounds)
|
30,512
|
24,824
|
99,938
|
106,664
|
Total costs per pound
produced
|
1.49
|
2.02
|
2.01
|
2.03
|
Average exchange rate
for the period (CAD/USD)
|
1.33
|
1.34
|
1.32
|
1.28
|
Site operating
costs, net of by-product credits
(US$
per pound)
|
1.12
|
1.52
|
1.52
|
1.59
|
Site operating costs,
net of by-product credits
|
45,528
|
50,215
|
200,993
|
216,475
|
Add off-property
costs:
|
|
|
|
|
Treatment and
refining costs
|
9,454
|
6,935
|
27,924
|
33,634
|
|
Transportation
costs
|
5,358
|
3,858
|
16,507
|
17,129
|
|
Total operating
costs
|
60,340
|
61,008
|
245,424
|
267,238
|
Total operating
costs (C1) (US$ per pound)
|
1.48
|
1.85
|
1.85
|
1.96
|
Adjusted net earnings (loss)
Adjusted net earnings (loss) remove the effect of the following
transactions from net earnings as reported under IFRS:
- Unrealized gains/losses on derivative instruments;
- Unrealized foreign currency gains/losses; and
- Non-recurring transactions, including related tax
adjustments.
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.
|
|
|
|
Three months
ended
December 31,
|
Year ended
December 31,
|
($ in thousands,
except per share amounts)
|
2016
|
2015
|
2016
|
2015
|
Net income
(loss)
|
5,113
|
(23,441)
|
(31,396)
|
(62,352)
|
|
Unrealized (gain)
loss on derivatives
|
3,363
|
954
|
4,404
|
3,131
|
|
Unrealized foreign
exchange (gain) loss
|
8,802
|
9,623
|
(7,785)
|
43,809
|
|
Write-down of
marketable securities
|
-
|
-
|
-
|
419
|
|
Other non-recurring
expenses*
|
-
|
-
|
5,489
|
-
|
|
Estimated tax effect
of adjustments
|
(874)
|
(248)
|
(2,572)
|
(538)
|
Adjusted net
income (loss)
|
16,404
|
(13,112)
|
(31,860)
|
(15,531)
|
Adjusted
EPS
|
0.07
|
(0.06)
|
(0.14)
|
(0.08)
|
* Other non-recurring
expenses includes legal and other advisory costs associated with
the special shareholder meeting, the proxy contest and related
litigation, and other non-recurring financing costs.
|
EBITDA and adjusted EBITDA
EBITDA represents net earnings before interest, income taxes,
and depreciation. EBITDA is presented because it is an important
supplemental measure of our performance and is frequently used by
securities analysts, investors and other interested parties in the
evaluation of companies in the industry, many of which present
EBITDA when reporting their results. Issuers of "high yield"
securities also present EBITDA because investors, analysts and
rating agencies consider it useful in measuring the ability of
those issuers to meet debt service obligations. The Company
believes EBITDA is an appropriate supplemental measure of debt
service capacity, because cash expenditures on interest are, by
definition, available to pay interest, and tax expense is inversely
correlated to interest expense because tax expense goes down as
deductible interest expense goes up; depreciation is a non-cash
charge.
Adjusted EBITDA is presented as a further supplemental measure
of the Company's performance and ability to service debt. Adjusted
EBITDA is prepared by adjusting EBITDA to eliminate the impact of a
number of items that are not considered indicative of ongoing
operating performance.
Adjusted EBITDA is calculated by adding to EBITDA certain items
of expense and deducting from EBITDA certain items of income that
are not likely to recur or are not indicative of the Company's
future operating performance consisting of:
- Unrealized gains/losses on derivative instruments;
- Unrealized foreign exchange gains/losses; and
- Non-recurring transactions.
*Non-GAAP performance
measure. See end of news release.
|
While some of the adjustments are recurring, other non-recurring
expenses do not reflect the underlying performance of the Company's
core mining business and are not necessarily indicative of future
results. Furthermore, unrealized gains/losses on derivative
instruments, foreign currency translation gains/losses and changes
in the fair value of financial instruments are not necessarily
reflective of the underlying operating results for the reporting
periods presented.
|
|
|
|
Three months
ended
December 31,
|
Year ended
December 31,
|
($ in thousands,
except per share amounts)
|
2016
|
2015
|
2016
|
2015
|
Net income
(loss)
|
5,113
|
(23,441)
|
(31,396)
|
(62,352)
|
Add:
|
|
|
|
|
|
Depletion and
amortization
|
9,225
|
12,848
|
53,024
|
49,599
|
|
Share-based
compensation expense
|
1,382
|
359
|
3,682
|
2,002
|
|
Finance
expense
|
8,028
|
6,433
|
30,007
|
25,923
|
|
Finance
income
|
(297)
|
(257)
|
(1,084)
|
(1,371)
|
|
Income tax expense
(recovery)
|
8,861
|
(5,104)
|
(14,713)
|
(5,605)
|
EBITDA
|
32,312
|
(9,162)
|
39,520
|
8,196
|
Adjustments:
|
|
|
|
|
|
Unrealized loss on
derivative instruments
|
3,363
|
954
|
4,404
|
3,131
|
|
Unrealized foreign
exchange (gain) loss
|
8,802
|
9,623
|
(7,785)
|
43,809
|
|
Write-down of
marketable securities
|
-
|
-
|
-
|
419
|
|
Other non-recurring
expenses*
|
-
|
-
|
5,489
|
-
|
Adjusted
EBITDA
|
44,477
|
1,415
|
41,628
|
55,555
|
* Other non-recurring
expenses includes legal and other advisory costs associated with
the special shareholder meeting, the proxy contest and related
litigation, and other non-recurring financing costs.
|
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
December 31,
|
Year ended
December 31,
|
(Cdn$ in thousands,
except per share amounts)
|
2016
|
2015
|
2016
|
2015
|
Earnings (loss)
from mining operations
|
37,393
|
(10,674)
|
1,776
|
1,320
|
Add:
|
|
|
|
|
|
Depletion and
amortization
|
9,224
|
12,829
|
52,939
|
49,514
|
Earnings from
mining operations before depletion and amortization
|
46,617
|
2,155
|
54,715
|
50,834
|
Site operating costs per ton milled
|
|
|
|
Three months
ended
December 31,
|
Year ended
December 31,
|
(Cdn$ in thousands,
except per share amounts)
|
2016
|
2015
|
2016
|
2015
|
Site operating
costs (included in cost of sales)
|
50,235
|
51,183
|
209,381
|
225,306
|
|
|
|
|
|
Tons milled
(millions) (75% basis)
|
5.50
|
5.44
|
22.11
|
22.91
|
Site operating
costs per ton milled
|
$9.13
|
$9.41
|
$9.47
|
$9.83
|
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 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 our ability to complete the mill
upgrade on time estimated and at the scheduled cost;
- 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.
SOURCE Taseko Mines Limited