Teck Resources (TECK) Q4 2023 earnings summary

Executive summary

• 2023 priorities centered on operational excellence, QB ramp-up, copper growth, sustainability, and balancing investment with shareholder returns; quarterly copper production reached a record.

• Adjusted EBITDA was $6.4B for 2023; steelmaking coal production of 23.7 Mt exceeded guidance and the prior year.

Financial highlights

• Q4 2023 gross profit before D&A was $1.8B and gross profit was $1.2B; FY 2023 gross profit before D&A was $7.1B and gross profit was $5.1B.

• Q4 adjusted EBITDA was $1.7B vs. $630M in Q4 2022; profit from continuing operations before taxes was $694M.

• FY 2023 profit from continuing operations before taxes was $3.9B; adjusted diluted EPS was $5.15 and diluted EPS from continuing operations was $4.64.

• Q4 adjusted diluted EPS was $1.40; diluted EPS from continuing operations was $0.92.

Outlook and guidance

• Copper production guidance: 465–540 kt in 2024, 550–620 kt in 2025–2026, and 530–600 kt in 2027; 2024 net cash unit costs are US$1.85–2.25/lb.

• QB capital cost guidance remains US$8.6–8.8B; offshore port facilities targeted for completion by end-Q1 2024 and molybdenum plant ramp-up by end-Q2.

• Zinc-in-concentrate production guidance is 565–630 kt in 2024; Red Dog Q1 sales are expected at 70–85 kt. 2024 net cash unit costs are US$0.55–0.65/lb.

• Steelmaking coal production guidance is 24.0–26.0 Mt annually for 2024–2027; 2024 adjusted site cash cost of sales guidance is C$95–110/t.

• 2024 capital spending guidance is $3.6–4.4B, a decrease of ~ $1.2B from 2023; QB2 development spending falls as construction nears completion.