NYSE: TC
TSX: TCM, TCM.WT
Frankfurt: A6R
TORONTO, Aug. 5 /PRNewswire-FirstCall/ - Thompson Creek
Metals Company Inc. ("Company" or "TCM"), one of the world's
largest publicly traded, pure molybdenum producers, today announced
financial results for the three and six months ended June 30, 2010 prepared in accordance with
United States generally accepted
accounting principles ("US GAAP"). All dollar amounts are in
United States ("US") dollars
unless otherwise indicated.
Overview (all in U.S. dollars):
- Net income for the second quarter of 2010 was $126.5 million, or
$0.90 per basic and $0.87 per diluted share, which included a non-
cash gain of $74.8 million, or $0.54 per basic and $0.51 per diluted
share, related to the previously announced requirement under US GAAP
to account for the Company's outstanding common stock purchase
warrants as a derivative liability and to record changes in the fair
market value in net income.
- Non-GAAP adjusted net income for the second quarter of 2010
(excluding the non-cash gain on the warrants) was $51.7 million, or
$0.37 per basic and $0.36 per diluted share.
- Net income and non-GAAP net income were positively affected during
the quarter by a net refund of certain state income taxes related to
prior year tax returns in the amount of $10.7 million, or $0.08 per
basic and $0.07 per diluted share.
- Cash flow from operations totaled $41.2 million in the second quarter
of 2010.
- Total cash, cash equivalents and short-term investments at June 30,
2010 were $482.8 million. Total debt was $10.5 million.
- The Company reaffirmed previous estimates for 2010 molybdenum
production of 29 to 32 million pounds, sales of molybdenum produced
at the Company's mines of 27 to 30 million pounds, and average cash
cost per pound produced of $6 to $7 per pound. Estimated 2010 cash
costs at the Thompson Creek Mine were lowered to $5.25 to $6.25 per
pound (down from previous guidance of $5.50 to $6.50 per pound) while
cash costs at the Endako Mine were raised to $8 to $9 per pound (up
from previous guidance of $7 to $8 per pound).
- The Company's anticipated capital costs for 2010 have been revised to
approximately $293 million, down from previous guidance of
$298 million.
"Thompson Creek improved its financial performance in the second
quarter of 2010 as a result of strengthening molybdenum prices. The
Company's average realized molybdenum sales price for the second
quarter of 2010 increased by 16% from the first quarter of 2010 and
nearly 80% from one year ago. The Company's operations also
performed well in the second quarter and remain on track to achieve
previously announced production and cost guidance for the year,"
said Kevin Loughrey, Chairman and
Chief Executive Officer.
"Molybdenum prices have edged lower recently due to slightly
softer demand from steel companies and also to a lessening of the
confidence of molybdenum market participants in the strength and
timing of the world economic recovery. Despite this correction to
pricing, we believe the fundamental supply and demand projections
for molybdenum remain quite favorable and should contribute to an
improving financial performance for the Company over the medium
term," Mr. Loughrey added.
The Company's financial performance continues to be affected by
the previously disclosed requirement under US GAAP to account for
the Company's outstanding common stock purchase warrants as a
derivative liability, with changes in the fair market value
recorded in net income (loss). During the second quarter of 2010,
the value of the outstanding warrants (and the Company's reported
derivative liability) was reduced by $74.8
million, resulting in a non-cash gain of the same amount.
Excluding the non-cash gain related to the warrants, the Company's
adjusted net income for the second quarter of 2010 was $51.7 million. The Company will continue to make
the US GAAP adjustments on a quarterly basis until all of the
outstanding warrants have been exercised or until they expire in
October 2011.
On July 15, 2010, the Company
entered into a definitive agreement to acquire all of the issued
and outstanding equity of Terrane Metals Corp. ("Terrane"). The
transaction, if consummated, will be implemented by way of a
court-approved plan of arrangement under British Columbia law. Thompson Creek has also
concurrently entered into a letter agreement with Royal Gold, Inc. with respect to the purchase
and sale of 25% of the payable gold from Terrane's Mt. Milligan
Copper Gold Project.
"The acquisition of Terrane fits well in our strategic growth
plan, which is expected to provide us with production and revenue
growth - anticipated to commence in 2013 - while diversifying our
commodity exposure. We believe with our Endako expansion, and now
Terrane's Mt. Milligan project, we expect to substantially improve
Thompson Creek's growth profile," said Mr. Loughrey.
Three Months Ended June 30,
2010
Revenues for the second quarter of 2010 were $148.4 million, up $74.4
million or 100.5% from $74.0
million for the second quarter of 2009. The increase was
primarily the result of a 79% increase in average realized
molybdenum sales prices to $16.84 per
pound from $9.41 per pound in the
second quarter of 2009.
Net income for the second quarter of 2010 was $126.5 million, or $0.90 per basic and $0.87 per diluted share, compared to a net loss
of $89.3 million, or $0.73 per basic and diluted share in the second
quarter of 2009. Net income for the second quarter of 2010 included
a non-cash unrealized gain on common stock purchase warrants of
$74.8 million, or $0.54 per basic and $0.51 per diluted share. Net loss for the second
quarter of 2009 included a non-cash unrealized loss on common stock
purchase warrants of $83.0 million,
or $0.68 per basic and diluted
share.
Non-GAAP adjusted net income for the second quarter of 2010
(excluding the non-cash unrealized gains related to the Company's
warrants) was $51.7 million, or
$0.37 per basic and $0.36 per diluted share. Non-GAAP adjusted net
loss for the second quarter of 2009 (excluding the non-cash
unrealized loss related to the Company's warrants) was $6.3 million, or $0.05 per basic and diluted share.
Net income and non-GAAP net income for the second quarter of
2010 were positively affected during the quarter by a one-time net
refund of certain state income taxes related to prior year tax
returns amounting to $10.7 million,
or $0.08 per basic and $0.07 per diluted share.
The non-cash unrealized gains and charges on common stock
purchase warrants were the result of a previously disclosed
requirement under US GAAP to account for the Company's outstanding
common stock purchase warrants as a derivative liability, with
changes in the fair market value recorded in net income (loss),
beginning January 1, 2009. The change
to being classified as a derivative liability (from being
classified as equity) was because the exercise price of the
warrants is denominated in Canadian dollars instead of the
Company's functional currency (US dollars). The Company notes that
up until the expiration date of the 24.5 million warrants
(exercisable at C$9 per share until
October 23, 2011), only one of two
scenarios will occur. One is that the warrants are exercised and
the Company receives cash, which would amount to approximately
C$220 million if all of the warrants
are exercised. The second is that the warrants expire unexercised
and no cash proceeds are received. The Company does not have an
obligation related to the recorded fair value that would require a
cash payment, other than minor administrative expenses related to
the exercise of warrants.
The Company's mines produced 7.0 million pounds of molybdenum in
the second quarter of 2010, compared to 6.7 million pounds in the
second quarter of 2009. The Thompson Creek Mine produced 5.1
million pounds, up from 4.7 million pounds a year earlier. The
Company's 75% share of the Endako Mine's production was 1.9 million
pounds, down from 2.0 million pounds a year earlier.
The weighted-average cash cost per pound produced (including all
stripping costs) was $7.06 per pound
in the second quarter of 2010, up from $5.21 per pound in the second quarter of 2009. At
the Thompson Creek Mine, cash cost per pound produced in the second
quarter of 2010 was $6.31 per pound,
up from $5.32 per pound a year
earlier. The Endako Mine's cash cost per pound produced was
$9.00 per pound, compared to
$4.94 per pound in the second quarter
of 2009. The increase in the cash cost per pound produced at both
the Thompson Creek and Endako mines was primarily due to lower ore
grades and lower recovery rates at both mines. In addition, costs
in the second quarter of 2010 reflected higher fuel costs
associated with running more trucks at both mines, a rise in
capacity utilization to a full 24-hour, 7-day mill schedule at the
Thompson Creek Mine, increased equipment maintenance and repair
costs (including maintenance and repairs associated with the
Langeloth five-week shutdown) and
unfavorable foreign exchange rates converting the Endako mine
Canadian dollar costs to US dollar costs.
Cash flow from operating activities in the second quarter of
2010 was $41.2 million, compared to
$6.1 million in the second quarter of
2009.
Capital costs (including accruals) totaled $77.6 million in the second quarter of 2010,
comprised of $40.9 million of capital
costs for the mines, the Langeloth Metallurgical Facility and
corporate, and $36.7 million for the
Company's 75% share of capital costs for the Endako mill
expansion.
Cash, cash equivalents and short-term investments were
$482.8 million on June 30, 2010, down from $523.6 million on March
31, 2010 and $511.5 million on
December 31, 2009. The Company's
total debt was $10.5 million on
June 30, 2010, down from $11.4 million on March 31,
2010 and $12.9 million on
December 31, 2009.
Six Months Ended June 30, 2010
Revenues for the six months ended June
30, 2010 were $276.2 million,
up $123.4 million or 81% from
$152.8 million a year earlier mainly
due to a 60% increase in average realized molybdenum sales prices
to $15.68 per pound in the first half
of 2010 from $9.81 per pound in the
first half of 2009.
Net income for the six months ended June
30, 2010 was $127.6 million,
or $0.91 per basic and $0.86 per diluted share, compared to a net loss
of $80.6 million, or $0.66 per basic and diluted share, for the six
months ended June 30, 2009. Net
income for the six months ended June 30,
2010 included a non-cash gain on common stock purchase
warrants of $50.3 million, or
$0.36 per basic and $0.34 per diluted share. Net loss for the six
months ended June 30, 2009 included a
non-cash charge on common stock purchase warrants of $83.3 million, or $0.68 per basic and diluted share.
Non-GAAP adjusted net income for the six months ended
June 30, 2010 (excluding non-cash
gains related to the Company's warrants) was $77.3 million, or $0.55 per basic and $0.52 per diluted share. Non-GAAP adjusted net
income for the six months ended June 30,
2009 (excluding non-cash charges related to the Company's
warrants) was $2.7 million, or
$0.02 per basic and diluted
share.
Cash flow from operating activities for the six months ended
June 30, 2010 was $66.8 million, compared to $43.5 million for the six months ended
June 30, 2009.
Capital costs (including accruals) totaled $106.6 million for the first six months of 2010,
comprised of $47.7 million of capital
costs for the mines, the Langeloth Metallurgical Facility and
corporate, and $58.9 million for the
Company's 75% share of capital costs for the Endako mill
expansion.
Selected Consolidated Financial and Operational Information
Three Months Ended Six Months Ended
June 30, June 30,
(US$ in millions except per ------------------- -------------------
share and per pound amounts) 2010 2009 2010 2009
--------------------------------- --------- --------- --------- ---------
(unaudited)
Financial
Revenues
Molybdenum sales............... $ 145.5 $ 71.2 $ 269.5 $ 146.8
Tolling, calcining and other... 2.9 2.8 6.7 6.0
--------- --------- --------- ---------
148.4 74.0 276.2 152.8
--------- --------- --------- ---------
Costs and expenses
Operating expenses............. 73.8 52.3 150.1 110.7
Selling and marketing.......... 1.8 1.3 3.3 2.7
Depreciation, depletion and
amortization.................. 11.9 10.2 22.9 20.4
Accretion expense.............. 0.4 0.4 0.8 0.7
General and administrative..... 8.4 8.1 14.2 13.1
Exploration.................... 1.8 1.9 3.5 3.7
--------- --------- --------- ---------
Total costs and expenses..... 98.1 74.2 194.8 151.3
--------- --------- --------- ---------
Operating income (loss)........ 50.3 (0.2) 81.4 1.5
Other (income) and expense..... (77.3) 89.8 (52.2) 86.4
--------- --------- --------- ---------
Income (loss) before income
and mining taxes................ 127.6 (90.0) 133.6 (84.9)
Income and mining taxes (benefit) 1.1 (0.7) 6.0 (4.3)
--------- --------- --------- ---------
Net income (loss)................ $ 126.5 $ (89.3) $ 127.6 $ (80.6)
--------- --------- --------- ---------
--------- --------- --------- ---------
Net income (loss) per share
Basic.......................... $ 0.90 $ (0.73) $ 0.91 $ (0.66)
Diluted........................ $ 0.87 $ (0.73) $ 0.86 $ (0.66)
Cash generated by operating
activities...................... $ 41.2 $ 6.1 $ 66.8 $ 43.5
Adjusted non-GAAP Measures:(1)
Adjusted net income (loss)(1).... $ 51.7 $ (6.3) $ 77.3 $ 2.7
Adjusted net income (loss) per
share - basic(1)................ $ 0.37 $ (0.05) $ 0.55 $ 0.02
Adjusted net income (loss) per
share - diluted(1).............. $ 0.36 $ (0.05) $ 0.52 $ 0.02
Operational Statistics
Mined molybdenum production
(000's lb)(2)................... 7,034 6,714 15,303 12,771
Cash cost ($/lb produced)(3)..... $ 7.06 $ 5.21 $ 6.14 $ 5.55
Molybdenum sold (000's lb):
Thompson Creek and Endako
Mine product.................. 7,013 6,505 13,748 13,054
Purchased and processed
product....................... 1,626 997 3,446 1,895
--------- --------- --------- ---------
8,639 7,502 17,194 14,949
--------- --------- --------- ---------
Average realized sales price
($/lb)(1)....................... $ 16.84 $ 9.41 $ 15.68 $ 9.81
--------- --------- --------- ---------
See footnotes on page 6.
Summary of Quarterly Results
(US$ in millions except per share and per pound amounts - unaudited)
Jun 30 Mar 31 Dec 31 Sep 30 June 30
2010 2010 2009 2009 2009
-------- -------- -------- -------- --------
Financial
Revenue $ 148.4 $ 127.8 $ 106.2 $ 114.4 $ 74.0
Operating income (loss) $ 50.3 $ 31.1 $ 15.8 $ 32.4 $ (0.2)
Net income (loss) $ 126.5 $ 1.1 $ 26.0 $ (1.4) $ (89.3)
Income (loss) per share:
- basic $ 0.90 $ 0.01 $ 0.19 $ (0.01) $ (0.73)
- diluted $ 0.87 $ 0.01 $ 0.18 $ (0.01) $ (0.73)
Cash generated by
operating activities $ 41.2 $ 25.6 $ 38.2 $ 24.2 $ 6.1
Adjusted non-GAAP
Measures:(1)
Adjusted net income
(loss)(1) $ 51.7 $ 25.6 $ 20.4 $ 14.3 $ (6.3)
Adjusted net income (loss)
per share:(1)
- basic(1) $ 0.37 $ 0.18 $ 0.15 $ 0.11 $ (0.05)
- diluted(1) $ 0.36 $ 0.17 $ 0.14 $ 0.11 $ (0.05)
Operational Statistics
Mined molybdenum
production (000's lb)(2) 7,034 8,269 6,268 6,221 6,714
Cash cost
($/lb produced)(3) $ 7.06 $ 5.36 $ 6.61 $ 5.67 $ 5.21
Molybdenum sold (000's lb):
Thompson Creek and
Endako Mine 7,013 6,735 6,889 7,445 6,505
Purchased and processed
product 1,626 1,820 1,464 1,324 997
-------- -------- -------- -------- --------
8,639 8,555 8,353 8,769 7,502
-------- -------- -------- -------- --------
Average realized sales
price ($/lb)(1) $ 16.84 $ 14.50 $ 12.37 $ 12.75 $ 9.41
-------- -------- -------- -------- --------
----------------------------
(1) See "Non-GAAP Financial Measures" below for the definition and
calculation of these non-GAAP measures.
(2) Mined molybdenum production pounds reflected are molybdenum oxide and
high performance molybdenum disulfide ("HPM") from our share of
production from the mines; excludes molybdenum processed from
purchased product.
(3) Weighted-average of Thompson Creek Mine and Endako Mine cash costs
(mining, milling, mine site administration, roasting and packaging)
for molybdenum oxide and HPM produced in the period, including all
stripping costs. Cash cost excludes: the effect of purchase price
adjustments, the effects of changes in inventory, stock-based
compensation, other non-cash employee benefits and depreciation,
depletion, amortization and accretion. The cash cost for the Thompson
Creek Mine, which only produces molybdenum sulfide on site, includes
an estimated molybdenum loss, an allocation of roasting and packaging
costs from the Langeloth Facility, and transportation costs. See
"Non-GAAP Financial Measures" for additional information.
Outlook
Molybdenum Market
For the second quarter of 2010, the average Platts Metals Week
published price for molybdenum oxide was $16.33 per pound, which increased from
$16.06 per pound in the first quarter
of 2010. Over the first six months of 2010, the monthly average
price for molybdenum oxide as published in Platts Metals Week
peaked in April, with an average price of $17.58 per pound. Since then, the 2010 average
Platts Metals Week published price declined to $16.91 per pound in May, $14.61 per pound in June and $14.10 in July. Although Thompson Creek
anticipates that over the balance of 2010 the price for molybdenum
oxide will increase above the present pricing level of July, since
contract sales make up the bulk of TCM's sales and since contract
sales typically trail the market price by one month, the average
price in June and July will have an effect on TCM's expected
average sales price realization for the third quarter of 2010.
Operations
For 2010, Thompson Creek expects its molybdenum production
volumes to be 29 to 32 million pounds, with the Thompson Creek Mine
at approximately 22 to 24 million pounds and the 75% share of the
Endako Mine at 7 to 8 million pounds (unchanged from previous
guidance). Anticipated average cash costs per pound produced are
estimated at $6 to $7 per pound in
2010 (unchanged from previous guidance), with $5.25 to $6.25 per pound at the Thompson Creek
Mine (down from previous guidance of $5.50
to $6.50 per pound) and $8 to
$9 per pound at the Endako Mine, assuming a US to Canadian
dollar exchange rate of US$1.00 =
C$1.00 for the last six months of
2010 (up from previous guidance of $7 to
$8 per pound at the Endako Mine, assuming a US to Canadian
dollar exchange rate of US$1.00 =
C$1.05). The increase in the expected
cash costs per pound produced at the Endako Mine is primarily due
to expected conveyor system downtime in the last six months of 2010
(which is expected to result in higher truck haulage costs), shovel
and crusher costs, a lower expected mill recovery rate, higher
costs from additional workforce in anticipation of the start-up of
the new mill and the expected change in the US to Canadian dollar
exchange rate from US$1.00 =
C$1.05 to US$1.00 = C$1.00. For the Endako Mine, a $0.01 change in the Canadian foreign exchange
rate would result in a change in the cash cost per pound produced
of approximately $0.10 per pound.
Thompson Creek expects to sell 27 to 30 million pounds of its
mined production in 2010 (unchanged from previous guidance). The
Langeloth Metallurgical Facility completed a five-week shut-down in
May 2010 for maintenance and repairs,
which resulted in an inventory build-up in the second quarter of
2010 of 1.1 million pounds of molybdenum concentrate that was not
converted to finished product. For the first six months of 2010,
total inventory increased by 2.7 million pounds. Thompson Creek has
some flexibility in building or depleting inventory levels
depending upon economic conditions and the related demand and sales
price for molybdenum. Given current market conditions, Thompson
Creek does not expect to reduce its inventory substantially during
the remainder of the year. In addition, due to TCM's higher
contractual commitments for 2010 compared to 2009, a higher level
of inventory is needed to provide adequate flexibility to serve
contract customers. Thompson Creek currently has fixed-price sales
contracts for approximately 1.1 million pounds at an average fixed
price of $15.70 per pound for
molybdenum oxide for the remainder of the year.
Capital costs for 2010 are expected to be approximately
$293 million, comprised of
$94 million in capital costs for the
mines, the Langeloth Facility and corporate and $199 million for TCM's 75% share of capital costs
required for the mill expansion project at the Endako Mine (changed
from previous guidance of $298
million, comprised of $89
million in capital costs from the mines, the Langeloth
Facility and corporate and $209
million for TCM's 75% share for the mill expansion at the
Endako Mine).
On July 30, 2010, TCM received the
approval of TCM's joint venture partner for the mill expansion at
the Endako Mine. Operating permits required by the Endako mill
expansion are proceeding, including the development of a closure
plan for expanded waste dumps and tailings facilities and minor
amendments to the Mining Act permit. In May
2010, Thompson Creek received notification of a petition
filed recently in the Supreme Court of British Columbia by the Stellat'en First
Nation claiming that the British Columbia Ministry of Energy, Mines
and Petroleum Resources has not fulfilled its duty to consult with
or accommodate Stellat'en's asserted aboriginal rights and title
interests in relation to the Endako Mine expansion project. The
petition names Thompson Creek, a 75% owner of the Endako Mine, as
one of the parties involved but does not cite Thompson Creek in any
of its claims regarding the lack of consultation. Thompson Creek is
satisfied with the efforts to date to consult and engage with the
Stellat'en First Nation and other First Nations regarding the
expansion project and will continue to work with the Government of
British Columbia towards building
positive relationships with First Nations regarding the Endako Mine
and the expansion project.
In 2010, Thompson Creek expects to conduct exploration drilling
at both of its operating mines totaling $2
to $4 million (unchanged from previous guidance) and to
spend approximately $7 to $9 million
under the option agreement with U.S. Energy Corporation on the
Mount Emmons Project for an ongoing pre-feasibility study, further
engineering evaluations, and ongoing project maintenance (unchanged
from previous guidance). As previously announced, the Company is
also conducting a re-evaluation of the Davidson Project regarding
various operating alternatives and related economic analysis.
2010 Third Quarter and Second Half
Net income for the 2010 third quarter and second half is
expected to be impacted by depressed molybdenum prices in June and
July, the upward cost trend at TCM's mines, a higher proportion of
sales from third party purchases and related costs in the 2010
third quarter, and the costs related to the acquisition of Terrane
which will be expensed as incurred.
Non-GAAP Financial Measures
In addition to the consolidated financial statements presented
in accordance with US GAAP, the Company uses certain non-GAAP
financial measures of TCM's financial performance. Readers should
refer to Non-GAAP Financial Measures in the Company's Form 10-Q for
the quarter ended June 30, 2010 as
filed with the Securities and Exchange Commission on August 5, 2010 and as available on the Company's
website for further details.
The following table is a reconciliation of the net income
presented in accordance with US GAAP to the non-GAAP financial
measures of adjusted net income (loss), and adjusted net income
(loss) per share - basic and diluted for the three and six months
ended June 30, 2010 and 2009.
For the three months ended June 30, 2010 (unaudited - US$ in millions
except shares and per share amounts)
Weighted Average Weighted Average
Basic Shares Diluted Shares
---------- ------------------- -------------------
Net Shares Shares
Income (000's) $/share (000's) $/share
---------- ------------------- -------------------
US GAAP measures $ 126.5 139,792 $ 0.90 145,440 $ 0.87
Add (Deduct):
Unrealized (gain)
loss on common
stock warrants (74.8) 139,792 (0.54) 145,440 (0.51)
----------
Non-GAAP measures $ 51.7 139,792 $ 0.37 145,440 $ 0.36
----------
----------
For the three months ended June 30, 2009 (unaudited - US$ in millions
except shares and per share amounts)
Weighted Average Weighted Average
Basic Shares Diluted Shares
---------- ------------------- -------------------
Net Shares Shares
Income (000's) $/share (000's) $/share
---------- ------------------- -------------------
US GAAP measures $ (89.3) 122,451 $ (0.73) 122,451 $ (0.73)
Add (Deduct):
Unrealized loss on
common stock
warrants 83.0 122,451 0.68 122,451 0.68
----------
Non-GAAP measures $ (6.3) 122,451 $ (0.05) 122,451 $ (0.05)
----------
----------
For the six months ended June 30, 2010 (unaudited - US$ in millions
except shares and per share amounts)
Weighted Average Weighted Average
Basic Shares Diluted Shares
---------- ------------------- -------------------
Net Shares Shares
Income (000's) $/share (000's) $/share
---------- ------------------- -------------------
US GAAP measures $ 127.6 139,711 $ 0.91 147,600 $ 0.86
Add (Deduct):
Unrealized (gain)
loss on common
stock warrants (50.3) 139,711 (0.36) 147,600 (0.34)
----------
Non-GAAP measures $ 77.3 139,711 $ 0.55 147,600 $ 0.52
----------
----------
For the six months ended June 30, 2009 (unaudited - US$ in millions
except shares and per share amounts)
Weighted Average Weighted Average
Basic Shares Diluted Shares
---------- ------------------- -------------------
Net Shares Shares
Income (000's) $/share (000's) $/share
---------- ------------------- -------------------
US GAAP measures $ (80.6) 122,353 $ (0.66) 122,353 $ (0.66)
Add (Deduct):
Unrealized (gain)
loss on common
stock warrants 83.3 122,353 0.68 122,353 0.68
----------
Non-GAAP measures $ 2.7 122,353 $ 0.02 122,353 $ 0.02
----------
----------
Additional information on the Company's financial position is
available in Thompson Creek's Quarterly Report on Form 10-Q for the
period ended June 30, 2010, which
will be filed on EDGAR (www.sec.gov) and SEDAR (www.sedar.com), and
posted on the Company's website (www.thompsoncreekmetals.com).
Conference call and webcast
Thompson Creek will hold a conference call for analysts and
investors to discuss its second quarter 2010 financial results on
Friday, August 6, 2010 at
8:30 a.m. Eastern Time. Kevin Loughrey, Chairman and Chief Executive
Officer, and Pamela Saxton, Chief
Financial Officer, will be available to answer questions during the
call.
To participate in the call, please dial 647-427-7450 or
1-888-231-8191 about five minutes prior to the start of the call. A
live audio webcast of the conference call will be available at
www.newswire.ca and www.thompsoncreekmetals.com.
An archived recording of the conference call will be available
at 416-849-0833 or 1-800-642-1687 (Passcode 86690991 followed by
the number sign) from 11:30 a.m. on
August 6 to 11:59 p.m. on
August 13. An archived recording of
the webcast will also be available at Thompson Creek's website.
About Thompson Creek Metals Company Inc.
Thompson Creek Metals Company Inc. is one of the largest
publicly traded, pure molybdenum producers in the world. The
Company owns the Thompson Creek open-pit molybdenum mine and mill
in Idaho, a metallurgical roasting
facility in Langeloth,
Pennsylvania and a 75% share of the Endako open-pit mine,
mill and roasting facility in northern British Columbia. Thompson Creek is evaluating
the Mount Emmons Deposit, a high-grade underground molybdenum
deposit near Crested Butte,
Colorado. Thompson Creek has an option to acquire up to 75%
of the property. The Company is continuing to pursue permitting of
the Davidson Deposit, a high-grade underground molybdenum deposit
near Smithers, B.C. The Company
has approximately 850 employees. Its principal executive office is
in Denver, Colorado, and it also
has an office in Toronto, Ontario.
More information is available at www.thompsoncreekmetals.com.
Cautionary Note Regarding Forward-Looking Statements
----------------------------------------------------
This news release contains "forward-looking information" within
the meaning of the United States Private Securities Litigation
Reform Act of 1995 and applicable Canadian securities legislation.
Often, but not always, forward-looking statements can be identified
by the use of words such as "plans", "expects", "is expected",
"budget", "scheduled", "estimates", "forecasts", "intends",
"anticipates", or "believes" or variations (including negative
variations) of such words and phrases, or state that certain
actions, events or results "may", "could", "would", "might" or
"will" be taken, occur or be achieved. Forward-looking statements
involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of
Thompson Creek and its subsidiaries to be materially different from
any future results, performance or achievements expressed or
implied by the forward-looking statements. Examples of
forward-looking information include, but are not limited to,
statements with respect to the future financial or operating
performance of Thompson Creek or its subsidiaries and its projects,
the estimation of mineral reserves and resources, the realization
of mineral reserve estimates, the timing and amount of estimated
future production, costs of production, capital, operating and
exploration expenditures, costs and timing of the development of
new deposits of Thompson Creek including Mt. Emmons and
Davidson, costs and timing of
future exploration, requirements for additional capital, benefits
of the Terrane acquisition to Thompson Creek shareholders
including: the ability for Thompson Creek to diversify its assets;
the benefits of the Gold Stream Transaction, if consummated; the
ability to finance future projects without equity dilution and
Thompson Creek's potential to obtain significant production growth
by 2013; the achievement of the mine plan at Mt. Milligan
including: the estimated mine life; the expected annual production;
and ability to create up to 400 direct permanent jobs, the
breakdown of how Thompson Creek intends to fund the initial capital
cost at Mt. Milligan; the commissioning of a mine and mill complex
at Mt. Milligan in 2013; Thompson Creek's expected 2010 molybdenum
production, the expected increase in Thompson Creek's share of
annual production resulting from the expansion of the Endako mine;
the execution of a definitive Gold Stream Transaction, Thompson
Creek's expected fully diluted share count following the
transaction, the objectives and timing of the Arrangement and Gold
Stream Transaction, the ability for the closing conditions to be
satisfied in connection with the Arrangement, disruption to
Thompson Creek's business as a result of the Arrangement, and
Thompson Creek's ability to achieve its expected growth
strategy.
Such factors include, among others, risks related to general
business, economic, competitive, political and social uncertainties
including the current global recessionary economic conditions, the
associated low molybdenum prices and the levels of disruption and
continuing illiquidity in the credit markets; risks related to
foreign currency fluctuations; energy prices & fluctuations;
title disputes or claims; limitations of insurance coverage;
changes in governmental regulation of mining operations; risks
related to the volatility of Thompson Creek's share price; changes
in environmental regulation; the actual results of current
exploration activities; actual results of reclamation activities;
conclusions of economic evaluations; changes in project parameters
as plans continue to be refined; possible variations of ore grade
or recovery rates; impurities and toxic substances in the mined
material, failure of plant, equipment or processes to operate as
anticipated; the age of the Langeloth Facility; structural
integrity and old equipment at the Endako Mine; accidents, labor
disputes and other risks of the mining industry; access to skilled
labor; relations with employees; dependence upon key management
personnel and executives; political instability, insurrection or
war; disruption of transportation services; increased
transportation costs and delays in obtaining governmental permits
and approvals, or financing or in the completion of development or
construction activities. Additional factors that could cause
Thompson Creek's results to differ from those described in the
forward-looking information can be found in the section entitled
"Risk Factors" in Thompson Creek's current Annual Report on Form
10-K, as amended, and subsequent documents filed on EDGAR at
www.sec.gov and on SEDAR at www.sedar.com. Although Thompson Creek
has attempted to identify important factors that could cause actual
actions, events or results to differ materially from those
described in forward-looking statements, there may be other factors
that cause actions, events or results to differ from those
anticipated, estimated or intended. Forward-looking statements
contained herein are made as of the date of this news release and
Thompson Creek disclaims any obligation to update any
forward-looking statements, whether as a result of new information,
future events or results or otherwise, except as required by law.
There can be no assurance that forward-looking statements will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements.
Accordingly, the reader is cautioned not to place undue reliance on
forward-looking statements.
Readers should refer to Thompson Creek's current Annual Report
on Form 10-K, as amended, which is available on SEDAR at
www.sedar.com and EDGAR at www.sec.gov and other continuous
disclosure documents available at www.sedar.com and www.sec.gov for
further information on ore reserves and mineralized material, which
is subject to the qualifications and notes set forth therein.
THOMPSON CREEK METALS COMPANY INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
June 30, December 31,
2010 2009
------------ ------------
(in millions, except
share data)
ASSETS
Current assets
Cash and cash equivalents................... $ 215.6 $ 158.5
Short-term investments...................... 267.2 353.0
Accounts receivable - trade................. 49.1 32.4
Accounts receivable - related parties....... 10.8 10.3
Product inventory........................... 73.5 43.5
Material and supplies inventory............. 33.4 34.5
Prepaid expense and other current assets.... 2.8 6.0
Income tax receivable....................... 5.9 4.8
------------ ------------
658.3 643.0
Property, plant and equipment, net............ 676.9 605.7
Restricted cash............................... 19.3 16.8
Reclamation deposits.......................... 30.3 30.3
Goodwill...................................... 47.0 47.0
Other assets.................................. 0.9 1.8
------------ ------------
$ 1,432.7 $ 1,344.6
------------ ------------
------------ ------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued liabilities.... $ 53.2 $ 29.9
Income and mining taxes payable............. 3.7 3.6
Current portion of long-term debt........... 2.9 3.7
Deferred income tax liabilities............. 6.6 6.7
------------ ------------
66.4 43.9
Long-term debt................................ 7.6 9.2
Other liabilities............................. 24.8 24.6
Asset retirement obligations.................. 25.6 24.8
Common stock warrant derivatives.............. 65.2 115.4
Deferred income tax liabilities............... 132.1 141.3
------------ ------------
321.7 359.2
------------ ------------
Shareholders' equity
Common stock, no-par, 139,792,091 and
139,511,257 shares issued and outstanding,
as of June 30, 2010 and December 31, 2009,
respectively............................... 700.2 697.1
Additional paid-in-capital.................. 47.8 45.7
Retained earnings........................... 360.4 232.8
Accumulated other comprehensive income...... 2.6 9.8
------------ ------------
1,111.0 985.4
------------ ------------
$ 1,432.7 $ 1,344.6
------------ ------------
------------ ------------
THOMPSON CREEK METALS COMPANY INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
------------------- -------------------
2010 2009 2010 2009
--------- --------- --------- ---------
(in millions, except per share data)
REVENUES
Molybdenum sales.............. $ 145.5 $ 71.2 $ 269.5 $ 146.8
Tolling, calcining and other 2.9 2.8 6.7 6.0
--------- --------- --------- ---------
Total revenues.............. 148.4 74.0 276.2 152.8
--------- --------- --------- ---------
COSTS AND EXPENSES
Operating expenses............ 73.8 52.3 150.1 110.7
Selling and marketing......... 1.8 1.3 3.3 2.7
Depreciation, depletion and
amortization................. 11.9 10.2 22.9 20.4
Accretion expense............. 0.4 0.4 0.8 0.7
General and administrative.... 8.4 8.1 14.2 13.1
Exploration................... 1.8 1.9 3.5 3.7
--------- --------- --------- ---------
Total costs and expenses.... 98.1 74.2 194.8 151.3
--------- --------- --------- ---------
OPERATING INCOME (LOSS)......... 50.3 (0.2) 81.4 1.5
OTHER (INCOME) AND EXPENSE
Change in fair value of
common stock warrants........ (74.8) 83.0 (50.3) 83.3
Loss (gain) on foreign
exchange..................... (1.9) 7.1 (1.3) 3.9
Interest (income) expense, net (0.4) (0.3) (0.3) (0.4)
Other......................... (0.2) - (0.3) (0.4)
--------- --------- --------- ---------
Total other (income) and
expense.................... (77.3) 89.8 (52.2) 86.4
--------- --------- --------- ---------
Income (loss) before income
and mining taxes............... 127.6 (90.0) 133.6 (84.9)
Income and mining tax expense
(benefit)...................... 1.1 (0.7) 6.0 (4.3)
--------- --------- --------- ---------
NET INCOME (LOSS)............... $ 126.5 $ (89.3) $ 127.6 $ (80.6)
--------- --------- --------- ---------
--------- --------- --------- ---------
NET INCOME (LOSS) PER SHARE
Basic......................... $ 0.90 $ (0.73) $ 0.91 $ (0.66)
--------- --------- --------- ---------
--------- --------- --------- ---------
Diluted....................... $ 0.87 $ (0.73) $ 0.86 $ (0.66)
--------- --------- --------- ---------
--------- --------- --------- ---------
Weighted average number of
common shares
Basic......................... 139.8 122.5 139.7 122.4
--------- --------- --------- ---------
Diluted....................... 145.4 122.5 147.6 122.4
--------- --------- --------- ---------
THOMPSON CREEK METALS COMPANY INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
------------------- -------------------
2010 2009 2010 2009
--------- --------- --------- ---------
(in millions)
OPERATING ACTIVITIES
Net income (loss)............... $ 126.5 $ (89.3) $ 127.6 $ (80.6)
Items not affecting cash:
Change in fair value of
common stock warrants........ (74.8) 83.0 (50.3) 83.3
Depreciation, depletion and
amortization................. 11.9 10.2 22.9 20.4
Accretion expense............. 0.4 0.4 0.8 0.7
Stock-based compensation...... 1.7 4.0 4.2 5.4
Deferred income tax benefit... (1.1) (4.3) (2.9) (11.2)
Unrealized loss on derivative
instruments.................. 0.7 1.6 1.3 1.7
Change in working capital
accounts....................... (24.1) 0.5 (36.8) 23.8
--------- --------- --------- ---------
Cash generated by operating
activities................. 41.2 6.1 66.8 43.5
--------- --------- --------- ---------
INVESTING ACTIVITIES
Short-term investments.......... 115.7 (81.5) 85.6 (181.8)
Capital expenditures............ (71.1) (13.7) (90.5) (41.3)
Restricted cash................. (1.0) (1.0) (2.5) (1.8)
Reclamation deposits............ - (0.2) - (2.6)
--------- --------- --------- ---------
Cash generated (used) in
investing activities....... 43.6 (96.4) (7.4) (227.5)
--------- --------- --------- ---------
FINANCING ACTIVITIES
Proceeds from issuance of
common shares, net............. 0.1 3.7 2.1 3.7
Repayment of long-term debt..... (0.9) (1.4) (2.4) (2.7)
--------- --------- --------- ---------
Cash generated (used) by
financing activities....... (0.8) 2.3 (0.3) 1.0
--------- --------- --------- ---------
EFFECT OF EXCHANGE RATE CHANGES
ON CASH........................ (4.4) 5.2 (2.0) 2.5
--------- --------- --------- ---------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS........... 79.6 (82.8) 57.1 (180.5)
Cash and cash equivalents,
beginning of period............ 136.0 160.3 158.5 258.0
--------- --------- --------- ---------
Cash and cash equivalents,
end of period.................. $ 215.6 $ 77.5 $ 215.6 $ 77.5
--------- --------- --------- ---------
--------- --------- --------- ---------
CONTACT: Pamela Solly, Director
of Investor Relations, Thompson Creek Metals Company Inc., Tel:
303-762-3526, psolly@tcrk.com; Wayne
Cheveldayoff, Investor Relations Advisor, Thompson Creek
Metals Company Inc., Tel: 416-860-1438, wcheveldayoff@tcrk.com;
Christine Stewart, Renmark Financial
Communications Inc., Tel: 416-644-2020,
cstewart@renmarkfinancial.com
SOURCE Thompson Creek Metals Company Inc.
Copyright g. 5 PR Newswire