Teck Resources (TECK) Q3 2024 earnings summary

Executive summary

• Completed sale of steelmaking coal business, receiving $7.3 billion in proceeds and transitioning to a pure-play energy transition metals company focused on copper and zinc.

• Returned over $1.3 billion to shareholders year-to-date, including $720 million in Q3, through dividends and buybacks.

• Reduced debt by $1.5 billion, achieving a net cash position of $1.8 billion as of September 30, 2024.

• Achieved record copper production in Q3 2024, with QB ramp-up contributing significantly and Red Dog delivering higher zinc output year-over-year.

• Q3 2024 results impacted by a $1.1 billion pre-tax impairment charge at Trail Operations due to challenging zinc market conditions and a plant fire.

Financial highlights

• Adjusted EBITDA was $986 million, more than doubling year-over-year, and adjusted EPS from continuing operations was $0.61, up from $0.16 in Q3 2023.

• Gross profit before depreciation and amortization from copper segment more than doubled to $604 million year-over-year.

• Zinc segment gross profit before depreciation and amortization rose 49% to $358 million year-over-year.

• Reported a non-cash after-tax impairment charge of $828 million ($1.1 billion pre-tax) on Trail Operations.

• Revenue rose to $2,858 million in Q3 2024 from $1,989 million in Q3 2023.

Outlook and guidance

• 2024 copper production guidance lowered to 420-455 thousand tonnes (from 435-500 thousand), and molybdenum to 3-4 thousand tonnes (from 4.3-5.5 thousand).

• QB copper production guidance for 2024 narrowed to 200-210 thousand tonnes and for 2025 to 240-280 thousand tonnes.

• Improved full-year zinc net cash unit cost guidance to $0.45-$0.55/lb, and refined zinc production guidance for Trail lowered to 240-250 thousand tonnes due to a plant fire.

• No change to Red Dog production guidance; strong operational performance expected to continue.