Teck Resources Ltd

Ladies and gentlemen, thank you for standing by. Welcome to TECC's fourth quarter 2023 earnings release conference call. At this time, all participants are in listen-only mode. Later, we will conduct a question and answer session. To join the question queue, please press star, then one on your touchtone phone. Should anyone need assistance during the conference call, they may signal an operator by pressing star, then zero on their telephone. This conference call is being recorded on Thursday, February 22nd, 2024. I would now like to turn the conference call over to Fraser Phillips, Senior Vice President, Investor Relations and Strategic Analysis. Please go ahead.

Thanks, Ariel. Good morning, everyone. Thank you for joining us for TechSports Quarter 2023 conference call. Please note today's call contains forward-looking statements, various risks and uncertainties, may cause actual results to vary. Tech does not assume the obligation to update any forward-looking statements. Please refer to slide two for the assumptions underlying our forward-looking statements. In addition, we will reference various non-GAAP measures throughout this call. Explanations and reconciliations regarding these measures can be found in our MD&A and the latest press release on our website. Jonathan Price, our CEO, will begin today's call with highlights from our fourth quarter and full year results. Crystal Presta, our CFO, will follow up with additional color on the quarter. Jonathan will then conclude today's session with a brief update on our key priorities and proper growth strategy, which will be followed by a Q&A session. With that, I will turn the call over to Jonathan.

Thank you, Fraser, and good morning, everyone. So starting on slide four, we had a strong fourth quarter performance across our business. we advanced the ramp-up of our QB operation, resulting in tech's highest-ever quarterly copper production. Adjusted EBITDA of $1.7 billion in Q4 and $6.4 billion for the year reflects robust prices for steelmaking coal and copper, as well as high-end steelmaking coal sales volumes. Over the course of the year, strong profitability allowed us to return a total of $765 million to shareholders, by paying $515 million in dividends and completing $250 million in share buybacks, while continuing to strengthen our balance sheet through the repayment of U.S. $294 million of the QB2 project finance facility. In addition, the Board has approved the payment of our quarterly base dividend of 12.5 cents per share on March 28th, and following the receipt of U.S. $1.3 billion in proceeds on closing a minority sales stake in our steel-making coal business to Nippon Steel in January, the board has authorized up to a $500 million share buyback. This extends our track record of strong cash returns to shareholders with nearly $4 billion returns through the last five years. Now, turning to our 2023 highlights on slide five, 2023 was a transformational year for tech. as we continue to advance each of the four pillars of our value creation strategy. In addition to the strong EBITDA we delivered, we reported higher copper production and sales than the previous year, driven by the addition of QB operations. We also produced 23.7 million tonnes of steel-making coal, above guidance and higher than the previous year. As we progress the full sale of the steelmaking co-op business, we were pleased to announce the closing of the sale of a minority interest in EVR to Nippon Steel and POSCO on January 3rd. We progressed the ramp up of our QV operations and advanced the path to value for our industry-leading copper growth pipeline through joint partnerships with San Nicolas and Durage Copper Nickel and the receipt of regulatory approval for Zafran Al. As mentioned earlier, we returned significant cash to shareholders in 2023, paying $515 million in dividends, as well as completing the $250 million share buyback, acting opportunistically to utilize available free cash flow. Importantly, we have maintained a strong financial position with $7.9 billion of liquidity, including $2.5 billion in cash as of February 21st. We continue to strive for sustainability leadership and make steady progress against our sustainability goals. Our reported high potential incident frequency for the full year 2023 remained low at a rate of 0.14. We've made a significant move in modernizing our governance structure by introducing the sunset clause for the dual-class share structure. We're proud that all tech-operated base metals operations have been awarded the copper mark or the zinc mark, and we've been named to the S&P Dow Jones Sustainability Index for the 14th consecutive year. Returning to QB on slide six, we remain focused on achieving reliable and consistent operations at QB. However, production was lower than planned in the fourth quarter. routine ramp-up activities continued along with planned maintenance shutdowns through the first quarter and we have had multiple periods of operating at or above design throughput capacity throughout 2024 we expect to see progressively stronger production from qb and expect full year copper and concentrate production to be between 230 and 275 000 tons On the construction site, by the end of 2023, the molybdenum plant was substantially complete and commissioning it currently well underway. All in waterworks at the port have been successfully concluded, materially de-risking our remaining construction. We are on track to finalize the construction of the offshore facilities at the port by the end of the first quarter and ramp up of the moly plant is expected to be completed by the end of the second quarter. As we look ahead, our QB2 product capital guidance of US $8.6 to $8.8 billion remains in place. Our guidance for QB net cash costs is US $1.95 to $2.25 per pound in 2024. QB unit costs are expected to remain elevated this year, particularly in the first half, and this is driven by the cost of alternative logistics, no molybdenum production in the first quarter as the plant is being commissioned, continued ramp-up and inflationary pressures, including increased Chilean energy costs. We will provide additional unit cost guidance when QB achieves steady state operational performance. And I will now hand it over to Crystal for additional color on the board.