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Mar 31, 2024
TKO Q1 2024 Earnings Report
Taseko reported strong first quarter 2024 results with significant increases in Adjusted EBITDA and earnings from mining operations, driven by the acquisition of the remaining 12.5% interest in Gibraltar Mine and favorable copper prices.
Key Takeaways
Taseko Mines Limited reported a strong first quarter in 2024, with Adjusted EBITDA reaching $50 million and earnings from mining operations before depletion and amortization at $53 million, marking significant increases from the previous year. Revenues for the quarter were $147 million, and net income was $19 million. The company also completed the acquisition of the remaining 12.5% interest in the Gibraltar Mine, achieving 100% ownership, and advanced construction at the Florence Copper project.
Adjusted EBITDA for Q1 2024 was $49.9 million, a 38% increase compared to Q1 2023.
Net income for the quarter was $18.9 million, or $0.07 per share.
Gibraltar Mine produced 29.7 million pounds of copper and sold 31.7 million pounds at an average realized price of US$3.89 per pound.
Taseko acquired the remaining 12.5% interest in Gibraltar Mine, achieving 100% ownership, and refinanced senior secured notes, pushing maturity to 2030.
TKO
TKO
Forward Guidance
Taseko expects total copper production at Gibraltar for 2024 to be approximately 115 million pounds. The company is also finalizing its insurance claim for property damage and business interruption related to the Concentrator #2 component failure, and expects off-property costs to reduce from the second half of 2024 through 2026 due to new offtake contracts.
Positive Outlook
- Total copper production at Gibraltar for 2024 is expected to be approximately 115 million pounds.
- Off-property costs are expected to reduce by approximately US$0.10 to US$0.20 per pound from the second half of 2024 through 2026 due to fixed, lower TCRCs from recently awarded offtake contracts.
- The company has copper put contracts to secure a minimum copper price of US$3.25 per pound for 21 million pounds of copper covering Q2 2024, and collar contracts for H2 2024 and 2025.
- Construction of the commercial production facility at Florence Copper is progressing smoothly, with first copper production expected in Q4 2025.
- The company considers the construction of Florence Copper to be fully funded, with remaining project costs funded by available liquidity, Mitsui installments, and cashflow from Gibraltar.
Challenges Ahead
- Concentrator #1 is scheduled for three weeks additional downtime in Q2 2024 for in-pit crusher relocation and other mill maintenance.
- The estimated remaining capital cost of the crusher relocation project is $10 million.
- The dialogue process for the New Prosperity Gold-Copper Project, while making meaningful progress, is not yet complete.
- Uncertainties related to unexpected judicial or regulatory proceedings could impact future operations.
- Changes in laws, regulations, and government policies affecting exploration and development activities and mining operations could have adverse effects.