Teck Resources (TECK) Q2 2024 earnings summary

Executive summary

• Completed sale of remaining 77% interest in steelmaking coal business (EVR) to Glencore for US$7.3 billion, transforming into a pure-play energy transition metals company focused on copper and zinc.

• Achieved record quarterly copper production of 110,400 tonnes, up 71% year-over-year, driven by Quebrada Blanca (QB) ramp-up and strong copper prices.

• Announced the largest cash return to shareholders in company history, including $3.5 billion in buybacks and dividends, and a $2.75 billion share buyback.

• High-potential incident frequency rate reduced by 46% year-over-year, reflecting improved safety performance.

• Advanced copper growth portfolio with permitting milestones for HVC Mine Life Extension and San Nicolás.

Financial highlights

• Q2 2024 revenue was $3.87 billion, up from $3.52 billion in Q2 2023; adjusted EBITDA was $1.7 billion, up 13% year-over-year.

• Gross profit before depreciation and amortization was $1.83 billion, flat year-over-year; gross profit was $1.2 billion, down 18% year-over-year.

• Returned $346 million to shareholders in Q2 2024, including $282 million in buybacks and $64 million in dividends.

• Net cash position of $8.7 billion as of July 2024, with $2.9 billion in notes outstanding.

• Cash flow from operations was $1.33 billion, up from $1.13 billion in Q2 2023.

Outlook and guidance

• 2024 copper production guidance revised to 435,000–500,000 tonnes (down from 465,000–540,000), with QB guidance reduced to 200,000–235,000 tonnes due to mine access issues.

• Copper net cash unit cost guidance updated to US$1.90–$2.30/lb; QB net cash unit cost guidance raised to US$2.25–$2.55/lb.

• Zinc production guidance unchanged at 565,000–630,000 tonnes; net cash unit cost guidance $0.55–$0.65/lb.

• Expect to reach full throughput rates at QB by year-end; production guidance for 2025–2027 unchanged.

• 2024 molybdenum production guidance revised to 4.3–5.5 thousand tonnes.