GROWING
RESPONSIBLY
2024
ANNUAL REPORT
Table of Contents
ABOUT FIRST QUANTUM
2
OUR PROPERTIES
3
CEO MESSAGE TO SHAREHOLDERS
4
BOARD OF DIRECTORS
8
FINANCIAL REPORTS
12
Management’s Discussion and Analysis
12
Overview
13
Full Year Highlights
14
Fourth Quarter Highlights
15
Cobre Panamá Update
18
Other Developments
19
Environment, Social and Governance
20
Guidance
22
Summary Operational Results
25
Operations Review
31
Development Projects
39
Exploration
41
Summary Financial Results
42
Liquidity and Capital Resources
51
Zambian VAT
57
Joint Venture
58
Related Party Transactions
58
Precious Metal Stream Arrangement
58
Material Legal Proceedings
60
Regulatory Disclosures
61
Summary Quarterly Information
75
Appendices
76
Cautionary Statement
On Forward-Looking Information
80
Management’s Responsibility
for Financial Reporting
82
Independent Auditor’s Report
83
Consolidated Financial Statements
90
Notes to the Consolidated
Financial Statements
95
CORPORATE INFORMATION
138
1
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
2
First Quantum is a global
mining company primarily
producing copper, with
secondary production in
gold, nickel and silver.
Our unique approach is to apply
our in-house technical, engineering,
construction and operational skills
to every project, which has enabled
the Company to successfully develop
and operate complex mines and
processing plants around the world.
After 25 years of operation
First Quantum is amongst the
world’s largest copper producers.
We are focused on providing a
tangible benefit from everything
we do for investors, employees
and the many communities that
surround our operations.
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
3
Ownership 80% | Economic rights 100%
Primary
Copper
Secondary
Gold
2024 Production
Copper 171kt, Gold 105koz
KANSANSHI | North-Western Province, ZAMBIA
RAVENSTHORPE | Western Australia, AUSTRALIA
GUELB MOGHREIN | Akjoujt, MAURITANIA
Ownership
100%
Primary
Copper
Secondary
Gold
2024 Production
Copper 18kt, Gold 31koz
SENTINEL | North-Western Province, ZAMBIA
Ownership
100%
Primary
Copper
2024 Production
Copper 231kt
ENTERPRISE | North-Western Province, ZAMBIA
Ownership
100%
Primary
Nickel
2024 Production
Nickel 19kt
COBRE PANAMÁ | Colón Province, PANAMA
Ownership 90% | (partnership with KOMIR)
Primary
Copper
Secondary
Gold, Molybdenum, Silver
Preservation & Safe Management
ÇAYELI | Rize Province, TÜRKIYE
Ownership
100%
Primary
Copper
Secondary
Zinc
2024 Production
Copper 11kt, Zinc 3kt
LAS CRUCES | Sevilla Province, SPAIN
Ownership
100%
Primary
Copper
Underground development project
2024 Copper Production 431,004 tonnes
HAQUIRA | Apurimac Region, PERU
Ownership
100%
Primary
Copper
Development Project
TACA TACA | Salta Province, ARGENTINA
Primary
Copper
Secondary
Gold, Molybdenum
Development Project
LA GRANJA | Cajamarca Region, PERU
Ownership 55% | (partnership with Rio Tinto)
Primary
Copper
Development Project
Ownership 75.7% | (partnership with POSCO)
Primary
Nickel
2024 Production
Nickel 5kt
Care & Maintenance
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
CEO Message to Shareholders
4
2024 was a year of resilience and regrouping at
First Quantum as we navigated challenges and
recognized achievements across our operations. We
began the year with the continued suspension of
operations at Cobre Panamá, but with decisive action
taken through a range of strategic financial initiatives,
we stabilized our balance sheet and strengthened the
Company’s long-term outlook. This, along with our
continued investment in the Kansanshi S3 Expansion,
were pivotal actions that reinforced First Quantum’s
resilience and strategic focus.
At the start of the year, First Quantum implemented
a comprehensive refinancing strategy to stabilize
our balance sheet and ensure financial flexibility.
announcement of the issuance of $1 billion of
senior notes due 2033 and the partial tender of
our 2027 notes.
First Quantum remains steadfast in proactively
reviewing balance sheet initiatives, including
the potential of a minority-stake in our
Zambian business, the sale of Las Cruces,
additional hedges and other prepayments,
as well as streaming.
We are committed to working with the
Government of Panama on the responsible
stewardship of Cobre Panamá. In January
2024, we delivered a draft for the first phase of
Preservation and Safe Management (“P&SM”)
This included a $500 million copper prepay
agreement, a $1.6 billion bond offering, a $1.15
billion equity bought deal offering, and the
amendment and extension of our $2.2 billion
corporate bank facilities. We also suspended our
dividend and reduced capital expenditures and
operating costs.
First Quantum initiated a hedging program to
provide protection from downside copper prices
during the period of expenditure associated
with the ramp-up of the Kansanshi S3 Expansion
and refinanced our Trident Facility. These efforts
to extend duration in the capital structure and
bolster liquidity continued in 2025 with the recent
We began the year with the continued suspension of operations at
Cobre Panamá, but with decisive action taken through a range of
strategic financial initiatives, we stabilized our balance sheet and
strengthened the Company’s long-term outlook.
Our Zambian operations delivered strong performance throughout 2024.
As a result of several operational initiatives during the year, the Company
achieved annual copper production of 431 thousand tonnes in 2024,
exceeding the guidance range of 400 to 420 thousand tonnes.
I am confident in the outlook for First Quantum. Once the Kansanshi
S3 Expansion is delivered and Cobre Panamá re-opens, First Quantum will
cement its status as a leading copper producer and growth company.
TRISTAN PASCALL, Chief Executive Officer
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
Kansanshi achieved its highest copper and gold production since
2021 and 2022, respectively, predominately driven by higher grades.
Sentinel’s increased copper production reflected higher grades
and throughput, with the highest average grades since 2017. Most
encouragingly, Sentinel moved record volumes in 2024, which was
driven by the teams’ efforts on safe productivity in the pit.
5
which we subsequently updated and expanded
following comments from an Intergovernmental
Commission and at the request of the Ministry of
Commerce and Industries. The P&SM plan includes
the export of copper concentrate that has been
stored at site since operations were suspended
and reactivation of the power plant, which would
in turn enable processing of the sulphide ore
stockpiles and provide material for continued
maintenance of the Tailing Management Facility
embankment wall. While the plan is still pending
government approval, First Quantum continues
to maintain the mine site and perform essential
environmental monitoring in order to uphold the
integrity of the operation.
Stakeholder engagement, including with local
communities, the Panamanian people and industry
and government officials, to work towards a
sustainable resolution for Cobre Panamá remains
a key priority. During the year, we expanded our
engagement with communities in Panama to
enhance transparency and provide accessible
information about Cobre Panamá. Throughout
2024, these outreach efforts reached over 40,000
Panamanian citizens through site visits and
briefings conducted in universities, schools, and
public spaces at more than 150 events nationwide.
In addition, over 300,000 Panamanians participated
in an online virtual tour of the Cobre Panamá via
Tour Virtual 360.
While arbitration is not First Quantum’s preferred
course of action, we have taken steps to protect
our investment with the initiation of proceedings
under the International Chamber of Commerce
and filing an initial notice of intent to arbitrate
under the Canada-Panama Free Trade Agreement.
A final hearing under the International Chamber
of Commerce arbitration is scheduled for
February 2026. Notwithstanding, we remain
committed to open dialogue with the Government
of Panama and to being part of a long-term
solution that benefits the country, its people,
and our stakeholders. In parallel, we welcome
the Government of Panama’s commitment to an
environmental audit as we remain confident that
the findings will validate the world-class standards
by which Cobre Panamá has always operated.
The Kansanshi S3 Expansion remains on track for
first production in the second half of 2025 and
represents a critical inflection point, returning the
Company to a trajectory of production growth and
a position of free cash flow generation. Throughout
2024, we delivered strong, tangible progress at the
project, including the construction and installation
of the SAG and ball mills, the gearless mill drives,
flotation cells, and erection of the pebble conveyors
and primary crusher. By the end of 2024, the project
had achieved 62% construction completion and early
commissioning work had commenced. Building
the workforce to ensure a smooth ramp-up of the
new concentrator, including hiring, onboarding and
training, is progressing well.
Along with the financial stability provided by the
financial initiatives at the start of the year, it was
also essential that Kansanshi and Trident deliver
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
6
strong operational performance. Accordingly, our
Zambian operations delivered strong performance
throughout 2024. As a result of several operational
initiatives during the year, the Company achieved
annual copper production of 431 thousand tonnes
in 2024, exceeding the guidance range of 400 to
420 thousand tonnes.
Kansanshi achieved its highest copper and gold
production since 2021 and 2022, respectively,
predominately driven by higher grades. Sentinel’s
increased copper production reflected higher grades
and throughput, with the highest average grades
since 2017. Most encouragingly, Sentinel moved
record volumes in 2024, which was driven by the
teams’ efforts on safe productivity in the pit.
Enterprise, Africa’s largest nickel mine, achieved
commercial production ahead of schedule, and
despite encountering difficult geology in December,
we mined through this area and we look forward to
good mine volumes to feed through the Enterprise
plant in 2025.
Zambia’s ongoing power challenge was a key focus
area in 2024. We successfully mitigated potential
disruptions by securing alternative power sources
through imports to ensure stable operations.
Additionally, we continued to support Zambia’s
broader energy resilience by collaborating on
long-term renewable energy solutions, including
partnerships with independent power producers.
Regrettably, we made the difficult decision to place
Ravensthorpe on care and maintenance in May of
2024 due to the high-cost structure of the operation.
The health and safety of our workforce remains our
highest priority and it was with deep regret that we
experienced the loss of a colleague at Kansanshi
in 2024. We extend our deepest sympathies to the
family and reaffirm our commitment to continuously
improving safety practices across all our operations.
First Quantum remains steadfast in its
environmental, social, and governance
commitments. In Zambia, our support for food
security initiatives and sustainable development
efforts further reinforced our commitment to
creating lasting positive impacts.
At Kansanshi, we collaborated with Hitachi
Construction Machinery Co Ltd and ABB Ltd to
trial the world’s first fully battery-powered ultra-
large dump truck which commenced testing
in June 2024. This project will test the truck’s
performance and battery management system,
aiming to reduce battery weight and improve load
capacity and efficiency using Hitachi Construction
Machinery’s dynamic charging technology and the
Company’s advanced trolley systems. With over
13 years of experience in implementing trolley-assist
systems, First Quantum has established itself as an
industry leader in this transformative technology.
We continue to take tangible steps towards
lowering the carbon intensity of our mining
operations and have committed to investing a
further $200 million on the Kansanshi mining
fleet over the next three years. These trucks will
be compatible with the Company’s trolley-assist
technology, Quantum Electra-Haul™, designed
to facilitate the transition to battery power. This
investment is expected to upgrade the existing
ex-pit fleet to fuel-source agnostic, higher payload
and more energy-efficient trucks. Quantum
Electra-Haul™ trolley lines currently installed at
Kansanshi will reduce diesel consumption by up
to 90% when trucks are connected.
It was pleasing to reach a Shareholder Rights
Agreement with Jiangxi Copper during the year,
which formalizes a clear basis for the relationship
between the two companies. We look forward to
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
Throughout 2024, the S3 Expansion project
at Kansanshi delivered strong, tangible
progress and remains on track for first
production in the second half of 2025.
7
Jiangxi Copper’s continued support.
We announced the appointment of Juanita
Montalvo and Hanjun Xia to the Board of Directors.
The new directors bring a diversity of skill sets
with Juanita’s experience in social affairs in Latin
America and Africa and Hanjun’s deep knowledge
of the copper market.
At our upcoming Annual General Meeting in
May 2025, Robert Harding will retire as Chair of
the Board, and we welcome Kevin McArthur as
our new Independent Chair. Kevin’s deep industry
knowledge through all stages of a mine life from
permitting, feasibility studies, and construction
to production, along with extensive leadership
experience make him well suited for the role to
guide the Company’s future. I would like to offer
my sincere personal thanks to Bob for his guidance,
knowledge and impact on the Board over the
years, including the last two years as Chair during a
period of challenge and change for First Quantum.
Kevin has been an invaluable director of the Board
since 2021 and I look forward to working more
closely with him in his new role as Chair.
2024 was a year of challenges, resilience and
progress. As we look to 2025, our priorities remain
clear. First, the delivery of the Kansanshi S3
Expansion project in 2025 will be an inflection point
for the Company that will enhance our financial
resilience and support continued growth. Secondly,
we will continue with the proactive management
of our balance sheet and liquidity position. Thirdly,
we look forward to commencing constructive
discussions with the Government of Panama for
a satisfactory outcome for Cobre Panamá. While
resolving the situation in Panama, we will continue
our public outreach programs which aim to show
the Panamanian public the benefits of Cobre
Panamá and that mining of natural resources
in an environmentally and socially responsible
manner is a necessity for our modern lives. Finally,
we will continue our focus on safe and productive
operational performance throughout.
I am confident in the outlook for First Quantum.
Once the Kansanshi S3 Expansion is delivered
and Cobre Panamá re-opens, First Quantum will
cement its status as a leading copper producer
and growth company. Within the Company’s
portfolios will be some of the world’s largest
copper-producing mines, coupled with industry-
leading growth optionality in our La Granja and
Taca Taca greenfield projects. Copper plays a
major role as the world continues to electrify,
industrialize and develop its digital infrastructure.
The world increasingly needs the copper that we
produce and we have the expertise and experience
to build and operate the world-class mines that
will be required to meet global demand. We are
proud of First Quantum’s contribution to society
in deploying technical capabilities, adding value
to economies and improving lives in the countries
where we operate.
I would like to thank our shareholders for their
continued trust and support. With a steadfast
focus on operational excellence, financial
discipline, and responsible resource development,
First Quantum is well-positioned to deliver value
for all stakeholders in the years ahead.
TRISTAN PASCALL
Chief Executive Officer
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
ROBERT HARDING
Independent Chair
Mr. Harding is a well-known and respected
executive in the Canadian business community.
He graduated with a Bachelor of Mathematics from
the University of Waterloo in 1980 and received his
Chartered Accountant designation the following
year. Mr. Harding began his career at a major
accounting firm before joining Hees International
(now Brookfield) where he served in progressively
senior roles including Controller, Chief Financial
Officer, Chief Operating Officer, and ultimately,
Chief Executive Officer in 1992. He retired from the
Board of Brookfield Asset Management, where he
was Chairman from 1997–2010, in 2019.
Member of: Audit Committee and
Nominating & Governance Committee
Mr. Pascall joined First Quantum in 2007. During his
time at the Company, he has worked in a variety of
site-based roles from pre-development of projects
through construction to operational responsibilities.
In 2015, he was appointed General Manager of Cobre
Panamá with responsibility for the operations
through the ramp-up and commercial production
phase. Prior to that, Tristan was part of the group
that developed, constructed and operated the
Sentinel project in Zambia and also worked on
projects at the Kansanshi mine and in the
Democratic Republic of Congo. Since 2020, Tristan
has held executive leadership roles in the Company
based in the UK.
Before joining First Quantum, Tristan spent eight
years in corporate finance and investment banking
with a focus on the resources industry. Tristan
graduated from the University of Western Australia
with a Bachelor of Engineering and Bachelor of
Commerce and completed an MBA at INSEAD
in France.
TRISTAN PASCALL
Chief Executive Officer
Board of Directors
8
Our Board of Directors is responsible
for the stewardship and long-term
success of First Quantum. Acting with
integrity towards employees, investors
and host communities is essential
to our success and to generating
shareholder value.
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
GEOFF CHATER
Independent Director
Mr. Chater is a geologist and corporate director
with over 35 years of experience in the mineral
exploration and mining industries operating
worldwide. As a capital markets and corporate
strategy consultant, he has focused on transaction-
related business development, strategic review,
relationship development, defense, mergers/
acquisitions, equity finance, and communications.
As a director, Mr. Chater has been involved in the
sale of several public resource companies, including
Nevsun Resources, Reservoir Minerals, Valley High
Ventures, and Mason Resources.
Mr. Chater currently serves as a Principal at Namron
Advisors. He previously served as an Independent
Director at New Gold Inc. (2021-2024), Corporate
Relations Manager at First Quantum Minerals Ltd.
(1999-2008), President of Valley High Ventures
Ltd. (2010-2011), President and CEO at Bearing
Resources Ltd. (2011-2012) and Luna Gold Ltd. (2014-
2015), Director of Nevsun Resources Ltd. (2016-2018)
and Mason Resources Ltd. (2017-2018). Mr. Chater
is a graduate of Texas Christian University with a
Bachelor of Science Degree in Geology.
Member of: Nominating and Governance
Committee and Human Resources Committee
Board of Directors continued
ALISON BECKETT
Independent Director,
Chair Human Resources Committee
Ms. Beckett has a career spanning both
industry and consulting, having worked at
Conoco (now ConocoPhillips) between 1991
and 2001 in roles across finance, commercial,
gas regulations and strategy.
From 2001 until 2020 she was an advisor
providing leadership advisory services at Egon
Zehnder. Currently she is Chair of Governors at
Sevenoaks School.
Member of: Audit Committee
Mr. Adams obtained his degree in Social Science
from Southampton University and qualified as
a Chartered Accountant in the United Kingdom
in 1981. He worked for the Anglo American group
of companies for 12 years up to 1999, his final
position being Vice President and Chief Financial
Officer of AngloGold North America based in
Denver, Colorado.
Mr. Adams worked for Aber Diamond Corporation as
Vice President and Chief Financial Officer from 1999
to 2003. Recent board roles include independent
non-executive Director of Torex Gold Resources and
Chairman of the Board of TMAC Resources Inc.
Member of: Audit Committee and Human
Resources Committee
ANDREW ADAMS
Independent Director
9
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
Ms. Hogenson has extensive operational, leadership
and executive experience in the oil and gas sector
worldwide having served as an executive at Santos
Limited and Unocal Corporation. Currently, she
is the Chief Executive Officer of Zone Oil & Gas, a
company she founded in 2008. Ms. Hogenson is also
an independent director at Verisk Analytics, a New
Jersey-based publicly traded data analytics and risk
assessment firm and a director at Tamarack Valley
Energy Ltd., a Calgary-based publicly traded oil &
gas upstream operator.
She previously served on the board of Parallel
Petroleum LLC, Cimarex Energy Co. and in an
advisory role at Samsung Oil & Gas, LLC and
Samsung C&T from 2008 to 2015. She also serves
on the Advisory Board of The Women’s Global
Leadership Conference and was a speaker at the
Harvard Business School Women’s Conference. Ms.
Hogenson earned a Bachelor of Science in Chemical
Engineering from The Ohio State University.
Member of: Environmental,
Health and Safety & CSR Committee
KATHLEEN HOGENSON
Independent Director,
Chair Nominating & Governance Committee
KEVIN MCARTHUR
Independent Director, Chair Environmental,
Health and Safety & CSR Committee
Mr. McArthur has over 40 years of experience
focused on mining operations, corporate
development and executive management. He
currently serves as a Director of Royal Gold, Inc.
and Novagold Resources Inc. Mr. McArthur recently
served as a non-executive Chair of Boart Longyear
Limited from 2019 to 2021, Chief Executive Officer
of Tahoe Resources Inc. from 2009 to 2015 and as
Executive Chair from 2015 to 2019.
Prior experience includes CEO of Goldcorp Inc. from
2006 to 2008 and CEO of Glamis Gold Ltd. from
1999 to 2006. His earlier career focused on mine
operations and project development with Glamis
Gold, BP Minerals and Homestake Mining Company.
Mr. McArthur obtained a degree in Mining
Engineering from the University of Nevada in 1979.
Member of: Human Resources Committee
JUANITA MONTALVO
Independent Director
Ms. Montalvo has over 25 years of governance,
executive, operations and investment experience
in the mining, extractive and agricultural industries
in various jurisdictions including Latin America
and Africa. She is a Managing Partner at Privus
Capital Inc., focused on private equity and strategic
corporate investments, and an Independent
Director of Dundee Precious Metals. Ms. Montalvo
has held various leadership roles, including as
Senior Vice President Corporate Affairs and
Sustainability at Sherritt International Corporation
and Country Manager in Madagascar during the
construction of the Ambatovy Joint Venture.
She is the Chairman of Wildlife Conservation
Society Canada and a founding member of the
Women for Nature initiative of Nature Canada.
She holds a B.Sc. in Biology and Biochemistry, a
B.A. in International Development Studies, and
a Masters in Development Economics, all from
Dalhousie University. She is also part of McKinsey’s
LGBTQ Leadership Master Class Alumni and has the
ICD.D designation from the Institute of Corporate
Directors and Rotman School of Management.
Board of Directors continued
10
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
SIMON SCOTT
Independent Director
Chair of the Audit Committee
Dr. Warner has considerable global asset
management experience in the metals, mining and
energy sectors, having served as Head of Global
Resources for Colonial First State Global Asset
Management from 2010 – 2017 (previously the
Senior Portfolio Manager from 2003 – 2007).
Dr. Warner earned a Bachelor of Applied Science
(Applied Chemistry) from the University of
Technology, Sydney and holds a D.Phil. in Solid State
Chemistry from the University of Oxford, England.
Member of: Environmental, Health and
Safety & CSR Committee and Human
Resources Committee
DR. JOANNE WARNER
Independent Director
HANJUN (KEVIN) XIA
Independent Director
Mr. Xia has over 20 years of experience in the global
copper industry, covering the entire industrial chain
from mining, smelting and processing to marketing
and trading.
Mr. Xia is currently at Jiangxi Copper Company
Limited, holding various roles since 2001, including
Coordinator in the Department of Overseas
Economic and Technical Cooperation, International
Cooperation Project Manager, Investor and
Government Relations Manager, Director of the
Office for Chairman and CEO and, more recently,
President of Marketing and Trading.
Mr. Scott has over 20 years of experience in the
mining industry. Between 2010 and 2016, he was
Chief Financial Officer of Lonmin plc, a London Stock
Exchange-listed platinum mining company and was
acting CEO between 2012 and 2013. Prior to that,
Mr. Scott was Chief Financial Officer of Aveng Limited,
a Johannesburg Stock Exchange-listed construction
company providing products and services to the
mining industry globally. Mr. Scott also held various
senior management positions in Anglo American
Platinum Limited including acting CFO.
His early career was spent in various financial
positions, including CFO of Southern Africa for JP
Morgan Chase. Mr. Scott is a Chartered Accountant
and holds degrees in both accounting and commerce
from the University of the Witwatersrand in South
Africa. He previously served on the board of AngloGold
Ashanti Holdings plc., a global gold mining company
(2019 - 2024). He is currently a Non-Executive Director
of Sylvania Platinum Limited, a PGMs-producing
company listed on the London Stock Exchange’s
Alternative Investment Market. As of 1 July 2024,
Mr. Scott was appointed Independent Non-Executive
Director of Gemfields Group Limited.
Member of: Environmental,
Health and Safety & CSR Committee
Board of Directors continued
11
2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
INDEX
OVERVIEW
FULL YEAR HIGHLIGHTS
FOURTH QUARTER HIGHLIGHTS
COBRE PANAMÁ UPDATE
OTHER DEVELOPMENTS
ENVIRONMENT, SOCIAL AND GOVERNANCE
GUIDANCE
SUMMARY OPERATIONAL RESULTS
OPERATIONS REVIEW
DEVELOPMENT PROJECTS
EXPLORATION
SUMMARY FINANCIAL RESULTS
LIQUIDITY AND CAPITAL RESOURCES
ZAMBIAN VAT
JOINT VENTURE
PRECIOUS METAL STREAM ARRANGEMENT
MATERIAL LEGAL PROCEEDINGS
REGULATORY DISCLOSURES
SUMMARY QUARTERLY INFORMATION
APPENDICES
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION
First Quantum Minerals Ltd. (“First Quantum” or “the Company”) is engaged in the production of copper, nickel and gold, and
related activities including exploration and development. The Company has operating mines located in Zambia, Türkiye and
Mauritania. The Company’s Cobre Panamá mine was placed into a phase of Preservation and Safe Management (“P&SM”)
in November 2023. The Company’s Ravensthorpe mine was placed into a care and maintenance (“C&M”) process in May
2024. The Company is progressing the Taca Taca copper-gold-molybdenum project in Argentina and is exploring La Granja
and the Haquira copper deposits in Peru.
This Management’s Discussion and Analysis (“MD&A”) should be read in conjunction with the audited consolidated financial
statements of the Company for the year ended December 31, 2024. The Company’s results have been prepared in
accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board (“IFRS”); and, are
presented in United States dollars, tabular amounts in millions, except where noted.
For further information on First Quantum, reference should be made to its public filings (including its most recently filed
Annual Information Form) which are available on SEDAR+ at www.sedarplus.com. Information is also available on the
Company’s website at www.first-quantum.com. This MD&A contains forward-looking information that is subject to risk
factors, see “Cautionary statement on forward-looking information” for further discussion. Information on risks associated
with investing in the Company’s securities and technical and scientific information under National Instrument 43-101 –
Standards for Disclosure for Mineral Projects (“NI 43-101”) concerning the Company’s material properties, including
information about mineral resources and mineral reserves, are contained in its most recently filed Annual Information Form.
This MD&A was prepared as of February 11, 2025.
OVERVIEW
In 2024, the Company’s Zambian operations continued to show strong operational performance, with Kansanshi achieving
its highest copper and gold production since 2021 and 2022, respectively, mainly driven by higher grades. Sentinel
increased copper production from 2023 to 2024, reflecting higher grades and throughput, and the mine achieved record ex-
pit mining volumes in the year. Despite the power challenges relating to the drought in Zambia, the Company’s proactive
sourcing of supplementary power allowed for minimal disruptions in the year. Furthermore, following the successful
commissioning and ramp up, Enterprise declared commercial production on June 1, 2024, and continues to deliver strong
operational results. The Kansanshi S3 Expansion remains on track for completion in mid-2025, representing an inflection
point that will enhance the Company’s financial resilience and support continued growth.
The Company filed an updated NI 43-101 Technical Report for Kansanshi on July 23, 2024. The technical report discloses
an updated Mineral Resource estimate which accounts for mining and processing depletions since the filing of the previous
report in September 2020. The increase in Mineral Reserve extends the operating life of Kansanshi by five years to 2049.
Cobre Panamá remains in a phase of P&SM with production halted. The P&SM program that would permit the shipment of
copper concentrate that remains on site continues to await approval from the Panamanian authorities. The Company is
committed to working constructively with the Government of Panama on the responsible stewardship and resolution for the
Cobre Panamá mine.
Ravensthorpe was placed into C&M in May 2024. C&M activities will continue to focus on execution of preventative
maintenance plans and to support its personnel and local regional communities.
During the year, the Company completed comprehensive refinancing and balance sheet strengthening initiatives, which
provided the Company with a solid financial position on which to deliver its operational objectives. These transactions
include a copper Prepayment Agreement, amendments to the Term Loan and Revolving Credit Facility, completion of the
offering of $1,600 million 9.375% senior secured second-lien notes due 2029, $1,150 million bought deal equity offering, and
the implementation of a copper hedging program.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 3
Year ended December 31, 2024
(In United States dollars, tabular amounts in millions, except where noted)
13
14
15
18
19
20
22
25
31
39
41
42
51
57
58
58
60
61
75
76
80
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS
13
12
Management’s Discussion and Analysis
FULL YEAR HIGHLIGHTS
Operational and Financial
Copper production, excluding Cobre Panamá, of 431 thousand tonnes (“kt”) was 14% higher than the prior year. Zambian
production of 402kt was 15% higher than 2023, reflecting continued mining discipline and higher grades at both Kansanshi
and Sentinel.
> Kansanshi recorded copper production of 171kt for the full year, 36kt higher than 2023. This reflects improved grade
control practices, resulting in higher feed grades. Kansanshi achieved its highest annual copper production since 2021.
> Sentinel achieved copper production of 231kt for the full year, 17kt higher than the prior year due to higher throughput
and grades. Throughput for December 2024 represented the highest monthly throughput since October 2022. Ex-pit
mining volumes were a record in 2024, reflecting higher productivities from the load and haul fleet.
> Enterprise declared commercial production as of June 1, 2024, and produced 19kt of nickel for the full year. The
nickel produced by Enterprise is expected to have a carbon intensity well below the industry average, an important
consideration as the world looks for supplies of responsibly mined metals required for the energy transition.
> Total gold production for the year of 139 thousand ounces (“koz”) was a 43% increase from the prior year, excluding
Cobre Panamá, attributable to higher grades at Kansanshi.
> Power restrictions continue in Zambia. The effects of the El Niño-induced drought constrained the country’s
hydropower generation during the year. The Company’s proactive strategy of securing supplementary power has allowed
the Company to maintain normal operations with minimal power interruptions.
> Copper C1 cash cost1 of $1.74 per pound (“lb”) for 2024 was $0.39 per lb lower than the prior year, excluding Cobre
Panamá, attributable to higher production at both Zambian operations and higher by-product credits. Copper AISC1 of
$2.57 per lb for 2024 was $0.42 per lb lower than the prior year, reflecting the lower copper C1 cash cost1.
> Cobre Panamá remains in a phase of P&SM with production halted. Approximately 1,300 workers remain on site and
further workforce reductions may occur depending on the timing of the P&SM program that would permit the shipment of
121 thousand dry metric tonnes of copper concentrate that remains on site. Implementation of the P&SM program
continues to await approval from the Panamanian authorities.
> Kansanshi S3 Expansion remains on track for completion in mid-2025. During 2024, the S3 Expansion project achieved
62% construction completion of the process plant and commenced early commissioning work, including the 33 kilovolts
(“kV”) power line and substation. Operational readiness achieved 62% completion with training of personnel on the
process simulator and field training at the Sentinel mine having commenced.
> Ravensthorpe was placed on C&M in early May 2024 and, as a result, produced 5 thousand contained tonnes of nickel
in 2024, a 77% decrease from 2023.
> Net earnings for the year attributable to shareholders of the Company of $2 million ($0.00 basic earnings per share)
represents a significant increase from the prior year’s net loss attributable to shareholders of the Company of $954 million
($1.38 basic loss per share). The increase was attributable to a higher gross profit, modification gains on loans, a
decrease in the tax expense and a lower impairment charge of $75 million in 2024 versus $900 million recognized in 2023
related to Ravensthorpe and exploration assets.
•
Gross profit of $1,350 million for the full year 2024 was an increase of $58 million from 2023, attributable to
improvement in copper prices and higher sales volumes at Kansanshi and Sentinel.
•
EBITDA2 of $1,491 million for the full year 2024 was a decrease of 36% from 2023, mainly due to lower sales
volumes, as a result of Cobre Panamá being placed into a phase of P&SM in the fourth quarter of 2023.
•
Cash flows from operating activities of $1,651 million ($2.03 per share2) for 2024 were $224 million or 16%
higher than the prior year, attributable to lower taxes paid combined with the receipt of $500 million attributable
to the copper Prepayment Agreement.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 4
1 Copper C1 cash cost (copper C1), and copper all-in sustaining costs (copper AISC) are non-GAAP ratios which do not have a standardized meaning prescribed
by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2 EBITDA is a non-GAAP financial measure, and cash flows from operating activities per share is a non-GAAP ratio, which do not have a standardized meaning
prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
> Net debt1 decreased by $890 million during the year to $5,530 million as at December 31, 2024. At December 31, 2024,
total debt was $6,342 million. The decrease was primarily attributable to the EBITDA2 contribution of $1,491 million,
along with proceeds from the bought deal share issuance and copper Prepayment Agreement. This was offset by capital
expenditures of $1,286 million, movements on working capital of $249 million and interest paid, inclusive of capitalized
interest, of $573 million.
> Amendments to the Term Loan and Revolving Credit Facility provided the Company with additional liquidity
headroom and increased the net leverage covenant from 3.50x to 5.75x Net Debt/EBITDA until June 30, 2025. The net
leverage covenant is reduced to 5.00x between July 1, 2025 and December 31, 2025; 4.25x between January 1, 2026
and June 30, 2026; and 3.75x thereafter.
> Completion of the offering of $1,600 million 9.375% senior secured second-lien notes due 2029, along with the
bought deal equity offering detailed below, allowed the Company to redeem in full its $1,050 million and $1,000 million
aggregate principal amount senior notes that were due in 2025 and 2026, respectively.
> Gross proceeds were approximately $1,150 million (C$1,553 million) from the previously disclosed bought deal
equity offering whereby 139,932,000 common shares were issued.
> Execution of a copper Prepayment Agreement (“Prepayment Agreement”) completed in February 2024 resulted in
gross proceeds of $500 million.
> A Shareholder Rights Agreement was entered into (the “Shareholder Rights Agreement” or “SRA”) with Jiangxi
Copper on July 23, 2024. The SRA has formalized and provides structure to the relationship that exists between the two
organizations.
FOURTH QUARTER HIGHLIGHTS
Operational and Financial
> Copper production and sales of 112kt and 112kt, respectively:
•
Copper production, excluding Cobre Panamá, was 14kt higher than the fourth quarter of 2023 and 4kt lower than
the previous quarter.
•
At Kansanshi, production of 48kt was 51% higher than the fourth quarter of 2023, driven by continued mining
discipline which resulted in higher feed grades on the sulphide and mixed circuits as well as higher recoveries on
the mixed circuit.
•
At Sentinel, production of 57kt was a 6% decrease from the fourth quarter of 2023 due to lower grades.
Throughput for December 2024 represented the highest monthly throughput since October 2022.
•
At Enterprise, nickel production was 4kt. Sources of nickel sulphide ore during the quarter were impacted by
weathering and alteration in the Southern Wall of the pit, and the presence of nickel silicates. In the second week
of December, the Enterprise flotation circuit was switched to treat copper ores from the Sentinel mine until the
relevant area in the Southern Wall was mined out in early January 2025 and nickel feed to the Enterprise
concentrator resumed.
> Copper C1 cash cost3 and copper AISC3, excluding Cobre Panamá, of $1.68 per pound (“lb”) and $2.50 per lb,
respectively:
•
The lower copper C1 cash cost3 for the quarter, compared to the fourth quarter of 2023, was mainly due to higher
copper production at Kansanshi and increased by-product credits.
•
The lower copper AISC3 reflects the lower copper C1 cash cost3 and lower deferred stripping4 at Kansanshi.
> Gold production of 39koz, excluding Cobre Panamá, was 16koz higher than the same quarter in 2023, attributable to
higher grades at Kansanshi.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 5
1 Net debt is a supplementary financial measure. These measures do not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2 EBITDA is a non-GAAP financial measure which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
3 Copper C1 cash cost (copper C1) and copper all-in sustaining cost (copper AISC), are non-GAAP ratios, which do not have a standardized meaning prescribed
by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
4 Deferred stripping is a non-GAAP financial measure which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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> At Trident, on October 15, 2024, FQM Trident signed a $425 million unsecured term loan facility (the “FQM Trident
Facility”) with a maturity date of September 2028 to replace the previous Trident facility that was scheduled to mature in
December 2025. Repayments on the FQM Trident Facility will commence in March 2026 and are due every six months
thereafter. This action is in line with the Company’s prudent management of its debt maturities.
> Hedging program: During the quarter, the Company entered into additional unmargined zero cost collars as protection
from downside price movements, financed by selling price upside beyond certain levels on a matched portion of
production. Approximately half of the planned production and sales in 2025 and over 90% of the same in 2026 remain
exposed to spot copper prices.
> Net earnings attributable to shareholders of the Company for the quarter was $99 million ($0.12 basic earnings per
share) and adjusted earnings1 was $31 million ($0.04 adjusted earnings per share2).
•
Gross profit was $405 million, an increase of $318 million or 366% from the same quarter in 2023, attributable
to higher realized copper and gold prices2.
•
Gross profit excluding Cobre Panamá and Ravensthorpe was $416 million, an increase of $299 million from
the same quarter in 2023. This was primarily attributable to higher net realized copper and gold prices2, higher
sales volumes and a favourable foreign exchange impact following the weakening of the Zambian Kwacha,
partially offset by lower net realized nickel prices2.
•
EBITDA1 of $455 million was higher than the same quarter of 2023, mainly due to higher gross profit.
•
Net earnings of $99 million was $1,546 million higher compared to loss of $1,447 million in the same quarter of
2023. This is attributable to higher gross profit, modification gains on loans, a decrease in tax expense and a
lower impairment charge of $2 million in the fourth quarter of 2024 versus $900 million recognized in the fourth
quarter of 2023 in relation to Ravensthorpe and exploration assets.
•
Cash flows from operating activities of $583 million ($0.70 per share2) were $768 million higher than the
same quarter of 2023, attributable to higher EBITDA1 and lower taxes paid. In 2023, pursuant to Law 406, Cobre
Panamá made a tax and royalty payment of $567 million.
> Net debt3 decreased by $61 million during the quarter, attributable to positive movements in EBITDA1 contribution and
working capital, partially offset by interest paid, and planned capital expenditure, mostly related to the Kansanshi S3
project.
CONSOLIDATED OPERATING HIGHLIGHTS
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Copper production (tonnes)1
111,602
116,088
160,200
431,004
707,678
Copper sales (tonnes)2
111,613
112,094
127,721
420,111
674,316
Gold production (ounces)
38,784
41,006
53,325
139,040
226,885
Gold sales (ounces)3
40,762
43,371
45,365
151,051
223,052
Nickel production (contained tonnes)4
3,720
4,827
7,313
23,718
26,252
Nickel sales (contained tonnes)5
5,578
4,598
5,719
26,032
23,220
1 Production is presented on a contained basis, and is presented prior to processing through the Kansanshi smelter.
2 Sales exclude the sale of copper anode produced from third-party concentrate purchased at Kansanshi. Sales of copper anode attributable to third-party
concentrate purchases were 5,994 tonnes and 31,421 tonnes for the three months and year-ended December 31, 2024, respectively, (10,965 tonnes and 40,134
tonnes for the three months and year-ended December 31, 2023, respectively).
3 Excludes refinery-backed gold credits purchased and delivered under the precious metal streaming arrangement (see “Precious Metal Stream Arrangement”).
4 Nickel production includes 7,906 tonnes of pre-commercial production from Enterprise for the year ended December 31, 2024, (4,527 tonnes for the year ended
December 31, 2023).
5 Nickel sales includes 5,734 tonnes of pre-commercial sales from Enterprise for the year ended December 31, 2024 (1,651 tonnes for year ended December 31,
2023).
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 6
1 Adjusted earnings (loss) and EBITDA are non-GAAP financial measures which do not have a standardized meaning prescribed by IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2 Realized metal prices, adjusted earnings (loss) per share and cash flows from operating activities per share are non-GAAP ratios, which do not have a
standardized meaning prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
3 Net debt is a supplementary financial measure which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
CONSOLIDATED FINANCIAL HIGHLIGHTS
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Sales revenues
1,256
1,279
1,218
4,802
6,456
Gross profit
405
456
87
1,350
1,292
Net earnings (loss) attributable to
shareholders of the Company
99
108
(1,447)
2
(954)
Basic net earnings (loss) per share
$0.12
$0.13
($2.09)
$0.00
($1.38)
Diluted net earnings (loss) per share
$0.12
$0.13
($2.09)
$0.00
($1.38)
Cash flows from (used by) operating
activities
583
260
(185)
1,651
1,427
Net debt1
5,530
5,591
6,420
5,530
6,420
EBITDA1,2
455
520
273
1,491
2,328
Adjusted earnings (loss)1
31
119
(259)
(17)
261
Adjusted earnings (loss) per share3
$0.04
$0.14
($0.37)
($0.02)
$0.38
Cash cost of copper production excluding
Cobre Panamá (C1) (per lb)3,4
$1.68
$1.57
$2.07
$1.74
$2.13
Total cost of copper production excluding
Cobre Panamá (C3) (per lb)3,4
$2.68
$2.54
$3.07
$2.75
$3.13
Copper all-in sustaining cost excluding
Cobre Panamá (AISC) (per lb)3,4
$2.50
$2.35
$2.97
$2.57
$2.99
Cash cost of copper production (C1) (per
lb)3,4
$1.68
$1.57
$1.82
$1.74
$1.82
Total cost of copper production (C3) (per
lb)3,4
$2.72
$2.59
$2.77
$2.80
$2.76
Copper all-in sustaining cost (AISC) (per
lb)3,4
$2.58
$2.42
$2.52
$2.66
$2.46
Realized copper price (per lb)3
$4.17
$4.24
$3.62
$4.15
$3.76
Net earnings (loss) attributable to
shareholders of the Company
99
108
(1,447)
2
(954)
Adjustments attributable to shareholders
of the Company:
Adjustment for expected phasing of
Zambian value-added tax (“VAT”)
(35)
(17)
20
(89)
(49)
Modification and redemption of
liabilities
(100)
–
–
(90)
–
Other adjustments
(3)
–
–
(3)
–
Ravensthorpe deferred tax write-off
–
–
160
–
160
Total adjustments to EBITDA1
excluding depreciation2
(58)
32
1,031
48
1,129
Tax adjustments
(12)
–
273
(3)
271
Minority interest adjustments
140
(4)
(296)
118
(296)
Adjusted earnings (loss)1
31
119
(259)
(17)
261
1 EBITDA and adjusted earnings (loss) are non-GAAP financial measures, and net debt is a supplementary financial measure. These measures do not have a
standardized meaning under IFRS and might not be comparable to similar financial measures disclosed by other issuers. Adjusted earnings (loss) have been
adjusted to exclude items from the corresponding IFRS measure, net earnings (loss) attributable to shareholders of the Company, which are not considered by
management to be reflective of underlying performance. The Company has disclosed these measures to assist with the understanding of results and to provide
further financial information about the results to investors and may not be comparable to similar financial measures disclosed by other issuers. The use of
adjusted earnings (loss) and EBITDA represents the Company’s adjusted earnings (loss) metrics. See “Regulatory Disclosures”.
2 Adjustments to EBITDA in 2024 relate principally to an impairment expense of $75 million and a credit relating to changes of restoration provision of $38 million
(2023 -impairment charges on Ravensthorpe and exploration assets, royalties, restructuring expenses and foreign exchange revaluations).
3 Adjusted earnings (loss) per share, realized metal prices, copper all-in sustaining cost (copper AISC), copper C1 cash cost (copper C1) and total cost of copper
(copper C3) are non-GAAP ratios, which do not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial measures
disclosed by other issuers. See “Regulatory Disclosures”.
4 Excludes the sale of copper anode produced from third-party concentrate purchased at Kansanshi. Sales of copper anode attributable to third-party concentrate
purchases were 5,994 tonnes and 31,421 tonnes for the three months and year-ended December 31, 2024, respectively (10,965 and 40,134 tonnes for the three
months and year-ended December 31, 2023, respectively).
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 7
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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COBRE PANAMÁ UPDATE
Preservation and Safe Management
Cobre Panamá currently remains in a phase of P&SM with production halted. Approximately 1,300 workers remain on site
and further workforce reductions may occur depending on the timing of the P&SM program that would permit the shipment of
121 thousand dry metric tonnes of copper concentrate that remains on site. Implementation of the P&SM program continues
to await approval from the Panamanian authorities.
At the request of the Ministry of Commerce and Industries (“MICI”), Cobre Panamá delivered a draft plan for the first phase
of the P&SM plan on January 16, 2024. Following a request for additional information and clarification from MICI, an updated
and expanded plan was presented to the Government of Panama (“GOP”) on March 26, 2024. On May 13, 2024, an
Intergovernmental Commission that had been convened to inspect the site and review the P&SM plan issued its Inspection
Report and recommendation for approval and implementation of the plan and its key activities, including the export of copper
concentrate that has been stored at site since operations were suspended, reactivation of the power plant, determining a
means of dealing with the sulphur containing ore stockpiles and providing material for the embankment walls of the tailings
facility. On June 11, 2024, the government, through MICI, requested additional updated information regarding the stability of
the Tailing Management Facility (“TMF”), which the company provided on June 17, 2024. Subsequently, there was an
election and a change of government on July 1, 2024. The incoming administration reviewed the P&SM plan upon taking
office in July 2024 and requested additional information, which was submitted by the Company on August 27, 2024, along
with a formal presentation to MICI on September 25, 2024. The plan is still pending government approval, and therefore not
all aspects of the plan have been able to be implemented by the Company.
The general elections were held in Panama during May 2024 and a new government took office on July 1, 2024 under the
leadership of President José Raúl Mulino. President Mulino has made public statements to the effect that his government
intends to address the Cobre Panamá mine in early 2025. The GOP also announced that an integrated audit of Cobre
Panamá would be conducted with international experts to establish a factual basis to aid in decision making for the future of
the mine.
On January 6, 2025, Panama’s Ministry of Environment (“MiAMBIENTE”) released the Terms of Reference for an
Environmental Audit of the Cobre Panamá mine. The audit will be conducted by international experts to provide updated
information on the status of the mine and support the GOP’s decision-making. The Terms of Reference for the
Environmental Audit were submitted to a public consultation process that concluded on February 7, 2025. Separately, an
independent audit of the copper concentrate stored on site was completed by the government in December 2024, which
confirmed the quantities of copper concentrate stored at the facilities.
On January 12, 2025, the Minister of Environment and the Minister of Public Security conducted a site visit of Cobre
Panamá. During the visit, the ministers toured the mine, process, port and power plant facilities to inspect the upkeep of the
mine and the status of surrounding communities and the environment. The visit also enabled the ministers to inspect 7,960
tons of ammonium nitrate stored at the mine’s Punta Rincón port. The Minister of Environment subsequently stated that the
ammonium nitrate should be exported, which commenced by road in January 2025. The P&SM plan is not yet approved by
the GOP.
In parallel with the upkeep of the mine site in advance of the approval of the P&SM plan, the Company has continued a
comprehensive program of public outreach across the country to enhance transparency and provide accessible information
about Cobre Panamá. Since the beginning of 2024, these outreach efforts have reached over 40,000 Panamanian citizens
through site visits and briefings conducted in universities, schools, and public spaces at more than 150 events nationwide.
Additionally, over 300,000 Panamanians have participated in an online virtual tour of the mine, further broadening public
engagement.
Arbitration Proceedings
Steps towards two arbitration proceedings have been taken by the Company. One under the Canada-Panama Free Trade
Agreement (FTA), and another under the International Chamber of Commerce (“ICC”) pursuant to the arbitration clause of
the Refreshed Concession Contract.
1.
On November 29, 2023, Minera Panamá S.A. (“MPSA”) initiated arbitration before the ICC's International Court
of Arbitration pursuant to the ICC’s Rules of Arbitration and Clause 46 of the Refreshed Concession Contract, to
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 8
protect its rights under Panamanian law and the Refreshed Concession Contract that the GOP agreed to in
October 2023. The arbitration clause of the contract provides for arbitration in Miami, Florida. The GOP
requested an extension to the proceedings following the replacement of external legal counsel and on the basis
that the new government required time to assess the situation concerning the mine. A final hearing for this matter
is now scheduled for February 2026.
2.
On November 14, 2023, First Quantum submitted a notice of intent to the GOP initiating the consultation period
required under the FTA. First Quantum submitted an updated notice of intent on February 7, 2024. First Quantum
is entitled to seek any and all relief appropriate in arbitration, including but not limited to damages and reparation
for Panama’s breaches of the Canada-Panama FTA. These breaches include, among other things, the GOP’s
failure to permit MPSA to lawfully operate the Cobre Panamá mine prior to the Supreme Court’s November 2023
decision, and the GOP’s pronouncements and actions concerning closure plans and P&SM at Cobre Panamá.
The Company has the right to file its arbitration claim under the FTA within three years of Panama's breaches of
the FTA.
The Company reiterates that arbitration is not the preferred outcome for the situation in Panama and it remains committed to
dialogue with the new GOP and to being part of a solution for the country and the Panamanian people.
OTHER DEVELOPMENTS
Zambian Power Supply
On February 29, 2024, Zambia’s President declared a National Emergency in response to a drought aggravated by El Niño.
As Zambia depends on hydro generation for most of its energy supply, the drought has had a significant impact on the
country’s power availability. Throughout the year, ZESCO has undertaken several measures, including allowing industrial
customers to purchase supplementary power imports, implementing load management and providing options for premium
power supplementary purchases, including from in-country thermal plants.
Zambia’s energy situation remained challenging through the fourth quarter. However, the Company’s proactive strategy of
securing supplementary power, primarily from Southern Africa, allowed the Company to maintain normal operations with
minimal power interruptions. The annualized impact of the Company’s supplementary sourcing strategy on the 2025 Copper
C1 cash cost1 is estimated to be approximately $0.07 per lb, which is included in the current guidance.
Zambia has received steady rainfall since the start of this rainy season in early November, which will continue through to the
end of March. Lake Kariba levels remain significantly lower than prior year due to the pulldown of lake levels earlier in 2024,
although a modest recharge has allowed water levels to rise 6% since the rainy season began. As such, the Company is not
planning for a full return to normal in-country hydroelectric power generation in 2025. To address the likely shortfall, the
Company has put sourcing plans in place for 2025 to ensure reliable electricity supply is available for its operations,
including the start-up of the Kansanshi S3 Expansion project.
First Quantum will continue collaborating with the national electricity utility, ZESCO, and third-party energy providers to
maintain a secure energy supply. Longer term, the 430 MW solar and wind project with TotalEnergies and Chariot Energy,
together with new hydropower initiatives in Zambia’s Northwest and Northern Provinces, remain on schedule for
commissioning by 2028. These developments are expected to bolster both First Quantum’s and Zambia’s overall energy
security.
Zambia 2025 National Budget
The 2025 National Budget was presented on September 27, 2024 by the Minister of Finance and National Planning, Dr.
Situmbeko Musokotwane, under the theme "Building Resilience for Inclusive Growth and Improved Livelihoods". No
significant changes were announced to the mining tax regime, with the Minister reaffirming his commitment to maintaining
stable and predictable tax policies to encourage investment.
However, on January 1, 2025, effective immediately, the suspension of the 15% export duty on gold doré was lifted following
the introduction of a Statutory Instrument (“SI”). January’s gold exports have been deferred to February, while active
discussions are underway with the Zambian Minister of Finance on the reinstatement of the export duty suspension.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 9
1 Copper C1 cash cost (copper C1) is a non-GAAP ratio, which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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Hedging Programs
Consistent with prior quarters, the Company entered into derivative contracts during the quarter, in the form of additional
unmargined zero cost copper collars, as protection from downside price movements, financed by selling price upside beyond
certain levels on a matched portion of production. Approximately half of the planned production and sales in 2025 and over
90% of the same in 2026 remain exposed to spot copper prices.
At February 11, 2025, the Company had zero cost copper collar contracts outstanding for 242,641 tonnes at weighted
average prices of $4.14 per lb to $4.81 per lb with maturities to June 2026.
Shareholder Rights Agreement Update
On July 23, 2024, the Company entered into a shareholder rights agreement (the “Shareholder Rights Agreement” or “SRA”)
with Jiangxi Copper Company Limited (“Jiangxi Copper”). The Shareholder Rights Agreement formalized and provided
structure to the relationship that exists between the two organizations.
NI 43-101 Technical Report for Kansanshi
On July 23, 2024, the Company filed an updated NI 43-101 Technical Report for Kansanshi. The Kansanshi Technical
Report discloses an updated Mineral Resource estimate which accounts for mining and processing depletions since the
filing of a previous report in September 2020. The updated Measured and Indicated Mineral Resource estimate, as at the
end of December 2023, now stands at 1,160.9 million tonnes (“Mt”) at an average copper grade of 0.61%TCu (excluding
stockpiles). Commensurate with the increase in the Mineral Resource inventory, and also accounting for depletion, the end
of December 2023 reported Proven and Probable Mineral Reserve has now risen to 935.2 Mt with an average grade of
0.56%TCu, and with an additional 169.5 Mt stockpiled at an average grade of 0.40%TCu. The increase in Mineral Reserve
extends the operating life of Kansanshi by 5 years to 2049.
ENVIRONMENT, SOCIAL AND GOVERNANCE (“ESG”)
Investing in mining innovation
The Company continues to take tangible steps towards lowering the carbon intensity of its mining operations and has
committed to investing a further $200 million on the Kansanshi mining fleet over the next three years, as outlined in the
capital expenditure guidance on page 13.
These trucks will be compatible with the Company’s trolley-assist technology, Quantum Electra-Haul™, designed to facilitate
the transition to battery power. This investment is expected to upgrade the existing ex-pit fleet to fuel-source agnostic, higher
payload and more energy-efficient trucks. This underlines the Company’s commitment to continue investing in innovative
technology as it seeks to decarbonize its mining operations through pit electrification.
Quantum Electra-Haul™ trolley lines currently installed at Kansanshi reduce diesel consumption by up to 90% when trucks
are connected. Future integration with battery technology, combined with the Company’s unique Quantum Electra-Haul™
trolley-assist technology, offers the potential for dynamic charging, further enhancing productivity while reducing reliance on
fossil fuels. The Company is continuing to progress trials of the world’s first ultra-large battery powered mining truck at
Kansanshi, in collaboration with Hitachi Construction Machinery Co Ltd. and ABB Ltd.
ESG Reporting
The latest ESG reports can be found in the ESG Analyst Centre on the Company’s website, under Sustainability. These
include the Task Force on Climate-Related Financial Disclosures-aligned Climate Change Reports, ESG Reports, Tax
Transparency and Contributions to Government Reports, the Extractive Sector Transparency Measures Act Report, the
Modern Slavery Report as well as the Company’s sustainability policies. The Company expects to publish its 2024
sustainability reporting in the second quarter of 2025.
Health & Safety
Tragically, on September 22, 2024, there was a fatal road traffic incident at the Kansanshi mine in Zambia involving a
tracked dozer and a light vehicle, fatally injuring an employee. The site Emergency Response Team was dispatched to the
area and the appropriate local authorities were notified. The tragic incident was subject to internal and external investigations
as well as a board review. The Company is committed to implementing the recommendations of these investigations across
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 10
the operations. The health and safety of the Company’s employees and contractors is a top priority and the Company is
focused on the continuous strengthening and improvement of the safety culture at all of its operations.
The Lost Time Injury Frequency Rates (“LTIFR”) is an area of continued focus and a key performance metric for the
Company. The Company’s rolling 12-month LTIFR is 0.04 per 200,000 hours worked as of December 31, 2024 (2023: 0.04).
Governance: Board leadership transition and renewal
Following over a decade as Lead Independent Director and two years as Chair of the Board, Robert Harding will retire at the
conclusion of the 2025 Annual General Meeting on May 8, 2025. At that time, Kevin McArthur, a Director since 2021, will
succeed him as Chairman.
“It has been a privilege to serve on First Quantum’s Board for the past twelve years and witness the Company’s
transformation,” said Robert Harding. “This announcement reflects the Board’s ongoing commitment to renewal, ensuring a
strong mix of experience and fresh insight over time. Having worked closely with Kevin, I am pleased with the Board’s
decision to appoint him as the next Chair. His deep industry knowledge and leadership experience make him well suited for
the role, and I have full confidence in him and the Board to guide the Company’s future.”
Kevin McArthur commented, “On behalf of the Board and the Company, I want to sincerely thank Bob for his leadership and
dedication over the years. He has helped guide First Quantum through some of its most challenging moments, always with a
steady hand and a clear vision for the future. His contributions have been invaluable, and we wish him all the best in his
retirement.”
“I wish to personally thank Bob for his guidance, support and impact both as a Board member and, in particular, during the
last two years as Chair during a period of challenge and change at First Quantum,” said Tristan Pascall, Chief Executive
Officer. “I am looking forward to working with Kevin in a much closer capacity in his new role and I know the Company will be
well served by his leadership of the Board. It is very healthy that we continue the ongoing Board succession process to
position the Company for its strategic objectives for 2025 and for the coming years of ongoing disciplined growth.”
On October 22, 2024, as part of the ongoing board renewal program, the Company appointed Juanita Montalvo and Hanjun
(“Kevin”) Xia to its Board of Directors with immediate effect.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 11
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
21
20
GUIDANCE
Guidance is based on a number of assumptions and estimates as of December 31, 2024, including among other things,
assumptions about metal prices and anticipated costs and expenditures. Guidance involves estimates of known and
unknown risks, uncertainties and other factors, which may cause the actual results to be materially different.
Production, C1 cash cost1 and capital expenditure guidance for 2025 to 2027 remain unchanged from the News Release
"First Quantum Minerals Announces 2024 Preliminary Production and 2025 - 2027 Guidance" dated January 15, 2025.
Guidance for 2025 to 2027 is presented with Cobre Panamá remaining in a phase of P&SM and Ravensthorpe in a phase of
C&M.
PRODUCTION GUIDANCE
000’s
2025
2026
2027
Copper (tonnes)
380 – 440
390 – 450
430 – 490
Gold (ounces)
135 – 155
215 – 240
200 – 225
Nickel (contained tonnes)
15 – 25
30 – 40
30 – 40
PRODUCTION GUIDANCE BY OPERATION1
Copper production guidance (000’s tonnes)
2025
2026
2027
Kansanshi
160 – 190
180 – 210
210 – 240
Trident - Sentinel
200 – 230
200 – 230
210 – 240
Other sites
20
10
10
Gold production guidance (000’s ounces)
Kansanshi
100 – 110
135 – 145
140 – 150
Guelb Moghrein
35 – 45
80 – 95
60 – 75
Nickel production guidance (000’s tonnes)
Trident - Enterprise
15 – 25
30 – 40
30 – 40
1 Production is stated on a 100% basis as the Company consolidates all operations.
Kansanshi copper production in 2025 and 2026 reflects a conservative ramp-up profile for S3, which remains on track for
first production in the second half of 2025. The progressive increase in copper production over the three-year guidance
period is attributable to production from S3. During 2024, the S3 Expansion project achieved 62% construction completion of
the process plant and commenced early commissioning work, including the 33kV power line and substation. Operational
readiness achieved 62% completion with training of new recruits on the process simulator and field training at the Sentinel
mine having commenced. The majority of the initial feed for S3 will be sourced from low-grade stockpiles before production
increases in 2027 as increased ore volumes of higher grade ore from the South East Dome deposit is fed into the plant.
Gold production guidance at Kansanshi reflects continued discipline of mining high-veined areas that contain higher gold
grades and the improved understanding of the sulphide copper-gold mineralization at depth.
Sentinel copper production in 2025 and 2026 reflects accelerated mining in Stages 3 and 4, which contains a higher
proportion of oxidized and transitional ore that is lower grade. Bringing forward production from Stages 3 and 4, along with a
balanced and responsible increase in waste stripping, is expected to de-risk future ore supply to achieve an optimal and
sustainable balance of grades and volumes during the life of the mine. This approach is underpinned by mining
productivities, Quantum Electra-Haul™ trolley-assist technology and waste dump profiles which also improves storm-water
management and the sequencing of in-pit crusher moves.
Enterprise production guidance is reflective of strong operational results achieved during the first year of commercial
production, despite persistent power disruptions, and demonstrates an increasing production profile as the orebody
becomes more accessible.
Guelb Moghrein gold production reflects the inclusion of gold production from Oriental Hill, which received mining approval in
2024. Mining activities will commence in 2025 with the majority of the gold from Oriental Hill being processed in 2026. Gold
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 12
1 C1 cash cost (C1) is a non-GAAP ratio, and does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
will also be extracted from tailings storage facilities and reprocessed through the newly commissioned Carbon-in-Leach
plant.
CASH COST1 AND ALL-IN SUSTAINING COST1
Total Copper
2025
2026
2027
C1 (per lb)1
$1.85 – $2.10
$1.85 – $2.10
$1.75 – $2.00
AISC (per lb)1
$3.05 – $3.35
$2.95 – $3.25
$2.85 – $3.15
Total Nickel
2025
2026
2027
C1 (per lb)1
$5.00 – $6.50
$3.75 – $5.00
$3.75 – $5.00
AISC (per lb)1
$7.50 – $9.25
$5.25 – $6.75
$5.25 – $6.75
1 C1 cash cost (C1) is a non-GAAP ratio, and copper all-in sustaining costs (copper AISC) are non-GAAP ratios which do not have a standardized meaning
prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2025 and 2026 copper C1 cash cost1 guidance is reflective of the adjusted production profile, higher contractor and
employee costs, combined with the impact of imported power costs at the Zambian operations as a result of the drought
conditions. These increases are partially offset by increased by-product gold credits from Kansanshi, higher capitalized costs
and a weaker Zambian kwacha.
AISC1 cash cost guidance reflects the updated production profile combined with increased sustaining capital expenditure2 at
Kansanshi as a result of a refined fleet replacement strategy and an increase in royalties driven by increased copper price
assumptions. AISC1 trends downwards as production from S3 commences.
Unit cost guidance assumes a gold price of $2,600 per ounce, average Brent crude oil price of $85 per barrel, Zambian
kwacha/US Dollar exchange rate of 26 and royalties based on consensus copper prices.
Total nickel unit cost guidance relates solely to the Enterprise operation while Ravensthorpe remains under a state of C&M.
Enterprise achieved commercial production in June 2024 with unit cost guidance decreasing year-on-year over the guidance
period as the production profile ramps up.
PURCHASE AND DEPOSITS ON PROPERTY, PLANT & EQUIPMENT
2025
2026
2027
Project capital1
590 – 650
330 – 360
120 – 150
Sustaining capital1
450 – 500
380 – 420
350 – 380
Capitalized stripping1
260 – 300
240 – 270
330 – 370
Total capital expenditure
1,300 – 1,450
950 – 1,050
800 – 900
1 Project capital, sustaining capital and capitalized stripping are non-GAAP financial measures which do not have a standardized meaning prescribed by IFRS and
might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2025 capital expenditure guidance reflects approximately $100 million of expenditure carried over from 2024. In addition, the
guidance period reflects higher cost pressures, such as power costs and labour rates.
Total capital expenditure for the S3 Expansion project remains unchanged at $1.25 billion with approximately $630 million
spent in 2024 and approximately $840 million spent to date. Across the three-year guidance period, capital expenditure for
the S3 Expansion project is expected to be approximately $400 million and includes pre-strip activities for the South East
Dome of approximately $100 million.
In addition to the S3 Expansion project, project capital2 in the three-year guidance period includes approximately:
•
$120 million at Kansanshi for the expansion of the smelter and tailings facilities and the installation of an in-pit
crusher,
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 13
1 C1 cash cost (C1) and All-in sustaining cost (AISC) are non-GAAP ratio, which does not have a standardized meaning prescribed by IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2 Sustaining capital and project capital are non-GAAP financial measure which do not have a standardized meaning prescribed by IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
23
22
•
$115 million for La Granja development, with the majority of the spend occurring in the back end of the guidance
period, predominantly on mineral rights as well as an Environmental Impact Assessment, drilling and other
environmental related activities,
•
$60 million in capital expenditures at Sentinel for the relocation of in-pit crushers,
•
$45 million for additional Quantum Electra-Haul™ trolley line installations across Kansanshi and Sentinel.
Within the three-year capital expenditure guidance, approximately $600 million relates to sustainability related project
capital1. Each of these projects are expected to drive improved sustainability performance and also improve cost structure
and productivity of the business.
The three-year capital expenditure guidance includes:
•
Replacement of the Kansanshi ex-pit mining fleet with more efficient and trolley-compatible trucks,
•
Continued expansion of Quantum Electra-Haul™ trolley-assist infrastructure across the Zambian operations to
lower diesel consumption and associated mine fleet greenhouse gas emissions, as well as offering the potential for
future integration with battery powered mining trucks,
•
Relocation and installation of in-pit crushers at the Zambian operations to optimize haul cycle efficiency and reduce
mine fleet diesel consumption,
•
Investments at Kansanshi to enhance the social infrastructure serving the workforce,
•
Investments to further develop the healthcare infrastructure and housing at Kalumbila town, adjacent to the Trident
operation,
•
Water initiatives at various operations to optimize management of water quality and reuse by operations,
•
Installation of a solar power plant at Enterprise to increase renewable energy use and reduce reliance on fossil-fuel
generators, and
•
Community engagement in relation to the La Granja and Taca Taca development projects in Peru and Argentina,
respectively.
Interest
Interest expense on debt for the year ended December 31, 2024 was $591 million. Interest expense on debt for the full year
2025 is expected to be approximately $600 million to $625 million and excludes finance cost accretion on related party loans
to Cobre Panamá and Ravensthorpe, finance cost accreted on the precious metal streaming arrangement and on the
Prepayment Agreement, capitalized interest expense and accretion on asset retirement obligation.
Cash outflow on interest paid for the year ended December 31, 2024 was $519 million and is expected to be approximately
$575 million to $600 million for the full year 2025. This figure excludes capitalized interest paid.
Capitalized interest for the year ended December 31, 2024 was $54 million and is expected to be approximately $25 million
for the full year 2025.
A significant proportion of the Company’s interest expense is incurred in jurisdictions where no tax credit is recognized.
Tax
The adjusted effective tax rate for 2024 was 29% due to the impact of interest expense for which there is no tax credit in
Canada.
The effective tax rate for 2025, excluding Cobre Panamá and interest expense, is expected to be approximately 30%.
Depreciation
Depreciation expense for the three months and year-ended December 31, 2024 was $169 million and $633 million, including
$10 million and $43 million for Cobre Panamá, respectively. The full year 2025 depreciation expense excluding Cobre
Panamá is expected to be between $700 million and $750 million. While under P&SM, depreciation at Cobre Panamá is
expected to be $80 million to $85 million on an annualized basis, which includes approximately $40 million of depreciation
associated with the concentrate shed sale.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 14
1 Project capital is a non-GAAP financial measure which do not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
SUMMARY OPERATIONAL RESULTS
Production
FOURTH QUARTER
QUARTERLY COPPER PRODUCTION BY OPERATION
QUARTERLY GOLD PRODUCTION BY OPERATION
'000 Tonnes
222
160
101
103
116
112
113
63
—
—
—
—
40
32
31
42
50
48
64
60
62
54
58
57
5
5
8
7
8
7
Cobre Panamá
Kansanshi
Sentinel
Other
Q3 2023
Q4 2023
Q1 2024
Q2 2024
Q3 2024
Q4 2024
'000 Ounces
73
53
27
32
41
39
46
31
—
—
—
—
20
17
20
24
32
30
7
5
6
8
9
8
1
1
Cobre Panamá
Kansanshi
Guelb Moghrein
Other
Q3 2023
Q4 2023
Q1 2024
Q2 2024
Q3 2024
Q4 2024
Copper production of 112kt for the fourth quarter of 2024, excluding Cobre Panamá, was 14% higher than the same
quarter of 2023, mainly attributable to higher feed grades at Kansanshi.
Gold production of 39koz for the fourth quarter of 2024, excluding Cobre Panamá, was 74% higher compared to 22koz in
the same quarter of 2023, mainly attributable to higher production in Kansanshi.
Nickel production at Enterprise for the fourth quarter of 2024 was 4kt, following the ramp-up to commercial production in
June 2024.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 15
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
25
24
FULL YEAR
YEAR-TO-DATE COPPER PRODUCTION BY OPERATION
YEAR-TO-DATE GOLD PRODUCTION BY OPERATION
'000 Tonnes
708
431
331
135
171
214
231
28
29
Cobre Panamá
Kansanshi
Sentinel
Other
December 31, 2023
December 31, 2024
'000 Ounces
227
139
130
—
69
105
26
31
2
3
Cobre Panamá
Kansanshi
Guelb Moghrein
Other
December 31, 2023
December 31, 2024
Copper production of 431kt for the year ended December 31, 2024, excluding Cobre Panamá, was 14% higher than the
same period of 2023.
Gold production of 139kt, excluding Cobre Panamá, was 43% higher compared to 97koz in 2023 mainly attributable to
higher gold grades at Kansanshi.
Nickel production at Enterprise of 19kt for the year ended December 31, 2024 is a 14kt increase from the 5kt in 2023.
Enterprise declared commercial production as of June 1, 2024.
Nickel production at Ravensthorpe of 5kt is a 77% decrease from 2023 as the operation was placed on C&M in early May
2024.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 16
Sales Volumes
FOURTH QUARTER
QUARTERLY COPPER SALES BY OPERATION
QUARTERLY GOLD SALES BY OPERATION
'000 Tonnes
219
128
102
95
112
112
114
36
—
—
42
31
32
36
49
49
59
55
63
51
54
55
4
6
7
8
9
8
Q3 2023
Q4 2023
Q1 2024
Q2 2024
Q3 2024
Q4 2024
'000 Ounces
77
45
30
37
43
41
46
20
—
—
24
19
21
29
34
32
7
6
9
8
8
9
1
Q3 2023
Q4 2023
Q1 2024
Q2 2024
Q3 2024
Q4 2024
Cobre Panamá
Kansanshi 1
Sentinel
Other
Cobre Panamá
Kansanshi
Guelb Moghrein
Other
1 Copper sales include third-party sales of concentrate, cathode and anode attributable to Kansanshi. Sales exclude the sale of copper anode produced from third-
party concentrate purchased at Kansanshi. Sales of copper anode attributable to third-party concentrate purchases were 5,994 tonnes for the three months
ended December 31, 2024 (10,965 tonnes for the three months ended December 31, 2023).
Copper sales volumes of 112kt for the fourth quarter of 2024, excluding Cobre Panamá, were 21% higher than the 92kt in
2023.
Gold sales volumes of 41koz for the fourth quarter of 2024, excluding Cobre Panamá, were 60% higher than the same
quarter of 2023 due to higher production at Kansanshi.
Nickel sales volumes were 6kt at Enterprise for the fourth quarter of 2024.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 17
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
27
26
FULL YEAR
YEAR-TO-DATE COPPER SALES BY OPERATION
YEAR-TO-DATE GOLD SALES BY OPERATION
'000 Tonnes
674
420
306
135
166
205
223
28
31
December 31, 2023
December 31, 2024
'000 Ounces
223
151
122
—
76
115
24
34
1
2
December 31, 2023
December 31, 2024
Cobre Panamá
Kansanshi 1
Sentinel
Other
Cobre Panamá
Kansanshi
Guelb Moghrein
Other
1 Copper sales include third-party sales of concentrate, cathode and anode attributable to Kansanshi. Sales exclude the sale of copper anode produced from third-
party concentrate purchased at Kansanshi. Sales of copper anode attributable to third-party concentrate purchases were 31,421 tonnes for the year ended
December 31, 2024 (40,134 tonnes for the year ended December 31, 2023).
Copper sales volumes for the year ended December 31, 2024, excluding Cobre Panamá of 420kt were 14% higher from
368kt in 2023.
Gold sales volumes for the year ended December 31, 2024, excluding Cobre Panamá, were 49% higher than the same
period in 2023.
Nickel sales volumes for the year ended December 31, 2024 were 20kt and 6kt at Enterprise and Ravensthorpe,
respectively.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 18
Cash Costs1
FOURTH QUARTER
QUARTERLY COPPER C1 CASH COST1
QUARTERLY COPPER AISC1
$ per lb
1.66
2.07
2.01
1.73
1.57
1.68
Kansanshi
Sentinel
Total excluding Cobre Panamá
Q3 2023
Q4 2023
Q1 2024
Q2 2024
Q3 2024
Q4 2024
1.20
1.40
1.60
1.80
2.00
2.20
2.40
$ per lb
2.54
2.97
2.77
2.71
2.35
2.50
Kansanshi
Sentinel
Total excluding Cobre Panamá
Q3 2023
Q4 2023
Q1 2024
Q2 2024
Q3 2024
Q4 2024
2.00
2.25
2.50
2.75
3.00
3.25
3.50
3.75
Excluding Cobre Panamá, total copper C1 cash cost1 of $1.68 per lb for the fourth quarter of 2024 was $0.39 per lb lower
than the same quarter of 2023, mainly reflecting higher copper production at Kansanshi and increased gold by-product
credits.
Excluding Cobre Panamá, total copper AISC1 of $2.50 per lb was $0.47 per lb lower than the same quarter of 2023,
reflecting the lower copper C1 cash cost1, lower sustaining capital expenditures2 at Sentinel, and lower deferred stripping2 at
Kansanshi.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 19
1 Copper C1 cash cost (copper C1), and copper all-in sustaining costs (copper AISC) are non-GAAP ratios which do not have a standardized meaning prescribed
by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2 Sustaining capital and deferred stripping are non-GAAP financial measures which do not have a standardized meaning prescribed by IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
29
28
FULL YEAR
YEAR-TO-DATE COPPER C1 CASH COST1
YEAR-TO-DATE COPPER AISC1
$ per lb
2.13
1.74
Kansanshi
Sentinel
Total excluding Cobre Panamá
December 31, 2023
December 31, 2024
1.25
1.50
1.75
2.00
2.25
2.50
$ per lb
2.99
2.57
Kansanshi
Sentinel
Total excluding Cobre Panamá
December 31, 2023
December 31, 2024
2.25
2.50
2.75
3.00
3.25
3.50
3.75
Excluding Cobre Panamá, total copper C1 cash cost1 of $1.74 per lb for the year ended December 31, 2024 was 18% lower
than 2023, driven by higher production at the Zambian operations and higher by-product credits.
Excluding Cobre Panamá, total copper AISC1 of $2.57 per lb was 14% lower than the same period in 2023, resulting from
the lower copper C1 cash costs1.
Please see the appendices from page 66 onward for further details on production and sales volumes by operation as well as
sales revenues and cash costs.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 20
1 Copper C1 cash cost (copper C1), and copper all-in sustaining costs (copper AISC) are non-GAAP ratios which do not have a standardized meaning prescribed
by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
OPERATIONS REVIEW
Kansanshi
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Waste mined (000’s tonnes)
24,079
26,844
14,276
93,651
59,877
Ore mined (000’s tonnes)
5,794
6,041
5,607
22,014
23,313
Sulphide ore milled (000’s tonnes)1
1,366
1,972
3,178
9,452
12,446
Sulphide ore grade processed (%)
0.85
0.59
0.50
0.60
0.51
Sulphide copper recovery (%)
90
92
87
91
88
Sulphide concentrate grade (%)
22.8
21.6
20.5
21.5
19.7
Mixed ore milled (000’s tonnes)1
3,184
3,122
1,903
10,061
7,773
Mixed ore grade processed (%)
1.05
1.05
0.61
0.98
0.63
Mixed copper recovery (%)
81
85
66
81
71
Mixed ore concentrate grade (%)
25.4
26.5
22.5
24.9
19.1
Oxide ore milled (000’s tonnes)1
1,878
1,817
1,678
7,404
7,232
Oxide ore grade processed (%)
0.77
0.82
0.80
0.74
0.83
Oxide copper recovery (%)
74
77
77
73
76
Oxide concentrate grade (%)
20.8
22.0
19.7
20.2
17.2
Copper production (tonnes)2
48,139
49,810
31,887
170,929
134,827
Copper smelter
Concentrate processed3
361,073
370,051
291,697
1,356,478
1,281,364
Copper anodes produced (tonnes)3
87,709
92,963
76,563
335,500
315,860
Smelter copper recovery (%)
97
97
98
97
98
Acid tonnes produced (000’s)
315
333
266
1,202
1,166
Copper sales (tonnes)4
49,141
49,131
31,295
166,287
135,385
Gold production (ounces)
29,787
31,659
16,718
105,103
68,970
Gold sales (ounces)
31,747
34,186
19,396
115,316
76,169
Copper all-in sustaining cost (AISC) (per
lb)5,6
$2.14
$2.15
$3.83
$2.48
$3.47
Copper cash cost (C1) (per lb)5,6
$1.21
$1.29
$2.43
$1.52
$2.27
Total copper cost (C3) (per lb)5,6
$2.33
$2.42
$3.69
$2.71
$3.48
Financial results ($ millions)
Copper
496
515
340
1,790
1,455
Gold
82
81
37
269
140
Other
–
–
–
–
3
Total sales revenues
578
596
377
2,059
1,598
Gross profit
210
204
12
552
132
EBITDA5
273
267
61
786
369
1 Measured in dry metric tonnes (“DMT”).
2 Production presented on a copper concentrate basis, i.e. mine production only. Production does not include output from the smelter.
3 Concentrate processed in smelter and copper anodes produced are disclosed on a 100% basis, inclusive of Trident and third-party concentrate processed.
Concentrate processed is measured in DMT.
4 Sales include third-party sales of concentrate, cathode and anode attributable to Kansanshi (excluding copper anode sales attributable to Trident). Sales exclude
the sale of copper anode produced from third-party concentrate purchased at Kansanshi. Sales of copper anode attributable to third-party concentrate purchases
were 5,994 and 31,421 tonnes for the three months and year-ended December 31, 2024, respectively, (10,965 and 40,134 tonnes for the three months and year-
ended December 31, 2023, respectively).
5 Copper all-in sustaining costs (copper AISC), copper C1 cash cost (copper C1), and total copper cost (copper C3) are non-GAAP ratios, and EBITDA is a non-
GAAP financial measure. These measures do not have a standardized meaning under IFRS and might not be comparable to similar financial measures disclosed
by other issuers. See “Regulatory Disclosures” for further information.
6 Excludes purchases of copper concentrate from third parties treated through the Kansanshi smelter.
Fourth Quarter
Kansanshi produced 48,139 tonnes of copper during the fourth quarter of 2024, which was 51% higher than the same
quarter of 2023. The increase was driven by continued mining discipline which resulted in higher feed grades and higher
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 21
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
31
30
recoveries on the sulphide and mixed circuits. The sulphide and mixed mill swap continued which increased the proportion of
mixed material which contained higher average feed grades. During the quarter, there was a planned plant shutdown in the
sulphide and mixed circuits for maintenance.
Gold production of 29,787 ounces for the fourth quarter of 2024 was 78% higher than the same quarter of 2023, attributable
to higher grades.
Copper C1 cash cost1 of $1.21 per lb was $1.22 per lb lower than the same quarter of 2023, primarily due to higher copper
production, increased by-product credits and capitalized costs, which offset the impact of increased electricity costs due to
higher prices of imported power and increased maintenance costs. Copper AISC1 of $2.14 per lb was $1.69 per lb lower than
the same quarter of 2023 due to lower copper C1 cash costs1 and deferred stripping2.
Sales revenues of $578 million for the fourth quarter of 2024 were 53% higher than the same quarter of 2023, reflecting
higher sales volumes, higher realized copper prices1, and higher by-product sales. Gross profit of $210 million was $198
million higher than the same quarter of 2023, reflecting higher sales revenues.
Full Year
Kansanshi produced 170,929 tonnes of copper for the year ended December 31, 2024, which was 27% higher than the
same period of 2023, and the highest production since 2021. This was attributable to improved grade control practices,
resulting in higher feed grades in particularly high-grade domains. Additionally, a mill swap allowed for the processing of a
higher proportion of mixed material that contained higher average feed grades. Oxide feed grades were impacted by ore
reclassifications with feed supplement from lower grade stockpiles.
Gold production for the year ended December 31, 2024 of 105,103 ounces was 52% higher than the same period of 2023,
mainly due to more selective mining methods employed on high-vein areas which contain higher grades.
Copper C1 cash cost1 of $1.52 per lb for the year ended December 31, 2024 was $0.75 per lb lower than the same period of
2023, mainly due to higher production, by-product credits and capitalized costs, which offset the impact of increased
electricity costs due to higher prices of imported power. Copper AISC1 of $2.48 per lb was $0.99 per lb lower than the same
period of 2023, driven by lower copper C1 cash costs1 and deferred stripping2.
Sales revenues of $2,059 million for the year ended December 31, 2024 were 29% higher than 2023 due to higher sales
volumes, realized copper prices1 and higher by-product sales. Gross profit for the year ended December 31, 2024 of $552
million was $420 million higher than the same period of 2023 due to higher sales revenues.
Kansanshi Copper Smelter
Fourth Quarter
The smelter treated 361,073 DMT of concentrate, producing 87,709 tonnes of copper anode and 315,000 tonnes of
sulphuric acid. The concentrate grade treated in the quarter was 25%. Concentrate treated was higher than the same
quarter of 2023 due to the processing of higher-grade, low-carbon, and low-sulphur third-party concentrates.
Full Year
The smelter treated 1,356,478 DMT of concentrate, producing 335,500 tonnes of copper anode and 1,202,000 tonnes of
sulphuric acid. The concentrate grade treated during the period was 25%. Concentrate treated was higher than the same
period of 2023 due to the processing of higher-grade, low-carbon, and low-sulphur third-party concentrates which have offset
the impact of the unplanned smelter shutdown during the first quarter of 2024.
Outlook
Production guidance for 2025 is 160,000 to 190,000 tonnes of copper and 100,000 to 110,000 ounces of gold. Copper and
gold production in 2025 includes production associated with the S3 Expansion, with first production expected in the second
half of 2025. The majority of the initial feed for S3 will be sourced from low-grade stockpiles.
A six-week maintenance shutdown of the Kansanshi smelter is planned in the second quarter of 2025.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 22
1 Copper all-in sustaining costs (copper AISC), Copper C1 cash cost (copper C1), and realized metal prices are non-GAAP ratios, which do not have a
standardized meaning under IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures” for further
information.
2 Deferred stripping is a non-GAAP financial measure which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
Through 2024, the S3 Expansion project achieved all key milestones. Refer to Development Projects section on page 29 for
further details on the project.
Trident - Sentinel copper mine and Enterprise nickel mine
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Sentinel
Waste mined (000’s tonnes)
30,881
24,539
23,188
109,087
86,053
Ore mined (000’s tonnes)
14,715
13,612
10,626
51,104
42,997
Copper ore milled (000’s tonnes)1
14,603
13,924
11,932
51,300
49,221
Copper ore grade processed (%)
0.44
0.48
0.55
0.51
0.49
Copper recovery (%)
87
87
91
88
90
Copper production (tonnes)
56,560
58,412
59,964
230,792
214,046
Concentrate grade (%)
23.9
24.5
28.4
25.5
28.0
Copper sales (tonnes)
55,117
53,662
55,112
222,791
205,160
Copper all-in sustaining cost (AISC) (per
lb)2
$2.88
$2.61
$2.51
$2.70
$2.67
Copper cash cost (C1) (per lb)2
$2.11
$1.86
$1.85
$1.94
$1.98
Total copper cost (C3) (per lb)2
$3.06
$2.76
$2.72
$2.85
$2.88
Enterprise
Waste mined (000’s tonnes)
9,723
11,030
11,550
42,022
35,202
Nickel ore mined (000’s tonnes)
646
677
556
2,691
1,237
Nickel ore milled (000’s tonnes)1
536
597
585
2,313
1,375
Nickel ore grade processed (%)
0.97
1.03
1.09
1.12
1.02
Nickel recovery (%)
72
78
43
72
32
Nickel production (tonnes)
3,720
4,827
2,751
18,725
4,527
Nickel sales (tonnes)
5,580
4,605
1,554
19,575
1,651
Nickel all-in sustaining cost (AISC) (per
lb)2,4
$7.48
$5.97
–
$6.31
–
Nickel cash cost (C1) (per lb)2,4
$4.62
$3.37
–
$3.76
–
Total nickel cost (C3) (per lb)2,4
$5.91
$4.76
–
$4.98
–
Financial results ($ millions)
Sales revenues – Copper
486
484
419
1,945
1,644
Sales revenues – Nickel
68
59
19
251
21
Sales revenues - Other
Total sales revenues
554
543
438
2,196
1,665
Gross profit3
159
204
112
733
432
EBITDA2
242
277
183
1,033
702
1 Measured in dry metric tonnes (“DMT”)
2 All-in sustaining costs (AISC), C1 cash cost (C1), and total cost (C3) are non-GAAP ratios, and EBITDA is a non-GAAP financial measure. These measures do
not have a standardized meaning under IFRS and might not be comparable to similar measures disclosed by other issuers. See “Regulatory Disclosures” for
further information.
3 Gross profit for the year ended December 31, 2024 includes cost of sales of $75 million related to the pre-commercial sales at Enterprise.
4 Pre-commercial production and sales volumes at Enterprise are not included in C1, C3 and AISC calculations.
Fourth Quarter
At the Sentinel mine, copper production of 56,560 tonnes for the fourth quarter of 2024 was 6% lower than the same quarter
of 2023 due to lower grades and recovery, partially offset by higher throughput. Throughput for December 2024 represented
the highest monthly throughput since October 2022. Mining performed well during the quarter with total ex-pit volumes 35%
higher than the fourth quarter of 2023 due to the development of Stage 3 (Western Cut-back) improving mining productivities
with increased availability of softer material on shorter haul cycles. Stripping in Stage 4 (Final Eastern Cut-back)
commenced during the fourth quarter.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 23
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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32
Grades were 20% lower than the same quarter of last year with the mining of lower grades from Stage 3, whereas mining in
the fourth quarter of 2023 was from high-grade areas of both Stage 1 and Stage 2. Throughput has benefited from improved
availability of the primary crushers as well as improved fragmentation of the ore with 22% higher volumes than the same
quarter of 2023. In-pit crusher 1 was successfully relocated and commissioned in its new location in December, two months
ahead of schedule. Recovery is 4% lower than the same quarter of 2023 due to the lower grade and ore-type B (“OTB”)
material from Stage 3.
Copper C1 cash cost1 of $2.11 per lb for the fourth quarter of 2024 was $0.26 per lb higher than the same quarter of 2023
due to lower copper production, higher electricity, employee, maintenance, and contractor costs, partially offset by lower fuel
costs and higher capitalized costs. Copper AISC1 for the fourth quarter of 2024 of $2.88 per lb was $0.37 per lb higher than
the same quarter of 2023, reflecting higher C1 cash cost1, higher deferred stripping2 and royalties, partially offset by lower
sustaining capital expenditure2.
Copper sales revenues of $486 million was $67 million higher than the same quarter of 2023, reflecting higher realized
copper prices1. Sales revenues comprise of both concentrate and anode sales, with a higher proportion of revenue realized
from copper anodes.
Gross profit of $159 million was $47 million higher than the same quarter of 2023, reflecting higher sales revenues.
Full Year
At the Sentinel mine, copper production of 230,792 tonnes for the year ended December 31, 2024 was 8% higher than 2023
due to higher throughput and grades, partially offset by lower recovery. Grades were 4% higher than 2023 as mining activity
was focused at the bottom of the high-grade Stage 1 pit, which was inaccessible for a significant portion of 2023 due to the
accumulation of water, with 2024 benefiting from an increased focus on strategic planning and management of site-wide
water balance and reduction of contact water generation. Throughput was 4% higher than 2023 with the development of
Stage 3 (Western Cut-back) that increased availability of the softer material, improved availability of the primary crushers
and improved fragmentation of the ore. Ex-pit mining volumes were a record in 2024 reflecting higher productivities from the
load and haul fleet.
Copper C1 cash cost1 of $1.94 per lb for the year ended December 31, 2024 was $0.04 per lb lower than the same period in
2023, reflecting higher copper production and lower reagents, tires and fuel costs, partially offset by higher electricity,
maintenance, explosives, contractors and employee costs. Copper AISC1 of $2.70 per lb was higher than the same period of
2023.
Copper sales revenues of $1,945 million were $301 million higher than the same period in 2023, due to higher copper sales
volumes and realized copper prices1. Sales revenues comprise of both concentrate and anode sales, with a higher
proportion of revenue realized from copper anodes.
Gross profit of $733 million was $301 million higher than 2023, reflecting higher sales revenues.
Outlook
Production guidance for 2025 is 200,000 to 230,000 tonnes of copper.
In 2025, the focus at Sentinel will be on increasing mill throughput with various ongoing initiatives in place to optimize blast
fragmentation, maintaining full stockpiles, improved milling rates and flotation recovery. Grades are expected to be lower
than 2024, in line with the pit development sequence. Stage 3 will supply a majority of the ore with lower volumes from
Stage 1 and Stage 2 compared to prior years. The relocation of in-pit crusher 2 has been planned for the 2025 year,
including installation of an innovative rail-driven conveyor system that is expected to result in reduced electricity and
maintenance costs. A major overhaul is planned for a rope shovel during the second quarter. The Quantum Electra-Haul™
trolley assist network will be expanded in Stage 2 and Stage 3. Stripping will continue in Stage 4, with ore expected to be
available in 2026. Bringing forward production from Stages 3 and 4, along with a balanced and responsible increase in
waste stripping, is expected to de-risk future ore supply to achieve an optimal and sustainable balance of grades and
volumes during the life of the mine.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 24
1 Copper all-in sustaining costs (copper AISC), Copper C1 cash cost (copper C1), and realized metal prices are non-GAAP ratios, which do not have a
standardized meaning under IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures” for further
information.
2 Sustaining capital and deferred stripping are non-GAAP financial measures which do not have a standardized meaning prescribed by IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
Enterprise
Fourth Quarter
For the fourth quarter of 2024, Enterprise produced 3,720 tonnes of nickel. Sources of nickel sulphide ore during the quarter
were impacted by weathering and alteration in a fault line in the Southern Wall of the pit, and the presence of nickel silicates.
In the second week of December, the Enterprise flotation circuit was switched to treat copper ores from the Sentinel mine
while the fault area was mined through and the altered material was stockpiled separately for blending with fresh nickel
sulphide ore. The relevant area in the Southern Wall was mined out in early January 2025 and nickel feed to the Enterprise
concentrator resumed.
Nickel C1 cash cost1 and AISC1 was $4.62 per lb and $7.48 per lb, respectively, for the fourth quarter of 2024.
Full Year
Following a successful ramp-up, Enterprise declared commercial production on June 1, 2024. For the year ended December
31, 2024, Enterprise produced 18,725 tonnes of nickel.
Nickel C1 cash cost1 and AISC1 was $3.76 per lb and $6.31 per lb, respectively, for the year ended December 31, 2024.
As a result of recent changes to IFRS, sales proceeds and related costs associated with nickel sold during the pre-
commercial ramp-up phase, up to May 31, 2024, are required to be recognized through earnings rather than being
capitalized.
Outlook
Production guidance for 2025 is 15,000 to 25,000 contained tonnes of nickel.
The focus for 2025 at Enterprise will be on optimizing the development of the pit to supply feed volumes to the plant.
Additional reverse circulation (“RC”) drilling will be performed to obtain additional geological information. Grades are
expected to be lower than 2024. Recovery will benefit from a better understanding of the geological characteristics of the
ore.
Cobre Panamá
Fourth Quarter
Production at Cobre Panamá has been halted since November 2023.
During the quarter, the process plant assets inspection frequency was maintained at 56 days and the equipment start-up
frequency remained unchanged at 14 days to preserve equipment through dynamic lubrication and monitoring asset
conditions. All the major ultra-class mobile equipment is in a maintenance cycle that adheres to the original equipment
manufacturer’s long-term storage recommendations and includes periodic inspections as well as scheduled startups.
In addition to asset preservation, a key focus continues to be on maintaining the environmental stability for all areas of the
site and compliance with the environmental and social impact study (“ESIA”) for the project, which remains in force. Primary
activities are in cleaning and maintenance works at sediment ponds, managing surface water at the waste dump and low-
grade stockpiles, and treatment of water to manage the pH levels.
Costs in the fourth quarter were approximately $13 million per month, which included labour, maintenance spares,
contractors’ services, electricity, and other general expenses, including the public outreach program across the country to
enhance transparency and provide accessible information about Cobre Panamá. The reduction in active equipment for
tailings management facility and open pit maintenance continued during the quarter. The Company is actively managing the
maintenance costs of Cobre Panamá and will adjust the level of employment and the cost of these activities according to the
conditions on the ground in Panama.
Cobre Panamá’s power station has been offline since operations were suspended in the fourth quarter of 2023 and is
currently awaiting the approval of the P&SM plan by the government of Panama and extension of the generation license by
the National Authority of Public Services (“ASEP”) before restarting as part of the implementation of the P&SM plan.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 25
1 Nickel all-in sustaining cost (nickel AISC), and nickel C1 cash cost (nickel C1) are non-GAAP ratios, and do not have standardized meanings under IFRS and
might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures” for further information.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
35
34
Approximately 121 thousand dry metric tonnes of copper concentrate remain onsite following the 2023 disruptions at the
Punta Rincón port. On January 29, 2024, the Attorney General of Panama advised that “minerals extracted through mining
concessions granted in accordance with the Mining Code belong to the concessionaire”. Because the copper concentrate
relates to the period prior to the unconstitutionality ruling by the Panamanian Supreme Court of Justice on November 28,
2023, against Law 406, article 2 of the Panamanian Mineral Resources Code establishes that this copper concentrate
belongs to the Company as the concessionaire at the time the mineral was extracted and processed. The Intergovernmental
Commission that reviewed the P&SM plan has recommended the timely export of the concentrate and the approval of all
activities outlined in the P&SM plan.
The above measures have been included in the P&SM plan that was first submitted to MICI in January 2024, and in the
updated and expanded plan that was submitted to MICI at the end of March 2024, and further annexes elaborated on June
17 and August 27, 2024. On January 12, 2025, the Minister of Environment and the Minister of Public Security conducted a
site visit of Cobre Panamá. During the visit, the ministers toured the mine, process, port and power plant facilities to inspect
the upkeep of the mine and the status of surrounding communities and the environment. The visit also enabled the ministers
to inspect 7,960 tons of ammonium nitrate stored at the mine’s Punta Rincón port. The Minister of Environment subsequently
stated that the ammonium nitrate should be exported, which commenced by road in January 2025. The P&SM plan is not yet
approved by the GOP.
Full Year
During the year ended December 31, 2024, no volumes were mined or milled, and nor were any copper or gold metals
produced.
There were no metal sales for the year ended December 31, 2024. Approximately 121 thousand dry metric tonnes of copper
concentrate remains unsold.
P&SM expenses for the year ended December 31, 2024 totaled $191 million. The total cash outflow for the year at Cobre
Panamá related to P&SM costs, working capital, capital expenditures, royalties, and payments relating to restructuring costs,
was approximately $370 million.
Outlook
Cobre Panamá currently remains in a phase of P&SM with production halted and production guidance suspended. P&SM
costs are expected to be between $12 million to $13 million per month in 2025.
Guelb Moghrein
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Copper production (tonnes)
4,421
4,688
3,246
17,792
13,014
Copper sales (tonnes)
4,951
4,845
2,700
18,851
12,717
Gold production (ounces)
8,428
8,621
5,327
31,478
26,363
Gold sales (ounces)
8,658
8,382
5,539
33,627
23,546
Magnetite concentrate production
(WMT)1
166,778
140,267
126,187
558,657
546,989
Magnetite concentrate sales (WMT)1
141,704
142,180
133,154
515,016
636,586
Copper all-in sustaining cost (AISC) (per
lb)2
$1.30
$1.55
$2.73
$1.80
$2.96
Copper cash cost (C1) (per lb)2
$1.01
$1.09
$2.24
$1.31
$2.44
Financial results ($ millions)
Sales revenues
79
75
43
286
207
Gross profit
26
25
2
81
19
EBITDA2
31
29
4
97
27
1 Magnetite concentrate production and sales volumes are measured in wet metric tonnes (“WMT”).
2 Copper all-in sustaining costs (copper AISC), copper C1 cash cost (copper C1), are non-GAAP ratios, and EBITDA is a non-GAAP financial measure. These
measures do not have a standardized meaning under IFRS and might not be comparable to similar measures disclosed by other issuers. See “Regulatory
Disclosures” for further information.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 26
Fourth Quarter and Full Year
Copper production for the fourth quarter and full year ended December 31, 2024 were 36% and 37% higher, respectively,
than the same periods of 2023, attributable to higher feed grades as a result of the nature of material fed from the ore
stockpile and Cutback 4.
Gold production for the fourth quarter and full year ended December 31, 2024 was 58% and 19% higher, respectively,
compared to the same periods of 2023 as a result of higher grades and recoveries.
Magnetite production for the fourth quarter of 2024 was 32% higher compared to the same quarter of 2023 due to higher
throughput and feed grade. Magnetite production for the year ended December 31, 2024 was 2% higher than 2023 due to
higher throughput.
Copper C1 cash cost1 for the fourth quarter and full year ended December 31, 2024 were $1.23 and $1.13 per lb lower,
respectively, compared to the same periods of 2023, attributable to higher copper production. Copper AISC1 for the fourth
quarter of 2024 was $1.30 per lb, $1.43 per lb lower than the same quarter of 2023, attributable to lower C1 cash cost1 and
lower sustaining capital expenditures2. Copper AISC1 for the year ended December 31, 2024 was $1.80 per lb, $1.16 per lb
lower than the prior year due to lower C1 cash cost1, partially offset by higher sustaining capital expenditures2.
Sales revenues for the fourth quarter and full year ended December 31, 2024 were 84% and 38% higher, respectively,
compared to the same periods of 2023 due to higher copper and gold sales volumes and higher realized metal prices1.
Gross profit for the fourth quarter and full year ended December 31, 2024 was $24 million and $62 million higher,
respectively, than the comparable periods of 2023, attributable to higher sales revenues.
Outlook
Production in 2025 is expected to be approximately 10,000 tonnes of copper, 35,000 to 45,000 ounces of gold, and 525,000
WMT of magnetite concentrate.
Extraction of Cutback 4 ore continues and is expected to be fully extracted by the second half of 2025. Gold production
includes production from Oriental Hill, which received mining approval in the fourth quarter of 2024 with ore expected to be
extracted in 2025. Gold will also be extracted from tailings storage facilities and reprocessed through the new Carbon-in-
Leach plant, which was commissioned in October 2024. Production continues to ramp up through the first quarter of 2025 as
circuit constraints and water supply deficiencies are addressed.
Production forecast in 2025 includes fibre shutdowns in seven-week intervals. A major SAG mill reline is planned for six days
in the first quarter of 2025 and a two-day shutdown is scheduled for the third quarter of 2025 to replace the grates.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 27
1 Copper C1 cash cost (copper C1), copper all-in sustaining costs (copper AISC), and realized metal prices are non-GAAP ratios, which do not have a standardized
meaning prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2 Sustaining capital is a non-GAAP financial measures, which does not have standardized meanings prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
37
36
Çayeli
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Copper production (tonnes)
2,482
3,178
2,487
11,491
11,036
Copper sales (tonnes)
2,404
4,456
2,805
12,182
10,583
Zinc production (tonnes)
406
542
374
2,629
3,597
Zinc sales (tonnes)
–
–
4,142
1,998
4,142
Copper all-in sustaining cost (AISC) (per
lb)1
$3.83
$2.54
$2.90
$2.81
$2.55
Copper cash cost (C1) (per lb)1
$2.91
$1.93
$2.31
$2.05
$1.97
Financial results ($ millions)
Sales revenues
21
37
25
103
83
Gross profit
7
18
5
42
18
EBITDA1
6
18
9
42
31
1 Copper all-in sustaining costs (copper AISC), copper C1 cash cost (copper C1), are non-GAAP ratios, and EBITDA is a non-GAAP financial measure. These
measures do not have a standardized meaning under IFRS and might not be comparable to similar measures disclosed by other issuers. See “Regulatory
Disclosures” for further information.
Fourth Quarter and Full Year
Copper production for the fourth quarter of 2024 was comparable to the same quarter of 2023. Copper production for the
year ended December 31, 2024 was 4% higher than the same period of 2023, attributable to higher grades.
Zinc production for the fourth quarter of 2024 was 9% higher than the same quarter of 2023, attributable to higher grades.
Zinc production for the year ended December 31, 2024 was 27% lower than 2023, due to lower throughput and recoveries.
Copper C1 cash cost1 of $2.91 per lb for the fourth quarter of 2024 was $0.60 per lb higher than the same period of 2023,
attributable to lower by-product credits. Copper C1 cash cost1 of $2.05 per lb for the year ended December 31, 2024 was
$0.08 per lb higher than the prior year due to higher employee costs following the higher TRY inflation rate and lower by-
product credits.
Gross profit of $7 million for the fourth quarter of 2024 was $2 million higher than the same quarter of 2023 due to higher
realized copper prices1. Gross profit for year ended December 31, 2024 of $42 million was $24 million higher than the same
period of 2023 due to higher sales revenues, attributable to higher copper sales volume and higher realized copper prices1.
Outlook
Production for 2025 is expected to be 10,000 tonnes of copper and 3,500 tonnes of zinc. Copper and zinc production
includes production from the South Orebody, which received mining approval in January 2025. First stope production is
expected in the first quarter of 2025.
An updated NI 43-101 Technical Report on Reserves and Resources is expected to be filed during the first half of 2025.
Ravensthorpe
Fourth Quarter and Full Year
Ravensthorpe was placed into C&M in May 2024 with production halted and production guidance suspended. C&M costs for
the quarter averaged $2 million per month.
Nickel production for the year ended December 31, 2024 was 4,993 contained tonnes and sales revenues for the year
ended December 31, 2024 were $89 million, a 77% and 73% decrease, respectively, compared to the same period of 2023,
due to the decision to place the Ravensthorpe operation into a period of C&M in May 2024.
Gross loss of $30 million for the year ended December 31, 2024 was an increase of $94 million compared to the gross loss
of $124 million for same period in 2023. The net realized nickel price1 for the year ended December 31, 2024 was $7.38 per
lb, a 19% decrease from 2023.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 28
1 Copper C1 cash cost (copper C1) and realized metal prices are non-GAAP ratios, do not have standardized meanings under IFRS and might not be comparable
to similar financial measures disclosed by other issuers. See “Regulatory Disclosures” for further information.
Outlook
C&M activity is focused on the execution of preventative maintenance plans that have been developed with major equipment
being run and monitored to help maintain it in good working condition. In addition, the Company continues to support its
personnel and local regional communities. Environmental approvals for Shoemaker Levy, Wind Farm and Tamarine Quarry
continue to progress. C&M costs are expected to be between $1.5 million and $2 million per month going forward.
DEVELOPMENT PROJECTS
Brownfield Projects
Kansanshi S3 Expansion
The S3 Expansion will transition Kansanshi from the current, more selective high-grade, medium-scale operation to a
medium-grade, larger-scale mining operation. Most of the capital spend on the S3 Expansion was incurred in 2024, and first
production is expected in the second half of 2025.
During the fourth quarter of 2024, the gearless mill drive installations were completed and the 33kV overhead line and
substation was commissioned. Civil and structural workstreams are substantially progressed. Work in priority mechanical
areas continues together with completion of piping and electrical systems to allow early commissioning of major systems.
At the end of 2024, the project achieved 62% construction completion of the process plant and commenced early
commissioning work. System configuration of the plant control system is at 80%, focused on functionality of cleaner and
reagent circuits, and functional testing of services areas. The plant simulator is available for operator training on site, with E-
learning modules being released for use. Operational readiness achieved 62% completion with training of personnel on the
process simulator.
Work is also underway to increase throughput capacity of the Kansanshi smelter to 1.6 Mtpa from the current capacity level
of 1.3 Mtpa. The capacity increase is expected to be achieved from expansion of ancillary plant at the smelter, including the
oxygen, condenser and acid plant, and also partly through enhancing copper concentrate grades by lowering the carbon and
pyrite content of the Kansanshi and Sentinel concentrate feeds. In addition to increased capacity, the smelter expansion is
expected to create greater flexibility should smelter capacity constraints in the Zambian Copperbelt arise, as well as reduce
downstream Scope 3 greenhouse gas (“GHG”) emissions from the transport and refining of copper concentrate at third party
smelters. During the quarter, the new waste heat boiler condenser and 5th train of wet electrostatic precipitators were
completed and successfully commissioned. Installation of the high pressure oxygen compressor was completed with
commissioning in progress. All major oxygen plant equipment arrived on site and installation is progressing. Acid Plant 5 civil
work was completed with structural mechanical and piping installation in progress.
Las Cruces Underground Project
On February 20, 2024, the Company filed an updated NI 43-101 Technical Report on Mineral Resources and Reserves for
the Las Cruces Underground Project. The purpose of the Technical Report was to update the 2022 Mineral Resources
estimate, declare a Mineral Reserves estimate and provide commentary on the project development strategy. The updated
NI 43-101 Technical Report is available on the Company’s public filings on SEDAR+ at www.sedarplus.com.
Greenfield Projects
Taca Taca
Taca Taca, located in the Salta province of Argentina, is the most advanced of the Company’s greenfield projects and is one
of the largest, highest-quality copper projects globally. It will consist of an open-pit copper mine and ore processing plant to
produce up to 275kt of copper per year along with gold and molybdenum by-products. With an initial mine life of 32 years
and a large resource base, Taca Taca will be a long-life asset.
The project´s primary Environmental and Social Impact Assessment (“ESIA”) continues to be under evaluation by the
Secretariat of Mining of Salta Province. Key milestones such as an independent evaluation from SEGEMAR (Argentinian
Geological and Mining Service) were completed during the fourth quarter of 2024, which included a workshop and site visit.
Following a decision on the ESIA, subsequent proceedings for detailed construction and operation permits will continue.
Since obtaining the environmental pre-feasibility approval for the 345kV power line in November 2022, the Company has
been advancing with the additional technical aspects required for the ESIA, anticipated for submission in early 2025. The
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 29
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
39
38
ESIA evaluation process for the proposed bypass and access road construction remains ongoing with a revised plan to
proceed with a 40km segment, bypassing the project site, instead of the initially planned 140km route.
The Free Prior Informed Consent (“FPIC”) process for the project was successfully concluded for all communities directly
influenced by the project, as defined by the relevant provincial authorities. The process culminated with the formal
informative assembly held in Tolar Grande in December 2024. Prior to this, the FPIC processes for the communities of
Olacapato and Pocitos were conducted in 2023.
The project will also require the approval of concessions for the borefield industrial water supply for the mine. Applications
for industrial water concessions were submitted in 2023. These concessions are expected to be granted following the
approval of the Mining ESIA. Additional water supply fieldwork commenced in the fourth quarter of 2024 to identify
supplementary water sources, and evaluate deeper confined aquifers to enhance sustainability of extraction. Other efforts
include improving borefields yield through pumping tests and additional drilling activities for borefield development.
Furthermore, parallel efforts are underway to confirm brine availability as part of the comprehensive sustainable water
management strategy.
On July 8, 2024, the government of Argentina’s President Javier Milei enacted the "Law of Grounds and Starting Points for
the Freedom of Argentines", which includes a new incentive regime for large investments (Régimen de Incentivo para
Grandes Inversiones) with a two-year window to apply starting on the same date. The legislation provides special foreign
exchange provisions and tax and customs incentives, focusing on predictability, stability, and legal certainty across various
sectors, including mining. On September 19, 2024, Salta province formally adhered to the regime, extending its benefits to
include local tax stability. The Company is currently preparing an update of the NI 43-101 Technical Report, and plans to
submit an application for the RIGI regime.
La Granja
In 2023, the Company finalized an agreement with Rio Tinto to progress the La Granja copper project in northern Peru. La
Granja is one of the largest undeveloped copper resources in the world with a published Inferred Mineral Resource of 4.32
billion tonnes at 0.51% copper, and potential for substantial expansion. La Granja is located in the district of Querocoto in the
northern region of Cajamarca, Peru, approximately 90 kilometres northeast of Chiclayo, at an altitude of between 2,000 and
2,800 metres.
Following the completion of conditions including regulatory approvals from the Government of Peru, First Quantum acquired
a 55% interest in the project and became the operator of La Granja. As part of the agreement with Rio Tinto, the Company is
obliged to invest a further $546 million (the “initial funding”) in the project over a period of not more than ten years.
Part of the initial funding will be used to complete an engineering study and ESIA over the next 12 to 24 months, after which
the remaining balance of the initial funding is expected to be spent on construction of the project contingent on a positive
investment decision and relevant government approvals. Upon satisfaction of the initial funding amount, all subsequent
expenditures will be applied on a pro-rata basis according to share ownership of the project.
Work will continue to progress community engagement and the engineering study. Following the transition in project
ownership, increased community engagement and local community participation in project support activities has been
established and will continue to be developed. Ongoing engagement with local, regional, and national authorities has
indicated strong support for the project at all levels of government, and discussion of possible project development pathways
is ongoing.
The engineering study will focus on developing an updated geological resource and reserve model, which will require
additional infill drilling to upgrade Inferred Resources to Measured and Indicated categories. The necessary permits and land
agreements to carry out the planned drill program were established in the fourth quarter of 2023. The drilling campaign
commenced shortly thereafter, and is now 60% complete, with approximately 30,000 meters drilled and three rigs operating.
The current phase of project work at La Granja is not capital intensive and is focused on initial drill delineation and
assessment of development options. Assay results are being collected on a regular basis, and an ongoing geotechnical
evaluation program has been established. High-level project layout options together with associated infrastructure
requirements and logistical routes are being developed and assessed, and additional metallurgical studies to establish
optimal processing configurations are underway.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 30
Haquira
Haquira is located in the Apurímac region of Peru, and is a longer-dated greenfield project for the Company. Land access
agreements were reached with three local communities during the second quarter of 2023. This enabled a cost-effective
drilling campaign to start at the Haquira East deposit in September 2023 and approximately 14,000 metres were drilled until
completion of the planned program by end of July 2024. During the period, drilling at Haquira returned encouraging
intercepts on the northerly margin of the Haquira East resource.
Following the signing of a new land access agreement with a fourth community, a short drilling campaign was also carried
out at the Cristo de los Andes satellite deposit in the third quarter of 2024.
The 3rd amendment of the current exploration permit was filed by the Company in November 2023. Following a successful
public participation workshop with the local communities as required by applicable law, the permit was approved by the
Ministry of Energy and Mines in early February 2025. This amendment extends the term of the permit for seven years,
allowing for further drilling in the future.
The Company remains open to dialogue with the two remaining communities regarding land access, aiming to expand the
drilling program into Haquira West deposit and other targets in the area of the project.
EXPLORATION
The Company’s global exploration program is focused on identifying high-quality porphyry and sediment-hosted copper
deposits in prospective belts around the world. The Company is engaged in the assessment and early stage exploration of a
number of properties globally, particularly in the Central African Copper belt and the Andean porphyry belt. More specific
targets are being pursued in other jurisdictions including Australia and Finland. The Company has recently established an
operating base and exploration team in Kazakhstan.
Near-mine exploration programs are focused on satellite targets around the Trident and Kansanshi operations in Zambia as
well as Çayeli in Türkiye. During the quarter, diamond drilling was active on copper and nickel targets within the Trident and
Kansanshi districts.
At Kansanshi, the Company has embarked on an exploration program for new sources of gold in the South East Dome area,
with encouraging results to date. Further field exploration and verification of this potential new discovery is a priority work
stream. At Çayeli, near mine drilling continues to deliver strong results on the new ‘South’ orebody which is now undergoing
detailed resource drilling and development. Following on from the discovery of the South Orebody, a detailed evaluation of
prior drill coverage along the Çayeli trend has defined extensive areas with limited or no drill testing at depth along the
prospective target horizon. A systematic drill program has been designed to test this trend over 2000m of strike and over
1000m depth with wide spaced holes. Further targets with outcropping mineralization have been established in the Çayeli
district and will be subject to detailed exploration in coming months. An updated NI 43-101 Technical Report on Reserves
and Resources for Çayeli is expected to be released in the first half of 2025. In Finland, a winter drill program will be initiated
on mafic Cu-Ni targets in the Central Lapland belt as well as a gravity anomaly immediately south of the Pyhäsalmi mine.
Intelligence gathering continues in several jurisdictions, especially Kazakhstan and Argentina. A new porphyry prospect was
defined in Kazakhstan using ‘AI’ (machine learning) enhanced targeting techniques. Following field validation the target has
been secured under new tenure. In Chile, a new Iron-Oxide-Copper-Gold prospect was advanced and will be tested by RC
drilling in January. Subsequent to research and field investigations in the Kingdom of Saudi Arabia during 2024 the Company
has recently applied and been accepted as a qualified bidder for certain upcoming land releases.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 31
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
41
40
SUMMARY FINANCIAL RESULTS
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Sales revenues
1,256
1,279
1,218
4,802
6,456
Gross profit (loss)
Cobre Panamá
(11)
(10)
25
(49)
867
Kansanshi
210
204
12
552
132
Trident
159
204
112
733
432
Corporate & other
47
58
(62)
114
(139)
Total gross profit
405
456
87
1,350
1,292
Exploration
(9)
(4)
(13)
(24)
(30)
General and administrative
(36)
(39)
(37)
(148)
(142)
Impairment and related charges
(2)
(2)
(900)
(75)
(900)
Other expense
(14)
(82)
(121)
(293)
(142)
Operating profit
344
329
(984)
810
78
Net finance expense1
(171)
(173)
(146)
(709)
(613)
Modification and redemption of liabilities
100
–
–
90
–
Adjustment for expected phasing of
Zambian VAT
35
17
(20)
89
49
Income tax expense
(118)
(120)
(642)
(388)
(757)
Net earnings (loss)
190
53
(1,792)
(108)
(1,243)
Net earnings (loss) attributable to:
Non-controlling interests
91
(55)
(345)
(110)
(289)
Shareholders of the Company
99
108
(1,447)
2
(954)
Adjusted earnings (loss)2
31
119
(259)
(17)
261
Earnings (Loss) per share
Basic
$0.12
$0.13
($2.09)
$0.00
($1.38)
Diluted
$0.12
$0.13
($2.09)
$0.00
($1.38)
Adjusted2
$0.04
$0.14
($0.37)
($0.02)
$0.38
Basic weighted average number of
shares (in 000’s)
832,530
832,474
691,674
812,222
690,876
1 Net finance expense comprises finance income and finance costs.
2 Adjusted earnings (loss) is a non-GAAP financial measure and adjusted earnings (loss) per share is a non-GAAP ratio. Such measures do not have a
standardized meaning prescribed by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 32
Sales Revenues
FOURTH QUARTER
QUARTERLY REVENUE BY COMMODITY
QUARTERLY REVENUE BY OPERATION
$ Millions
1,053
1,057
66
104
70
66
29
29
1,218
1,256
Q4 2023
Q4 2024
$ Millions
1,218
1,256
280
13
377
578
438
554
123
111
Q4 2023
Q4 2024
Copper
Gold
Nickel
Other
Cobre Panamá
Kansanshi
Trident
Hedge gain (loss)
Other
Sales revenues for the fourth quarter of 2024 of $1,256 million were 3%, or $38 million, higher than the same quarter of
2023, reflecting increases in gold and copper sales revenues of $38 million and $4 million, respectively. The increase was
attributable to higher net realized copper and gold prices1 more than offsetting the impact of lower sales volumes, following
Cobre Panamá being placed on P&SM throughout the year and Ravensthorpe being placed in a period of C&M from May
2024.
Copper sales revenues excluding Cobre Panamá for the fourth quarter of 2024 of $1,057 million were 33%, or $261 million,
higher than the same quarter of 2023, reflecting an increase in the net realized copper price1 and copper sales volumes
which were 21% higher compared to the same quarter of 2023. The higher copper sales volumes were attributable to
Kansanshi, arising from increased production.
The net realized price1 for copper of $4.08 per lb for the fourth quarter of 2024 was 19% higher than the same quarter of
2023. This compares to an increase of 13% in the average LME price of copper for the same period to $4.17 per lb. Copper
sales revenues include a $13 million gain or $0.06 per lb, on the copper sales hedge program.
Nickel sales revenues of $66 million for the fourth quarter of 2024 were 6%, or $4 million, lower than the same quarter of
2023, due to Ravensthorpe being placed in a period of C&M from May 2024 and lower net realized metal prices1.
The net realized price1 for nickel of $6.74 per lb for the fourth quarter of 2024 was 10% lower than the same quarter of 2023.
Gold sales revenues excluding Cobre Panamá for the fourth quarter of 2024 of $104 million were 121%, or $57 million,
higher than the same quarter of 2023, arising from a 60% increase in gold sales volumes, attributable to increased
production at Kansanshi, and 39% higher net realized gold prices1.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 33
1 Realized metal price is a non-GAAP ratio, which does not have a standardized meaning under IFRS and might not be comparable to similar financial measures
disclosed by other issuers. See “Regulatory Disclosures” for further information.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
43
42
FULL YEAR
YEAR-TO-DATE REVENUE BY COMMODITY
YEAR-TO-DATE REVENUE BY OPERATION
$ Millions
5,641
4,015
319
347
341
335
155
105
6,456
4,802
December 31, 2023
December 31, 2024
$ Millions
6,456
4,802
2,513
(6)
34
1,598
2,059
1,665
2,196
680
519
December 31, 2023
December 31, 2024
Copper
Gold
Nickel
Other
Cobre Panamá
Kansanshi
Trident
Hedge gain (loss)
Other
Sales revenues for the year ended December 31, 2024 of $4,802 million were 26%, or $1,654 million, lower than the same
period of 2023, reflecting the decrease in copper sales revenues of $1,626 million, primarily attributable to Cobre Panamá
being placed on P&SM with 121 thousand DMT of copper concentrate remaining onsite.
Copper sales revenues excluding Cobre Panamá for the year ended December 31, 2024 of $4,018 million were 22%, or
$717 million, higher than the comparable period of 2023, reflecting increased copper sales volumes, and an increase in the
net realized copper price1 of 14% and 13%, respectively. This was attributable to strong operational performance at the
Zambian operations, with copper sales volumes at Trident and Kansanshi increasing by 17,631 tonnes and 30,902 tonnes,
respectively.
The net realized price1 for copper of $4.03 per lb in 2024 was 13% higher than the same period in 2023. This compares to
an increase of 8% in the average LME price of copper for the same period to $4.15 per lb. Copper sales revenues include a
$34 million gain, or $0.04 per lb, on the copper sales hedge program.
Nickel sales revenues of $335 million were lower then the same period of 2023, at 2%, or $6 million, lower. The reduction in
nickel sales revenue is due to lower net realized metal prices1 despite increased sales volumes from the ramp-up of
production at Enterprise. Ravensthorpe was also placed into a period of C&M from May 2024.
The net realized price1 for nickel of $7.38 per lb in 2024 was 19% lower than the comparable period in 2023.
Gold sales revenues excluding Cobre Panamá in 2024 of $350 million were 87%, or $163 million, higher than the
comparable period in 2023, arising from a 49% increase in gold sales volumes, attributable to increased production at
Kansanshi, and 28% higher net realized gold prices1.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 34
1 Realized metal price is a non-GAAP ratio, which does not have a standardized meaning under IFRS and might not be comparable to similar financial measures
disclosed by other issuers. See “Regulatory Disclosures” for further information.
QUARTERLY
FULL YEAR
Copper selling price (per lb)
Q4 2024
Q3 2024
Q4 2023
2024
2023
Average LME cash price
$4.17
$4.18
$3.70
$4.15
$3.85
Realized copper price1
$4.17
$4.24
$3.62
$4.15
$3.76
Treatment/refining charges (“TC/RC”)
(per lb)
($0.04)
($0.06)
($0.13)
($0.07)
($0.15)
Freight charges (per lb)
($0.05)
($0.03)
($0.05)
($0.05)
($0.03)
Net realized copper price1
$4.08
$4.15
$3.44
$4.03
$3.58
QUARTERLY
FULL YEAR
Gold selling price (per oz)
Q4 2024
Q3 2024
Q4 2023
2024
2023
Average LBMA cash price
$2,664
$2,474
$1,974
$2,388
$1,941
Net realized gold price1,2
$2,545
$2,383
$1,835
$2,294
$1,786
QUARTERLY
FULL YEAR
Nickel selling price (per payable lb)
Q4 2024
Q3 2024
Q4 2023
2024
2023
Average LME cash price
$7.27
$7.37
$7.82
$7.63
$9.74
Realized nickel price1
$7.22
$7.36
$7.53
$7.68
$9.07
Treatment/refining charges (“TC/RC”)
(per lb)
($0.48)
($0.01)
$–
($0.30)
$–
Net realized nickel price1
$6.74
$7.35
$7.53
$7.38
$9.07
1 Realized metal prices is a non-GAAP ratio which does not have a standardized meaning under IFRS and might not be comparable to similar financial measures
disclosed by other issuers. See “Regulatory Disclosures” for further information.
2 Excludes gold revenues recognized under the precious metal stream arrangement.
Given the volatility in commodity prices, significant variances may arise between average market price and net realized
prices1 due to the timing of sales during the period.
Gross Profit
Fourth Quarter
Gross profit in Q4 2023
87
Gross profit in Q4 2023 (Excl. Cobre Panamá, Ravensthorpe and Las Cruces)
123
Higher net realized prices1
143
Movement in hedge program
14
Higher sales volumes and change in sales mix
149
Higher by-product contribution
23
Lower cash costs
13
Higher royalty expense
(34)
Higher depreciation
(27)
Positive impact of foreign exchange on operating costs
12
Gross profit in Q4 2024 (Excl. Cobre Panamá, Ravensthorpe, Las Cruces)
416
Gross profit in Q4 20242
405
1 Realized metal price is a non-GAAP ratio, which does not have a standardized meaning under IFRS and might not be comparable to similar financial measures
disclosed by other issuers. See “Regulatory Disclosures” for further information.
2 Gross profit is reconciled to EBITDA by including exploration costs of $9 million, general and administrative costs of $36 million, care and maintenance costs of
$52 million, share of loss in joint venture of $9 million, other expense of $13 million and adding back depreciation of $169 million (a reconciliation of EBITDA is
included in “Regulatory Disclosures”).
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 35
1 Realized metal price is a non-GAAP ratio, which does not have a standardized meaning under IFRS and might not be comparable to similar financial measures
disclosed by other issuers. See “Regulatory Disclosures” for further information
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
45
44
$ Millions
QUARTERLY GROSS PROFIT BY OPERATION
87
405
25
(11)
12
210
112
159
13
(62)
34
Cobre Panamá
Kansanshi
Trident
Hedge gain (loss)
Other
Q4 2023
Q4 2024
Gross profit for the fourth quarter of 2024 was $405 million, an increase of $318 million, or 366%, from the same quarter in
2023 attributable to higher realized copper and gold prices1.
Gross profit excluding Cobre Panamá and Ravensthorpe was $416 million, an increase of $299 million or 256% from the
same quarter in 2023. This was primarily attributable to higher sales revenues, lower cash costs and a favourable foreign
exchange impact following the weakening of the Kwacha.
Full Year
Gross profit in 2023
1,292
Gross profit in 2023 (Excl. Cobre Panamá, Ravensthorpe and Las Cruces)
581
Higher net realized prices1
388
Movement in hedge program
34
Higher sales volumes and change in sales mix
428
Higher by-product contribution
81
Higher cash costs
(37)
Higher royalty expense
(74)
Higher depreciation
(56)
Positive impact of foreign exchange on operating costs
84
Gross profit in 2024 (Excl. Cobre Panamá, Ravensthorpe and Las Cruces)
1,429
Gross profit in 20242
1,350
1 Realized metal price is a non-GAAP ratio, which does not have a standardized meaning under IFRS and might not be comparable to similar financial measures
disclosed by other issuers. See “Regulatory Disclosures” for further information.
2 Gross profit is reconciled to EBITDA by including exploration costs of $24 million, general and administrative costs of $148 million, care and maintenance costs of
$253 million, share of loss in joint venture of $85 million, and adding back depreciation of $633 million and other expense of $18 million (a reconciliation of
EBITDA is included in “Regulatory Disclosures”).
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 36
1 Realized metal price is non-GAAP ratio which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
$ Millions
FULL YEAR GROSS PROFIT BY OPERATION
1,292
1,350
867
(49)
132
552
432
733
34
(139)
80
Cobre Panamá
Kansanshi
Trident
Hedge gain (loss)
Other
December 31, 2023
December 31, 2024
Gross profit for the year ended December 31, 2024 was $1,350 million, an increase of $58 million, or 4%, from the same
period in 2023, attributable to increased realized copper prices1.
Gross profit excluding Cobre Panamá and Ravensthorpe was $1,429 million, an increase of $880 million or 160% from the
same period in 2023. This was primarily attributable to higher sales revenue and a favourable foreign exchange impact
following the weakening of the Kwacha, partially offset by higher cash costs, impacted by higher electricity costs.
Net Earnings (Loss)
Fourth Quarter
Net earnings attributable to shareholders of the Company for the fourth quarter of 2024 was $99 million, $1,546 million
higher compared to a loss of $1,447 million in the same quarter of 2023. The net earnings increase was attributable to higher
gross profit and a gain on modification of liabilities. Additionally, there was a decrease in other expense, tax expense and a
lower impairment charge of $2 million in the fourth quarter of 2024 compared to a $900 million charge recognized in the
fourth quarter of 2023 in relation to impairment of Ravensthorpe and exploration assets.
The modification gain on liabilities of $100 million in the fourth quarter of 2024 related to revised terms of the agreement with
Korea Panama Mining Corporation (“KPMC”) which resulted in an adjustment to the carrying amount of the liability.
Net finance expense of $171 million was $25 million higher than the same quarter of 2023, reflecting an increase in related
party finance cost accretion and the additional finance cost accretion on the copper Prepayment Agreement. Net finance
expense principally consists of interest on debt of $150 million, related party interest of $27 million, accretion of the
Prepayment Agreement of $10 million, and accretion of deferred revenue of $15 million. This was partially offset by finance
income of $22 million and interest capitalized of $21 million.
A credit of $35 million reflecting the expected phasing of the Zambian VAT was recognized in the quarter, whereas an
expense of $20 million was recognized in the same quarter of 2023.
Other expense of $14 million is $107 million lower than the $121 million expense recognized in the same quarter of 2023.
C&M costs of $52 million were recorded in the fourth quarter of 2024, with Cobre Panamá remaining under P&SM,
Ravensthorpe being placed on C&M in May 2024 together with ongoing costs at Las Cruces. A $9 million share of loss in
KPMC was recognized in the quarter, compared to a $58 million loss recognized in the same quarter of 2023. Gains of $38
million and $13 million was recognized in the quarter in relation to revisions in estimates of restoration provisions and foreign
exchange, respectively. This compared to a gain on the change in estimates on restoration provisions of $4 million and a
foreign exchange loss of $43 million in the same quarter of 2023.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 37
1 Realized metal price is non-GAAP ratio which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
47
46
An income tax expense of $118 million was recognized in the fourth quarter of 2024, compared with a $642 million income
tax expense recognized in the same quarter of 2023, reflecting applicable statutory tax rates that range from 20% to 30% for
the Company’s operations. The effective tax rate excluding Cobre Panamá and interest expense for the quarter ended
December 31, 2024 was 24%.
Basic earnings per share was $0.12 during the quarter, compared to $2.09 loss per share in the same quarter of 2023.
Full Year
Net earnings attributable to shareholders of the Company of $2 million for the year ended December 31, 2024 was $956
million higher compared to loss of $954 million in same period in 2023. The net earnings change was attributable to a higher
gross profit, modification and redemption gains on liabilities, a decrease in the tax expense and a lower impairment charge
of $75 million in 2024 compared to $900 million recognized in the same period of 2023 in relation to Ravensthorpe and
exploration assets. This was partially offset by an increase in other expense in the year ended December 31, 2024.
The modification and redemption of liabilities gain of $90 million in the year ended December 31, 2024 included $100 million
related to revised terms of the agreement with KPMC which resulted in an adjustment to the carrying amount of the liability.
Net finance expense of $709 million was $96 million higher than the same period of 2023, reflecting an increase in related
party finance cost accretion, higher interest paid on bonds and the inclusion of the additional finance cost accretion on the
Prepayment Agreement. Net finance expense principally consisted of interest on debt of $591 million, related party cost
accretion of $124 million, accretion of deferred revenue of $61 million, and accretion of the Prepayment Agreement of $36
million, offset by capitalized interest of $54 million and finance income of $90 million.
A credit of $89 million reflecting the expected phasing of the Zambian VAT was recognized in the year ended December 31,
2024, compared with a credit of $49 million recognized in the same period of 2023.
Other expense of $293 million is $151 million higher than other expense of $142 million incurred in the same period in 2023.
C&M costs of $253 million were recorded in the year ended December 31, 2024 reflecting Cobre Panamá being under
preservation and safe management, and Ravensthorpe being placed on C&M in May 2024 together with ongoing costs at
Las Cruces. C&M costs included $191 million incurred in Cobre Panamá. During the year an $85 million share of loss in
KPMC was recognized in the year to December 31, 2024, compared to the $18 million gain recognized in the same period of
2023. A gain of $39 million was recognized in relation to the restoration provision for closed properties. A foreign exchange
gain of $4 million was recognized compared to a foreign exchange loss of $67 million in the same period in 2023. A $14
million restructuring expense was also recognized in the period in relation to Ravensthorpe and Cobre Panamá compared to
a $49 million restructuring expense in the same period of 2023.
An impairment charge of $75 million, was recognized, which includes $72 million at Ravensthorpe, following the decision to
scale back operations in the first quarter of 2024 and subsequently placing the mine on C&M in May 2024. This compares to
$854 million recognized in the same period of 2023 in relation to Ravensthorpe and $46 million in respect of exploration
assets.
An income tax expense of $388 million was recognized in the year ended December 31, 2024, compared to a $757 million
expense recognized in the same period in 2023, reflecting applicable statutory tax rates that range from 20% to 30% for the
Company’s operations. The effective tax rate excluding Cobre Panamá and interest expense for the year ended December
31, 2024 was 28%.
Basic earnings per share was $0.00 during the year ended December 31, 2024, compared to a loss per share of $1.38 in the
same period of 2023.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 38
Adjusted Earnings (Loss)1
FOURTH QUARTER
QUARTERLY ADJUSTED EARNINGS (LOSS)1
QUARTERLY ADJUSTED EARNINGS (LOSS) PER SHARE2
$ Millions
(259)
31
(139)
(53)
24
143
72
108
(216)
(180)
13
Cobre Panamá
Kansanshi
Trident
Other
Hedge gain (loss)
Q4 2023
Q4 2024
$ per share
$0.52
$(0.37)
$(0.20)
$(0.02)
$0.14
$0.04
Adjusted earnings (loss) per share
Q3 2023
Q4 2023
Q1 2024
Q2 2024
Q3 2024
Q4 2024
Adjusted earnings1 for the quarter ended December 31, 2024 of $31 million decreased by $290 million from adjusted loss1 of
$259 million in the comparative period in 2023. Adjusted earnings per share2 of $0.04 in the fourth quarter compares to
adjusted loss per share2 of $0.37 in the same quarter of 2023. The principal items not included in adjusted earnings1 in the
quarter are the $100 million modification gain on the KPMC loan, a decrease in estimates of restoration provisions at closed
sites of $38 million, the adjustment for expected phasing of Zambian VAT of $35 million, and foreign exchange gains of $13
million. Where relevant, adjustments are effected for minority interest and joint venture ownership.
The effective tax rate, on an adjusted basis excluding Cobre Panamá and interest expense, for the quarter ended December
31, 2024 was 32%. A reconciliation of adjusted metrics is included in “Regulatory Disclosures”.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 39
1 Adjusted earnings (loss) is a non-GAAP financial measure, which does not have a standardized meaning prescribed by IFRS and might not be comparable to
similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2 Adjusted earnings (loss) per share is a non-GAAP ratio, which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
49
48
FULL YEAR
FULL YEAR ADJUSTED EARNINGS (LOSS)1
FULL YEAR ADJUSTED EARNINGS (LOSS) PER SHARE2
$ Millions
261
(17)
499
(218)
135
384
270
482
(643)
(699)
34
Cobre Panamá
Kansanshi
Trident
Other
Hedge gain (loss)
December 31, 2023
December 31, 2024
$ per share
$0.38
$(0.02)
Adjusted earnings per share
December 31, 2023
December 31, 2024
Adjusted loss1 for the year ended December 31, 2024 of $17 million decreased by $278 million from adjusted earnings1 of
$261 million the same period in 2023. Adjusted loss per share2 of $0.02 in the year ended December 31, 2024 compares to
adjusted earnings per share2 of $0.38 in the same period of 2023.
The principal items not included in adjusted loss1 is the $90 million modification and redemption gain on liabilities, the
adjustment for expected phasing of Zambian VAT of $89 million, an impairment expense of $75 million of which $71 million
relates to Ravensthorpe, a decrease in estimates of restoration provisions at closed sites of $39 million, a restructuring
expense of $14 million, and foreign exchange gains of $4 million. Where relevant, adjustments are effected for minority
interest and joint venture ownership.
The effective tax rate for the year ended December 31, 2024, on an adjusted basis, excluding Cobre Panamá and interest
expense was 29%. A reconciliation of adjusted metrics is included in “Regulatory Disclosures”.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 40
1 Adjusted earnings (loss) is a non-GAAP financial measure, which does not have a standardized meaning prescribed by IFRS and might not be comparable to
similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2 Adjusted earnings (loss) per share is a non-GAAP ratio, which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
LIQUIDITY AND CAPITAL RESOURCES
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Cash flows from (used by) operating activities
583
260
(185)
1,651
1,427
Cash flows used by investing activities
(335)
(329)
(335)
(1,294)
(1,380)
Purchase and deposits on property, plant and
equipment
(324)
(329)
(344)
(1,286)
(1,300)
Acquisition of La Granja
–
–
–
–
(105)
Interest paid and capitalized to property, plant and
equipment
(21)
(14)
(6)
(54)
(26)
Other
10
14
15
46
51
Cash flows from (used by) financing activities1
(127)
(114)
224
(501)
(776)
Net movement in debt and trading facilities
53
(38)
484
(1,065)
(17)
Proceeds on issuance of common shares
–
–
–
1,103
–
Interest paid1
(180)
(76)
(230)
(519)
(527)
Dividends paid to shareholders
–
–
–
–
(93)
Net payments to joint venture (KPMC)
–
–
(30)
–
(109)
Other
–
–
–
(20)
(30)
Exchange losses on cash and cash equivalents
(2)
–
–
(3)
–
Net cash inflow (outflow)
119
(183)
(296)
(147)
(729)
Cash and cash equivalents and bank overdrafts
812
693
959
812
959
Total assets
24,107
23,942
23,758
24,107
23,758
Total current liabilities
1,545
1,773
2,007
1,545
2,007
Total long-term liabilities
10,660
10,529
10,973
10,660
10,973
Net debt2
5,530
5,591
6,420
5,530
6,420
Cash flows from (used by) operating activities per
share3
$0.70
$0.31
($0.27)
$2.03
$2.07
1 Interest paid excludes $21 million and $54 million capitalized to property, plant and equipment for the fourth quarter and full year ended December 31, 2024,
presented in cash flows used by investing activities (three months and year-ended December 31, 2023: $6 million and $26 million).
2 Net debt is a supplementary financial measure, which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
3 Cash flows from (used by) operating activities per share is a non-GAAP ratio, and does not have a standardized meaning prescribed by IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
FOURTH QUARTER
Cash Flows from (used by) Operating Activities
Cash flows from operating activities for the fourth quarter were $768 million higher than the same quarter of 2023,
attributable to higher EBITDA1, and lower taxes paid. In 2023, Cobre Panamá, pursuant to Law 406 made a tax and royalty
payment of $567 million.
Cash Flows used by Investing Activities
Investing activities of $335 million mostly comprise of capital expenditures of $324 million which were $20 million lower than
the same quarter of 2023. Capital expenditure for the fourth quarter of 2024, reflected lower spend while Cobre Panamá is
on P&SM and Ravensthorpe being placed in a period of C&M. This was partially offset by planned higher spending on the
S3 project at Kansanshi.
Cash Flows from (used by) Financing Activities
Cash flows used by financing activities of $127 million for the fourth quarter of 2024 included a net inflow of $53 million on
total debt. This was due to drawings on the revolving credit facility as a result of Cobre Panamá being in P&SM, partially
offset by planned repayments on the term loan and additional drawing on the trading facilities related to metal sales.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 41
1 EBITDA is a non-GAAP financial measure which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
51
50
Interest paid of $180 million is included within cash flows used by financing activities which excludes $21 million of
capitalized interest. Interest paid was $50 million lower than the $230 million paid in the fourth quarter of 2023 which
excludes $6 million of capitalized interest. The lower interest paid in the quarter reflects timing of bond interest payments.
FULL YEAR
Cash Flows from Operating Activities
Cash flows from operating activities for the year were $224 million higher than the same period of 2023, arising due to lower
taxes paid combined with the receipt of $500 million attributable to the Prepayment Agreement. This was partially offset by
lower EBITDA1 and adverse movements on working capital following the unwinding of accounts payable at Cobre Panamá
and Ravensthorpe. In 2023, Cobre Panamá, pursuant to Law 406 made a tax and royalty payment of $567 million.
Cash Flows used by Investing Activities
Investing activities of $1,294 million for the year included capital expenditures of $1,286 million which were $14 million lower
than 2023, reflecting lower spend in Cobre Panamá and Ravensthorpe, which have been held in P&SM and C&M
respectively, and Enterprise, following declaration of commercial production effective June 1, 2024. This was partially offset
by planned increased capital expenditure on the S3 project at Kansanshi and spend on La Granja.
Cash Flows used by Financing Activities
Cash flows used by financing activities of $501 million for the year included a $1,065 million net movement on total debt.
Included within the net movement on total debt were the proceeds of $1,600 million of senior notes due 2029, which,
together with $1,103 million of the equity issuance from the comprehensive refinancing in Q1 2024, were used for the full
redemption of $1,050 million of all the senior notes due 2025 and $1,000 million of all the senior notes due 2026. These
movements also include scheduled repayments on the term loan and utilization of the revolving credit facility and trading
facilities.
Interest paid of $519 million is included within cash flows from financing activities for the year which excludes $54 million of
capitalized interest, and is $8 million lower than the $527 million of interest paid in 2023 which excludes $26 million of
capitalized interest. The higher interest paid in the year reflects the increased coupon rate on the senior notes and higher
floating interest rates, despite the reduction in the Company’s gross debt levels.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 42
1 EBITDA is a non-GAAP financial measure which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
Liquidity
FOURTH QUARTER
QUARTERLY NET DEBT 1 MOVEMENT
5,591
(455)
(154)
324
201
42
(19)
5,530
Closing Net Debt1
at Sept. 30, 2024
EBITDA1
Working
capital2
Capital
expenditure
Interest
paid3
Taxes
paid
Other4
Closing Net Debt1
at Dec. 31, 2024
1
EBITDA is a non-GAAP financial measure and net debt is a supplementary financial measure. These measures do not have a standardized meaning under
IFRS and might not be comparable to similar measures disclosed by other issuers. See “Regulatory Disclosures” for further information.
2
Working capital includes inflows of $104 million on trade and other receivables and $71 million on trade and other payables, offset by outflows of $13 million
from movements in inventories and an $8 million outflow related to long-term incentive plans.
3
Interest paid includes $21 million of interest capitalized to property plant and equipment.
4
Other includes interest received of $8 million.
Net debt1 decreased by $61 million during the quarter to $5,530 million at December 31, 2024 with total debt of $6,342
million. This was primarily attributable to positive movements in EBITDA2 contribution and working capital, partially offset by
interest paid and planned capital expenditure, mostly related to S3 at Kansanshi.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 43
1 Net debt is a supplementary financial measure which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
2 EBITDA is a non-GAAP financial measure which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
53
52
FULL YEAR
YEAR-TO-DATE NET DEBT 1 MOVEMENT
6,420
(1,491)
(500)
(1,103)
249
1,286
573
128
(32)
5,530
Closing Net Debt1
at Dec. 31, 2023
EBITDA 1
Copper
Prepayment
Equity
Issuance 2
Working
capital 3
Capital
expenditure
Interest
paid 4
Taxes
paid
Other 5
Closing Net Debt1
at Dec. 31, 2024
1
EBITDA is a non-GAAP financial measure and net debt is a supplementary financial measure. These measures do not have a standardized meaning
under IFRS and might not be comparable to similar measures disclosed by other issuers. See “Regulatory Disclosures” for further information.
2
The company issued 139,932,000 common shares at a price of C$11.10 per common share for aggregate gross proceeds of C$1,553 million (approximately
$1,150 million). Net proceeds after related fees were $1,103 million.
3
Working capital includes outflows of $275 million on trade and other payables and $5 million from movements in inventories. This was partially offset by an
inflow of $50 million on trade and other receivables. Additionally there was a $19 million outflow related to long-term incentive plans.
4
Interest paid includes $54 million of interest capitalized to property plant and equipment.
5
Other includes interest received of $35 million.
Net debt1 decreased by $890 million during the year ended December 31, 2024 to $5,530 million. The decrease was
primarily attributable to the EBITDA2 contribution of $1,491 million, the proceeds of the share issuance of $1,103 million, net
of related fees, and the receipt of $500 million under the prepayment agreement. This was offset by capital expenditures of
$1,286 million, movements on working capital of $249 million and interest paid, inclusive of capitalized interest, of $573
million. At December 31, 2024, total debt was $6,342 million.
In the first quarter of 2024, the Company successfully completed a comprehensive refinancing which included, a $500
million Prepayment Agreement, the amendment and extension of corporate banking facilities, $1,103 million bought deal
offering of common shares and the $1,600 million senior secured second lien notes 9.375% offering, increasing the
Company’s financial flexibility via the provision of additional liquidity and covenant headroom, as well as reducing net
leverage, and extending the debt maturity profile, to allow for the completion of the S3 Expansion while the Company
continues to focus on a resolution at Cobre Panamá.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 44
1 Net debt is a supplementary financial measure. These measures do not have a standardized meaning prescribed by IFRS and might not be comparable to similar
financial measures disclosed by other issuers. See “Regulatory Disclosures”.
2 EBITDA is a non-GAAP financial measure which does not have a standardized meaning prescribed by IFRS and might not be comparable to similar financial
measures disclosed by other issuers. See “Regulatory Disclosures”.
Liquidity Outlook
Contractual and other obligations as at December 31, 2024 are as follows:
Carrying
Value
Contractual
Cash flows
< 1 year
1 – 3 years
3 – 5 years
Thereafter
Debt – principal repayments
6,226
6,297
382
2,873
1,742
1,300
Debt – finance charges
–
2,078
533
915
462
168
Trading facilities
116
116
116
–
–
–
Trade and other payables
554
554
554
–
–
–
Derivative instruments1
38
38
38
–
–
–
Liability to joint venture2
1,180
1,650
–
366
1,284
–
Other loans owed to non-controlling
interest3
214
255
32
–
223
–
Current taxes payable
144
144
144
–
–
–
Deferred payments
15
15
2
3
3
7
Leases
13
11
4
5
1
1
Capital commitments
–
102
102
–
–
–
Restoration provisions
598
1,427
8
22
62
1,335
9,098
12,687
1,915
4,184
3,777
2,811
1 Other derivative instruments related to provisionally priced sales contracts are classified as fair value through profit or loss and recorded at fair value, with
changes in fair value recognized as a component of cost of sales.
2 Refers to distributions to KPMC, a joint venture that holds a 20% non-controlling interest in MPSA, of which the Company has joint control, and not scheduled
repayments.
3 Refers to liability with POSCO Holdings, an entity that holds a 24.3% non-controlling interest in FQM Australia Holdings Pty Ltd (“Ravensthorpe”), of which the
Company has full control.
At December 31, 2024, the Company had total capital commitments of $102 million, principally related to the S3 project at
Kansanshi.
The consolidated annual financial statements for the year ended December 31, 2023, were prepared on a going concern
basis but indicated a material uncertainty that cast significant doubt about the Company’s ability to continue as a going
concern in relation to a possible breach of a financial covenant. Following actions taken by management during the first
quarter of 2024, there is no longer a material uncertainty. These actions include the completion of the above-mentioned
equity and bond offerings, amendment to the banking facilities, redemption of 2025 and 2026 notes and establishment of the
Prepayment Agreement. During the second quarter of 2024 to further reduce commodity price risk, management
commenced a hedging program on a proportion of future copper sales to December 2025.
On October 15, 2024, FQM Trident signed a $425 million unsecured term loan facility (the “FQM Trident Facility”) with a
maturity date of September 2028 to replace the previous Trident facility, scheduled to mature in December 2025.
Repayments on the FQM Trident Facility commence in March 2026 and are due every 6 months thereafter. This action is in
line with the Company’s prudent management of its debt maturities.
At December 31, 2024, the Company had $750 million committed undrawn senior debt facilities and $812 million of net
unrestricted cash (inclusive of overdrafts), as well as future cash flows in order to meet all current obligations as they
become due. The Company was in compliance with all existing financial covenants as at December 31, 2024, and current
forecasts, including judgmental assumptions, do not indicate a breach of financial covenants.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 45
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
55
54
Hedging Program
During the year, the Company entered into derivative contracts, in the form of unmargined zero cost copper collars, as
protection from downside price movements, financed by selling price upside beyond certain levels on a matched portion of
production.
At February 11, 2025, the Company had zero cost copper collar contracts outstanding for 242,641 tonnes at weighted
average prices of $4.14 per lb to $4.81 per lb with maturities to June 2026. Approximately half of planned production and
sales in 2025 and over 90% of the same in 2026 remain exposed to spot copper prices.
Tonnes ('000s)
$/lb
COPPER SALES QUARTERLY HEDGE PROFILE - FEBRUARY 11, 2025
37
58
56
56
17
17
4.16
4.14
4.17
4.10
4.14
4.14
4.85
4.91
4.77
4.86
4.57
4.60
Collar Contracts (kt)
Floor ($/lb)
Potential Upside ($/lb)
Q1 2025
Q2 2025
Q3 2025
Q4 2025
Q1 2026
Q2 2026
4.00
4.50
5.00
The Company has hedging programs in respect of future copper sales and provisionally priced sales contracts. Below is a
summary of the fair values of unsettled derivative financial instruments for commodity contracts recorded on the
consolidated balance sheet.
COMMODITY CONTRACTS
December 31, 2024
December 31, 2023
Asset position
204
14
Liability position
(38)
(62)
Opening
Positions
(tonnes)
Average Contract
Price
Closing Market
Price
Maturities
Through
Commodity contracts at December 31,
2024
Copper zero cost collar
181,250
$4.17/lb - $4.97/lb
$3.95/lb
Dec-25
For the year ended December 31, 2024, a fair value gain of $112 million (year ended December 31, 2023, nil) has been
recognized on derivatives designated as hedged instruments through accumulated other comprehensive income. The
effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized
in other comprehensive income. The time value of hedges for the year ended December 31, 2024, of $50 million (year
ended December 31, 2023, nil) is also recognized in other comprehensive income.
During the year ended December 31, 2024, a gain for settled hedges of $34 million was realized through sales revenues.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 46
Provisional Pricing and Derivative Contracts
A portion of the Company’s metal sales is sold on a provisional pricing basis whereby sales are recognized at prevailing
metal prices when title transfers to the customer and final pricing is not determined until a subsequent date, typically two to
five months later. The difference between final price and provisional invoice price is recognized in net earnings (loss). In
order to mitigate the impact of these adjustments on net earnings (loss), the Company enters into derivative contracts to
directly offset the pricing exposure on the provisionally priced contracts. The provisional pricing gains or losses and offsetting
derivative gains or losses are both recognized as a component of cost of sales. Derivative assets are presented in other
assets and derivative liabilities are presented in other liabilities with the exception of copper and gold embedded derivatives,
which are included within accounts receivable.
As at December 31, 2024, the following derivative positions in provisionally priced sales and commodity contracts not
designated as hedged instruments were outstanding:
Open Positions
(tonnes/oz)
Average
Contract price
Closing Market
price
Maturities
Through
Embedded derivatives in provisionally priced
sales contracts:
Copper
85,919
$4.27/lb
$3.95/lb
May-25
Gold
20,122
$2,645/oz
$2,611/oz
Jan-25
Nickel
3,181
$7.38/lb
$6.85/lb
Mar-25
Commodity contracts:
Copper
86,002
$4.27/lb
$3.95/lb
May-25
Gold
20,123
$2,645/oz
$2,611/oz
Jan-25
Nickel
3,168
$7.38/lb
$6.85/lb
Mar-25
As at December 31, 2024, substantially all of the Company’s metal sales contracts subject to pricing adjustments were
hedged by offsetting derivative contracts.
Equity
As at December 31, 2024, the Company had 834,206,136 common shares outstanding.
Foreign Exchange
Foreign exchange risk arises from transactions denominated in currencies other than the U.S. Dollar (“USD”). The USD/
ZMW exchange rate has had the greatest impact on the Company’s cost of sales, as measured in USD. A 10% movement in
the USD/ZMW exchange rate would impact the Company’s cost of sales by approximately $20 million per year.
ZAMBIAN VAT
In 2022, the Company reached an agreement with the Government of the Republic of Zambia (“GRZ”) for the repayment of
the outstanding VAT claims based on offsets against future corporate income tax and mineral royalty tax payments. This
commenced July 1, 2022.
The total VAT receivable accrued by the Company’s Zambian operations at December 31, 2024, was $732 million, of which
$359 million relates to Kansanshi, $345 million relates to FQM Trident, with the balance of $28 million attributable to other
Zambian subsidiaries providing support services.
Offsets of $37 million against other taxes due have been granted and cash refunds of $282 million during the year ended
December 31, 2024. In the year ended December 31, 2023, offsets of $143 million were granted and cash refunds of $124
million were received.
The Company considers that the outstanding VAT claims are fully recoverable and has classified all VAT balances due to the
Zambian operations based on the expected recovery period. As at December 31, 2024, amounts totalling $217 million are
presented as current.
A $36 million credit adjustment for Zambian VAT receipts has been recognized in net earnings (loss) in the quarter ended
December 31, 2024, representing the expected phasing of recoverability of the receivable amount. An expense of $20
million had previously been recognized in the quarter ended December 31, 2023. As at December 31, 2024, a VAT payable
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 47
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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56
to ZCCM-IH of $58 million, net of adjustment for expected phasing of payments, has been recognized. A $5 million expense
adjustment for phasing of the ZCCM payable was recognized in the year ended December 31, 2024.
VAT receivable by the Company’s Zambian operations
December 31,
2024
Balance at beginning of the year
652
Movement in claims, net of foreign exchange movements
(14)
Adjustment for expected phasing for non-current portion
94
At December 31, 2024
732
AGING ANALYSIS OF VAT RECEIVABLE FOR THE COMPANY’S ZAMBIAN OPERATIONS
< 1 year
1-3 years
3-5 years
5-8 years
> 8 years
Total
Receivable at the period end
105
28
405
225
159
922
Adjustment for expected phasing
–
(8)
(126)
(33)
(23)
(190)
Total VAT receivable from Zambian operations
105
20
279
192
136
732
JOINT VENTURE
On November 8, 2017, the Company completed the purchase of a 50% interest in KPMC from LS-Nikko Copper Inc. KPMC
is jointly owned and controlled with Korea Mine Rehabilitation and Mineral Resources Corporation (“KOMIR”) and holds a
20% interest in Cobre Panamá. The purchase consideration of $664 million comprised the acquisition consideration of $635
million and the reimbursement of cash advances of $29 million with $179 million paid on closing. The final consideration of
$100 million was paid in November 2021.
A $560 million investment in the joint venture representing the discounted consideration value and the Company’s
proportionate share of the profit or loss in KPMC to date is recognized. For the year ended December 31, 2024, the loss
attributable to KPMC was $158 million (December 31, 2023: $55 million loss). The loss in KPMC relates to the 20% equity
accounted share of loss reported by MPSA, a subsidiary of the Company and the loss relating to the modification of the loan
receivable from the Company. The material assets and liabilities of KPMC are an investment in MPSA of $427 million,
shareholder loans receivable of $1,180 million from the Company and shareholder loans payable of $1,309 million due to the
Company and its joint venture partner KOMIR.
At December 31, 2024, the Company’s subsidiary, MPSA, owed to KPMC $1,180 million (December 31, 2023: $1,156 million
and December 31, 2022: $1,256 million). The loan matures on June 30, 2029. Effective November 1, 2023, MPSA agreed
with KPMC to suspend interest accruals and payments for up to 12 months.
In the fourth quarter of 2024, MPSA revised the terms of the loan agreement with KPMC. Effective November 1, 2024,
MPSA has agreed with KPMC to suspend interest accruals and payments up to 12 months. The modification was deemed to
be non-substantial under IFRS 9, and resulted in an adjustment to the carrying amount of the liability of $100 million, which
has been recorded in net earnings. Finance cost has continued to be accreted, applying the effective interest method under
IFRS 9.
RELATED PARTY TRANSACTIONS
Amounts paid to related parties were incurred in the normal course of business and on an arm’s length basis. During the
year, $nil (December 31, 2023: $6 million) was paid to parties related to key management. As at December 31, 2024, $nil
million (December 31, 2023: $1 million) was included in trade and other payables concerning related party amounts payable.
For further information, refer to Note 16 of the Company's Consolidated Financial Statements.
PRECIOUS METAL STREAM ARRANGEMENT
Arrangement Overview
The Company, through MPSA, has a precious metal streaming arrangement with Franco-Nevada Corporation (“Franco-
Nevada”). The arrangement comprises two tranches. Under the first phase of deliveries under the first tranche (“Tranche 1”)
Cobre Panamá is obliged to supply Franco-Nevada 120 ounces of gold and 1,376 ounces of silver for each 1 million pounds
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 48
of copper produced, deliverable within 5 days of eligible copper concentrate sales. Under the first phase of deliveries under
the second tranche (“Tranche 2”) Cobre Panamá is obliged to supply Franco-Nevada a further 30 ounces of gold and 344
ounces of silver for each 1 million pounds of copper produced, deliverable within 5 days of eligible copper concentrate sales.
Tranche 1 was amended and restated on October 5, 2015, which provided for $1 billion of funding to the Cobre Panamá
project. Under the terms of Tranche 1, Franco-Nevada, through a wholly owned subsidiary, agreed to provide a $1 billion
deposit to be funded on a pro-rata basis of 1:3 with the Company’s 80% share of the capital costs of Cobre Panamá in
excess of $1 billion. The full Tranche 1 deposit amount has been fully funded to MPSA. Tranche 2 was finalized on March
16, 2018, and $356 million was received on completion. Proceeds received under the terms of the precious metals
streaming arrangement are accounted for as deferred revenue.
In all cases, the amount paid is not to exceed the prevailing market price per ounce of gold and silver.
The Company commenced the recognition of delivery obligations under the terms of the arrangement in September 2019
following the first sale of copper concentrate. Deferred revenue will continue to be recognized as revenue over the life of the
mine. The amount of precious metals deliverable under both tranches is indexed to total copper-in-concentrate sold by
Cobre Panamá.
GOLD STREAM
TRANCHE 1
TRANCHE 2
Delivered (oz)
0 to 808,000
0 to 202,000
Delivery terms
120 oz of gold per one million
pounds of copper
30 oz of gold per one million
pounds of copper
Threshold
First 1,341,000 oz
First 604,000 oz
Ongoing cash payment
$464.21/oz (+1.5% annual inflation)
20% market price
SILVER STREAM
TRANCHE 1
TRANCHE 2
Delivered (oz)
0 to 9,842,000
0 to 2,460,500
Delivery terms
1,376 oz of silver per one million
pounds of copper
344 oz of silver per one million
pounds of copper
Threshold
First 21,510,000 oz
First 9,618,000 oz
Ongoing cash payment
$6.96/oz (+1.5% annual inflation)
20% market price
Under the first threshold of deliveries, the above Tranche 1 ongoing cash payment terms are for approximately the first 20
years of expected deliveries, thereafter the greater of $464.21 per oz for gold and $6.96 per oz for silver, subject to an
adjustment for inflation, and one half of the then prevailing market price. Under the first threshold of deliveries, the above
Tranche 2 ongoing cash payment terms are for approximately the first 25 years of production, and thereafter the ongoing
cash payment per ounce rises to 50% of the spot price of gold and silver.
Accounting
Gold and silver produced by the mine, either contained in copper concentrate or in doré form, are sold to off-takers and
revenue recognized accordingly. Cobre Panamá gold and silver revenues consist of revenues derived from the sale of
metals produced by the mine, as well as revenues recognized from the amortization of the precious metal stream
arrangement.
Gold and silver revenues recognized under the terms of the precious metal streaming arrangement are indexed to copper
sold from the Cobre Panamá mine, and not gold or silver production. Gold and silver revenues recognized in relation to the
precious metal streaming arrangement comprise two principal elements:
> the non-cash amortization of the deferred revenue balance.
> the ongoing cash payments received, as outlined in the above section.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 49
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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Obligations under the precious metal streaming arrangement are satisfied with the purchase of refinery-backed gold and
silver credits, the cost of which is recognized within revenues. Refinery-backed credits purchased and delivered are
excluded from the gold and silver sales volumes disclosed and realized price calculations.
C11 and AISC1 include the impact of by-product credits, which include both gold and silver revenues earned under the
precious metal stream arrangement and revenues earned on the sales of mine production of gold and silver. Also included is
the cost of refinery-backed gold and silver credits, purchased at market price, to give a net gold and silver by-product credit.
The Company’s Cobre Panamá mine was placed into a phase of P&SM in November 2023 with approximately 121 thousand
DMT of copper concentrate remaining on site.
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Gold and silver revenue – ongoing cash
payments
–
–
12
–
56
Gold and silver revenue – non cash
amortization
–
–
20
–
96
Total gold and silver revenues - precious
metal stream
–
–
32
–
152
Cost of refinery-backed credits for
precious metal stream included in
revenue
–
–
(51)
–
(240)
MATERIAL LEGAL PROCEEDINGS
Panama
Introduction
On March 8, 2023, MPSA and the Republic of Panama announced they had reached agreement on the terms and conditions
of a refreshed concession contract (“Refreshed Concession Contract”). MPSA and the Government of Panama ("GOP")
signed the Refreshed Concession Contract on June 26, 2023, and it was subsequently countersigned by the National
Comptroller of Panama. The Refreshed Concession Contract was presented before the Commerce Committee of the
National Assembly of Panama, who recommended the amendment of certain terms of the contract. The Company and GOP
agreed to modifications to the agreement based on these recommendations after a brief period of negotiation. The GOP
cabinet approved the amended terms of the Refreshed Concession Contract on October 10, 2023, and MPSA and the
Republic entered into the agreement the next day. On October 20, 2023, the National Assembly in Panama approved Bill
1100, being the proposal for approval of the Refreshed Concession Contract for the Cobre Panamá mine. On the same day,
President Laurentino Cortizo sanctioned Bill 1100 into Law 406 and this was subsequently published in the Official Gazette.
Panama Constitutional Proceedings and Mining Moratorium.
On October 26, 2023, a claim was lodged with the Supreme Court of Justice of Panama asserting that Law 406 was
unconstitutional. MPSA was not a party to that proceeding. The petitioner argued that Law 406, which gave legal effect to
the Refreshed Concession Contract, was unconstitutional.
On November 3, 2023, the National Assembly of Panama approved Bill 1110, which President Cortizo sanctioned into Law
407 and which was published the same day in the Official Gazette. Law 407 declares a mining moratorium for an indefinite
duration within Panama, including preventing any new mining concession from being granted or any existing mining
concessions from being renewed or extended.
On November 28, 2023, the Supreme Court issued a ruling declaring Law 406 unconstitutional and stating that the effect of
the ruling is that the Refreshed Concession Contract no longer exists. The ruling was subsequently published in the Official
Gazette on December 2, 2023. The Supreme Court did not order the closure of the Cobre Panamá mine.
On December 19, 2023, the (now former) Minister for Commerce and Industry announced plans for Cobre Panamá following
the ruling of the Supreme Court. The validity of Panama’s Mineral Resources Code which was established more than 50
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 50
1 Copper C1 cash cost (copper C1), and copper all-in sustaining costs (copper AISC) are non-GAAP ratios which do not have a standardized meaning prescribed
by IFRS and might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
years ago was reiterated by the Minister given the absence of retroactivity of the Supreme Court ruling. As part of these
plans, a temporary phase of environmental Preservation and Safe Management would be established during which
intervening period independent audits, review and planning activities would be undertaken. It was stated that Panama would
be the first country in the world to implement a sudden mine closure of this magnitude, and therefore the planning is
estimated by the GOP to take up to two years, and 10 years or more to implement. The (now former) Minister for Commerce
and Industry also announced plans to consider the economic impacts of the halt to operations of Cobre Panamá at both a
national and local level. Please refer to the Cobre Panamá Update section for an overview of developments following the
Presidential elections in May 2024, and inauguration of President Mulino in July 2024, with respect to a proposed audit at
Cobre Panamá. The Company is of the view, supported by the advice of legal counsel, that it has acquired rights with
respect to the operation of the Cobre Panamá project, as well as rights under international law.
Arbitration Proceedings
Steps towards two arbitration proceedings have been taken by the Company. One under the Canada-Panama Free Trade
Agreement (FTA), and another under the International Chamber of Commerce (“ICC”) pursuant to the arbitration clause of
the Refreshed Concession Contract.
1.
On November 29, 2023, Minera Panamá S.A. (“MPSA”) initiated arbitration before the ICC's International Court of
Arbitration pursuant to the ICC’s Rules of Arbitration and Clause 46 of the Refreshed Concession Contract, to
protect its rights under Panamanian law and the Refreshed Concession Contract that the GOP agreed to in
October 2023. The arbitration clause of the contract provides for arbitration in Miami, Florida. The GOP requested
an extension to the proceedings following the replacement of external legal counsel and on the basis that the new
government required time to assess the situation concerning the mine. A final hearing for this matter is now
scheduled for February 2026.
2.
On November 14, 2023, First Quantum submitted a notice of intent to the GOP initiating the consultation period
required under the FTA. First Quantum submitted an updated notice of intent on February 7, 2024. First Quantum
is entitled to seek any and all relief appropriate in arbitration, including but not limited to damages and reparation
for Panama’s breaches of the Canada-Panama FTA. These breaches include, among other things, the GOP’s
failure to permit MPSA to lawfully operate the Cobre Panamá mine prior to the Supreme Court’s November 2023
decision, and the GOP’s pronouncements and actions concerning closure plans and P&SM at Cobre Panamá. The
Company has the right to file its arbitration claim under the FTA within three years of Panama's breaches of the
FTA.
REGULATORY DISCLOSURES
Seasonality
The Company’s results as discussed in this MD&A are subject to seasonal aspects, in particular the rainy season in Zambia.
The rainy season in Zambia generally starts in November and continues through April, with the heaviest rainfall normally
experienced in the months of January, February and March. As a result of the rainy season, mine pit access and the ability
to mine ore is lower in the first quarter of the year than other quarters and the cost of mining is higher.
Off-Balance Sheet Arrangements
The Company had no off-balance sheet arrangements as of the date of this report.
Non-GAAP Financial Measures and Ratios
This document refers to cash cost (C1), all-in sustaining cost (AISC) and total cost (C3) per unit of payable production,
operating cash flow per share, realized metal prices, EBITDA, net debt and adjusted earnings, which are not measures
recognized under IFRS, do not have a standardized meaning prescribed by IFRS and are not necessarily comparable to
similar measures presented by other issuers. These measures are used internally by management in measuring the
performance of the Company’s operations and serve to provide additional information which should not be considered in
isolation to measures prepared under IFRS.
C1, AISC and C3 are non-GAAP financial measures based on production and sales volumes for which there is no directly
comparable measure under IFRS, though a reconciliation from the cost of sales, as stated in the Company’s financial
statements, and which should be read in conjunction with this MD&A, to C1, AISC and C3 can be found on the following
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 51
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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60
pages. These reconciliations set out the components of each of these measures in relation to the cost of sales for the
Company as per the consolidated financial statements.
The calculation of these measures is described below, and may differ from those used by other issuers. The Company
discloses these measures in order to provide assistance in understanding the results of the operations and to provide
additional information to investors.
Calculation of Cash Cost, All-In Sustaining Cost, Total Cost, Sustaining Capital Expenditure and
Deferred Stripping Costs Capitalized
The consolidated cash cost (C1), all-in sustaining cost (AISC) and total cost (C3) presented by the Company are measures
that are prepared on a basis consistent with the industry standard definitions by the World Gold Council and Brook Hunt cost
guidelines but are not measures recognized under IFRS. In calculating the C1 cash cost, AISC and C3, total cost for each
segment, the costs are measured on the same basis as the segmented financial information that is contained in the financial
statements.
C1 cash cost includes all mining and processing costs less any profits from by-products such as gold, silver, zinc, pyrite,
cobalt, sulphuric acid, or iron magnetite and is used by management to evaluate operating performance. TC/RC and freight
deductions on metal sales, which are typically recognized as a component of sales revenues, are added to C1 cash cost to
arrive at an approximate cost of finished metal.
AISC is defined as cash cost (C1) plus general and administrative expenses, sustaining capital expenditure, deferred
stripping, royalties and lease payments and is used by management to evaluate performance inclusive of sustaining
expenditure required to maintain current production levels.
C3 total cost is defined as AISC less sustaining capital expenditure, deferred stripping and general and administrative
expenses net of insurance, plus depreciation and exploration. This metric is used by management to evaluate the operating
performance inclusive of costs not classified as sustaining in nature such as exploration and depreciation.
Sustaining capital expenditure is defined as capital expenditure during the production phase, incurred to sustain and
maintain the existing assets to achieve constant planned levels of production, from which future economic benefits will be
derived. This includes expenditure for assets to retain their existing productive capacity, and to enhance assets to minimum
reliability, environmental and safety standards.
Deferred stripping costs capitalized are defined as waste material stripping costs in excess of the strip ratio, for the
production phase, and from which future economic benefits will be derived from future access to ore. Deferred stripping
costs are capitalized to the mineral property, and will be depreciated on a units-of-production basis.
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Purchase and deposits on property, plant
and equipment
324
329
344
1,286
1,300
Sustaining capital expenditure and
deferred stripping
108
101
159
424
590
Project capital expenditure
216
228
185
862
710
Total capital expenditure
324
329
344
1,286
1,300
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 52
Non-GAAP Reconciliations
The following tables provide a reconciliation of C12, C32 and AISC2 to the consolidated financial statements:
For the three
months ended
December 31,
2024
Cobre
Panamá
Kansanshi
Sentinel
Guelb
Moghrein
Las
Cruces
Çayeli
Pyhäsalmi
Copper
Ravensthorpe
Enterprise
Nickel
Corporate
& other
Total
Cost of sales1
(10)
(368)
(345)
(53)
–
(14)
(5)
(795)
–
(50)
(50)
(6)
(851)
Adjustments:
Depreciation
10
67
78
6
–
1
–
162
–
7
7
–
169
By-product
credits
1
82
–
37
–
(1)
6
125
–
(1)
(1)
–
124
Royalties
–
51
35
2
–
2
–
90
–
2
2
–
92
Treatment and
refining charges
(1)
(5)
(15)
(1)
–
(1)
–
(23)
–
(5)
(5)
–
(28)
Freight costs
–
–
1
–
–
(1)
–
–
–
–
–
–
–
Finished goods
–
17
(7)
–
–
(3)
(1)
6
–
12
12
–
18
Other4
–
32
–
1
–
2
(1)
34
–
3
3
6
43
Cash cost
(C1)2,4
–
(124)
(253)
(8)
–
(15)
(1)
(401)
–
(32)
(32)
–
(433)
Adjustments:
Depreciation
(excluding
depreciation in
finished goods)
(10)
(66)
(76)
(5)
–
(1)
(1)
(159)
–
(6)
(6)
1
(164)
Royalties
–
(51)
(35)
(2)
–
(2)
–
(90)
–
(2)
(2)
–
(92)
Other
–
(1)
(2)
–
–
–
–
(3)
–
(1)
(1)
–
(4)
Total cost (C3)2,4
(10)
(242)
(366)
(15)
–
(18)
(2)
(653)
–
(41)
(41)
1
(693)
Cash cost (C1)2,4
–
(124)
(253)
(8)
–
(15)
(1)
(401)
–
(32)
(32)
–
(433)
Adjustments:
General and
administrative
expenses
(14)
(6)
(13)
–
–
(1)
–
(34)
–
(2)
(2)
–
(36)
Sustaining capital
expenditure and
deferred
stripping3
(4)
(41)
(47)
(1)
–
(2)
–
(95)
–
(13)
(13)
–
(108)
Royalties
–
(51)
(35)
(2)
–
(2)
–
(90)
–
(2)
(2)
–
(92)
Other
–
–
2
–
–
–
–
2
–
–
–
–
2
AISC2,4
(18)
(222)
(346)
(11)
–
(20)
(1)
(618)
–
(49)
(49)
–
(667)
AISC (per lb)2,4
–
$2.14
$2.88
$1.30
–
$3.83
–
$2.58
–
$7.48
$7.48
–
Cash cost – (C1)
(per lb)2,4
–
$1.21
$2.11
$1.01
–
$2.91
–
$1.68
–
$4.62
$4.62
–
Total cost – (C3)
(per lb)2,4
–
$2.33
$3.06
$1.79
–
$3.37
–
$2.72
–
$5.91
$5.91
–
1 Total cost of sales per the Consolidated Statement of Earnings (Loss) in the Company’s annual audited consolidated financial statements.
2 C1 cash cost (C1), total costs (C3), and all-in sustaining costs (AISC) are non-GAAP ratios which do not have a standardized meaning prescribed by IFRS and
might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
3 Sustaining capital and deferred stripping are non-GAAP financial measures which do not have a standardized meaning prescribed by IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
4 Excludes purchases of copper concentrate from third parties treated through the Kansanshi Smelter.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 53
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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62
For the three months
ended December 31,
2023
Cobre
Panamá
Kansanshi
Sentinel
Guelb
Moghrein
Las
Cruces
Çayeli
Pyhäsalmi
Copper
Corporate
& other
Ravensthorpe
Enterprise
Total
Cost of sales1
(255)
(365)
(307)
(41)
(6)
(20)
(4)
(998)
(6)
(108)
(19)
(1,131)
Adjustments:
Depreciation
80
53
75
3
–
4
1
216
(4)
14
–
226
By-product credits
22
37
–
24
–
4
3
90
–
2
–
92
Royalties
25
27
29
1
–
1
–
83
–
2
–
85
Treatment and refining
charges
(18)
(5)
(15)
(2)
–
(2)
–
(42)
–
–
–
(42)
Freight costs
–
–
(11)
–
–
(1)
–
(12)
–
–
–
(12)
Finished goods
(75)
(1)
(6)
(3)
(1)
4
(1)
(83)
–
3
19
(61)
Other4
39
87
2
–
7
–
–
135
10
1
–
146
Cash cost (C1)2,4
(182)
(167)
(233)
(18)
–
(10)
(1)
(611)
–
(86)
–
(697)
Adjustments:
Depreciation (excluding
depreciation in finished
goods)
(108)
(52)
(76)
(3)
–
(4)
(1)
(244)
4
(13)
–
(253)
Royalties5
3
(27)
(29)
(1)
–
(1)
–
(55)
–
(2)
–
(57)
Other
(1)
(7)
(5)
(1)
–
–
–
(14)
–
–
–
(14)
Total cost (C3)2,4,5
(288)
(253)
(343)
(23)
–
(15)
(2)
(924)
4
(101)
–
(1,021)
Cash cost (C1)2,4
(182)
(167)
(233)
(18)
–
(10)
(1)
(611)
–
(86)
–
(697)
Adjustments:
General and
administrative expenses
(10)
(9)
(12)
(1)
–
(1)
–
(33)
–
(4)
–
(37)
Sustaining capital
expenditure and
deferred stripping3
(30)
(60)
(42)
(1)
–
(2)
–
(135)
–
(24)
–
(159)
Royalties5
3
(27)
(29)
(1)
–
(1)
–
(55)
–
(2)
–
(57)
Other
–
–
(1)
–
–
(1)
–
(2)
–
–
–
(2)
AISC2,4,5
(219)
(263)
(317)
(21)
–
(15)
(1)
(836)
–
(116)
–
(952)
AISC (per lb)2,4,5
$1.71
$3.83
$2.51
$2.73
–
$2.90
–
$2.52
–
$16.08
–
Cash cost – (C1)
(per lb)2,4
$1.45
$2.43
$1.85
$2.24
–
$2.31
–
$1.82
–
$11.78
–
Total cost – (C3)
(per lb)2,4,5
$2.22
$3.69
$2.72
$3.07
–
$3.02
–
$2.77
–
$14.18
–
1 Total cost of sales per the Consolidated Statement of Earnings (Loss) in the Company’s annual audited consolidated financial statements.
2 C1 cash cost (C1), total costs (C3) and all-in sustaining costs (AISC) are non-GAAP ratios which do not have a standardized meaning prescribed by IFRS and
might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
3 Sustaining capital and deferred stripping are non-GAAP financial measures which do not have a standardized meaning prescribed by IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
4 Excludes purchases of copper concentrate from third parties treated through the Kansanshi Smelter.
5 Royalties in C3 and AISC costs for the quarter and year ended December 31, 2023 exclude the 2022 impact of $28 million attributable to payments pursuant of
Law 406 in Panama.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 54
For the year
ended
December 31,
2024
Cobre
Panamá
Kansanshi
Sentinel
Guelb
Moghrein
Las
Cruces
Çayeli
Pyhäsalmi
Copper
Ravensthorpe
Enterprise
Nickel
Corporate
& other
Total
Cost of sales1
(43)
(1,507) (1,285)
(205)
–
(61)
(17) (3,118)
(119)
(178)
(297)
(37) (3,452)
Adjustments:
Depreciation
43
251
295
20
–
4
1
614
2
16
18
1
633
By-product
credits
(2)
269
–
131
–
8
19
425
3
–
3
–
428
Royalties
–
174
133
8
–
8
–
323
2
9
11
–
334
Treatment and
refining charges
(1)
(19)
(48)
(8)
–
(7)
–
(83)
(1)
(5)
(6)
–
(89)
Freight costs
–
–
(21)
–
–
(4)
–
(25)
–
–
–
–
(25)
Finished goods
–
9
(23)
7
–
1
(4)
(10)
10
86
96
–
86
Other4
–
264
2
1
–
2
(1)
268
3
–
3
36
307
Cash cost
(C1)2,4,5
(3)
(559)
(947)
(46)
–
(49)
(2) (1,606)
(100)
(72)
(172)
– (1,778)
Adjustments:
Depreciation
(excluding
depreciation in
finished goods)
(43)
(253)
(302)
(19)
–
(4)
(2)
(623)
–
(15)
(15)
–
(638)
Royalties
–
(174)
(133)
(8)
–
(8)
–
(323)
(2)
(9)
(11)
–
(334)
Other
–
(10)
(9)
(1)
(1)
–
–
(21)
(2)
(1)
(3)
–
(24)
Total cost
(C3)2,4,5
(46)
(996) (1,391)
(74)
(1)
(61)
(4) (2,573)
(104)
(97)
(201)
– (2,774)
Cash cost
(C1)2,4,5
(3)
(559)
(947)
(46)
–
(49)
(2) (1,606)
(100)
(72)
(172)
– (1,778)
Adjustments:
General and
administrative
expenses
(63)
(26)
(46)
(2)
–
(3)
–
(140)
(4)
(4)
(8)
–
(148)
Sustaining capital
expenditure and
deferred
stripping3
(10)
(153)
(195)
(9)
–
(8)
–
(375)
(15)
(34)
(49)
–
(424)
Royalties
–
(174)
(133)
(8)
–
(8)
–
(323)
(2)
(9)
(11)
–
(334)
Other
(1)
–
1
–
(1)
–
–
(1)
(1)
–
(1)
–
(2)
AISC2,4,5
(77)
(912) (1,320)
(65)
(1)
(68)
(2) (2,445)
(122)
(119)
(241)
– (2,686)
AISC (per lb)2,4,5
–
$2.48
$2.70
$1.80
–
$2.81
–
$2.66
$14.25
$6.31
$8.85
–
Cash cost – (C1)
(per lb)2,4,5
–
$1.52
$1.94
$1.31
–
$2.05
–
$1.74
$11.97
$3.76
$6.38
–
Total cost – (C3)
(per lb)2,4,5
–
$2.71
$2.85
$2.05
–
$2.53
–
$2.80
$12.45
$4.98
$7.37
–
1 Total cost of sales per the Consolidated Statement of Earnings (Loss) in the Company’s annual audited consolidated financial statements.
2 C1 cash cost (C1), total costs (C3) and all-in sustaining costs (AISC) are non-GAAP ratios which do not have a standardized meaning prescribed by IFRS and
might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
3 Sustaining capital and deferred stripping are non-GAAP financial measures which do not have a standardized meaning prescribed by IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
4 Excludes purchases of copper concentrate from third parties treated through the Kansanshi Smelter
5 Pre-commercial production and sales volumes at Enterprise are not included in C1, C3 and AISC calculations.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 55
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
65
64
For the year ended
December 31, 2023
Cobre
Panamá
Kansanshi
Sentinel
Guelb
Moghrein
Las
Cruces
Çayeli
Pyhäsalmi
Copper
Corporate
& other
Ravensthorpe
Enterprise
Total
Cost of sales1
(1,646)
(1,466) (1,212)
(188)
(68)
(65)
(19)
(4,664)
(23)
(456)
(21)
(5,164)
Adjustments:
Depreciation
531
221
282
12
–
16
3
1,065
(2)
58
–
1,121
By-product credits
170
143
–
110
–
10
17
450
–
12
–
462
Royalties
69
137
110
6
1
5
–
328
–
17
–
345
Treatment and
refining charges
(156)
(23)
(46)
(8)
–
(7)
–
(240)
–
–
–
(240)
Freight costs
–
–
(25)
–
–
(5)
–
(30)
–
–
–
(30)
Finished goods
(66)
6
(21)
(1)
–
1
(3)
(84)
–
15
21
(48)
Other4
72
322
13
–
28
–
–
435
25
5
–
465
Cash cost (C1)2,4
(1,026)
(660)
(899)
(69)
(39)
(45)
(2)
(2,740)
–
(349)
–
(3,089)
Adjustments:
Depreciation
(excluding
depreciation in
finished goods)
(554)
(219)
(283)
(13)
–
(16)
(4)
(1,089)
2
(55)
–
(1,142)
Royalties5
(41)
(119)
(110)
(6)
(1)
(5)
–
(282)
–
(17)
–
(299)
Other
(15)
(15)
(12)
(1)
–
–
–
(43)
–
(6)
–
(49)
Total cost (C3)2,4
(1,636)
(1,013) (1,304)
(89)
(40)
(66)
(6)
(4,154)
2
(427)
–
(4,579)
Cash cost (C1)2,4
(1,026)
(660)
(899)
(69)
(39)
(45)
(2)
(2,740)
–
(349)
–
(3,089)
Adjustments:
General and
administrative
expenses
(46)
(31)
(42)
(3)
(2)
(2)
–
(126)
–
(16)
–
(142)
Sustaining capital
expenditure and
deferred stripping3
(177)
(199)
(158)
(5)
–
(6)
–
(545)
–
(45)
–
(590)
Royalties5
(41)
(119)
(110)
(6)
(1)
(5)
–
(282)
–
(17)
–
(299)
Other
(2)
–
(1)
–
(1)
(1)
–
(5)
–
(1)
–
(6)
AISC2,4
(1,292)
(1,009) (1,210)
(83)
(43)
(59)
(2)
(3,698)
–
(428)
–
(4,126)
AISC (per lb)2,4
$1.85
$3.47
$2.67
$2.96
$4.91
$2.55
–
$2.46
–
$12.22
–
Cash cost – (C1)
(per lb)2,4
$1.47
$2.27
$1.98
$2.44
$4.57
$1.97
–
$1.82
–
$9.95
–
Total cost – (C3)
(per lb)2,4
$2.34
$3.48
$2.88
$3.17
$4.67
$2.87
–
$2.76
–
$12.20
–
1 Total cost of sales per the Consolidated Statement of Earnings (Loss) in the Company’s annual audited consolidated financial statements.
2 C1 cash cost (C1), total costs (C3) and all-in sustaining costs (AISC) are non-GAAP ratios which do not have a standardized meaning prescribed by IFRS and
might not be comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
3 Sustaining capital and deferred stripping are non-GAAP financial measures which do not have a standardized meaning prescribed by IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See “Regulatory Disclosures”.
4 Excludes purchases of copper concentrate from third parties treated through the Kansanshi Smelter.
5 Royalties in C3 and AISC costs exclude the 2022 impact of $18 million attributable to the 3.1% sale of a gross royalty interest in KMP to ZCCM-IH and exclude
the 2022 impact of $28 million attributable to payments pursuant of Law 406 in Panama.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 56
Realized Metal Prices
Realized metal prices are used by the Company to enable management to better evaluate sales revenues in each reporting
period. Realized metal prices are calculated as gross metal sales revenues divided by the volume of metal sold in lbs. Net
realized metal price is inclusive of the treatment and refining charges (TC/RC) and freight charges per lb.
EBITDA and Adjusted Earnings
EBITDA and adjusted earnings (loss), which are non-GAAP financial measures, and adjusted earnings (loss) per share,
which is a non-GAAP ratio, are the Company’s adjusted earnings metrics, and are used to evaluate operating performance
by management. These measures do not have a standardized meaning under IFRS and might not be comparable to similar
measures disclosed by other issuers. The Company believes that the adjusted metrics presented are useful measures of the
Company’s underlying operational performance as they exclude certain impacts which the Company believes are not
reflective of the Company’s underlying performance for the reporting period. These include impairment and related charges,
foreign exchange revaluation gains and losses, gains and losses on disposal of assets and liabilities, one-time costs related
to acquisitions, dispositions, restructuring and other transactions, revisions in estimates of restoration provisions at closed
sites, debt extinguishment and modification gains and losses, the tax effect on unrealized movements in the fair value of
derivatives designated as hedged instruments, and adjustments for expected phasing of Zambian VAT.
Calculation of Operating Cash Flow per Share and Net Debt
Cash flows from operating activities per share is a non-GAAP ratio and is calculated by dividing the operating cash flow
calculated in accordance with IFRS by the basic weighted average common shares outstanding for the respective period.
Net debt is comprised of bank overdrafts and total debt less unrestricted cash and cash equivalents.
NET DEBT
Q4 2024
Q3 2024
Q4 2023
Q4 2022
Cash and cash equivalents
843
783
1,157
1,688
Bank overdraft
31
90
198
–
Current debt
498
685
769
575
Non-current debt
5,844
5,599
6,610
6,805
Net debt
5,530
5,591
6,420
5,692
EBITDA
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Operating profit (loss)
344
329
(984)
810
78
Depreciation
169
159
226
633
1,121
Other adjustments:
Foreign exchange loss (gain)
(13)
23
43
(4)
67
Impairment expense1
2
2
900
75
900
Share of results of joint venture
(12)
(1)
35
(13)
35
Royalty payable2,3
–
–
28
–
46
Restructuring expense4
–
2
18
14
49
Other expense
3
6
11
15
28
Revisions in estimates of restoration
provisions at closed sites
(38)
–
(4)
(39)
4
Total adjustments excluding depreciation
(58)
32
1,031
48
1,129
EBITDA
455
520
273
1,491
2,328
1 The fourth quarter and full year ended December 31, 2024 includes an impairment charge of $1 million and $72 million relating to Ravensthorpe, following the
decision to scale back operations at Ravensthorpe in Q1 and subsequently placing the mine on C&M in May. For the fourth quarter and year ended December
31, 2023, an impairment charge of property, plant and equipment of $854 million was recognized at Ravensthorpe following an impairment test.
2 The full year ended December 31, 2023, includes a royalty attributable due to ZCCM-IH of $18 million relating to the year ended December 31, 2022.
3 The quarter and year ended December 31, 2023, pursuant to Law 406, include payments of $28 million income taxes, withholding and mining taxes related to
2022 which has been recognized in royalty expense.
4 The fourth quarter and full year ended December 31, 2023 includes $18 million from the severance package at Cobre Panamá. Following a corporate
reorganization within the Kansanshi segment, the year ended December 31, 2023 also includes a restructuring expense of $31 million.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 57
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
67
66
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Net earnings (loss) attributable to
shareholders of the Company
99
108
(1,447)
2
(954)
Adjustments attributable to shareholders
of the Company:
Adjustment for expected phasing of
Zambian VAT
(35)
(17)
20
(89)
(49)
Modification and redemption of
liabilities1
(100)
–
–
(90)
–
Other adjustments
(3)
–
–
(3)
–
Total adjustments to EBITDA excluding
depreciation
(58)
32
1,031
48
1,129
Ravensthorpe deferred tax charge2
–
–
160
–
160
Tax adjustments
(12)
–
273
(3)
271
Minority interest adjustments
140
(4)
(296)
118
(296)
Adjusted earnings (loss)
31
119
(259)
(17)
261
Basic earnings (loss) per share as
reported
$0.12
$0.13
($2.09)
$0.00
($1.38)
Diluted earnings (loss) per share
$0.12
$0.13
($2.09)
$0.00
($1.38)
Adjusted earnings (loss) per share
$0.04
$0.14
($0.37)
($0.02)
$0.38
1 In the fourth quarter and year ended December 31, 2024, the Company revised the terms of the loan agreement with KPMC. Effective November 1, 2024, MPSA
has agreed with KPMC to suspend interest accruals and payments for up to 12 months resulting in an adjustment to the carrying amount of the liability of $100
million.
2 In the year ended December 31, 2023 the Company derecognized $160 million of deferred tax assets in Ravensthorpe.
Significant Judgments, Estimates and Assumptions
Many of the amounts disclosed in the financial statements involve the use of judgments, estimates and assumptions. These
judgments and estimates are based on management’s knowledge of the relevant facts and circumstances at the time,
having regard to prior experience, and are continually evaluated.
Significant judgments
> Assessment of impairment indicators
Management applies significant judgment in assessing the cash-generating units and assets for the existence of indicators
of impairment at the reporting date. Internal and external factors are considered in assessing whether indicators of
impairment are present that would necessitate impairment testing.
As at December 31, 2024, the carrying amount of the net assets of the Company is more than its market capitalisation. The
share price is impacted by a number of factors including P&SM at Cobre Panamá. The Company completed an analysis of
the recoverable amounts of its cash-generating units to compare against their respective carrying values as of December 31,
2024. An impairment charge of $72 million was recognized in respect of Inventory and PPE additions at Ravensthorpe in the
year ended December 31, 2024 (Refer to Note 5 and Note 6). The recoverable amount of Cobre Panamá has been
determined using a fair value less costs of disposal calculation based on a cash flow model covering different possible
scenarios, including the process of international arbitration and various levels of operation. In addition, judgment is applied to
the probability assigned to scenarios considered for Cobre Panamá (Refer to Note 7). The recoverable amount of other
cash-generating units exceeds the carrying value as at December 31, 2024, and therefore no further impairment charge has
been recognized.
Significant assumptions regarding commodity prices, production, operating costs, capital expenditures and discount rates
are used in determining whether there are any indicators of impairment. These assumptions are reviewed regularly by senior
management and compared, where applicable, to relevant market consensus views.
For exploration projects, management considers indicators including the Company’s continued ability and plans to further
develop the projects and title of mineral properties required to advance the projects to assess the existence of impairment
indicators.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 58
The Company’s most significant cash-generating units are longer-term assets and therefore their value is assessed on the
basis of longer-term pricing assumptions. Shorter-term assets are more sensitive to short term commodity prices
assumptions that are used in the review of impairment indicators.
> Control over Cobre Panamá
The Company suspended production at the Cobre Panamá mine at the end of November 2023 and placed the mine into a
phase of P&SM. The Company evaluated whether it still maintained effective power over the mine and related operations,
and has consolidated MPSA and the Cobre Panamá mine on the basis of control, effectively exercising power over the
relevant activities related to the mine, it's exposure to variable returns, and impact on the returns of the operation through its
managerial involvement.
> Control over La Granja UK Holdings Limited
Management considered various factors, including the legal form of the shareholding, in determining that the Company has
control over La Granja UK Holdings Limited.
In determining whether the acquisition of La Granja constituted a business or an asset acquisition, management considered
whether substantially all of the fair value of the gross assets acquired were concentrated in a single identifiable asset or a
group of similar identifiable assets (the ‘concentration test’) and concluded that this was evident. The acquisition has
therefore been accounted for as an asset acquisition.
Rio Tinto’s 45% non-controlling interest in La Granja is recognized on consolidation. Management considered accounting
treatments for non-controlling interests on asset acquisitions and concluded to measure non-controlling interest arising by
reference to the fair value of consideration paid for a 55% holding, as would have been an accounting option had the
acquisition been considered a business combination. The non-controlling interest is subsequently adjusted for the change in
the non-controlling interest’s share of net assets in La Granja, which can be and is different to its share of result.
In assessing the fair value of consideration paid, management concluded that $546 million of initial funding that the
Company is responsible for does not constitute deferred consideration, and therefore the consideration for the acquisition
was $105 million that was paid to Rio Tinto for a 55% shareholding.
> Determination of ore reserves and resources
Judgments about the amount of product that can be economically and legally extracted from the Company’s properties are
made by management using a range of geological, technical and economic factors, history of conversion of mineral deposits
to proven and probable reserves, as well as data regarding quantities, grades, production techniques, recovery rates,
production costs, transport costs, commodity demand, commodity prices and exchange rates. This process may require
complex and difficult geological judgments to interpret the data. The Company uses qualified persons (as defined by the
Canadian Securities Administrators’ National Instrument 43-101) to compile this data.
Changes in the judgments surrounding ore reserves and resources may impact the carrying value of property, plant and
equipment, restoration provisions included in provisions and other liabilities, deferred revenue, recognition of deferred
income tax amounts and depreciation.
> Achievement of commercial production
Once a mine or smelter reaches the operating levels intended by management, depreciation of capitalized costs begins.
Significant judgment is required to determine when certain of the Company’s assets reach this level.
Management considers several factors, including, but not limited to the following:
•
completion of a reasonable period of commissioning;
•
consistent operating results achieved at a pre-determined level of design capacity and indications exist that this
level will continue;
•
mineral recoveries at or near expected levels; and
•
the transfer of operations from development personnel to operational personnel has been completed.
During the year ended December 31, 2024, the Company concluded that the Enterprise mine was operating in a manner
intended by management and commercial production was achieved from June 1, 2024.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 59
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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68
> Taxes
Judgment is required in determining the recognition and measurement of deferred income tax assets and liabilities on the
balance sheet. In the normal course of business, the Company is subject to assessment by taxation authorities in various
jurisdictions. These authorities may have different interpretations of tax legislation or tax agreements than those applied by
the Company in computing current and deferred income taxes. These different judgments may alter the timing or amounts of
taxable income or deductions. The final amount of taxes to be paid or recovered depends on a number of factors including
the outcome of audits, appeals and negotiation. The timings of recoveries with respect to indirect taxes, such as VAT, are
subject to judgment which, in the instance of a change of circumstances, could result in material adjustments.
The Company operates in a specialized industry and in a number of tax jurisdictions. As a result, its income is subject to
various rates of taxation. The breadth of its operations and the global complexity and interpretation of tax regulations require
assessment and judgment of uncertainties and of the taxes that the Company will ultimately pay. These are dependent on
many factors, including negotiations with tax authorities in various jurisdictions, outcomes of tax litigation and resolution of
disputes. The resolution of these uncertainties may result in adjustments to the Company’s tax assets and liabilities.
Management assesses the likelihood and timing of taxable earnings in future periods in recognizing deferred income tax
assets on unutilized tax losses. Future taxable income is based on forecast cash flows from operations and the application
of existing tax laws in each jurisdiction. Forecast cash flows are based on life of mine projections.
To the extent that future cash flows and taxable income differ significantly from forecasts, the ability of the Company to
realize the net deferred income tax assets recorded at the balance sheet date could be impacted.
The Company operates in certain jurisdictions that have increased degrees of political and sovereign risk. Tax legislation in
these jurisdictions is developing and there is a risk that fiscal reform changes with respect to existing investments could
unexpectedly impact application of the tax legislation. Following due public consultation and regulatory signoff, the National
Assembly in Panama approved Bill 1100, being the proposal for approval of the Refreshed Concession Contract for the
Cobre Panamá mine on October 20, 2023. On the same day, President Laurentino Cortizo sanctioned Bill 1100 into Law
406, which was subsequently published in the Official Gazette. Law 406 approved the concession contract for the Cobre
Panamá mine on October 20, 2023. On November 16, 2023, in accordance with its contractual obligations to the Republic of
Panama under Law 406, the Company made tax and royalty payments of $567 million in respect of the period from
December 2021 to October 2023. On November 28, 2023, the Supreme Court of Justice of Panama announced that it
declared Law 406 unconstitutional. The ruling was subsequently published in the Official Gazette on December 2, 2023.
As the ruling on unconstitutionality is not retroactive, the Company has recorded all payments of taxes and royalties that
were calculated based on a taxable margin as current tax expense as per Law 406 up to December 2, 2023. Subsequent to
December 2, 2023, the Company has recorded all taxes and royalties as per the general income tax and mining code. Taxes
are disclosed in note 13 of the financial statements.
> Precious metal stream arrangement
On October 5, 2015, the Company finalized an agreement with Franco-Nevada Corporation (“Franco-Nevada”) for the
delivery of precious metals from the Cobre Panamá project. Franco-Nevada have provided $1 billion deposit to the Cobre
Panamá project against future deliveries of gold and silver produced by the mine. A further agreement was completed on
March 26, 2018, with an additional $356 million received from Franco-Nevada.
Management has determined that under the terms of the agreements the Company meets the ‘own-use’ exemption criteria
under IFRS 9: Financial Instruments. The Company also retains significant business risk relating to the operation of the mine
and as such has accounted for the proceeds received as deferred revenue.
Management has exercised judgment in determining the appropriate accounting treatment for the Franco-Nevada streaming
agreements. Management has determined, with reference to the agreed contractual terms in conjunction with the Cobre
Panamá reserves and mine plan, that funds received from Franco-Nevada constitute a prepayment of revenues deliverable
from future Cobre Panamá production.
Significant accounting estimates
Estimates are inherently uncertain and therefore actual results may differ from the amounts included in the financial
statements, potentially having a material future effect on the Company’s consolidated financial statements. The estimates
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 60
and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities
within the next financial year are addressed below:
> Determination of ore reserves and life of mine plan
Reserves are estimates of the amount of product that can be economically and legally extracted from the Company’s
properties. Estimating the quantity and/or grade of reserves requires the size, shape and depth of ore bodies or fields to be
determined by analyzing geological data such as drilling samples. Following this, the quantity of ore that can be extracted in
an economical manner is calculated using data regarding the life of mine plans and forecast sales prices (based on current
and long-term historical average price trends).
The majority of the Company’s property, plant and equipment are depreciated over the estimated lives of the assets on a
units-of-production basis. The calculation of the units-of-production rate, and therefore the annual depreciation expense
could be materially affected by changes in the underlying estimates which are driven by the life of mine plans. Changes in
estimates can be the result of actual future production differing from current forecasts of future production, expansion of
mineral reserves through exploration activities, differences between estimated and actual costs of mining and differences in
the commodity prices used in the estimation of mineral reserves.
Management made significant estimates of the strip ratio for each production phase. Waste material stripping costs in
excess of this ratio, and from which future economic benefit will be derived from future access to ore, will be capitalized to
mineral property and depreciated on a units-of-production basis.
Changes in the proven and probable reserves estimates may impact the carrying value of property, plant and equipment,
restoration provisions, deferred revenue, recognition of deferred income tax amounts and depreciation.
> Review of asset carrying values and impairment charges
Management’s determination of recoverable amounts includes estimates of mineral prices, recoverable reserves and
resources, and operating, capital and restoration costs and tax regulations applicable to the cash-generating unit’s
operations are subject to certain risks and uncertainties that may affect the recoverability of mineral property costs. The
calculation of the recoverable amount can also include assumptions regarding the appropriate discount rate and inflation and
exchange rates. Although management has made its best estimate of these factors, it is possible that changes could occur
in the near term that could adversely affect management’s estimate of the net cash flow to be generated from its projects.
> Estimation of the amount and timing of restoration and remediation costs
Accounting for restoration provisions requires management to make estimates of the future costs the Company will incur to
complete the restoration and remediation work required to comply with existing laws, regulations and agreements in place at
each mining operation and any environmental and social principles the Company is in compliance with. The calculation of
the present value of these costs also includes assumptions regarding the timing of restoration and remediation work,
applicable risk-free interest rate for discounting those future cash outflows, inflation and foreign exchange rates. Actual costs
incurred may differ from those amounts estimated. Also, future changes to environmental laws and regulations could
increase the extent of restoration work required to be performed by the Company. Increases in future costs could materially
impact the amounts charged to operations for restoration. A 10% increase in costs would result in an increase to restoration
provisions of $60 million at December 31, 2024.
The provision represents management’s best estimate of the present value of the future restoration and remediation costs.
The actual future expenditures may differ from the amounts currently provided; any increase in future costs could materially
impact the amounts included in the liability disclosed in the consolidated balance sheet.
> Estimation and assumptions relating to the timing of VAT receivables in Zambia
In addition to the timing of the recoverability of VAT receivables being a key judgment, certain assumptions are determined
by management in calculating the adjustment for expected phasing of VAT receipts. In assessing the expected phasing
adjustment, management considers an appropriate discount rate as disclosed in note 4c, which is then applied to calculate
the phasing adjustment based on the estimated timing of recoverability. Changes to the timings could materially impact the
amounts charged to finance costs. The impact of repayments being one year later than estimated at December 31, 2024,
would lead to a decrease to the carrying value and an increase to finance costs of $58 million.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 61
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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70
Financial instruments risk exposure
Credit risk
The Company’s credit risk is primarily attributable to cash and bank balances, short-term deposits, derivative instruments
and trade and other receivables. The Company’s exposure to credit risk is represented by the carrying amount of each class
of financial assets, including commodity contracts, recorded in the consolidated balance sheet.
The Company limits its credit exposure on cash held in bank accounts by holding its key transactional bank accounts with
highly rated financial institutions. The Company manages its credit risk on short-term deposits by only investing with
counterparties that carry investment grade ratings as assessed by external rating agencies and spreading the investments
across these counterparties. Under the Company’s risk management policy, allowable counterparty exposure limits are
determined by the level of the rating unless exceptional circumstances apply. A rating of investment grade or equivalent is
the minimum allowable rating required as assessed by international credit rating agencies. Likewise, it is the Company’s
policy to deal with banking counterparties for derivatives who are rated investment grade or above by international credit
rating agencies and graduated counterparty limits are applied depending upon the rating.
Exceptions to the policy for dealing with relationship banks with ratings below investment grade are reported to, and
approved by, the Audit Committee. As at December 31, 2024, substantially all cash and short-term deposits are with
counterparties of investment grade.
The Company’s credit risk associated with trade accounts receivable is managed through establishing long-term contractual
relationships with international trading companies using industry-standard contract terms. 51% of the Company’s trade
receivables are outstanding from three customers together representing 31% of the total sales for the year. No amounts
were past due from these customers at the balance sheet date. The Company continues to trade with these customers.
Revenues earned from these customers are included within the Kansanshi, Trident, Panama and Çayeli segments. Other
accounts receivable consist of amounts owing from government authorities in relation to the refund of value-added taxes
applying to inputs for the production process and property, plant and equipment expenditures, prepaid taxes and amounts
held in broker accounts
The VAT receivable due from government authorities includes $515 million at December 31, 2024, which is past due
(December 31, 2023: $521 million).
The carrying amount of financial assets recorded in the financial statements, net of any allowances for losses, represents
the Company’s maximum exposure to credit risk. Expected credit losses on trade and other receivables at December 31,
2024, are insignificant.
Liquidity risk
The Company manages liquidity risk by maintaining cash and cash equivalent balances and available credit facilities to
ensure that it is able to meet its short-term and long-term obligations as and when they fall due. Company-wide cash
projections are managed centrally and regularly updated to reflect the dynamic nature of the business and fluctuations
caused by commodity price and exchange rate movements.
The Company was obligated under its corporate revolving credit and term loan facility to maintain liquidity and satisfy various
covenant ratio tests on a historical cash flow basis. These ratios were in compliance during the year ended December 31,
2024 and December 31, 2023. And current forecasts including judgmental assumptions, do not indicate a breach of financial
covenants. If the Company breaches a covenant in its Financing Agreements, this would be an event of default which, if un-
addressed, would entitle the lenders to make the related borrowings immediately due and payable and if made immediately
due and payable all other borrowings would also be due and payable.
Market risks
Commodity price risk
The Company is subject to commodity price risk from fluctuations in the market prices of copper, gold, nickel, zinc and other
elements.
As part of the hedging program, the Company has elected to apply hedge accounting for a portion of copper sales. For the
year ended December 31, 2024, a fair value gain of $112 million (2023: nil) has been recognized on derivatives designated
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 62
as hedged instruments through accumulated other comprehensive income. The time value of hedges for the year ended
December 31, 2024, of $50 million is also recognized in other comprehensive income.
As at the year ended December 31, 2024, the Company had copper zero cost collar unmargined sales contracts for 181,250
tonnes at weighted average prices of $4.17 per lb to $4.97 per lb outstanding with maturities to December 2025.
The Company is also exposed to commodity price risk on diesel fuel required for mining operations and sulphur required for
acid production. The Company’s risk management policy allows for the management of these exposures through the use of
derivative financial instruments. As at December 31, 2024, and December 31, 2023, the Company had not entered into any
fuel forward contracts.
The Company’s commodity price risk related to changes in fair value of embedded derivatives in accounts receivable
reflecting copper, nickel, gold and zinc sales provisionally priced based on the forward price curve at the end of each quarter.
Interest rate risk
The majority of the Company’s interest expense is fixed however it is also exposed to an interest rate risk arising from
interest paid on floating rate debt and the interest received on cash and short-term deposits.
Deposits are invested on a short-term basis to ensure adequate liquidity for payment of operational and capital expenditures.
To date, no interest rate management products are used in relation to deposits.
The Company manages its interest rate risk on borrowings on a net basis. The Company manages this via primary issuance
of debt on a fixed or floating basis and via interest swaps if deemed necessary. The Company has a policy allowing floating-
to-fixed interest rate swaps targeting 50% of exposure over a five-year period. As at December 31, 2024, and December 31
2023, the Company held no floating-to-fixed interest rate swaps.
Foreign exchange risk
The Company’s functional and reporting currency is USD. As virtually all of the Company’s revenues are derived in USD and
the majority of its business is conducted in USD, foreign exchange risk arises from transactions denominated in currencies
other than USD. Commodity sales are denominated in USD, the majority of borrowings are denominated in USD and the
majority of operating expenses are denominated in USD. The Company’s primary foreign exchange exposures are to the
local currencies in the countries where the Company’s operations are located, principally the Zambian Kwacha (“ZMW”),
Australian dollar (“A$”) Mauritanian ouguiya (“MRU”), the euro (“EUR”) and the Turkish lira (“TRY”); and to the local
currencies suppliers who provide capital equipment for project development, principally the A$, EUR and the South African
rand (“ZAR”).
The Company’s risk management policy allows for the management of exposure to local currencies through the use of
financial instruments at a targeted amount of up to 100% for exposures within one year down to 50% for exposures in five
years.
Capital management
The Company takes a balanced approach to capital management in order to safeguard its ability to continue operate as a
going concern, ensuring sufficient liquidity is available for continued growth, cognizant of the requirements of shareholders
and debt holders the Company considers the items included in equity to be capital.
The Company manages the capital structure and makes adjustments in light of changes in economic conditions and the risk
characteristics of the Company’s assets. In the first quarter of 2024, the Company successfully completed a comprehensive
refinancing increasing the Company’s financial flexibility via the provision of additional liquidity and covenant headroom, as
well as reducing net leverage, and extending the debt maturity profile, to allow for the completion of the S3 Expansion while
the Company continues to focus on a resolution at Cobre Panamá. As a continued part of this strategy to ensure balance
sheet flexibility, the Company refinanced the FQM Trident loan in Q4-2024, maintaining bank support and extending the
maturity.
The Company uses a combination of short-term and long-term debt to finance its operations and development projects.
Typically, floating rates of interest are attached to short-term debt, and fixed rates on senior notes.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 63
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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72
Disclosure Controls and Procedures
The Company’s disclosure controls and procedures are designed to provide reasonable assurance that all relevant
information is communicated to senior management, to allow timely decisions regarding required disclosure.
An evaluation of the effectiveness of the Company’s disclosure controls and procedures, as defined under the National
Instrument 52-109 - Certification of Disclosure in Issuers’ Annual and Interim Filings, was conducted as of December 31,
2024, under the supervision of the Company’s Audit Committee and with the participation of management. Based on the
results of the evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure
controls and procedures were effective as of the end of the period covered by this report in providing reasonable assurance
that the information required to be disclosed in the Company’s annual filings, interim filings or other reports filed or submitted
by it under securities legislation is recorded, processed, summarized and reported in accordance with the securities
legislation.
Since the December 31, 2024 evaluation, there have been no adverse changes to the Company’s controls and procedures
and they continue to remain effective.
Internal Control over Financial Reporting (“ICFR”)
Internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of the
Company’s financial reporting and the preparation of financial statements in compliance with IFRS. The Company’s internal
control over financial reporting includes policies and procedures that:
> pertain to the maintenance of records that accurately and fairly reflect the transactions of the Company;
> provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements
in accordance with IFRS;
> ensure the Company’s receipts and expenditures are made only in accordance with authorization of management and the
Company’s directors; and
> provide reasonable assurance regarding prevention or timely detection of unauthorized transactions that could have a
material effect on the annual or interim financial statements.
There have been no changes in the Company’s ICFR during the year ended December 31, 2024 that have materially
affected, or are reasonably likely to materially affect, the Company’s ICFR.
An evaluation of the effectiveness of the Company’s internal control over financial reporting was conducted as of December
31, 2024 by the Company’s management, including the Chief Executive Officer and Chief Financial Officer, based on the
Control - Integrated Framework (2013) established by the Committee of Sponsoring Organizations (COSO) of the Treadway
Commission. Based on this evaluation, management has concluded that the Company’s internal controls over financial
reporting were effective.
Limitations of Controls and Procedures
The Company’s management, including the Chief Executive Officer and Chief Financial Officer, believe that any disclosure
controls and procedures or internal control over financial reporting, no matter how well conceived and operated, can provide
only reasonable and not absolute assurance that the objectives of the control system are met. Further, the design of a
control system reflects the fact that there are resource constraints, and the benefits of controls must be considered relative
to their costs. Because of the inherent limitations in all control systems, they cannot provide absolute assurance that all
control issues and instances of fraud, if any, within the Company have been prevented or detected. These inherent
limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of
simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of
two or more people, or by unauthorized override of the control. The design of any systems of controls is also based in part
upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed
in achieving its stated goals under all potential future conditions. Accordingly, because of the inherent limitations in a cost
effective control system, misstatements due to error or fraud may occur and not be detected.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 64
SUMMARY QUARTERLY INFORMATION
The following unaudited tables set out a summary of certain quarterly and annual results for the Company:
Consolidated operations
2022
Q1 23
Q2 23
Q3 23
Q4 23
2023
Q1 24
Q2 24
Q3 24
Q4 24
2024
Sales revenues
Copper
6,555
1,333
1,464
1,791
1,053
5,641
857
1,008
1,093
1,057
4,015
Gold
382
76
63
114
66
319
57
82
104
104
347
Nickel1
441
98
89
84
70
341
105
106
58
66
335
Other
248
51
35
40
29
155
17
35
24
29
105
Total sales revenues
7,626
1,558
1,651
2,029
1,218
6,456
1,036
1,231
1,279
1,256
4,802
Cobre Panamá
2,959
606
697
930
280
2,513
(5)
(1)
–
–
(6)
Kansanshi
1,706
388
358
475
377
1,598
354
531
596
578
2,059
Trident
1,980
349
410
468
438
1,665
550
549
543
554
2,196
Sales hedge program gain
(5)
–
–
–
–
–
–
–
21
13
34
Other
986
215
186
156
123
680
137
152
119
111
519
Total sales revenues
7,626
1,558
1,651
2,029
1,218
6,456
1,036
1,231
1,279
1,256
4,802
Gross profit
2,200
280
265
660
87
1,292
156
333
456
405
1,350
EBITDA2
3,316
518
568
969
273
2,328
180
336
520
455
1,491
Net earnings (loss) attributable to
shareholders of the Company
1,034
75
93
325 (1,447)
(954)
(159)
(46)
108
99
2
Adjusted earnings (loss)2
1,064
76
85
359
(259)
261
(154)
(13)
119
31
(17)
Total assets
25,080 24,495 24,272 24,841 23,758 23,758 23,474 23,710 23,942 24,107 24,107
Current liabilities
1,738
1,662
1,952
1,951
2,007
2,007
1,152
1,332
1,773
1,545
1,545
Total long-term liabilities
11,105 10,617 10,134 10,319 10,973 10,973 10,668 10,786 10,529 10,660 10,660
Net debt2
5,692
5,780
5,650
5,637
6,420
6,420
5,277
5,437
5,591
5,530
5,530
Basic earnings (loss) per share
$1.50
$0.11
$0.13
$0.47 ($2.09) ($1.38) ($0.21) ($0.06)
$0.13
$0.12
$0.00
Adjusted earnings (loss) per share3
$1.54
$0.11
$0.12
$0.52 ($0.37)
$0.38 ($0.20) ($0.02)
$0.14
$0.04 ($0.02)
Diluted earnings (loss) per share
$1.49
$0.11
$0.13
$0.47 ($2.09) ($1.38) ($0.21) ($0.06)
$0.13
$0.12
$0.00
Dividends declared per common share
(CDN$ per share)
$0.165 $0.130
$– $0.080
$– $0.210
$–
$–
$–
$–
$–
Cash flows per share from operating
activities3
$3.38
$0.43
$1.04
$0.86 ($0.27)
$2.07
$0.55
$0.48
$0.31
$0.70
$2.03
Basic weighted average shares (000’s)4
690,516
690,457
690,219
691,137
691,674
690,876
751,683
831,765
832,474
832,530
812,222
Copper statistics
Total copper production (tonnes)
775,859
138,753
187,175
221,550
160,200
707,678
100,605
102,709
116,088
111,602
431,004
Total copper sales (tonnes)5
782,236
150,287
177,362
218,946
127,721
674,316
101,776
94,628
112,094
111,613
420,111
Realized copper price (per lb)3
$3.90
$3.95
$3.75
$3.70
$3.62
$3.76
$3.78
$4.39
$4.24
$4.17
$4.15
TC/RC (per lb)
(0.13)
(0.14)
(0.15)
(0.15)
(0.13)
(0.15)
(0.10)
(0.06)
(0.06)
(0.04)
(0.07)
Freight charges (per lb)
(0.03)
(0.02)
(0.03)
(0.02)
(0.05)
(0.03)
(0.07)
(0.05)
(0.03)
(0.05)
(0.05)
Net realized copper price (per lb)3
$3.74
$3.79
$3.57
$3.53
$3.44
$3.58
$3.61
$4.28
$4.15
$4.08
$4.03
Cash cost – copper (C1) (per lb)3,6
$1.76
$2.24
$1.98
$1.42
$1.82
$1.82
$2.02
$1.73
$1.57
$1.68
$1.74
C1 (per lb) excluding Cobre Panamá 3,6
$1.92
$2.78
$2.23
$1.66
$2.07
$2.13
$2.01
$1.73
$1.57
$1.68
$1.74
All-in sustaining cost (AISC) (per lb)3,6,10
$2.35
$2.87
$2.64
$2.02
$2.52
$2.46
$2.85
$2.82
$2.42
$2.58
$2.66
AISC (per lb) excluding Cobre Panamá 3,6
$2.70
$3.57
$3.08
$2.54
$2.97
$2.99
$2.77
$2.71
$2.35
$2.50
$2.57
Total cost – copper (C3) (per lb)3,6,10
$2.73
$3.30
$2.92
$2.29
$2.77
$2.76
$3.04
$2.87
$2.59
$2.72
$2.80
Gold statistics
Total gold production (ounces)
283,226
47,874
52,561
73,125
53,325
226,885
26,984
32,266
41,006
38,784
139,040
Total gold sales (ounces)7
270,775
51,941
48,640
77,106
45,365
223,052
29,778
37,140
43,371
40,762
151,051
Net realized gold price (per ounce)3
$1,665 $1,766 $1,797 $1,764 $1,835 $1,786 $1,930 $2,207 $2,383 $2,545 $2,294
Nickel statistics
Nickel produced (contained tonnes)8
21,529
5,917
5,976
7,046
7,313
26,252
7,771
7,400
4,827
3,720
23,718
Nickel produced (payable tonnes)
18,501
4,344
4,366
5,177
5,363
19,250
5,751
5,505
3,597
2,697
17,550
Nickel sales (contained tonnes)9
20,074
5,846
5,906
5,749
5,719
23,220
8,211
7,645
4,598
5,578
26,032
Nickel sales (payable tonnes)
16,768
4,322
4,287
4,204
4,216
17,029
6,415
6,125
3,562
4,477
20,579
Realized nickel price (per payable lb)3
$11.93 $10.25
$9.50
$8.96
$7.53
$9.07
$7.70
$8.19
$7.36
$7.22
$7.68
Net realized nickel price (per payable lb)3
$11.93 $10.25
$9.50
$8.96
$7.53
$9.07
$7.40
$7.86
$7.35
$6.74
$7.38
1 Enterprise was declared to be in Commercial production, effective June 1, 2024. $75 million of Enterprise Nickel pre-commercial production revenues are
included in year ended December 31, 2024.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 65
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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74
2 EBITDA and adjusted earnings (loss) are non-GAAP financial measures and net debt is a supplementary financial measure. These measures do not have a
standardized meanings under IFRS and might not be comparable to similar measures disclosed by other issuers. See “Regulatory Disclosures” for further
information.
3 All-in sustaining costs (AISC), copper C1 cash cost (copper C1), and total copper cost (C3), realized metal prices, adjusted earnings (loss) per share and cash
flows from operating activities per share are non-GAAP ratios. These measures do not have a standardized meaning under IFRS and might not be comparable to
similar measures disclosed by other issuers. See “Regulatory Disclosures” for further information.
4 Fluctuations in average weighted shares between quarters reflects shares issued and changes in levels of treasury shares held for performance share units.
5 Sales of copper anode attributable to anode produced from third-party purchased concentrate are excluded.
6 Excludes purchases of copper concentrate from third parties treated through the Kansanshi Smelter.
7 Excludes refinery-backed gold credits purchased and delivered under the precious metal streaming arrangement. See “Precious Metal Stream Arrangement”
8 Nickel production includes 7,906 tonnes of pre-commercial production from Enterprise for the year ended December 31, 2024 (4,527 tonnes for the year ended
December 31, 2023.
9 Nickel sales includes 5,734 tonnes of pre-commercial sales from Enterprise for year ended December 31, 2024, (1,651 tonnes of pre-commercial sales from
Enterprise for the year ended December 31, 2023.
10 Royalties in C3 and AISC costs for the year ended December 31, 2023 exclude the 2022 impact of $18 million attributable to the 3.1% sale of a gross royalty
interest in KMP to ZCCM-IH and exclude the 2022 impact of $28 million attributable to payments pursuant of Law 406 in Panama.
APPENDICES
PRODUCTION
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Copper production (tonnes)1
Cobre Panamá
–
–
62,616
–
330,863
Kansanshi cathode
9,649
10,140
6,423
34,922
30,654
Kansanshi concentrate
38,490
39,670
25,464
136,007
104,173
Kansanshi total
48,139
49,810
31,887
170,929
134,827
Sentinel
56,560
58,412
59,964
230,792
214,046
Guelb Moghrein
4,421
4,688
3,246
17,792
13,014
Las Cruces
–
–
–
–
3,892
Çayeli
2,482
3,178
2,487
11,491
11,036
Total copper production (tonnes)
111,602
116,088
160,200
431,004
707,678
Total copper production excluding Cobre
Panamá (tonnes)
111,602
116,088
97,584
431,004
376,815
Gold production (ounces)
Cobre Panamá
–
–
30,986
–
129,854
Kansanshi
29,787
31,659
16,718
105,103
68,970
Guelb Moghrein
8,428
8,621
5,327
31,478
26,363
Other sites2
569
726
294
2,459
1,698
Total gold production (ounces)
38,784
41,006
53,325
139,040
226,885
Total gold production excluding Cobre
Panamá (ounces)
38,784
41,006
22,339
139,040
97,031
Nickel production (contained tonnes)
Enterprise
3,720
4,827
2,751
18,725
4,527
Ravensthorpe
–
–
4,562
4,993
21,725
Total nickel production (contained
tonnes)
3,720
4,827
7,313
23,718
26,252
1 Production is presented on a contained basis, and is presented prior to processing through the Kansanshi smelter.
2 Other sites include Çayeli and Pyhäsalmi.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 66
SALES
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Copper sales volume (tonnes)
Cobre Panamá
–
–
35,809
–
306,417
Kansanshi cathode
9,670
9,585
6,879
34,780
29,343
Kansanshi anode3
39,471
39,546
24,416
131,507
106,042
Kansanshi total3
49,141
49,131
31,295
166,287
135,385
Sentinel anode
50,502
51,439
37,676
185,561
165,642
Sentinel concentrate
4,615
2,223
17,436
37,230
39,518
Sentinel total
55,117
53,662
55,112
222,791
205,160
Guelb Moghrein
4,951
4,845
2,700
18,851
12,717
Las Cruces
–
–
–
–
4,054
Çayeli
2,404
4,456
2,805
12,182
10,583
Total copper sales (tonnes)
111,613
112,094
127,721
420,111
674,316
Total copper sales excluding Cobre
Panamá (tonnes)
111,613
112,094
91,912
420,111
367,899
Gold sales volume (ounces)
Cobre Panamá
–
–
19,861
–
121,554
Kansanshi
31,747
34,186
19,396
115,316
76,169
Guelb Moghrein
8,658
8,382
5,539
33,627
23,546
Other sites1
357
803
569
2,108
1,783
Total gold sales (ounces)2
40,762
43,371
45,365
151,051
223,052
Total gold sales excluding Cobre
Panamá (ounces)2
40,762
43,371
25,504
151,051
101,498
Nickel sales volume (contained tonnes)
Ravensthorpe
(2)
(7)
4,165
6,457
21,569
Enterprise
5,580
4,605
1,554
19,575
1,651
Total Nickel sales (contained tonnes)
5,578
4,598
5,719
26,032
23,220
1 Other sites include Çayeli and Pyhäsalmi.
2 Excludes refinery-backed gold credits purchased and delivered under precious metal streaming arrangement.
3 Copper sales include third-party sales of concentrate, cathode and anode attributable to Kansanshi. Sales of copper anode attributable to third-party concentrate
purchases were 5,994 and 31,421 tonnes for the three months and year ended December 31, 2024, (10,965 and 40,134 tonnes for the three months and year
ended December 31, 2023).
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 67
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
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76
SALES REVENUES
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Cobre Panamá
- copper
–
–
257
(3)
2,340
- gold
–
–
19
(3)
132
- silver
–
–
4
–
41
Kansanshi
- copper cathode
85
86
55
313
241
- copper anode
411
429
285
1,477
1,214
- gold
82
81
37
269
140
- other
–
–
–
–
3
Trident
- copper anode
451
466
302
1,669
1,372
- copper
concentrate
35
18
117
276
272
- nickel
68
59
19
251
21
Guelb Moghrein
- copper
42
40
19
156
94
- gold
22
20
11
76
44
- magnetite
15
15
13
54
69
Las Cruces
- copper
–
–
–
–
36
Çayeli
- copper
20
33
18
93
72
- zinc, gold and
silver
1
4
7
10
11
Pyhäsalmi
- zinc, pyrite, gold
and silver
2
3
2
12
13
Ravensthorpe
- nickel
(2)
(1)
51
84
320
- cobalt
2
–
2
5
12
Corporate1
22
26
–
63
9
Sales revenues
1,256
1,279
1,218
4,802
6,456
Sales revenues
excluding Cobre
Panamá
1,256
1,279
938
4,808
3,943
Copper
1,057
1,093
1,053
4,015
5,641
Gold
104
104
66
347
319
Nickel
66
58
70
335
341
Other
29
24
29
105
155
1,256
1,279
1,218
4,802
6,456
1 Corporate sales include sales hedges (see “Hedging Program” for further discussion).
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 68
(in United States dollars, tabular amounts in millions, except where noted)
UNIT CASH COSTS (PER LB)1,2
QUARTERLY
FULL YEAR
Q4 2024
Q3 2024
Q4 2023
2024
2023
Cobre Panamá
Mining
$–
$–
$0.33
$–
$0.34
Processing
–
–
0.88
–
0.91
Site administration
–
–
0.10
–
0.09
TC/RC and freight charges
–
–
0.42
–
0.38
By-product credits
–
–
(0.28)
–
(0.25)
Copper cash cost (C1) (per lb)
$–
$–
$1.45
$–
$1.47
Copper all-in sustaining cost (AISC) (per lb)
$–
$–
$1.71
$–
$1.85
Total copper cost (C3) (per lb)
$–
$–
$2.22
$–
$2.34
Kansanshi
Mining
$0.57
$0.72
$0.99
$0.79
$1.11
Processing
0.82
0.89
1.08
0.94
1.01
Site administration
0.23
0.12
0.49
0.16
0.26
TC/RC and freight charges
0.18
0.16
0.19
0.18
0.18
By-product credits
(0.75)
(0.75)
(0.52)
(0.72)
(0.46)
Total smelter costs
0.16
0.15
0.20
0.17
0.17
Copper cash cost (C1) (per lb)
$1.21
$1.29
$2.43
$1.52
$2.27
Copper all-in sustaining cost (AISC) (per lb)
$2.14
$2.15
$3.83
$2.48
$3.47
Total copper cost (C3) (per lb)
$2.33
$2.42
$3.69
$2.71
$3.48
Sentinel
Mining
$0.67
$0.64
$0.70
$0.67
$0.74
Processing
0.83
0.77
0.58
0.75
0.68
Site administration
0.20
0.12
0.19
0.15
0.20
TC/RC and freight charges
0.29
0.19
0.28
0.25
0.24
Total smelter costs
0.12
0.14
0.10
0.12
0.12
Copper cash cost (C1) (per lb)
$2.11
$1.86
$1.85
$1.94
$1.98
Copper all-in sustaining cost (AISC) (per lb)
$2.88
$2.61
$2.51
$2.70
$2.67
Total copper cost (C3) (per lb)
$3.06
$2.76
$2.72
$2.85
$2.88
Enterprise
Mining
$1.94
$1.63
$–
$1.58
$–
Processing
1.18
0.91
–
1.02
–
Site administration
0.19
0.11
–
0.14
–
TC/RC and freight charges
1.31
0.72
–
1.02
–
Nickel cash cost (C1) (per lb)
$4.62
$3.37
$–
$3.76
$–
Nickel all-in sustaining cost (AISC) (per lb)
$7.48
$5.97
$–
$6.31
$–
Total nickel cost (C3) (per lb)
$5.91
$4.76
$–
$4.98
$–
Ravensthorpe
Nickel cash cost (C1) (per lb)
$–
$–
$11.78
$11.97
$9.95
Nickel all-in sustaining cost (AISC) (per lb)
$–
$–
$16.08
$14.25
$12.22
Total nickel cost (C3) (per lb)
$–
$–
$14.18
$12.45
$12.20
Guelb Moghrein
Copper cash cost (C1) (per lb)
$1.01
$1.09
$2.24
$1.31
$2.44
Copper all-in sustaining cost (AISC) (per lb)
$1.30
$1.55
$2.73
$1.80
$2.96
Total copper cost (C3) (per lb)
$1.79
$1.87
$3.07
$2.05
$3.17
Çayeli
Copper cash cost (C1) (per lb)
$2.91
$1.93
$2.31
$2.05
$1.97
1 All-in sustaining costs (AISC), C1 cash cost (C1), C3 total cost (C3) are non-GAAP ratios, which do not have standardized meaning prescribed by IFRS and
might not be comparable to similar measures disclosed by other issuers. See “Regulatory Disclosures” for further information.
2 Excludes purchases of copper concentrate from third parties treated through the Kansanshi Smelter.
(in United States dollars, tabular amounts in millions, except where noted)
First Quantum Minerals Ltd. | Q4 2024 MANAGEMENT’S DISCUSSION AND ANALYSIS 69
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
79
78
Certain statements and information herein, including all statements that are not historical facts, contain forward-looking
statements and forward-looking information within the meaning of applicable securities laws. The forward-looking information
includes estimates, forecasts and statements as to the Company’s production estimates for copper, gold and nickel; C1 cash
costs, all-in sustaining cost and capital expenditure estimates; the expected effects of the SRA; the status of Cobre Panamá
and the P&SM program, the timing and results of the environmental audit and the process proposed by the government of
Panama; the development and operation of the Company’s projects, including the timing and effects of planned maintenance
shutdowns; the remaining capital expenditures and expected time to completion, and expected production of the Kansanshi
S3 Expansion; the Company’s investment in and the expected effects of the Kansanshi mining fleet and the battery-powered
dump truck trial at Kansanshi; the increase in throughput capacity of the Kansanshi smelter; the Company’s expectations
regarding production, throughput capacity, mining performance and fragmentation at Sentinel and the effect of ongoing
initiatives; the Company’s expectations regarding the mine’s carbon intensity and results of drilling at Enterprise; the
commencement of mining activities at Oriental Hill at Guelb Moghrein; the C&M process at Ravensthorpe, including the
costs thereof, and the status of environmental approvals for Shoemaker Levy, Wind Farm and Tamarine Quarry; the timing of
receipt of concessions, approvals, permits required for Taca Taca, including the ESIA and water use permits; the amount and
timing of the Company’s expenditures at La Granja, project development and the Company’s plans for community
engagement and completion of an engineering study and ESIA for La Granja; the curtailment of the power supply in Zambia
and the Company’s ability to secure sufficient power and avoid interruptions to operations, including through collaboration
with ZESCO and third-party energy providers; the expected impact of Zambia’s rainy season and water levels on
hydropower generation; the timing of approval of the exploration permit renewal application for Haquira and the Company’s
goals regarding its drilling program; the estimates regarding the interest expense on the Company’s debt, cash outflow on
interest paid, capitalized interest and depreciation expense; the expected effective tax rate for the Company for 2025; the
effect of foreign exchange on the Company’s cost of sales; the Company’s hedging programs; the effect of seasonality on
the Company’s results; capital expenditure and mine production costs; the timing and outcome of arbitration proceedings
which involve the Company; estimates of the future price of certain precious and base metals; estimated mineral reserves
and mineral resources; the Company’s project pipeline, development and growth plans and exploration and development
program, future expenses and exploration and development capital requirements; the Company’s assessment and
exploration of properties in the Central African Copper belt, the Andean porphyry belt, Australia, Finland, Kazakhstan and
Türkiye; plans, targets and commitments regarding climate change-related physical and transition risks and opportunities
(including intended actions to address such risks and opportunities); future reporting regarding sustainability, climate change
and environmental matters; greenhouse gas emissions and energy efficiency; and community engagement efforts. Often,
but not always, forward-looking statements or information can be identified by the use of words such as “aims”, “plans”,
“expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does
not anticipate” or “believes” or variations of such words and phrases or statements that certain actions, events or results
“may”, “could”, “would”, “might” or “will” be taken, occur or be achieved.
With respect to forward-looking statements and information contained herein, the Company has made numerous
assumptions including among other things, assumptions about the geopolitical, economic, permitting and legal climate in
which the Company operates; continuing production at all operating facilities (other than Cobre Panamá and Ravensthorpe);
the price of certain precious and base metals, including copper, gold, nickel, silver, cobalt, pyrite and zinc; exchange rates;
anticipated costs and expenditure; the Company’s ability to secure sufficient power at its Zambian operations to avoid
interruption resulting from the country’s decreased power availability; mineral reserve and mineral resource estimates; the
timing and sufficiency of deliveries required for the Company’s development and expansion plans; the ability of the Company
to reduce greenhouse gas emissions at its operations; and the ability to achieve the Company’s goals. Forward-looking
statements and information by their nature are based on assumptions and involve known and unknown risks, uncertainties
and other factors which may cause the actual results, performance or achievements, or industry results, to be materially
different from any future results, performance or achievements expressed or implied by such forward-looking statements or
information. These factors include, but are not limited to, future production volumes and costs, the temporary or permanent
closure of uneconomic operations, costs for inputs such as oil, power and sulphur, political stability in Panama, Zambia,
Peru, Mauritania, Finland, Türkiye, Argentina and Australia, adverse weather conditions in Panama, Zambia, Finland,
Türkiye, Mauritania, and Australia, potential social and environmental challenges (including the impact of climate change),
power supply, mechanical failures, water supply, procurement and delivery of parts and supplies to the operations and
events generally impacting global economic, political and social stability and legislative and regulatory reform. For mineral
resource and mineral reserve figures appearing or referred to herein, varying cut-off grades have been used depending on
the mine, method of extraction and type of ore contained in the orebody.
See the Company’s Annual Information Form for additional information on risks, uncertainties and other factors relating to
the forward-looking statements and information. Although the Company has attempted to identify factors that would cause
actual actions, events or results to differ materially from those disclosed in the forward-looking statements or information,
there may be other factors that cause actual results, performances, achievements or events not as anticipated, estimated or
intended. Also, many of these factors are beyond First Quantum’s control. Accordingly, readers should not place undue
reliance on forward-looking statements or information. The Company undertakes no obligation to reissue or update forward-
looking statements or information as a result of new information or events after the date hereof except as may be required
by law. All forward-looking statements made and information contained herein are qualified by this cautionary statement.
Cautionary Statement on
Forward-Looking Information
(in United States dollars, tabular amounts in millions, except where noted)
(in United States dollars, tabular amounts in millions, except where noted)
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
MANAGEMENT’S DISCUSSION AND ANALYSIS CONT’D
81
80
The consolidated financial statements of First Quantum Minerals Ltd. have been prepared by and are the responsibility of
the Company’s management. The consolidated financial statements have been prepared in accordance with IFRS
Accounting Standards as issued by the International Accounting Standards Board and, where appropriate, reflect
management’s best estimates and judgments based on currently available information.
Management has developed and is maintaining a system of internal controls to obtain reasonable assurance that the
Company’s assets are safeguarded, transactions are authorized and financial information is reliable.
The Company’s independent auditors, PricewaterhouseCoopers LLP, who are appointed by the shareholders, conduct an
audit in accordance with Canadian generally accepted auditing standards. Their report outlines the scope of their audit and
gives their opinion on the consolidated financial statements.
The Audit Committee of the Board of Directors meets periodically with management and the independent auditors to review
the scope and results of the annual audit, and to review the consolidated financial statements and related financial reporting
matters prior to approval of the consolidated financial statements.
Signed by Signed by
Tristan Pascall Ryan MacWilliam
Chief Executive Officer
Chief Financial Officer
February 11, 2025
PricewaterhouseCoopers LLP
PwC Tower, 18 York Street, Suite 2500, Toronto, Ontario, Canada M5J 0B2
T.: +1 416 863 1133, F.: +1 416 365 8215, Fax to mail: ca_toronto_18_york_fax@pwc.com
“PwC” refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.
To the Shareholders of First Quantum Minerals Ltd.
Our opinion
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects,
the financial position of First Quantum Minerals Ltd. and its subsidiaries (together, the Company) as at
December 31, 2024 and 2023, and its financial performance and its cash flows for the years then ended in
accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board
(IFRS Accounting Standards).
What we have audited
The Company’s consolidated financial statements comprise:
the consolidated statements of earnings (loss) for the years ended December 31, 2024 and 2023;
the consolidated statements of comprehensive income (loss) for the years ended December 31, 2024
and 2023;
the consolidated statements of cash flows for the years ended December 31, 2024 and 2023;
the consolidated statements of financial position as at December 31, 2024 and 2023;
the consolidated statements of changes in equity for the years ended December 31, 2024 and 2023;
and
the notes to the consolidated financial statements, comprising material accounting policy information
and other explanatory information.
Basis for opinion
We conducted our audit in accordance with Canadian generally accepted auditing standards. Our
responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of
the consolidated financial statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Independence
We are independent of the Company in accordance with the ethical requirements that are relevant to our
audit of the consolidated financial statements in Canada. We have fulfilled our other ethical responsibilities
in accordance with these requirements.
FIRST QUANTUM MINERALS LTD.
2024 ANNUAL REPORT
83
82
Management’s Responsibility
for Financial Reporting
Independent Auditor’s Report
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the consolidated financial statements for the year ended December 31, 2024. These matters were
addressed in the context of our audit of the consolidated financial statements as a whole, and in forming
our opinion thereon, and we do not provide a separate opinion on these matters.
Key audit matter
How our audit addressed the key audit matter
Impairment Assessment related to Cobre
Panama Cash Generating Unit
Refer to note 2 – Material accounting policies,
note 3 – Significant judgments, estimates and
assumptions, note 7 – Goodwill and note 24 –
Commitments and contingencies to the
consolidated financial statements.
As at December 31, 2024, the carrying value of
goodwill assigned to the Cobre Panama cash
generating unit (CGU) is $237 million. The carrying
value of the Cobre Panama CGU is
$10,666 million.
The recoverable amount of the CGU to which
goodwill has been allocated is tested for
impairment at the same time at the end of every
year or earlier if any indicator of impairment exists.
The recoverable amount is the higher of fair value
less costs of disposal and value in use. If the
recoverable amount of an asset or CGU is
estimated to be less than its carrying value, the
carrying value of the asset or CGU is reduced to its
recoverable amount.
Management performed an impairment test of the
Cobre Panama CGU as at December 31, 2024.
For the purposes of the impairment test, the
recoverable amount of the Cobre Panama CGU
has been determined using a fair value less costs
of disposal method based on cash flow models
covering various possible scenarios, including the
Our approach to addressing the matter included the
following procedures, among others:
Tested how management estimated the
recoverable amount of the Cobre Panama
CGU, which included the following:
–
Tested the appropriateness of the fair value
less costs of disposal method and tested
the mathematical accuracy of the
underlying cash flow models.
–
Tested the underlying data used in the
discounted cash flow models.
–
Evaluated the reasonableness of
assumptions such as the probability
assigned to each scenario, commodity
prices, future costs and capital
expenditures and estimates related to the
fiscal regime for the operating scenarios
by: (i) obtaining and assessing evidence,
which includes external information,
regarding management’s assessment of
the probability of the various scenarios;
(ii) comparing commodity prices with
external market and industry data; (iii)
comparing future costs and capital
expenditures to historical actual production
costs and historical actual and budgeted
capital expenditures of the Cobre Panama
CGU, and assessing whether these
assumptions were consistent with evidence
obtained in other areas of the audit, as
applicable; and (iv) assessing the
reasonableness of the estimate related to
Key audit matter
How our audit addressed the key audit matter
process of international arbitration and various
levels of operation, and which uses a post-tax
discount rate, taking account of assumptions that
would be made by market participants. The
outcome of the scenarios considered remains
uncertain. The future cash flows used in the various
scenarios of the models are inherently uncertain
and could materially change over time as a result of
changes, where applicable, to assumptions such as
the probability of the various scenarios occurring;
the ore reserves and resources estimates,
commodity prices, discount rate, future costs and
capital expenditures and estimates related to the
fiscal regime for the operating scenarios; and
estimates related to potential arbitral recoveries.
For the applicable scenarios, reserves and
resources are estimated based on the National
Instrument 43-101 compliant report produced by
qualified persons (management’s experts).
In light of this assessment by management, the
recoverable amount of the Cobre Panama CGU
exceeds the carrying value of the Cobre Panama
CGU as at December 31, 2024, and therefore no
impairment charge has been recognized.
We considered this a key audit matter due to the
subjectivity and complexity in performing
procedures to test the assumptions used by
management in determining the recoverable
amount of the Cobre Panama CGU, which involved
significant judgment from management. The audit
effort involved the use of professionals with
specialized skill and knowledge in the field of
valuation.
the fiscal regime that may be applicable to
the Cobre Panama CGU.
–
The work of management’s experts was
used in performing the procedures to
evaluate the reasonableness of the
assumptions associated with the ore
reserves and resources estimates. As a
basis for using this work, the competence,
capabilities and objectivity of
management’s experts were evaluated, the
work performed was understood and the
appropriateness of the work as audit
evidence was evaluated. The procedures
performed also included evaluation of the
methods and assumptions used by
management’s experts and tests of the
data used by management’s experts and
an evaluation of their findings.
–
Professionals with specialized skill and
knowledge in the field of valuation were
used to assist in evaluating the
appropriateness of the cash flow models
used and the reasonableness of the
discount rate.
Tested the related disclosures made in the
consolidated financial statements.
FIRST QUANTUM MINERALS LTD.
2024 ANNUAL REPORT
85
84
Key audit matter
How our audit addressed the key audit matter
Assessment of impairment indicators for
property, plant and equipment
Refer to note 3 – Significant judgments, estimates
and assumptions and note 6 – Property, plant and
equipment to the consolidated financial statements.
The Company’s property, plant and equipment
(PP&E) carrying value was $19,193 million as at
December 31, 2024, relating to several CGUs.
Management applies significant judgment in
assessing the CGUs and assets for the existence of
indicators of impairment at the reporting date.
Internal and external factors are considered in
assessing whether indicators of impairment are
present that would necessitate impairment testing.
Factors regarding commodity prices, production,
operating costs, capital expenditures, discount rate,
title of mineral properties required to advance the
exploration projects and the Company’s continued
ability and plans to further develop the exploration
projects are used in determining whether there are
any indicators of impairment, as applicable.
We considered this a key audit matter due to the
significance of the PP&E and subjectivity in
performing procedures to evaluate audit evidence
relating to the significant judgments made by
management in its assessment of indicators of
impairment.
Our approach to addressing the matter included the
following procedures, among others:
Evaluated the reasonableness of
management’s assessment of indicators of
impairment for PP&E, which included the
following:
–
Assessed the completeness of external or
internal factors that could be considered as
indicators of impairment of the Company’s
PP&E by considering evidence obtained in
other areas of the audit.
–
Assessed commodity prices and discount
rate by comparing to external market and
industry data; and production, operating
costs and capital expenditures by
considering the current and past
performance of the CGUs and evidence
obtained in other areas of the audit, as
applicable.
–
Obtained external evidence for a sample of
mineral property titles required to advance
the exploration projects.
–
Read board minutes, obtained budget
approvals and considered evidence
obtained in other areas of the audit to
assess the Company’s continued ability
and plans to further develop the exploration
projects.
Other information
Management is responsible for the other information. The other information comprises the information,
other than the consolidated financial statements and our auditor’s report thereon, included in the annual
report, which is expected to be made available to us after the date of this auditor’s report.
Our opinion on the consolidated financial statements does not cover the other information and we will not
express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other
information identified above when it becomes available and, in doing so, consider whether the other
information is materially inconsistent with the consolidated financial statements or our knowledge obtained
in the audit, or otherwise appears to be materially misstated.
When we read the information, other than the consolidated financial statements and our auditor’s report
thereon, included in the annual report, if we conclude that there is a material misstatement therein, we are
required to communicate the matter to those charged with governance.
Responsibilities of management and those charged with governance for the
consolidated financial statements
Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with IFRS Accounting Standards, and for such internal control as management
determines is necessary to enable the preparation of consolidated financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless management either intends to liquidate
the Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting
process.
Auditor’s responsibilities for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as
a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s
report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a
guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards
will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these consolidated financial statements.
FIRST QUANTUM MINERALS LTD.
2024 ANNUAL REPORT
87
86
As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the consolidated financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Company’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s
report to the related disclosures in the consolidated financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, future events or conditions may cause the Company to
cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements,
including the disclosures, and whether the consolidated financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial
information of the entities or business units within the Company as a basis for forming an opinion on
the consolidated financial statements. We are responsible for the direction, supervision and review of
the audit work performed for purposes of the group audit. We remain solely responsible for our
audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant
ethical requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with those charged with governance, we determine those matters that
were of most significance in the audit of the consolidated financial statements of the current period and
are therefore the key audit matters. We describe these matters in our auditor’s report unless law or
regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the adverse consequences of
doing so would reasonably be expected to outweigh the public interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditor’s report is James Lusby.
/s/PricewaterhouseCoopers LLP
Chartered Professional Accountants, Licensed Public Accountants
Toronto, Ontario
February 11, 2025
FIRST QUANTUM MINERALS LTD.
2024 ANNUAL REPORT
89
88
Note
2024
2023
Sales revenues
17
4,802
6,456
Cost of sales
18
(3,452)
(5,164)
Gross profit
1,350
1,292
Exploration
(24)
(30)
General and administrative
(148)
(142)
Impairment and related charges
5,6
(75)
(900)
Other expense
21
(293)
(142)
Operating profit
810
78
Finance income
90
106
Finance costs
20
(799)
(719)
Adjustment for expected phasing of Zambian VAT
4c
89
49
Modification and redemption of liabilities
10, 11b
90
–
Earnings (loss) before income taxes
280
(486)
Income tax expense
13
(388)
(757)
Net loss
(108)
(1,243)
Net loss attributable to:
Non-controlling interests
(110)
(289)
Shareholders of the Company
15
2
(954)
Earnings (Loss) per share attributable to
the shareholders of the Company
Net earnings (loss) ($ per share)
Basic
15
0.00
(1.38)
Diluted
15
0.00
(1.38)
Weighted average shares outstanding (000’s)
Basic
15
812,222
690,876
Diluted
15
812,222
690,876
Total shares issued and outstanding (000’s)
14a
834,206
693,599
The accompanying notes are an integral part of these consolidated financial statements
1
The accompanying notes are an integral part of these consolidated financial statements
The accompanying notes are an integral part of these consolidated financial statements
Note
2024
2023
Net loss
(108)
(1,243)
Other comprehensive income (loss)
Items that have been/may subsequently be reclassified to net earnings (loss):
Movements on unrealized cash flow hedge positions 1
23
112
–
Deferred tax on unrealized movements on cash flow hedges
n/a
(18)
–
Total comprehensive loss for the year
(14)
(1,243)
Total comprehensive loss for the year attributable to:
Non-controlling interests
(110)
(289)
Shareholders of the Company
96
(954)
Total comprehensive loss for the year
(14)
(1,243)
1 The year ended December 31, 2024, includes a $50 million gain recognized in other comprehensive income related to the time value of hedges (year ended
December 31, 2023, nil).
91
90
Consolidated Statements of Earnings (Loss)
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
Consolidated Statements of Comprehensive Income (Loss)
(expressed in millions of U.S. dollars)
CONSOLIDATED FINANCIAL STATEMENTS
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
Note
2024
2023
Cash flows from operating activities
Net (loss)
(108)
(1,243)
Adjustments for
Depreciation
18
633
1,121
Income tax expense
13
388
757
Impairment and related charges
5,6
75
900
Share-based compensation expense
16
54
50
Net finance expense
709
613
Adjustment for expected phasing of Zambian VAT
4c
(89)
(49)
Foreign exchange
(26)
23
Modification and redemption of liabilities
10
(90)
–
Deferred revenue amortization
12
–
(96)
Share of loss in joint venture
9,21
85
18
Other
(103)
1
Taxes paid
13
(128)
(625)
Proceeds from Copper Prepayment
12
500
–
Movements in operating working capital
Movements in trade and other receivables
50
277
Movements in inventories
(5)
(147)
Movements in trade and other payables
(275)
(22)
Long-term incentive plans
(19)
(151)
Net cash from operating activities
1,651
1,427
Cash flows used by investing activities
Purchase and deposits on property, plant and equipment
6,22
(1,286)
(1,300)
Acquisition of La Granja
6
–
(105)
Interest paid and capitalized to property, plant and equipment
6
(54)
(26)
Interest received
35
51
Other
11
–
Net cash used by investing activities
(1,294)
(1,380)
Cash flows used by financing activities
Net movement in trading facility
10
(28)
24
Movement in restricted cash
(14)
(25)
Proceeds from debt
10
2,967
2,759
Repayments of debt
10
(4,004)
(2,800)
Proceeds on issuance of common shares
14
1,103
–
Net payments to joint venture (KPMC)
9,11b
–
(109)
Dividends paid to shareholders of the Company
–
(93)
Interest paid
(519)
(527)
Other
(6)
(5)
Net cash used by financing activities
(501)
(776)
Decrease in cash and cash equivalents and bank overdrafts
(144)
(729)
Cash and cash equivalents and bank overdrafts – beginning of year
959
1,688
Exchange losses on cash and cash equivalents
(3)
–
Cash and cash equivalents and bank overdrafts – end of year
812
959
Cash and cash equivalents and bank overdrafts comprising:
Cash and cash equivalents
843
1,157
Bank overdrafts
(31)
(198)
Note
December 31,
2024
December 31,
2023
Assets
Current assets
Cash and cash equivalents
843
1,157
Trade and other receivables
4
509
586
Inventories
5
1,554
1,593
Current portion of other assets
8
311
123
3,217
3,459
Non-current assets
Cash and cash equivalents - restricted cash
46
34
Non-current VAT receivable
4b
515
521
Property, plant and equipment
6
19,193
18,583
Goodwill
7
237
237
Investment in joint venture
9
560
645
Deferred income tax assets
13
50
50
Other assets
8
289
229
Total assets
24,107
23,758
Liabilities
Current liabilities
Bank overdrafts
31
198
Trade and other payables
554
831
Current taxes payable
144
27
Current debt
10
498
769
Current portion of provisions, other liabilities and deferred revenue
11,12
318
182
1,545
2,007
Non-current liabilities
Debt
10
5,844
6,610
Provisions and other liabilities
11
2,045
2,069
Deferred revenue
12
1,764
1,420
Deferred income tax liabilities
13
1,007
874
Total liabilities
12,205
12,980
Equity
Share capital
6,549
5,411
Retained earnings
4,885
4,895
Accumulated other comprehensive income (loss)
35
(59)
Total equity attributable to shareholders of the Company
11,469
10,247
Non-controlling interests
433
531
Total equity
11,902
10,778
Total liabilities and equity
24,107
23,758
Approved by the board of Directors and authorized for issue on February 11, 2025.
Signed by
Signed by
Simon Scott, Director
Robert Harding, Director
The accompanying notes are an integral part of these consolidated financial statements
The accompanying notes are an integral part of these consolidated financial statements
93
92
Consolidated Statements of Cash Flows
(expressed in millions of U.S. dollars)
Consolidated Statements of Financial Position
(expressed in millions of U.S. dollars)
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
CONSOLIDATED FINANCIAL STATEMENTS CONT’D
Share
capital
Retained
earnings
Accumulated
other
comprehensive
income (loss)
Total equity
attributable to
shareholders of
the Company
Non-
controlling
interests
Total
Balance at December 31, 2023
5,411
4,895
(59)
10,247
531
10,778
Net earnings (loss)
–
2
–
2
(110)
(108)
Other comprehensive
income 1
–
–
94
94
–
94
Total comprehensive income
(loss)
–
2
94
96
(110)
(14)
Share-based compensation
expense
54
–
–
54
–
54
Acquisition of treasury shares
and cash from share awards
(19)
–
–
(19)
–
(19)
Share issue (Note 14)
1,103
–
–
1,103
–
1,103
Other
–
(12)
–
(12)
12
–
Balance at December 31, 2024
6,549
4,885
35
11,469
433
11,902
1 For the year ended December 31, 2024 a fair value gain of $112 million (year ended December 31, 2023, nil) has been recognized on derivatives designated as
hedged instruments through accumulated other comprehensive income. The effective portion of changes in the fair value of derivatives that are designated and
qualify as cash flow hedges is recognized in other comprehensive income. The time value of hedges for the year ended December 31, 2024, of $50 million (year
ended December 31, 2023, nil) is also recognized in other comprehensive income.
Share
capital
Retained
earnings
Accumulated
other
comprehensive
loss
Total equity
attributable to
shareholders of
the Company
Non-
controlling
interests
Total
Balance at December 31, 2022
5,492
5,468
(59)
10,901
1,336
12,237
Net loss
–
(954)
–
(954)
(289)
(1,243)
Other comprehensive
income
–
–
–
–
–
–
Total comprehensive loss
–
(954)
–
(954)
(289)
(1,243)
Share-based compensation
expense
50
–
–
50
–
50
Acquisition of treasury shares
and cash from share awards
(145)
–
–
(145)
–
(145)
Dividends
14
(109)
–
(95)
–
(95)
Conversion of non-controlling
interest rights
–
490
–
490
(516)
(26)
Balance at December 31, 2023
5,411
4,895
(59)
10,247
531
10,778
1. NATURE OF OPERATIONS
First Quantum Minerals Ltd. (“First Quantum” or “the Company”) is engaged in the production of copper, nickel and gold, and
related activities including exploration and development. The Company has operating mines located in Zambia, Türkiye and
Mauritania. The Company’s Cobre Panamá mine was placed into a phase of Preservation and Safe Management (“P&SM”)
in November 2023. The Company’s Ravensthorpe mine was placed into a care and maintenance process in May 2024. The
Company is progressing the Taca Taca copper-gold-molybdenum project in Argentina and is exploring La Granja and the
Haquira copper deposits in Peru.
The Company’s shares are publicly listed for trading on the Toronto Stock Exchange.
The Company is registered and domiciled in Canada, and its registered office is 1133 Melville Street, Suite 3500, The Stack,
Vancouver, BC, Canada, V6E 4E5.
2. MATERIAL ACCOUNTING POLICIES
The significant accounting policies used in the preparation of these consolidated financial statements are described below.
a)
Basis of presentation and going concern
The consolidated financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the
International Accounting Standards Board (“IFRS”) and, where appropriate, reflect management’s best estimates and
judgments based on currently available information.
These consolidated financial statements have been prepared under the historical cost convention, with the exception of
derivative assets and liabilities and investments which are measured at fair value.
These consolidated financial statements have been prepared on a going concern basis. In making the assessment that the
Company is a going concern, management have taken into account all available information about the future, which is at
least, but is not limited to, twelve months from December 31, 2024.
At December 31, 2024, the Company had $750 million of committed undrawn senior debt facilities and $812 million of net
unrestricted cash (inclusive of overdrafts), as well as future cash flows in order to meet all current obligations as they
become due. The Company was in compliance with all existing facility covenants as at December 31, 2024 and current
forecasts, including judgmental assumptions, do not indicate a breach of financial covenants. Expected credit losses on
financial assets remain immaterial at December 31, 2024. Refer to note 23 for the Company’s hedging program.
b) Principles of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the
Company (its “subsidiaries”). Control is achieved where the Company has the right to variable returns from its involvement
with the investee and has the ability to affect those returns through its power over the investee. The results of subsidiaries
acquired or disposed of during the year are included in the consolidated statement of earnings from the effective date of
acquisition or up to the effective date of disposal, as appropriate.
The principal operating subsidiaries are Kansanshi Mining Plc (“Kansanshi”), Minera Panamá S.A. (“MPSA” or “Cobre
Panamá”), FQM Trident Limited (“Trident”) (formerly Kalumbila Minerals Limited), First Quantum Mining and Operations
Limited (“FQMO”), Mauritanian Copper Mines SARL(“Guelb Moghrein”), FQM Australia Nickel Pty Limited (“Ravensthorpe”),
Cobre Las Cruces S.A. (“Las Cruces”), Çayeli Bakir Isletmeleri A.S. (“Çayeli”), Pyhäsalmi Mine Oy (“Pyhäsalmi”), FQM
Trading LP and FQM Trading AG (“FQM Trading”) (formerly Metal Corp Trading AG). The exploration subsidiaries include
Minera Antares Peru S.A.C. (“Haquira”), the subsidiary, Corriente Argentina S.A. (“Taca Taca”) which relates to the Taca Taca
project, and Minera La Granja S.A.C. (Peru) ("La Granja") which the Company acquired a 55% stake in from Rio Tinto in
August 2023. All the above operating subsidiaries are 100% owned, with the exception of Ravensthorpe (75.7%),
Kansanshi, in which the Company holds an 80% interest, with the ZCCM-IH dividend rights attributed to their 20% ownership
converted to a 3.1% royalty right during 2023, and Cobre Panamá, in which the Company holds a 90% interest, 10% of
which is held indirectly through the joint venture, Korea Panama Mining Corp (“KPMC”), a jointly controlled Canadian entity
acquired in November 2017.
The accompanying notes are an integral part of these consolidated financial statements
95
94
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Statements of Changes in Equity
(expressed in millions of U.S. dollars)
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
Non-controlling interests
At December 31, 2024, POSCO Holdings owned 24.3% (2023: 24.3%) of Ravensthorpe, KPMC owned 20% of Cobre
Panamá and Rio Tinto owned 45% of La Granja.
On April 4, 2023 the Company’s subsidiary, Kansanshi Mining Plc “KMP” and ZCCM Investments Holdings Plc “ZCCM-IH” (a
Zambian government controlled entity) completed the agreement to convert ZCCM-IH’s dividend rights to a 3.1% royalty
interest in KMP. Accordingly, the non-controlling interest in the consolidated financial statements has been derecognized.
Through the operations in Zambia and Panama, there are a number of transactions with the respective governments in the
ordinary course of business, including taxes, royalties, utilities and power. The Company is limited in its ability to use the
assets of Kansanshi and Cobre Panamá as a result of the agreement with the other owners of these subsidiaries.
Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the Company’s equity
therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination
and the non-controlling interest’s share of changes in equity since the date of the combination.
c)
Accounting policies
Foreign currency translation
The presentation currency and the functional currency of the Company and all of the Company’s operations is the USD. The
Company’s foreign currency transactions are translated into USD at the rate of exchange in effect at the date of the
transaction. Monetary assets and liabilities are translated using period end exchange rates with any gains and losses
included in the determination of net earnings. Non-monetary assets and liabilities are translated using historical rates.
Inventories
Product inventories comprise ore in stockpiles, work-in-progress and finished goods. Product inventories are recorded at the
lower of average cost and net realizable value. Cost includes materials, direct labour, other direct costs and production
overheads and depreciation of plant, equipment and mineral properties directly involved in the mining and production
processes. Costs are determined primarily on the basis of average costs for ore in stockpiles and on a first-in first-out basis
for work-in-progress and finished goods.
Waste material stripping costs related to production at, or below, the life-of-phase strip ratio are inventoried as incurred, with
the excess capitalized to mineral property and depreciated in future periods.
When inventories have been written down to net realizable value, a new assessment of net realizable value is made at each
subsequent reporting date that the inventory is still held.
Consumable stores are valued at the lower of purchase cost and net realizable value and recorded as a current asset.
Property, plant and equipment
(i)
Mineral properties and mine development costs
Exploration and evaluation costs are expensed in the period incurred unless there is an expectation that future economic
benefit is probable. Property acquisition costs, development costs and amounts paid under development option agreements
are capitalized. Development decisions are made based upon consideration of project economics, including future metal
prices, reserves and resources, and estimated operating and capital costs.
Property acquisition and mine development costs, including costs incurred during the production phase to increase future
output by providing access to additional reserves (deferred stripping costs), are deferred and depreciated on a units-of-
production basis over the component of the reserves to which they relate.
ii)
Property, plant and equipment
Property, plant and equipment are recorded at cost less accumulated depreciation. Costs recorded for assets under
construction include all expenditures incurred in connection with the development and construction of the assets. No
depreciation is recorded until the assets are substantially complete and ready for productive use. Where relevant, the
Company has estimated residual values on certain plant and equipment.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 7
Property, plant and equipment are depreciated using either the straight-line or units-of-production basis over the shorter of
the estimated useful life of the asset or the life of mine. Depreciation calculated on a straight-line basis is as follows for major
asset categories:
Office equipment
33 %
Furniture and fittings
15 %
Infrastructure and buildings
2%-5%
Motor vehicles
20%-25%
Depreciation on equipment utilized in the development of assets, including open pit and underground mine development, is
depreciated and recapitalized as development costs attributable to the related asset.
(iii) Borrowing costs
Borrowing costs attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of the
cost of the asset until such time as the asset is substantially complete and ready for its intended use or sale. Where funds
have been borrowed specifically to finance an asset, the amount capitalized is the actual borrowing costs incurred. Where
the funds are used to finance an asset form part of general borrowings, the amount capitalized is calculated using a
weighted average of rates applicable to relevant general borrowings of the Company during the period.
(iv) Business combinations and goodwill
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business
combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets
transferred by the Company. The results of businesses acquired during the year are included in the consolidated financial
statements from the effective date of when control is obtained. The identifiable assets, liabilities and contingent liabilities of
the business which can be measured reliably are recorded at provisional fair values at the date of acquisition. Provisional fair
values are finalized within twelve months of the acquisition date. Acquisition-related costs are expensed as incurred.
Goodwill arising in a business combination is measured as the excess of the sum of the consideration transferred and the
amount of any non-controlling interest over the net identifiable assets acquired and liabilities assumed.
Asset impairment
(i)
Property, plant and equipment
The Company performs impairment tests on property, plant and equipment, mineral properties and mine development costs
when events or changes in circumstances occur that indicate the assets may not be recoverable. If any such indication
exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss, if any.
Where it is not possible to estimate the recoverable amount of an individual asset, for example due to no distinctive cash
flows, the Company estimates the recoverable amount of the cash-generating unit "CGU" to which the assets belong. Cash-
generating units are individual operating mines, smelters or exploration and development projects.
Recoverable amount is the higher of fair value less costs of disposal and value in use. Fair value less costs of disposal is
determined as the amount that would be obtained from the sale of the asset in an arm’s length transaction between
knowledgeable and willing parties. For mining assets this would generally be determined based on the present value of the
estimated future cash flows arising from the continued development, use or eventual disposal of the asset. In assessing
these cash flows and discounting them to present value, assumptions used are those that an independent market participant
would consider appropriate. Value in use is the estimated future cash flows expected to arise from the continuing use of the
assets in their present form and from their disposal, discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset.
If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying
amount of the asset or cash-generating unit is reduced to its recoverable amount. An impairment loss is recognized
immediately in net earnings.
Where an impairment loss subsequently reverses, the carrying amount of the asset or cash-generating unit is increased to
the revised estimate of its recoverable amount, such that the increased carrying amount does not exceed the carrying
amount that would have been determined had no impairment loss been recognized for the asset or cash-generating unit in
prior years. A reversal of an impairment loss is recognized in net earnings immediately.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
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(ii) Goodwill
Goodwill arising on business combinations is allocated to each of the Company’s cash-generating units (or groups of cash-
generating units) that is expected to benefit from the synergies of the combination. Goodwill is allocated to the lowest level at
which the goodwill is monitored by the Company’s board of directors for internal management purposes. The recoverable
amount of the cash-generating unit to which goodwill has been allocated is tested for impairment at the same time at the end
of every year or earlier if an indicator of impairment exists.
Any impairment loss is recognized in net earnings immediately. Impairment of goodwill is not subsequently reversed.
Restoration provisions
The Company recognizes liabilities for constructive or legislative and regulatory obligations, including those associated with
the reclamation of mineral properties and property, plant and equipment, when those obligations result from the acquisition,
construction, development or normal operation of assets. Provisions are measured at the present value of the expected
expenditures required to settle the obligation using a pre-tax discount rate reflecting the time value of money. The liability is
increased for accretion expense, representing the unwinding of the discount applied to the provision, and adjusted for
changes to the current market-based risk-free discount rate, and the amount or timing of the underlying cash flows needed
to settle the obligation. The associated restoration costs are capitalized as part of the carrying amount of the related long-
lived asset and depreciated over the expected useful life of the asset or expensed in the period for closed sites.
Revenue recognition
The Company produces copper, gold, nickel, silver and zinc products which are sold under pricing arrangements where final
prices are set at a specified date based on market prices.
The Company identifies contracts with customers, the performance obligations within it, the transaction price and its
allocation to the performance obligations.
Revenues are recognized when control of the product passes to the customer and are measured based on expected
consideration. Control typically passes on transfer of key shipping documents which typically occurs around the shipment
date. Shipping services provided are a separate performance obligation and the revenue for these services is recognized
over time. For bill-and-hold arrangements, whereby the Company invoices but retains physical possession of products,
revenue recognition is also subject to the arrangement being substantive, as well as the product concerned being separately
identifiable, ready for transfer and not transferable to another customer.
For provisionally priced sales, changes between the prices recorded upon recognition of revenue and the final price due to
fluctuations in metal market prices result in the existence of an embedded derivative in the accounts receivable. This is
recorded at fair value, with changes in fair value classified as a component of cost of sales.
The Company recognizes deferred revenue in the event it receives payments from customers before a sale meets criteria for
revenue recognition. The transaction price is adjusted to reflect any significant financing component at the rate that reflects
the credit characteristics of the entity receiving the financing.
Current and deferred income taxes
Tax expense for the period comprises current and deferred tax. Tax is recognized in the income statement, except to the
extent that it relates to items recognized in other comprehensive income or directly in equity. In this case, the tax is also
recognized in other comprehensive income or directly in equity, respectively.
Current tax expense is calculated using income tax rates that have been enacted or substantively enacted at the balance
sheet date. Periodically, the positions taken by the Company with respect to situations in which applicable tax regulation is
subject to interpretation are evaluated to establish provisions, where appropriate, on the basis of amounts expected to be
paid to the tax authorities.
Deferred income tax is recognized on differences between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable profit, and are accounted for using the
liability method. Deferred income tax liabilities are generally recognized for all taxable temporary differences, and deferred
income tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that
taxable profits will be available against which those deductible temporary differences can be utilized. Such assets and
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 9
liabilities are not recognized if the temporary difference arises from goodwill or from the initial recognition of assets and
liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
Deferred income tax assets and liabilities are not recognized in respect of taxable temporary differences associated with
investments in subsidiaries and associates where the timing of the reversal of the temporary differences can be controlled by
the Company and it is probable that temporary differences will not reverse in the foreseeable future.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it
is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the
liability is settled or the asset realized, based on income tax rates and income tax laws that have been enacted or
substantively enacted by the balance sheet date. The measurement of deferred income tax liabilities and assets reflects the
tax consequences that would follow from the manner in which the Company expects to recover or settle the carrying amount
of its assets and liabilities.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets
against current tax liabilities, and when they relate to income taxes levied by the same taxation authority and the Company
intends to settle its current tax assets and liabilities on a net basis.
Share-based compensation
The grant-date fair value of equity-settled share-based payment arrangements granted to employees is generally recognized
as an expense, with a corresponding increase in equity, over the vesting period of the options. The amount recognized as an
expense is adjusted to reflect the number of options for which the related service and non-market performance conditions
are expected to be met, such that the amount ultimately recognized is based on the number of options that meet the related
service and non-market performance conditions at the vesting date.
For share-based payment options with non-vesting conditions, the grant-date fair value of the share-based payment is
measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.
The Company grants stock options under its stock option plan and performance stock units (“PSUs”), restricted stock units
(“RSUs”) and key restricted stock units (“KRSUs”) under its long-term incentive plan to directors and employees. The
Company expenses the fair value of stock options, PSUs, RSUs and KRSUs granted over the vesting period, with a
corresponding increase in equity.
The fair value of stock options is determined using an option pricing model that takes into account, as of the grant date, the
exercise price, the expected life of the option, the current price of the underlying stock and its expected volatility, expected
dividends on the stock, and the risk-free interest rate over the expected life of the option. Cash consideration received from
employees when they exercise the options is credited to capital stock.
PSUs typically vest at the end of a three-year period if certain performance and vesting criteria, based on the Company’s
share price performance relative to a representative group of other mining companies, have been met. The fair value of
PSUs is determined using a valuation model that takes into account, as of the grant date, the expected life of the PSU,
expected volatility, expected dividend yield, and the risk-free interest rate over the life of the PSU to generate potential
outcomes for share prices, which are used to estimate the probability of the PSUs vesting at the end of the performance
measurement period.
RSUs typically vest at the end of a three-year period and the fair value of RSUs is determined by reference to the share
price of the Company at the date of grant.
KRSUs vest in tranches over a four to eight-year period and the fair value of KRSUs is determined by reference to the share
price of the Company at the date of grant.
Details of share-based compensation are disclosed in note 16.
Earnings per share
Earnings per share are calculated using the weighted average number of shares outstanding during the period. Shares
acquired under the long-term incentive plan are treated as treasury shares and are deducted from the number of shares
outstanding for the calculation of basic earnings per share. Diluted earnings per share are calculated using the treasury
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 10
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
share method whereby all “in the money” share based arrangements are assumed to have been exercised at the beginning
of the period and the proceeds from the exercise are assumed to have been used to purchase common shares at the
average market price during the period.
Financial instruments
The Company’s financial instruments consist of cash and cash equivalents, bank overdrafts restricted cash, trade and other
receivables, investments, trade and other payables, derivative instruments, debt and amounts due to joint ventures.
Financial assets are classified as measured at amortized cost, fair value through other comprehensive income (“FVOCI”)
and fair value through profit and loss (“FVTPL”). Financial liabilities are measured at amortized cost or FVTPL.
(i)
Cash and cash equivalents, bank overdrafts and restricted cash
Cash and cash equivalents and bank overdrafts comprise cash or overdrafts at banks and on hand and other short-term
investments with initial maturities of less than three months. Restricted cash comprises cash deposits used to guarantee
letters of credit issued by the Company or held for escrow purposes.
Cash and cash equivalents, bank overdrafts and restricted cash are measured at amortized cost. Cash pooling
arrangements are presented on a gross basis unless physical cash settlement of balances has been made at the balance
sheet date.
(ii) Trade and other receivables
Provisionally priced sales included in trade and other receivables are classified as FVTPL. All other trade receivables are
classified as amortized cost financial assets and are recorded at the transaction price, net of transaction costs incurred and
expected credit losses.
(iii) Investments
Investments are designated as FVOCI. Fair value is determined in the manner described in note 23. Unrealized gains and
losses are recognized in other comprehensive income.
(iv) Derivatives and hedging
A portion of the Company’s metal sales are sold on a provisional basis whereby sales are recognized at prevailing metal
prices when title transfers to the customer and final pricing is not determined until a subsequent date, typically two months
later. The Company enters into derivative contracts to directly offset the exposure to final pricing adjustments on the
provisionally priced sales contracts. The Company also periodically enters into derivative instruments to mitigate cash flow
exposure to commodity prices, foreign exchange rates and interest rates. Derivative financial instruments, including
embedded derivatives related to the provisionally priced sales contracts, are classified as fair value through profit or loss and
measured at fair value as determined by active market prices and valuation models, as appropriate. Valuation models
require the use of assumptions concerning the amount and timing of estimated future cash flows and discount rates. In
determining these assumptions, the Company uses readily observable market inputs where available or, where not
available, inputs generated by the Company. Changes in the fair value of derivative instruments are recorded in net
earnings.
At the inception of a designated hedging relationship, the Company documents the relationship between hedging
instruments and hedged items, as well as its risk management objectives and strategy for undertaking various hedging
transactions. The Company also documents its assessment, both at hedge inception and on an ongoing basis, of whether
derivatives that are used in hedging transactions are highly effective in offsetting changes in cash flows of hedged items.
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is
recognized in other comprehensive income. The time value of hedges for the year-ended December 31, 2024 of $50 million
(December 31, 2023: $nil) is also recognized in other comprehensive income.
Amounts accumulated in equity are reclassified to the Statements of Earnings in the periods when the hedged item affects
net earnings.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 11
(v) Trade and other payables, debt and amounts due to joint ventures
Trade payables, debt and amounts due to joint ventures are classified as amortized cost financial liabilities and are
recognized initially at fair value, net of transaction costs incurred, and are subsequently stated at amortized cost. For debt,
any difference between the amounts originally received, net of transaction costs, and the redemption value is recognized in
net earnings over the period to maturity using the effective interest rate method.
Exchanges of instruments and modifications to debt are assessed using quantitative and qualitative factors to consider
whether the exchange or modification constitutes an extinguishment of the original financial liability and establishment of a
new financial liability. In the case of extinguishment, any fees or costs incurred are recognized in the Statement of Earnings.
Where the terms in an exchange or modification are not assessed to be substantially different, a modification gain or loss is
recognized at an amount equal to the difference between the modified cash flows discounted at the original effective interest
rate and the carrying value of the debt. The carrying value of the debt is adjusted for this modification gain or loss, directly
attributable transaction costs, and any cash paid to or received from the debt holder.
(vi) Impairment of financial assets
Expected credit losses (“ECL”) are recognized for financial assets held at amortized cost. This is based on credit losses that
result from default events that are possible within a 12-month period, except for trade receivables, whose ECLs are on a
simplified lifetime basis, and any financial assets for which there has been a significant increase in credit risk since initial
recognition, for which ECLs over the lifetime are recognized.
Investments in joint ventures
Joint arrangements whereby joint control exists are accounted for using the equity method and presented separately in the
balance sheet. The investment is initially recognized at cost and adjusted thereafter for the post-acquisition share of profit or
loss. Further details of the investments in joint ventures are provided in note 9.
d) Adoption of new Standards
In 2024, the International Accounting Standards Board (“IASB”) issued amendments to IAS 1 to clarify the criteria for
determining whether to classify a liability as current or non-current and cover what additional disclosures may also be
required for liabilities subject to covenants, to IFRS 16 to clarify the accounting treatment for sale and leaseback
transactions, providing guidance on how to determine whether the transaction should be accounted for as a sale or a
financing transaction and IAS 7, to clarify the classification of supplier finance arrangements in the statement of cash flows
regarding supplier finance arrangements, effective January 1, 2024, have had no significant impact on the financial
statements.
e)
Accounting standards issued but not yet effective
Standards and interpretations issued but not yet effective up to the date of issuance of the financial statements are listed
below. This listing of standards and interpretations issued are those that the Company reasonably expects to have an impact
on disclosures, financial position or performance when applied at a future date.
IFRS 18 Presentation and Disclosure in Financial Statements (effective for annual periods beginning on or after 1 January
2027). Management is currently assessing the implications of applying the new standard on the group’s consolidated
financial statements.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 12
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
3. SIGNIFICANT JUDGMENTS, ESTIMATES AND ASSUMPTIONS
Many of the amounts disclosed in the financial statements involve the use of judgments, estimates and assumptions. These
judgments and estimates are based on management’s knowledge of the relevant facts and circumstances at the time,
having regard to prior experience, and are continually evaluated.
(i) Significant judgments
• Assessment of impairment indicators
Management applies significant judgment in assessing the cash-generating units and assets for the existence of indicators
of impairment at the reporting date. Internal and external factors are considered in assessing whether indicators of
impairment are present that would necessitate impairment testing.
As at December 31, 2024, the carrying amount of the net assets of the Company is more than its market capitalisation. The
share price is impacted by a number of factors including P&SM at Cobre Panamá. The Company completed an analysis of
the recoverable amounts of its cash-generating units to compare against their respective carrying values as of December 31,
2024. An impairment charge of $72 million was recognized in respect of Inventory and PPE additions at Ravensthorpe in the
year ended December 31, 2024 (Refer to Note 5 and Note 6). The recoverable amount of Cobre Panamá has been
determined using a fair value less costs of disposal calculation based on a cash flow model covering different possible
scenarios, including the process of international arbitration and various levels of operation. In addition, judgment is applied to
the probability assigned to scenarios considered for Cobre Panamá (Refer to Note 7). The recoverable amount of other
cash-generating units exceeds the carrying value as at December 31, 2024, and therefore no further impairment charge has
been recognized.
Significant assumptions regarding commodity prices, production, operating costs, capital expenditures and discount rates
are used in determining whether there are any indicators of impairment. These assumptions are reviewed regularly by senior
management and compared, where applicable, to relevant market consensus views.
For exploration projects, management considers indicators including the Company’s continued ability and plans to further
develop the projects and title of mineral properties required to advance the projects to assess the existence of impairment
indicators.
The Company’s most significant cash-generating units are longer-term assets and therefore their value is assessed on the
basis of longer-term pricing assumptions. Shorter-term assets are more sensitive to short term commodity prices
assumptions that are used in the review of impairment indicators.
The carrying value of property, plant and equipment and goodwill at the balance sheet date is disclosed in note 6 and note 7
respectively, and by mine location in note 22.
Asset impairments are disclosed in notes 5 and 6.
• Control over Cobre Panamá
The Company suspended production at the Cobre Panamá mine at the end of November 2023 and placed the mine into a
phase of P&SM. The Company evaluated whether it still maintained effective power over the mine and related operations,
and has consolidated MPSA and the Cobre Panamá mine on the basis of control, effectively exercising power over the
relevant activities related to the mine, it's exposure to variable returns, and impact on the returns of the operation through its
managerial involvement.
• Control over La Granja UK Holdings Limited
On August 27, 2023 the Company announced that it had acquired a 55% stake in the La Granja project in Peru from Rio
Tinto. Management considered various factors, including the legal form of the shareholding, in determining that the
Company has control over La Granja UK Holdings Limited.
In determining whether the acquisition of La Granja constituted a business or an asset acquisition, management considered
whether substantially all of the fair value of the gross assets acquired were concentrated in a single identifiable asset or a
group of similar identifiable assets (the ‘concentration test’) and concluded that this was evident. The acquisition has
therefore been accounted for as an asset acquisition.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 13
Rio Tinto’s 45% non-controlling interest in La Granja is recognized on consolidation. Management considered accounting
treatments for non-controlling interests on asset acquisitions and concluded to measure non-controlling interest arising by
reference to the fair value of consideration paid for a 55% holding, as would have been an accounting option had the
acquisition been considered a business combination. The non-controlling interest is subsequently adjusted for the change in
the non-controlling interest’s share of net assets in La Granja, which can be and is different to its share of result.
In assessing the fair value of consideration paid, management concluded that $546 million of initial funding that the
Company is responsible for does not constitute deferred consideration, and therefore the consideration for the acquisition
was $105 million that was paid to Rio Tinto for a 55% shareholding.
• Determination of ore reserves and resources
Judgments about the amount of product that can be economically and legally extracted from the Company’s properties are
made by management using a range of geological, technical and economic factors, history of conversion of mineral deposits
to proven and probable reserves as well as data regarding quantities, grades, production techniques, recovery rates,
production costs, transport costs, commodity demand, commodity prices and exchange rates. This process may require
complex and difficult geological judgments to interpret the data. The Company uses qualified persons (as defined by the
Canadian Securities Administrators’ National Instrument 43-101) to compile this data.
Changes in the judgments surrounding ore reserves and resources may impact the carrying value of property, plant and
equipment (note 6), restoration provisions included in provisions and other liabilities (note 11), deferred revenue (note 12),
recognition of deferred income tax amounts (note 13) and depreciation (note 7).
• Achievement of commercial production
Once a mine or smelter reaches the operating levels intended by management, depreciation of capitalized costs begins.
Significant judgment is required to determine when certain of the Company’s assets reach this level.
Management considers several factors, including, but not limited to the following:
•
completion of a reasonable period of commissioning;
•
consistent operating results achieved at a pre-determined level of design capacity and indications exist that this
level will continue;
•
mineral recoveries at or near expected levels; and
•
the transfer of operations from development personnel to operational personnel has been completed.
During the year ended December 31, 2024, the Company concluded that the Enterprise mine was operating in a manner
intended by management and commercial production was achieved from June 1, 2024.
• Taxes
Judgment is required in determining the recognition and measurement of deferred income tax assets and liabilities on the
balance sheet. In the normal course of business, the Company is subject to assessment by taxation authorities in various
jurisdictions. These authorities may have different interpretations of tax legislation or tax agreements than those applied by
the Company in computing current and deferred income taxes. These different judgments may alter the timing or amounts of
taxable income or deductions. The final amount of taxes to be paid or recovered depends on a number of factors including
the outcome of audits, appeals and negotiation. The timings of recoveries with respect to indirect taxes, such as VAT, are
subject to judgment which, in the instance of a change of circumstances, could result in material adjustments.
The Company operates in a specialized industry and in a number of tax jurisdictions. As a result, its income is subject to
various rates of taxation. The breadth of its operations and the global complexity and interpretation of tax regulations require
assessment and judgment of uncertainties and of the taxes that the Company will ultimately pay. These are dependent on
many factors, including negotiations with tax authorities in various jurisdictions, outcomes of tax litigation and resolution of
disputes. The resolution of these uncertainties may result in adjustments to the Company’s tax assets and liabilities.
Management assesses the likelihood and timing of taxable earnings in future periods in recognizing deferred income tax
assets on unutilized tax losses. Future taxable income is based on forecast cash flows from operations and the application
of existing tax laws in each jurisdiction. Forecast cash flows are based on life of mine projections.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 14
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
To the extent that future cash flows and taxable income differ significantly from forecasts, the ability of the Company to
realize the net deferred income tax assets recorded at the balance sheet date could be impacted.
The Company operates in certain jurisdictions that have increased degrees of political and sovereign risk. Tax legislation in
these jurisdictions is developing and there is a risk that fiscal reform changes with respect to existing investments could
unexpectedly impact application of the tax legislation. Following due public consultation and regulatory signoff, the National
Assembly in Panama approved Bill 1100, being the proposal for approval of the Refreshed Concession Contract for the
Cobre Panamá mine on October 20, 2023. On the same day, President Laurentino Cortizo sanctioned Bill 1100 into Law
406, which was subsequently published in the Official Gazette. Law 406 approved the concession contract for the Cobre
Panamá mine on October 20, 2023. On November 16, 2023, in accordance with its contractual obligations to the Republic of
Panama under Law 406, the Company made tax and royalty payments of $567 million in respect of the period from
December 2021 to October 2023. On November 28, 2023, the Supreme Court of Justice of Panama announced that it
declared Law 406 unconstitutional. The ruling was subsequently published in the Official Gazette on December 2, 2023.
As the ruling on unconstitutionality is not retroactive, the Company has recorded all payments of taxes and royalties that
were calculated based on a taxable margin as current tax expense as per Law 406 up to December 2, 2023. Subsequent to
December 2, 2023, the Company has recorded all taxes and royalties as per the general income tax and mining code. Taxes
are disclosed in note 13.
• Precious metal stream arrangement
On October 5, 2015, the Company finalized an agreement with Franco-Nevada Corporation (“Franco-Nevada”) for the
delivery of precious metals from the Cobre Panamá project. Franco-Nevada have provided $1 billion deposit to the Cobre
Panamá project against future deliveries of gold and silver produced by the mine. A further agreement was completed on
March 26, 2018, with an additional $356 million received from Franco-Nevada.
Management has determined that under the terms of the agreements the Company meets the ‘own-use’ exemption criteria
under IFRS 9: Financial Instruments. The Company also retains significant business risk relating to the operation of the mine
and as such has accounted for the proceeds received as deferred revenue.
Management has exercised judgment in determining the appropriate accounting treatment for the Franco-Nevada streaming
agreements. Management has determined, with reference to the agreed contractual terms in conjunction with the Cobre
Panamá reserves and mine plan, that funds received from Franco-Nevada constitute a prepayment of revenues deliverable
from future Cobre Panamá production.
(ii) Significant accounting estimates
Estimates are inherently uncertain and therefore actual results may differ from the amounts included in the financial
statements, potentially having a material future effect on the Company’s consolidated financial statements. The estimates
and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities
within the next financial year are addressed below:
• Determination of ore reserves and life of mine plan
Reserves are estimates of the amount of product that can be economically and legally extracted from the Company’s
properties. Estimating the quantity and/or grade of reserves requires the size, shape and depth of ore bodies or fields to be
determined by analyzing geological data such as drilling samples. Following this, the quantity of ore that can be extracted in
an economical manner is calculated using data regarding the life of mine plans and forecast sales prices (based on current
and long-term historical average price trends).
The majority of the Company’s property, plant and equipment are depreciated over the estimated lives of the assets on a
units-of-production basis. The calculation of the units-of-production rate, and therefore the annual depreciation expense
could be materially affected by changes in the underlying estimates which are driven by the life of mine plans. Changes in
estimates can be the result of actual future production differing from current forecasts of future production, expansion of
mineral reserves through exploration activities, differences between estimated and actual costs of mining and differences in
the commodity prices used in the estimation of mineral reserves.
Management made significant estimates of the strip ratio for each production phase. Waste material stripping costs in
excess of this ratio, and from which future economic benefit will be derived from future access to ore, will be capitalized to
mineral property and depreciated on a units-of-production basis.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 15
Changes in the proven and probable reserves estimates may impact the carrying value of property, plant and equipment
(note 6), restoration provisions (note 11), deferred revenue (note 12), recognition of deferred income tax amounts (note 13)
and depreciation (note 7).
• Review of asset carrying values and impairment charges
Management’s determination of recoverable amounts includes estimates of mineral prices, recoverable reserves and
resources, and operating, capital and restoration costs and tax regulations applicable to the cash-generating unit’s
operations are subject to certain risks and uncertainties that may affect the recoverability of mineral property costs. The
calculation of the recoverable amount can also include assumptions regarding the appropriate discount rate and inflation and
exchange rates. Although management has made its best estimate of these factors, it is possible that changes could occur
in the near term that could adversely affect management’s estimate of the net cash flow to be generated from its projects.
•
Estimation of the amount and timing of restoration and remediation costs
Accounting for restoration provisions requires management to make estimates of the future costs the Company will incur to
complete the restoration and remediation work required to comply with existing laws, regulations and agreements in place at
each mining operation and any environmental and social principles the Company is in compliance with. The calculation of
the present value of these costs also includes assumptions regarding the timing of restoration and remediation work,
applicable risk-free interest rate for discounting those future cash outflows, inflation and foreign exchange rates. Actual costs
incurred may differ from those amounts estimated. Also, future changes to environmental laws and regulations could
increase the extent of restoration work required to be performed by the Company. Increases in future costs could materially
impact the amounts charged to operations for restoration. A 10% increase in costs would result in an increase to restoration
provisions of $60 million at December 31, 2024.
The provision represents management’s best estimate of the present value of the future restoration and remediation costs.
The actual future expenditures may differ from the amounts currently provided; any increase in future costs could materially
impact the amounts included in the liability disclosed in the consolidated balance sheet. The carrying amount of the
Company’s restoration provision is disclosed in note 11c.
• Estimation and assumptions relating to the timing of VAT receivables in Zambia
In addition to the timing of the recoverability of VAT receivables being a key judgment, certain assumptions are determined
by management in calculating the adjustment for expected phasing of VAT receipts. In assessing the expected phasing
adjustment, management considers an appropriate discount rate as disclosed in note 4c, which is then applied to calculate
the phasing adjustment based on the estimated timing of recoverability. Changes to the timings could materially impact the
amounts charged to finance costs. The impact of repayments being one year later than estimated at December 31, 2024,
would lead to a decrease to the carrying value and an increase to finance costs of $58 million. The carrying amount of the
Company’s VAT receivables is disclosed in note 4b.
4. TRADE RECEIVABLES
a) Trade and other receivables
December 31,
2024
December 31,
2023
Trade receivables
209
272
VAT receivable (current)
240
153
Other receivables
60
161
509
586
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 16
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
105
104
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
b) VAT receivable
December 31,
2024
December 31,
2023
Kansanshi Mining Plc ("KMP")
359
314
FQM Trident Limited
345
302
First Quantum Mining and Operations Limited (Zambia)
28
36
VAT receivable from the Company’s Zambian operations
732
652
Other
23
22
Total VAT receivable
755
674
Less: current portion, included within trade and other receivables
(240)
(153)
Non-current VAT receivable
515
521
c) VAT receivable by the Company’s Zambian operations
December 31,
2024
Balance at beginning of the year
652
Movement in claims, net of foreign exchange movements
(14)
Adjustment for expected phasing for non-current portion
94
Balance at December 31, 2024
732
During the year ended December 31, 2024, the Company was granted offsets of $37 million and cash refunds of $282
million with respect to VAT receivable balances. During the year ended December 31, 2023, offsets of $143 million were
granted and cash refunds of $124 million were received.
In 2022, the Company reached agreement in respect of the outstanding Zambian value-added tax receivable sum including
an approach for repayment based on offsets against future corporate income taxes and mineral royalties. This has resulted
in adjustments to reflect the agreed receivable amount to be repaid, and the revised expected phasing of recoverability of
that receivable amount. These adjustments have been presented in Other income and Adjustment for expected phasing of
Zambian VAT in the Statement of Earnings, respectively. The adjustment for expected phasing for the non-current portion
represents the application of an appropriate discount rate of 10% to the expected recovery of VAT receivable against future
corporate income taxes and mineral royalties, a credit of $94 million for the year ended December 31, 2024, represents the
application of an appropriate discount rate to the expected recovery of VAT. For the year ended December 31, 2023 a credit
of $49 million was recognized. As at December 31, 2024, amounts totalling $217 million are presented as current (December
31, 2023: $131 million).
On April 4, 2023 the Company’s subsidiary, KMP and ZCCM Investments Holdings Plc "ZCCM-IH" completed the agreement
to convert ZCCM-IH's dividend rights to a 3.1% royalty interest in KMP. The transaction also provides for 20% of the KMP
VAT refunds as at June 30, 2022 to be paid to ZCCM-IH, as and when these are received by KMP from the Zambia Revenue
Authority ("ZRA)". As at December 31, 2024, a VAT payable to ZCCM-IH of $58 million, net of adjustment for expected
phasing of payments, and an expense of $5 million for the year ended December 31, 2024, has been recognized.
d) Aging analysis of VAT receivable for the Company’s Zambian operations
< 1 year
1-3 years
3-5 years
5-8 years
> 8 years
Total
Receivable at the period end
105
28
405
225
159
922
Adjustment for expected phasing
–
(8)
(126)
(33)
(23)
(190)
Total VAT receivable from Zambian
operations
105
20
279
192
136
732
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 17
5. INVENTORIES
December 31,
2024
December 31,
2023
Ore in stockpiles
162
171
Work-in-progress
25
37
Finished product
410
410
Total product inventory
597
618
Consumable stores
957
975
1,554
1,593
Approximately 121 thousand dry metric tonnes of copper concentrate, equivalent to a cost of $128 million, remains unsold at
Cobre Panamá following disruptions at the Punta Rincón port.
An impairment charge of $53 million was recognized in respect of inventories at Ravensthorpe in the year ended December
31, 2024.
6. PROPERTY, PLANT AND EQUIPMENT
Mineral properties and mine
development costs
Plant and
equipment
Capital work-
in-progress
Operating
mines
Exploration
and
development
projects
Total
Net book value, as at
December 31, 2023
9,449
1,465
6,273
1,396
18,583
Additions
–
1,244
–
–
1,244
Disposals
(22)
–
–
–
(22)
Transfers between categories
366
(889)
458
65
–
Impairments1
(19)
–
(3)
–
(22)
Capitalized interest (note 20)
2
52
–
–
54
Depreciation charge (note 18)
(370)
–
(274)
–
(644)
Net book value, as at December 31,
2024
9,406
1,872
6,454
1,461
19,193
Cost
16,693
1,872
10,361
1,461
30,387
Accumulated depreciation
(7,287)
–
(3,907)
–
(11,194)
1 An impairment charge of $19 million was recognized in respect of additions at Ravensthorpe in the year ended December 31, 2024.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 18
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
107
106
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
Mineral properties and mine
development costs
Plant and
equipment
Capital work-
in-progress
Operating
mines
Exploration and
development
projects
Total
Net book value, as at
December 31, 2022
9,892
1,356
6,631
1,174
19,053
Additions
–
1,382
–
–
1,382
Acquisitions
–
–
–
201
201
Disposals
(44)
–
–
–
(44)
Transfers between categories
881
(1,295)
347
67
–
Conversion of non-controlling
interest rights
–
–
(73)
–
(73)
Restoration provision (note 11c)
–
–
65
–
65
Impairments 1
(584)
(4)
(250)
(46)
(884)
Capitalized interest (note 20)
–
26
–
–
26
Depreciation charge (note 18)
(696)
–
(447)
–
(1,143)
Net book value, as at December 31,
2023
9,449
1,465
6,273
1,396
18,583
Cost
16,421
1,465
9,906
1,396
29,188
Accumulated depreciation
(6,972)
–
(3,633)
–
(10,605)
1 In the year ended December 31, 2023 a full impairment test was performed on the Ravensthorpe CGU following margin pressure from weak nickel prices and
high operating costs using a fair value less costs of disposal method utilizing a discounted cashflow model based on estimated future cashflows. An impairment
charge of $854 million was recognized against property, plant and equipment and other assets at Ravensthorpe in the year ended December 31, 2023. A further
$46 million was recognized in respect of other exploration assets in the year ended December 31, 2023
Included within capital work-in-progress and mineral properties – operating mines at December 31, 2024, is an amount of
$1,025 million related to capitalized deferred stripping costs (December 31, 2023: $949 million). For the year December 31,
2024, $54 million of interest was capitalized (year ended December 31, 2023: $26 million). The amount of capitalized
interest was determined by applying the weighted average cost of borrowings of 8.5% (December 31, 2023: 7.5%) to the
accumulated qualifying expenditures.
7. GOODWILL
Goodwill of $237 million arose through the acquisition of Inmet Mining Corporation (“Inmet”) in 2013 after the application of
IAS 12 – Income taxes, due to the requirement to recognize a deferred tax liability calculated as the tax effect of the
difference between the fair value of the assets acquired and their respective tax bases. Goodwill is not deductible for tax
purposes. The goodwill was assigned to the Cobre Panamá cash-generating unit.
The carrying value of the Cobre Panamá cash-generating unit at December 31, 2024, was $10,666 million inclusive of the
Cobre Panamá power station, and deferred revenue (December 31, 2023: $10,553 million).
The annual impairment test has been performed as at December 31, 2024. For the purposes of the goodwill impairment test,
the recoverable amount of Cobre Panamá has been determined using a fair value less costs of disposal calculation based
on a cash flow model covering different possible scenarios, including the process of international arbitration and various
levels of operation, which uses a post-tax discount rate, taking account of assumptions that would be made by market
participants. The outcome of the scenarios considered, and potential associated recoveries remains uncertain.
The future cash flows used in the various scenarios of the model are inherently uncertain and could materially change over
time as a result of changes, where applicable, to ore reserves and resources estimates, commodity prices, discount rate,
future costs and capital expenditure, estimates related to the fiscal regime, and estimates related to potential arbitral
recoveries for Cobre Panamá. For the applicable scenarios, reserves and resources are estimated based on the National
Instrument 43-101 compliant report produced by qualified persons adjusted for updates by management since the last
report. The various cash flow model scenarios used remain consistent with the reserves and resource volumes approved as
part of the Company’s estimation of proven and probable reserves in determining the recoverable value of Cobre Panamá.
Such volumes are dependent on a number of variables, including the recovery of metal from the ore, production costs,
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 19
duration of mining rights, and the selling price of extracted minerals. Commodity prices are management’s estimates of the
views of market participants, including a long-term copper price of $4.20 per lb. The estimates are derived from the median
of consensus forecasts. A nominal discount rate of 10.0% (December 31, 2023: 10.0%) has been applied to future cash
flows. Future costs and capital expenditure are based on the latest available engineering reports and are consistent with
technical reports prepared in accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects.
Future Preservation and Safe Management costs assumed in the various cash flow model scenarios are based on
management's latest forecasts and budgets. The measurement is classified as level 3 in the fair value hierarchy.
In light of this assessment by management, the calculated recoverable amount of the cash-generating unit exceeds the
carrying value of Cobre Panamá at December 31, 2024, and therefore no impairment charge has been recognized. An
increase in the discount rate of 3 per cent, or a reduction in the assumed copper price by 55 cents per pound would result in
the calculated recoverable amount approximately equalling the carrying value, if all other model inputs remained the same.
8. OTHER ASSETS
December 31,
2024
December 31,
2023
Prepaid expenses
136
133
KPMC shareholder loan
243
188
Other investments
17
17
Derivative instruments (note 23)
204
14
Total other assets
600
352
Less: current portion of other assets
(311)
(123)
289
229
9. JOINT VENTURE
On November 8, 2017, the Company completed the purchase of a 50% interest in KPMC from LS-Nikko Copper Inc. KPMC
is jointly owned and controlled with Korea Mine Rehabilitation and Mineral Resources Corporation (“KOMIR”) and holds a
20% interest in Cobre Panamá. The purchase consideration of $664 million comprised the acquisition consideration of $635
million and the reimbursement of cash advances of $29 million with $179 million paid on closing. The final consideration of
$100 million was paid in November 2021.
A $560 million investment in the joint venture representing the discounted consideration value and the Company’s
proportionate share of the profit or loss in Korea Panama Mining Corporation (“KPMC”) to date is recognized. For the year
ended December 31, 2024, the loss attributable to KPMC was $158 million (December 31, 2023: $55 million loss). The profit
or loss in KPMC relates to the 20% equity accounted share of profit or loss reported by Minera Panamá S.A. (“MPSA”), a
subsidiary of the Company. The material assets and liabilities of KPMC are an investment in MPSA of $427 million,
shareholder loans receivable of $1,180 million from the Company (note 11b) and shareholder loans payable of $1,309 million
due to the Company and its joint venture partner KOMIR.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 20
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
109
108
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
10. DEBT
December 31,
2024
December 31,
2023
Drawn debt
Senior Notes:
First Quantum Minerals Ltd. 7.50% due April 2025
(a)
–
1,049
First Quantum Minerals Ltd. 6.875% due March 2026
(a)
–
997
First Quantum Minerals Ltd. 6.875% due October 2027
(b)
1,495
1,493
First Quantum Minerals Ltd. 9.375% due March 2029
(c)
1,573
–
First Quantum Minerals Ltd. 8.625% due June 2031
(d)
1,287
1,285
First Quantum Minerals Ltd. senior debt facility
(e)
1,448
1,987
FQM Trident term loan
(f)
423
424
Trading facilities
(g)
116
144
Total debt
6,342
7,379
Less: current maturities and short term debt
(498)
(769)
5,844
6,610
Undrawn debt
First Quantum Minerals Ltd. senior debt facility
(e)
750
250
Trading facilities
(g)
410
446
(a) Redemption of 2025 and 2026 Senior Notes
In March 2024, the Company completed the redemption in full of its $1,050 million 7.50% senior notes due 2025 and $1,000
million 6.875% senior notes due 2026. The Company redeemed the notes at a redemption price of 100.00% of the principal
amount, plus accrued and unpaid interest, using the proceeds from its previously-announced comprehensive refinancing.
(b) First Quantum Minerals Ltd. 6.875% due October 2027
On September 17, 2020, the Company announced the offering and pricing of $1,500 million of 6.875% Senior Notes due
2027 at an issue price of 100.00%. Settlement took place on October 1, 2020. The Company and its subsidiaries are
subject to certain restrictions on asset sales, payments, incurrence of indebtedness and issuance of preferred stock.
The notes are part of the senior obligations of the Company and are guaranteed by certain subsidiaries of the Company.
Interest is payable semi-annually.
The Company may redeem some or all of the notes at any time on or after October 15, 2023, at redemption prices ranging
from 103.44% in the first year to 100% from October 2025, plus accrued interest. In addition, until October 15, 2023, the
Company may redeem up to 35% of the principal amount of notes, in an amount not greater than the net proceeds of certain
equity offerings, at a redemption price of 106.875% plus accrued interest.
(c) First Quantum Minerals Ltd. 9.375% due June 2029
On February 21, 2024 the Company announced the offering and pricing of $1,600 million of 9.375% Senior Notes due 2029
at an issue price of 100.00%. Settlement took place on February 29, 2024. The notes are part of the senior obligations of the
Company and are guaranteed by certain subsidiaries of the Company. Interest is payable semi-annually. The Company and
its subsidiaries are subject to certain restrictions on asset sales, payments, incurrence of indebtedness and issuance of
preferred stock.
The Company may redeem some or all of the notes at any time on or after March 1, 2026, at redemption prices ranging from
104.688% in the first year to 100.000% from March 1 2028, plus accrued interest. In addition, until March 1, 2026, the
Company may redeem up to 35% of the principal amount of notes, in an amount not greater than the net proceeds of certain
equity offerings, at a redemption price of 109.375% plus accrued interest.
In addition, and prior to March 1, 2026, subject to certain conditions at Cobre Panama, the Company may, at its option, on
only one occasion, redeem up to 35% of the aggregate principal amount of the 2029 Notes at a redemption price equal to
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 21
107.031% of the aggregate principal amount thereof, plus accrued and unpaid interest and certain additional amounts, if any,
thereon to, but not including, the applicable redemption date.
(d) First Quantum Minerals Ltd. 8.625% due June 2031
On May 17, 2023 the Company announced the offering and pricing of $1,300 million of 8.625% Senior Notes due 2031 at an
issue price of 100.00%. Settlement took place on May 30, 2023. The notes are part of the senior obligations of the Company
and are guaranteed by certain subsidiaries of the Company. Interest is payable semi-annually. The Company and its
subsidiaries are subject to certain restrictions on asset sales, payments, incurrence of indebtedness and issuance of
preferred stock.
The Company may redeem some or all of the notes at any time on or after June 1, 2026, at redemption prices ranging from
104.313% in the first year to 100.000% from June 1 2028, plus accrued interest. In addition, until June 1, 2026, the
Company may redeem up to 35% of the principal amount of notes, in an amount not greater than the net proceeds of certain
equity offerings, at a redemption price of 108.625% plus accrued interest.
(e) First Quantum Minerals Ltd. senior debt facility
In February 2024, the Company signed an amendment and extension of the existing 2021 Term Loan and Revolving Credit
Facility (“RCF”), replacing the 2021 Term Loan and RCF Facility. The 2024 Facility comprises a $943 million Term Loan
Facility, with a balance of $921 million as at December 31, 2024, following scheduled repayments in 2024, and a $1.3 billion
RCF. Interest is charged at SOFR plus a margin. This margin can change relative to a certain financial ratio of the Company.
The amendments to the Facility provide the Company with additional liquidity headroom and increases the net leverage
covenant from 3.50x to 5.75x Net Debt/EBITDA until June 30, 2025. The net leverage covenant is then reduced to 5.00x
between July 1, 2025 and December 31, 2025; 4.25x between January 1, 2026 and June 30, 2026; and 3.75x thereafter.
The definitions of both Net Debt and EBITDA used in computing the ratio under the covenant are defined in the Financing
Agreements.
At December 31, 2024, $550 million of the RCF had been drawn, leaving $750 million available for the Company to draw.
(f) FQM Trident term loan
On February 12, 2024, FQM Trident agreed with the lenders to its unsecured term loan facility to reschedule loan
repayments due in 2024 to 2025. On October 15, 2024, FQM Trident signed a $425 million unsecured term loan facility (the
“FQM Trident Facility”) with a maturity date of September 2028 to replace the previous Trident facility, scheduled to mature in
December 2025. Repayments on the FQM Trident Facility commence in March 2026 and are due every 6 months thereafter.
The principal outstanding under the FQM Trident Facility as at December 31, 2024 was $425 million.
(g) Trading facilities
The Company’s metal marketing division has six uncommitted borrowing facilities totalling $526 million, which have been
reduced while Cobre Panama remains on P&SM. The facilities are used to finance purchases and the short term hedging of
copper, gold and other metals, undertaken by the metal marketing division. Interest on the facilities is calculated at the
bank’s benchmark rate plus a margin. The loans are collateralized by physical inventories.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 22
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
111
110
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
11. PROVISIONS AND OTHER LIABILITIES
a) Provisions and other liabilities
December 31,
2024
December 31,
2023
Amount owed to joint venture (note 11b)1
1,180
1,156
Restoration provisions (note 11c)
598
647
VAT payable to ZCCM-IH 2
58
52
Derivative instruments (note 23)
38
62
Other loans owed to non-controlling interests (note 11d)
214
202
Liabilities directly associated with assets held for sale
16
18
Leases
13
20
Retirement provisions
15
18
Copper Prepayment Agreement (note 12b)
217
–
Other
14
76
Total other liabilities
2,363
2,251
Less: current portion of provisions, other liabilities and deferred revenue
(318)
(182)
2,045
2,069
1 The shareholder loan is due from the Company’s Cobre Panamá operation to KPMC, a 50:50 joint venture between the Company and KOMIR.
2 On April 4, 2023 the Company’s subsidiary, KMP and ZCCM-IH completed the agreement to convert ZCCM-IH’s dividend rights to a 3.1% royalty interest in KMP.
The transaction also provides for 20% of the KMP VAT refunds as at June 30, 2022 to be paid to ZCCM-IH, as and when these are received by KMP from the
ZRA.
b) Amount owed to joint venture
December 31,
2024
December 31,
2023
Balance at the beginning of the year
1,156
1,256
Related party finance cost (note 20)
124
92
Gain on modification1
(100)
–
Repayment
–
(192)
Balance at end of year due to KPMC
1,180
1,156
1 In the fourth quarter of 2024, MPSA revised the terms of the loan agreement with KPMC. Effective November 1, 2024, MPSA has agreed with KPMC to suspend
interest accruals and payments up to twelve months. The modification was on an arm's lengths basis and deemed to be non-substantial under IFRS 9, and
resulted in an adjustment to the carrying amount of the liability of $100 million, which has been recorded in net earnings. Finance cost has continued to be
accreted, applying the effective interest method under IFRS 9.
As at December 31, 2024, the accrual for interest payable is $340 million (December 31, 2023: $216 million) and is included
in the carrying value of the amount owed to the joint venture, as this has been deferred under the loan agreement. Amounts
due to KPMC are specifically excluded from the calculation of net debt as defined under the Company’s banking covenant
ratios.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 23
c) Restoration provisions
The Company has restoration and remediation obligations associated with its operating mines, processing facilities, closed
sites and development projects. The following table summarizes the movements in the restoration provisions:
December 31,
2024
December 31,
2023
Balance at the beginning of the year
647
555
Changes in estimate – operating sites (note 6)
–
65
Changes in estimate – closed sites (note 21)
(39)
4
Other adjustments
(32)
6
Accretion expense (note 20)
22
17
Balance at year end
598
647
Less: current portion
(7)
(3)
591
644
The Company has issued letters of credit which are guaranteed by cash deposits, classified as restricted cash on the
balance sheet at December 31, 2024, totalling $45 million (December 31, 2023: $33 million).
The restoration provisions have been recorded initially as a liability based on management’s best estimate of cash flows,
using a risk-free discount between 4.0% and 4.8% (December 31, 2023, between 4.0% and 4.8%) and an inflation factor
between 2.0% and 23.8% (December 31, 2023, between 2.0% and 20.0%). Reclamation activity is expected to occur over
the life of each of the operating mines, a period of up to 32 years, with the majority payable in the years following the
cessation of mining operations.
d) Other loans owed to non-controlling interests
On September 30, 2021, the Company completed the sale of a 30% equity interest in Ravensthorpe. Consideration paid of
$240 million comprised cash for equity of $90 million and loans acquired of $150 million. Additional subsequent loans to date
of $28 million have been made.
During the third quarter 2023, the Company's interest in Ravensthorpe increased from 70.0% to 75.7% following an equity
raise which POSCO Holdings, the minority shareholder, elected not to participate in.
Effective October 1, 2024, Ravensthorpe has agreed with POSCO Holdings, to postpone interest accruals and payments on
the non-current loan. Finance cost has continued to be accreted, applying the effective interest method under IFRS 9.
During 2024, accrued interest and finance cost accretion to date amounted to $10 million and $3 million, respectively.
12. DEFERRED REVENUE
December 31,
2024
December 31,
2023
Franco-Nevada Precious Metal Stream Arrangement (note 12a)
1,481
1,420
Copper Prepayment Agreement (note 12b)
500
–
Balance at the end of the year
1,981
1,420
Less: current portion (note 11)
(217)
–
Non-current portion
1,764
1,420
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 24
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
113
112
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
a) Franco-Nevada Precious Metal Stream Arrangement
The Company commenced the recognition of delivery obligations under the terms of the Franco Nevada precious metal
stream arrangement in June 2019 following the first sale of copper concentrate by Cobre Panamá. The Company uses
refinery-backed credits as the mechanism for satisfying its delivery obligations under the arrangement. The Company’s
Cobre Panamá mine was placed into a phase of P&SM in November 2023. In the year ended December 31, 2024, nil million
was delivered under the stream the cost of which are presented net within sales revenues (year ended December 31, 2023:
$240 million).
December 31,
2024
December 31,
2023
Balance at the beginning of the year
1,420
1,455
Accretion of finance costs (note 20)
61
61
Amortization of gold and silver revenue
–
(96)
Balance at the end of the year
1,481
1,420
a) Franco-Nevada Precious Metal Stream Arrangement
The Company, through its subsidiary, MPSA, has a precious metal streaming arrangement with Franco-Nevada. The
arrangement comprises two tranches. Under the first phase of deliveries under the first tranche (“Tranche 1”) Cobre Panamá
will supply Franco-Nevada 120 ounces of gold and 1,376 ounces of silver for each 1 million pounds of copper produced,
deliverable within 5 days of eligible copper concentrate sales. Under the first phase of deliveries under the second tranche
(“Tranche 2”) Cobre Panamá will supply Franco-Nevada a further 30 ounces of gold and 344 ounces of silver for each 1
million pounds of copper produced, deliverable within 5 days of eligible copper concentrate sales.
Tranche 1 was finalized on October 5, 2015 which provided for $1 billion of funding to the Cobre Panamá project. Under the
terms of Tranche 1, Franco-Nevada, through a wholly owned subsidiary, agreed to provide a $1 billion deposit to be funded
on a pro-rata basis of 1:3 with the Company’s 80% share of the capital costs of Cobre Panamá in excess of $1 billion. The
full Tranche 1 deposit amount has been fully funded to MPSA. Tranche 2 was finalized on March 16, 2018, and $356 million
was received on completion. Proceeds received under the terms of the precious metals streaming arrangement are
accounted for as deferred revenue.
The amount of precious metals deliverable under both tranches is indexed to total copper-in-concentrate sold by Cobre
Panamá. Under the terms of Tranche 1 the ongoing payment of the Fixed Payment Stream is fixed per ounce payments of
$464.21 per oz gold and $6.96 per oz silver subject to an annual inflation adjustment for the first 1,341,000 ounces of gold
and 21,510,000 ounces of silver (approximately the first 20 years of expected deliveries). Thereafter the greater of $464.21
per oz for gold and $6.96 per oz for silver, subject to an annual adjustment for inflation, and one half of the then prevailing
market price. Under Tranche 2 the ongoing price per ounce for deliveries is 20% of the spot price for the first 604,000
ounces of gold and 9,618,000 ounces of silver (approximately the first 25 years of production), and thereafter the price per
ounce rises to 50% of the spot price of gold and silver.
In all cases, the amount paid is not to exceed the prevailing market price per ounce of gold and silver.
b) Copper Prepayment Agreement
On February 15, 2024, the Company signed a $500 million 3-year copper prepayment agreement with Jiangxi Copper
("Copper Prepayment Agreement"). The agreement provides for the delivery of 50kt of copper anode per annum from
Kansanshi payable at market prices. The prepaid amount will reduce in line with deliveries over the second and third years
of the Prepayment Agreement.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 25
13. INCOME TAX EXPENSES
The significant components of the Company’s income tax expense are as follows:
December 31,
2024
December 31,
2023
Current income tax expense
269
605
Deferred income tax expense
119
152
388
757
Taxes paid of $128 million includes $12 million of VAT receivables that were offset in settlement of Zambian income taxes
payable.
The income taxes shown in the consolidated statements of earnings (loss) differ from the amounts obtained by applying
statutory rates to the earnings before income taxes due to the following:
2024
2023
Amount $
%
Amount $
%
Earnings (Loss) before income taxes
280
(486)
Income tax expense at Canadian statutory rates
76
27
(131)
27
Difference in foreign tax rates
8
3
(99)
20
Resource and depletion allowances1
—
—
(65)
13
Non-deductible expenses
7
3
41
(8)
Losses not recognized2
305
109
399
(82)
Recognition and de-recognition of deferred tax
assets3
—
—
179
(37)
Prior year taxes relating to Panama4
—
—
277
(57)
Mining taxes5
—
—
156
(32)
Impact of foreign exchange
(8)
(3)
—
—
Income tax expense
388
139
757
(156)
1 Certain allowances, incentives and tax deductions applicable only to the extractive industry.
2 Consists of financing cost that were incurred in Canada and losses incurred in Australia and Panama where it is not probable that sufficient taxable income will be
generated.
3 In the prior year, the Company derecognized $160 million of deferred tax assets in Ravensthorpe and $19 million in Panama.
4 In the prior year, the Company paid income taxes, withholding tax and mining taxes relating to 2021 and 2022 years pursuant to Law 406 in Panama.
5 In the prior year, the Company paid mining taxes based on adjusted gross profits at a rate between 12-16% pursuant to Law 406 in Panama.
In 2024, no income tax payments were made in Panama.
In March 2023, the Company and the Government of Panama ("GOP") agreed to a Refreshed Concession Agreement
contract that provided for an initial 20-year term with a 20-year extension option and possible additional extension for life of
mine. The agreement included an annual minimum contribution of $375 million in Government income, comprised of
corporate taxes, withholding taxes and a profit-based mineral royalty of 12 to 16 percent, with downside protections.
Following due public consultation and regulatory signoff, the National Assembly in Panama approved Bill 1100, being the
proposal for approval of the Refreshed Concession Contract for the Cobre Panamá mine on October 20, 2023. On the same
day, President Laurentino Cortizo sanctioned Bill 1100 into Law 406, which was subsequently published in the Official
Gazette. Law 406 approved the concession contract for the Cobre Panamá mine on October 20, 2023. On November 16,
2023, in accordance with its contractual obligations to the Republic of Panama under Law 406, the Company made tax and
royalty payments of $567 million in respect of the period from December 2021 to October 2023. On November 28, 2023, the
Supreme Court of Justice of Panama announced that it declared Law 406 unconstitutional. The ruling was subsequently
published in the Official Gazette on December 2, 2023.
As the ruling on unconstitutionality is not retroactive, the Company has recorded all payments of taxes and royalties that
were calculated based on a taxable margin as current tax expense as per Law 406 up to December 2, 2023. Subsequent to
December 2, 2023, the Company has recorded all taxes and royalties as per the general income tax and mining code.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 26
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
115
114
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
Of the $567 million payment, $20 million relates to 2021, $375 million relates to 2022 and $172 million relates to 2023.
Payments for 2023 include corporate taxes, withholding taxes and a profit-based mineral royalty of 12 to 16 percent. Taxes
not calculated based on a taxable margin, which includes a top-up of $76 million to $375 million for the year 2022, are
included in cost of sales and not in tax expense.
The deferred income tax assets and liabilities included on the balance sheet are as follows:
December 31,
2024
December 31,
2023
Deferred income tax assets
50
50
Deferred income tax liabilities
(1,007)
(874)
(957)
(824)
The significant components of the Company’s deferred income taxes are as follows:
2024
2023
Temporary differences relating to property, plant and equipment
(1,122)
(1,036)
Unused operating losses
42
78
Temporary differences relating to non-current liabilities (including restoration provisions)
55
54
Temporary differences relating to inventory
13
7
Unrealized foreign exchange loss and phasing of Zambian VAT receivable
24
42
Other
31
31
Net deferred income tax liabilities
(957)
(824)
The Company believes that it is probable that the results of future operations will generate sufficient taxable income to
realize the above noted deferred income tax assets.
The Company has unrecognized deductible temporary differences relating to operating loss carryforwards that may be
available for tax purposes in Canada totalling $6,235 million (December 31, 2023: $6,263 million) expiring between 2025
and 2044, in Panama totalling $1,569 million (December 31, 2023: $1,604 million) expiring between 2025 and 2029 and in
Australia totalling $764 million (December 31, 2023: $683 million) with no expiry date.
The Company has unrecognized deductible temporary differences relating to restricted interest expense that may be
available for tax purposes in Canada totalling $418 million (December 31, 2023: $0 million) with no expiry, and in Australia
totalling $44 million (December 31, 2023: $0 million) expiring 2039.
The Company has non-Canadian resident subsidiaries that have undistributed earnings of $1,595 million (December 31,
2023: $3,145 million). These undistributed earnings are not expected to be repatriated in the foreseeable future and the
Company has control over the timing of such, therefore taxes that may apply on repatriation have not been provided for.
On June 20, 2024, the Government of Canada enacted the Global Minimum Tax Act (“GMTA”) which implements key
measures of the OECD’s Pillar Two GMT in Canada and includes the introduction of a 15% GMT that applies to large
multinational enterprise groups with global consolidated revenues over €750 million. The legislation is effective from January
1, 2024. As a result, the Company is liable to pay a top-up tax in Canada when the effective tax rate in a jurisdiction in which
its subsidiary operates in is below the 15% minimum rate.
In December 2023, the Government of Switzerland implemented supplementary tax measures in response to the OECD’s
Pillar Two GMT initiative. The supplementary tax measures includes the introduction of a Qualified Domestic Minimum Top-
Up Tax for tax years beginning on or after January 1, 2024, which tops up the Switzerland effective tax rate to 15%. As a
result of these changes, the Company’s subsidiary in Switzerland recognized an additional income tax expense of $3 million
in the year ended December 31, 2024.
All entities within the Company group have an effective tax rate of at least 15% for the year ended December 31, 2024,
including our subsidiary in Switzerland as a result of the new measures enacted by the Government of Switzerland as
described above. Therefore, no tax expense was recognized in respect of the GMTA for the year ended December 31, 2024.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 27
14. SHARE CAPITAL
a) Common shares
Authorized
Unlimited common shares without par value Issued
Number of
shares
(000’s)
Balance as at December 31, 2023
693,599
Shares issued through Equity issue
139,932
Shares issued through Share Option Plan
675
Balance as at December 31, 2024
834,206
The balance of share capital at December 31, 2024 was $6,771 million (December 31, 2023: $5,668 million).
On January 6, 2020, the Company announced adoption of a Shareholders Rights Plan. The Shareholders Rights Plan (“the
Rights Plan”) applies in the event of any person or persons acting in concert having beneficial ownership of 20% or more of
the Company’s outstanding common shares without having complied with bid provisions under the Rights Plan. In the
occurrence of such an event, each outstanding common share has a right attached to it to purchase additional common
shares of the Company, at a substantial discount to the then market price.
On July 23, 2024, the Company entered into a shareholder rights agreement (the “Shareholder Rights Agreement” or “SRA”)
with Jiangxi Copper. The Shareholder Rights Agreement will formalize and provide structure to the relationship that exists
between the two organizations. Further, the Shareholder Rights Agreement is also expected to support reasonable sharing
of best practices between the parties across the copper value chain, including in smelting and refining, in which Jiangxi
Copper is a world leader. The four key provisions of the SRA are:
1. Nomination rights: Jiangxi Copper will have the right to nominate one person for consideration by the Nominating and
Governance Committee of the board of the Company, which will make a recommendation to the board regarding the
appointment or election of the nominee;
2. Standstill: Jiangxi Copper has agreed to customary standstill restrictions which, subject to certain exceptions, prohibit
Jiangxi Copper from taking certain actions, including, without the consent of the Company, acquiring shares of the
Company during the term of the SRA and for a period of six months following the termination of the SRA;
3. Restrictions on dispositions: Jiangxi Copper has agreed to certain restrictions on the disposition of its shares of the
Company which include, subject to certain exceptions (i) the right of the Company to designate one or more purchasers
of such shares in the event that Jiangxi Copper proposes to sell a block of 5% or more of the shares of the Company, and
(ii) not selling such shares to any person that owns, or would own, following completion of such sale, more than 9.9% of
the issued and outstanding shares of the Company (allowing for certain ordinary secondary market transactions executed
through the TSX or other stock exchanges on which the common shares are listed); and,
4. Shareholder support: Jiangxi Copper has agreed that it will not withhold its vote in respect of the director nominees
proposed by management of the Company or the reappointment of auditors, nor will it vote against any other matters
recommended by the Company’s board of directors (other than matters relating to an acquisition of all the shares of the
Company by a third party, a sale of a controlling interest in any material asset of the Company or an issuance of shares
that would result in a person owning more than 10% of the issued and outstanding shares of the Company).
The SRA will terminate upon the earlier of July 23, 2027 and the date on which Jiangxi Copper’s ownership percentage of
the Company’s shares falls below 10%. Jiangxi Copper and the Company may terminate the SRA at any time by mutual
written agreement.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 28
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
117
116
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
b) Treasury shares
The Company established an independent trust to purchase, on the open market, the common shares pursuant to the long-
term incentive plan (note 16a). The Company consolidates the trust as it is subject to control by the Company. Consequently,
shares purchased by the trust to satisfy obligations under the long-term incentive plan are recorded as treasury shares in
shareholders’ equity. Generally, dividends received on shares held in the trust will be paid to plan participants in cash as
received.
Number of
shares
(000’s)
Balance as at December 31, 2022
6,257
Shares purchased
4,495
Shares vested
(3,939)
Balance as at December 31, 2023
6,813
Shares purchased
596
Shares vested
(1,248)
Balance as at December 31, 2024
6,161
The balance of shares held in the trust as at December 31, 2024 was $79 million (December 31, 2023: $56 million).
c) Dividends
On July 25, 2023, the Company declared an interim dividend of CDN$0.08 per share, in respect of the financial year ended
December 31, 2023 (paid on September 19, 2023 to shareholders of record on August 28, 2023.
On January 15, 2024, the Company announced that it had suspended its final dividend in respect of the financial year ended
December 31, 2023 (February 14, 2023: CDN$0.13 per share) as a result of Cobre Panamá being in a phase of
Preservation and Safe Management.
15. EARNINGS (LOSS) PER SHARE
2024
2023
Basic and diluted earnings (loss) attributable to shareholders
of the Company
2
(954)
Basic weighted average number of shares outstanding
(000’s of shares)
812,222
690,876
Potential dilutive securities
–
–
Diluted weighted average number of shares outstanding
(000’s of shares)
812,222
690,876
Earnings (Loss) per common share – basic (expressed in $ per share)
0.00
(1.38)
Earnings (Loss) per common share – diluted (expressed in $ per share)
0.00
(1.38)
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 29
16. SHARE BASED COMPENSATION AND RELATED PARTY TRANSACTIONS
a) Long-term incentive plans
The Company has a long-term incentive plan (the “Plan”), which provides for the issuance of performance stock units
(“PSUs”) and restricted stock units (“RSUs”) in such amounts as approved by the Company’s Compensation Committee.
Included in general and administrative expense is share-based compensation expense of $52 million (December 31, 2023:
$43 million) related to this Plan.
Under the Plan, each PSU entitles participants, which includes directors, officers, and employees, to receive up to one-and-
a-half common shares of the Company at the end of a three-year period if certain performance and vesting criteria, which are
based on the Company’s performance relative to a representative group of other mining companies, have been met. The fair
value of each PSU is recorded as compensation expense over the vesting period. The fair value of each PSU is estimated
using a Monte Carlo Simulation approach. A Monte Carlo Simulation is a technique used to approximate the probability of
certain outcomes, called simulations, based on normally distributed random variables and highly subjective assumptions.
This model generates potential outcomes for stock prices and allows for the simulation of multiple stocks in tandem resulting
in an estimated probability of vesting.
Under the Plan, each RSU entitles the participant to receive one common share of the Company subject to vesting criteria.
RSU grants typically vest fully at the end of the three-year period. The fair value of each RSU is recorded as compensation
expense over the vesting period. The fair value of each RSU is estimated based on the market value of the Company’s
shares at the grant date and an estimated forfeiture rate of 11.5% (December 31, 2023: 11.5%).
The Company has a long term compensation scheme for the next generation of operational business leaders (current
directors do not participate in the scheme), KRSUs. The scheme allows for full vesting over eight years with partial vesting
commencing in the fourth year. The objectives of the scheme are to promote a long-term strategic focus amongst
participants and to facilitate the Company’s management succession plans as the roles of the founding directors transition
during the scheme period. Included in general and administrative expense is share-based compensation expense of $5
million (December 31, 2023: $7 million) related to this Plan.
The Company will meet its obligations under the scheme through market purchases.
2024
2023
Number of units
(000’s)
Number of units
(000’s)
Performance stock units
Outstanding - beginning of year
1,952
3,112
Granted
2,391
1,404
Vested
(134)
(2,472)
Forfeited
(628)
(92)
Outstanding - end of year
3,581
1,952
Restricted stock units
Outstanding - beginning of year
4,348
6,090
Granted
5,052
1,154
Vested
(1,210)
(2,483)
Forfeited
(725)
(413)
Outstanding - end of year
7,465
4,348
Key restricted stock units
Outstanding – beginning of year
4,492
6,010
Granted
—
—
Vested
(989)
(1,208)
Forfeited
(196)
(310)
Outstanding - end of year
3,307
4,492
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 30
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
119
118
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
The following assumptions were used in the Monte Carlo Simulation model to calculate compensation expense in respect of
the PSUs granted in the following years:
2024
2023
Risk-free interest rate
4.32 %
4.49 %
Vesting period
3 years
3 years
Expected volatility
64.42 %
50.10 %
Expected forfeiture per annum
4.00 %
4.00 %
Weighted average probability of vesting
55.40 %
56.06 %
b) Share option plan
The Company has in the past granted share options over common shares in the Company to certain management. Options
are exercisable at a price equal to the closing quoted price of the Company’s shares on the date of grant and are fully vested
after three years. Options are forfeited if the employee leaves the Company before the options vest. If the options remain
unexercised after a period of five years from the grant date the options expire.
Each share option converts into one common share on exercise. An amount equal to the share price at the date of grant is
payable by the recipient on the exercise of each option. The options carry neither rights to dividends nor voting rights.
Options may be exercised at any time from the date of vesting to the date of their expiry.
2024
2023
Number of
units
(000’s)
Number of
units
(000’s)
Share options
Outstanding - beginning of year
741
1,307
Exercised
(675)
(508)
Forfeited
(66)
(58)
Expired
—
—
Outstanding - end of year
0
741
Exercisable - end of year
—
—
Volatility was calculated with reference to the Company’s historical share price volatility up to the grant date to reflect a term
approximate to the expected life of the option.
The Company recognized total expenses of $nil (December 31, 2023: $nil) related to equity-settled share-based payments
on share options issued under the above plan for the year ended December 31, 2024.
c) Key management compensation
Key management personnel include the members of the senior management team and directors.
2024
2023
Salaries, fees and other benefits
5
5
Bonus payments
1
1
Share based compensation
5
6
Total compensation paid to key management
11
12
d) Other related party transactions
Amounts paid to related parties were incurred in the normal course of business and on an arm’s length basis. During the
year, $nil (December 31, 2023: $6 million) was paid to parties related to key management. As at December 31, 2024, $nil
(December 31, 2023: $1 million) was included in trade and other payables concerning related party amounts payable.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 31
17. SALES REVENUES
2024
2023
Copper
4,015
5,641
Gold
347
319
Nickel
335
341
Other
105
155
4,802
6,456
18. COST OF SALES
2024
2023
Costs of production
(2,779)
(4,081)
Depreciation
(644)
(1,143)
Movement in inventory
(40)
38
Movement in depreciation in inventory
11
22
(3,452)
(5,164)
19. EXPENSES BY NATURE1
2024
2023
Depreciation
(633)
(1,121)
Employment costs, benefits and contractor
(754)
(1,135)
Raw materials and consumables
(586)
(1,027)
Royalties2
(341)
(345)
Repairs and maintenance
(229)
(379)
Fuel
(229)
(398)
Freight
(157)
(231)
Utilities
(254)
(219)
Change in inventories
(40)
38
Other
(401)
(519)
(3,624)
(5,336)
1 Expenses presented above include cost of sales, general and administrative and exploration expenses.
2 Taxes not calculated based on a taxable margin, which includes in the year ended December 31, 2023 a top-up of $76 million to $375 million for the year 2022 at
Cobre Panamá, are included in cost of sales and not in tax expense.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 32
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
121
120
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
20. FINANCE COSTS
2024
2023
Interest expense on debt
(591)
(556)
Interest expense on other financial liabilities
(19)
(19)
Interest expense on financial liabilities measured at
amortized cost
(610)
(575)
Related party finance cost (note 11b)
(124)
(92)
Finance cost accretion on deferred revenue (note 12a)
(61)
(61)
Finance cost accretion on Copper Prepayment Agreement (note 12b)
(36)
–
Accretion on restoration provision
(22)
(17)
Total finance costs
(853)
(745)
Less: interest capitalized (note 6)
54
26
(799)
(719)
21. OTHER EXPENSE
2024
2023
Care and maintenance 1
(253)
–
Foreign exchange gains (losses)
4
(67)
Change in restoration provision for closed properties (note 11c)
39
(4)
Share in loss in joint venture (note 9)
(85)
(18)
Restructuring expense
(14)
(49)
Other income (expenses)
16
(4)
(293)
(142)
1 The Care and maintenance expense for the fourth quarter and full year ended December 31, 2024 includes $39 million and $191 million respectively for Cobre
Panamá.
22. SEGMENTED INFORMATION
The Company’s reportable operating segments are Cobre Panamá, Kansanshi and Trident. Each of the reportable segments
report information separately to the CEO, the chief operating decision maker.
The Corporate & other segment includes the Company's remaining operations, Guelb Moghrein, Las Cruces, Çayeli,
Pyhäsalmi and Ravensthorpe, the metal marketing division which purchases and sells third party material, and the
exploration projects. The Corporate & other segment is responsible for the evaluation and acquisition of new mineral
properties, regulatory reporting, treasury and finance and corporate administration.
The Company’s operations are subject to seasonal aspects, in particular the rainy season in Zambia. The rainy season in
Zambia generally starts in November and continues through April, with the heaviest rainfall normally experienced in the
months of January, February and March. As a result of the rainy season, mine pit access and the ability to mine ore is lower
in the first quarter of the year than other quarters and the cost of mining is higher.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 33
Earnings (Loss) by segment
For the year ended December 31, 2024, segmented information for the statement of earnings (loss) is presented as follows:
Revenue 1
Cost of sales
(excluding
depreciation)
Depreciation
Other
Operating
profit (loss) 2,8
Income tax
expense
Cobre Panamá 3
(6)
–
(43)
(184)
(233)
–
Kansanshi 4
2,059
(1,256)
(251)
(38)
514
(161)
Trident 5
2,196
(1,152)
(311)
(33)
700
(180)
Corporate & other 6,7
553
(411)
(28)
(285)
(171)
(47)
Total
4,802
(2,819)
(633)
(540)
810
(388)
1 Refinery-backed credits presented net within revenue – see note 12.
2 Operating profit (loss) less net finance costs and taxes equals net earnings (loss) for the period on the consolidated statement of earnings (loss).
3 Cobre Panamá is 20% owned by KPMC, a joint venture.
4 On April 4, 2023 the Company’s subsidiary, KMP and ZCCM-IH completed the agreement to convert ZCCM-IH’s dividend rights to a 3.1% royalty interest in KMP.
5 Trident includes Sentinel copper mine and the Enterprise Nickel mine. The Enterprise Nickel mine was declared to be in Commercial production, effective June 1,
2024. $19 million of Enterprise Nickel pre-commercial production revenues are included in the year ended December 31, 2024.
6 Corporate & other includes Guelb Moghrein, Las Cruces, Çayeli and Pyhäsalmi and Ravensthorpe, which was previously reported separately.
7 Corporate & other revenue includes hedge gains and losses recognized on zero cost collar options.
8 Finance costs of $799 million, including interest expense on debt, are not included within operating profit. See note 20.
For the year ended December 31, 2023, segmented information for the statement of earnings (loss) is presented as follows:
Revenue 1
Cost of sales
(excluding
depreciation)
Depreciation
Other
Operating
profit (loss) 2,6
Income tax
(expense)
credit
Cobre Panamá 3
2,513
(1,115)
(531)
(35)
832
(499)
Kansanshi
1,598
(1,245)
(221)
(72)
60
(7)
Trident 4
1,665
(955)
(278)
(40)
392
(106)
Corporate & other 5
680
(728)
(91)
(1,067)
(1,206)
(145)
Total
6,456
(4,043)
(1,121)
(1,214)
78
(757)
1 Refinery-backed credits presented net within revenue – see note 12.
2 Operating profit (loss) less net finance costs and taxes equals net earnings (loss) for the period on the consolidated statement of earnings (loss).
3 Cobre Panamá is 20% owned by KPMC, a joint venture.
4 Trident includes Sentinel copper mine and the Enterprise Nickel project.
5 Corporate & other includes Guelb Moghrein, Las Cruces, Çayeli, Pyhäsalmi and Ravensthorpe
6 Finance costs of $719 million, including interest expense on debt, are not included within operating profit, See note 20.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 34
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
123
122
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
Balance sheet by segment
Segmented information on balance sheet items is presented as follows:
December 31, 2024
December 31, 2023
Non-current
assets 1
Total assets
Total
liabilities
Non-current
assets 1
Total assets
Total liabilities
Cobre Panamá 2
11,500
12,307
2,807
11,533
12,322
2,923
Kansanshi 3
3,251
4,282
850
2,611
3,853
798
Trident 4
2,860
3,656
1,205
2,896
3,669
1,072
Corporate & other 5,6
1,853
3,862
7,343
1,757
3,914
8,187
Total
19,464
24,107
12,205
18,797
23,758
12,980
1 Non-current assets include $19,193 million of property plant and equipment (December 31, 2023: $18,583 million) and exclude financial instruments, deferred tax
assets, VAT receivable and goodwill.
2 Cobre Panamá is 20% owned by KPMC, a joint venture.
3 On April 4, 2023 the Company’s subsidiary, KMP and ZCCM-IH completed the agreement to convert ZCCM-IH’s dividend rights to a 3.1% royalty interest in KMP.
This transaction also provides for 20% of the KMP VAT refunds as at June 30, 2022 to be paid to ZCCM-IH, as and when they are received by KMP from the
ZRA.
4 Trident includes Sentinel copper mine and the Enterprise Nickel mine.
5 Included within the corporate segment are assets relating to the Haquira project, $720 million (December 31, 2023: $711 million), to the Taca Taca project, $492
million (December 31, 2023: $485 million), and to the La Granja project, $249 million (December 31, 2023: $207 million).
6 Corporate & other includes Guelb Moghrein, Las Cruces, Çayeli, Pyhäsalmi and Ravensthorpe, which were previously reported separately.
Purchase and deposits on property, plant and equipment by segment
Additions to non-current assets other than financial instruments, deferred tax assets and goodwill represent additions to
property, plant and equipment, for which capital expenditure is presented as follows:
2024
2023
Cobre Panamá
38
421
Kansanshi
877
426
Trident 1
281
328
Corporate & other
90
125
Total
1,286
1,300
1 Trident includes Sentinel copper mine and the Enterprise nickel mine.
Geographical information
2024
2023
Revenue by destination 1,2,3
Asia & Oceania
3,807
5,156
Europe
490
678
Africa
408
332
Americas
63
290
Hedge gain 2
34
–
Total
4,802
6,456
1 Presented based on the ultimate destination of the product if known. If the eventual destination of the product sold through traders is not known, then revenue is
allocated to the location of the product at the time when control passes.
2 Revenue includes hedge gains recognized on zero cost collar options. $112 million for the year ended December 31, 2024 (December 31, 2023: $nil).
3 For the year ended December 31, 2024, the Company has one customer that individually accounts for more than 10% of the Company’s total revenue. This
customer represents approximately 17% of total revenue (2023: 12%).
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 35
2024
2023
Non-current assets by location
Panama
11,500
11,533
Zambia
6,099
5,495
Peru
956
915
Argentina
491
483
Mauritania
35
48
Spain
42
40
Australia
26
27
Türkiye
32
26
Finland
2
2
Other
281
228
19,464
18,797
Investments, deferred income tax assets, goodwill, restricted cash, other deposits and
VAT receivable
1,426
1,502
20,890
20,299
23. FINANCIAL INSTRUMENTS
The Company classifies its financial assets as amortized cost, FVOCI or FVTPL. Financial liabilities are measured at
amortized cost or FVTPL.
The following provides the classification of financial instruments by category at December 31, 2024:
Amortized
cost 5
Fair value
through
profit or loss
Fair value
through OCI
Total
Financial assets
Trade and other receivables 1
60
209
–
269
Due from KPMC (note 8)
243
–
–
243
Derivative instruments in designated hedge relationships 2
–
–
112
112
Other derivative instruments 3
–
92
–
92
Investments 4
–
–
17
17
Financial liabilities
Trade and other payables
554
–
–
554
Other derivative instruments 3
–
38
–
38
Leases
13
–
–
13
Liability to joint venture
1,180
–
–
1,180
Other loans owed to non-controlling interest
214
–
–
214
Debt 5
6,342
–
–
6,342
1 Commodity products are sold under pricing arrangements where final prices are set at a specified future date based on market commodity prices. Changes
between the prices recorded upon recognition of revenue and the final price due to fluctuations in commodity market prices give rise to an embedded derivative
in the accounts receivable related to the provisionally priced sales contracts.
2 For the year ended December 31, 2024 a fair value gain of $112 million has been recognized on derivatives designated as hedged instruments through
accumulated other comprehensive income. The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is
recognized in other comprehensive income. The time value of hedges for the year ended December 31, 2024, of $50 million is also recognized in other
comprehensive income.
3 Other derivative instruments related to provisionally priced sales contracts are classified as fair value through profit or loss and recorded at fair value, with
changes in fair value recognized as a component of cost of sales.
4 Investments held by the Company are held at fair value through other comprehensive income.
5 The fair value of financial assets and liabilities measured at amortized cost is comparable to the carrying value due to the short term to maturities or due to the
rates of interest approximating market rates.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 36
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
125
124
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
The following provides the classification of financial instruments by category at December 31, 2023:
Amortized
cost4
Fair value
through profit
or loss
Fair value
through OCI
Total
Financial assets
Trade and other receivables 1
161
272
–
433
Due from KPMC (note 8)
188
–
–
188
Other derivative instruments 2
–
14
–
14
Investments 3
–
–
17
17
Financial liabilities
Trade and other payables
831
–
–
831
Other derivative instruments 2
–
62
–
62
Leases
20
–
–
20
Liability to joint venture
1,156
–
–
1,156
Other loans owed to non-controlling interest
202
–
–
202
Debt 4
7,379
–
–
7,379
1 Commodity products are sold under pricing arrangements where final prices are set at a specified future date based on market commodity prices. Changes
between the prices recorded upon recognition of revenue and the final price due to fluctuations in commodity market prices give rise to an embedded derivative
in the accounts receivable related to the provisionally priced sales contracts.
2 Other derivative instruments related to provisionally priced sales contracts are classified as fair value through profit or loss and recorded at fair value, with
changes in fair value recognized as a component of cost of sales.
3 Investments held by the Company are held at fair value through other comprehensive income.
4 The fair value of financial assets and liabilities measured at amortized cost, with the exception of debt, is comparable to the carrying value due to the short term to
maturities or due to the rates of interest approximating market rates. The fair value of debt is $6,510 million as at December 31, 2024.
Fair values
The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the
highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and
the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described
below:
Level 1
Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2
Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly
or indirectly.
Level 3
Inputs for the asset or liability that are not based on observable market data.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 37
The following table sets forth the Company’s assets and liabilities measured at fair value on the balance sheet at December
31, 2024:
Level 1
Level 2
Level 3
Total fair
value
Financial assets
Derivative instruments – LME contracts 1
90
–
–
90
Derivative instruments – OTC contracts 2
—
2
–
2
Derivative instruments in designated hedge relationships 3
—
112
–
112
Investments 4
1
–
16
17
Financial liabilities
Derivative instruments – LME contracts 1
38
–
–
38
Derivative instruments – OTC contracts 2
–
–
–
–
1 Futures for copper, nickel, gold and zinc were purchased on the London Metal Exchange (“LME”) and London Bullion Market and have direct quoted prices,
therefore these contracts are classified within Level 1 of the fair value hierarchy.
2 The Company’s derivative instruments are valued by the Company’s brokers using pricing models based on active market prices. All forward swap contracts held
by the Company are OTC and therefore the valuation models require the use of assumptions concerning the amount and timing of estimated future cash flows
and discount rates using inputs which can generally be verified and do not involve significant management judgment. Such instruments are classified within Level
2 of the fair value hierarchy. Derivative assets are included within other assets on the balance sheet and derivative liabilities are included within provisions and
other liabilities on the balance sheet.
3 For the year ended December 31, 2024 a fair value gain of $112 million has been recognized on derivatives designated as hedged instruments through
accumulated other comprehensive income. The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is
recognized in other comprehensive income. The time value of hedges for the year ended December 31, 2024, of $50 million is also recognized in other
comprehensive income.
4 The Company’s investments in marketable equity securities are classified within Level 1 and Level 3 of the fair value hierarchy. The investments classified within
Level 1 of the fair value hierarchy are valued using quoted market prices in active markets. The fair value of the marketable equity securities is calculated as the
quoted market price of the marketable security multiplied by the quantity of shares held by the Company. The investments in equity securities in non-public
companies are classified within Level 3 of the fair value hierarchy as the valuation is based on unobservable inputs, supported by little or no market activity.
The following table sets forth the Company’s assets and liabilities measured at fair value on the balance sheet at December
31, 2023, in the fair value hierarchy:
Level 1
Level 2
Level 3
Total fair
value
Financial assets
Derivative instruments – LME contracts 1
14
–
–
14
Derivative instruments – OTC contracts 2
–
–
–
–
Investments 3
1
–
16
17
Financial liabilities
Derivative instruments – LME contracts 1
57
–
–
57
Derivative instruments – OTC contracts 2
–
5
–
5
1 Futures for copper, nickel, gold and zinc were purchased on the London Metal Exchange (“LME”) and London Bullion Market and have direct quoted prices,
therefore these contracts are classified within Level 1 of the fair value hierarchy.
2 The Company’s derivative instruments are valued by the Company’s brokers using pricing models based on active market prices. All forward swap contracts held
by the Company are OTC and therefore the valuation models require the use of assumptions concerning the amount and timing of estimated future cash flows
and discount rates using inputs which can generally be verified and do not involve significant management judgment. Such instruments are classified within Level
2 of the fair value hierarchy. Derivative assets are included within other assets on the balance sheet and derivative liabilities are included within provisions and
other liabilities on the balance sheet.
3 The Company’s investments in marketable equity securities are classified within Level 1 and Level 3 of the fair value hierarchy. The investments classified within
Level 1 of the fair value hierarchy are valued using quoted market prices in active markets. The fair value of the marketable equity securities is calculated as the
quoted market price of the marketable security multiplied by the quantity of shares held by the Company. The investments in equity securities in non-public
companies are classified within Level 3 of the fair value hierarchy as the valuation is based on unobservable inputs, supported by little or no market activity.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 38
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
127
126
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
Financial risk management
Credit risk
The Company’s credit risk is primarily attributable to cash and bank balances, short-term deposits, derivative instruments
and trade and other receivables. The Company’s exposure to credit risk is represented by the carrying amount of each class
of financial assets, including commodity contracts, recorded in the consolidated balance sheet.
The Company limits its credit exposure on cash held in bank accounts by holding its key transactional bank accounts with
highly rated financial institutions. The Company manages its credit risk on short-term deposits by only investing with
counterparties that carry investment grade ratings as assessed by external rating agencies and spreading the investments
across these counterparties. Under the Company’s risk management policy, allowable counterparty exposure limits are
determined by the level of the rating unless exceptional circumstances apply. A rating of investment grade or equivalent is
the minimum allowable rating required as assessed by international credit rating agencies. Likewise, it is the Company’s
policy to deal with banking counterparties for derivatives who are rated investment grade or above by international credit
rating agencies and graduated counterparty limits are applied depending upon the rating.
Exceptions to the policy for dealing with relationship banks with ratings below investment grade are reported to, and
approved by, the Audit Committee. As at December 31, 2024, substantially all cash and short-term deposits are with
counterparties of investment grade.
The Company’s credit risk associated with trade accounts receivable is managed through establishing long-term contractual
relationships with international trading companies using industry-standard contract terms. 51% of the Company’s trade
receivables are outstanding from three customers together representing 31% of the total sales for the year. No amounts
were past due from these customers at the balance sheet date. The Company continues to trade with these customers.
Revenues earned from these customers are included within the Kansanshi, Trident, Panama and Çayeli segments. Other
accounts receivable consist of amounts owing from government authorities in relation to the refund of value-added taxes
applying to inputs for the production process and property, plant and equipment expenditures, prepaid taxes and amounts
held in broker accounts.
Significant credit risk exposures to any single counterparty or group of counterparties having similar characteristics are as
follows:
December 31,
2024
December 31,
2023
Commodity traders and smelters (Trade and other receivables)
383
433
Government authorities (VAT receivable)
755
674
Total
1,138
1,107
The VAT receivable due from government authorities includes $515 million at December 31, 2024, which is past due
(December 31, 2023: $521 million). See note 4c.
The carrying amount of financial assets recorded in the financial statements, net of any allowances for losses, represents
the Company’s maximum exposure to credit risk. Expected credit losses on trade and other receivables at December 31,
2024, are insignificant.
Liquidity risk
The Company manages liquidity risk by maintaining cash and cash equivalent balances and available credit facilities to
ensure that it is able to meet its short-term and long-term obligations as and when they fall due. Company-wide cash
projections are managed centrally and regularly updated to reflect the dynamic nature of the business and fluctuations
caused by commodity price and exchange rate movements.
The Company was obligated under its corporate revolving credit and term loan facility to maintain liquidity and satisfy various
covenant ratio tests on a historical cash flow basis. These ratios were in compliance during the year ended December 31,
2024 and December 31, 2023. And current forecasts including judgmental assumptions, do not indicate a breach of financial
covenants. If the Company breaches a covenant in its Financing Agreements, this would be an event of default which, if un-
addressed, would entitle the lenders to make the related borrowings immediately due and payable and if made immediately
due and payable all other borrowings would also be due and payable.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 39
The Company had the following balances and facilities available to them at the balance sheet dates:
December 31,
2024
December 31,
2023
Cash and cash equivalents and bank overdrafts – unrestricted cash
843
1,157
Working capital balance1
1,256
1,293
Undrawn debt facilities (note 10)
1,160
696
1 Working capital includes trade and other receivables (note 4), inventories (note 5), current prepaid expenses (note 8), current trade and other payables, current
taxes payable, current leases (note 11) and current deferred revenue (note 11).
Contractual and other obligations as at December 31, 2024 are as follows:
Carrying
Value
Contractual
Cashflows
<1 Year
1-3 years
3-5 years
Thereafter
Debt - principal
6,226
6,297
382
2,873
1,742
1,300
Debt - finance charges
–
2,078
533
915
462
168
Trading facilities
116
116
116
–
–
–
Trade and other payables
554
554
554
–
–
–
Derivative instruments
38
38
38
–
–
–
Liability to joint venture1
1,180
1,650
–
366
1,284
–
Other loans owed to non-
controlling interest2
214
255
32
–
223
–
Current taxes payable
144
144
144
–
–
–
Deferred payments
15
15
2
3
3
7
Leases
13
11
4
5
1
1
Commitments
–
102
102
–
–
–
Restoration provisions
598
1,427
8
22
62
1,335
9,098
12,687
1,915
4,184
3,777
2,811
1 Refers to distributions to KPMC, a joint venture that holds a 20% non-controlling interest in MPSA of which the Company has joint control, and not scheduled
repayments.
2 Refers to liability with POSCO Holdings, an entity that holds a 24.3% non-controlling interest in FQM Australia Holdings Pty Ltd (“Ravensthorpe”), of which the
Company has full control
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 40
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
129
128
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
Contractual and other obligations as at December 31, 2023 are as follows:
Carrying
Value
Contractual
Cashflows
<1 Year
1-3 years
3-5 years
Thereafter
Debt - principal
7,235
7,268
625
3,843
1,500
1,300
Debt - finance charges
–
1,821
544
670
327
280
Trading facilities
144
144
144
–
–
–
Trade and other payables
831
831
831
–
–
–
Derivative instruments2
62
62
62
Liability to joint venture2
1,156
1,736
–
–
–
1,736
Other loans owed to non-
controlling interest3
202
251
–
28
223
–
Current taxes payable
27
27
27
–
– 0
Deferred payments
18
18
2
4
4
8
Leases
20
22
7
11
3
1
Commitments
–
347
347
–
–
–
Restoration provisions
647
1,267
6
22
42
1,197
10,342
13,794
2,595
4,578
2,099
4,522
1 Other derivative instruments related to provisionally priced sales contracts are classified as fair value through profit or loss and recorded at fair value, with
changes in fair value recognized as a component of cost of sales.
2 Refers to distributions to KPMC, a joint venture that holds a 20% non-controlling interest in MPSA of which the Company has joint control, and not scheduled
repayments.
3 Refers to liability with POSCO Holdings, an entity that holds a 24.3% non-controlling interest in FQM Australia Holdings Pty Ltd (“Ravensthorpe”), of which the
Company has full control.
Market risks
a)
Commodity price risk
The Company is subject to commodity price risk from fluctuations in the market prices of copper, gold, nickel, zinc and other
elements.
As part of the hedging program, the Company has elected to apply hedge accounting for a portion of copper sales. For the
year ended December 31, 2024, a fair value gain of $112 million (2023: nil) has been recognized on derivatives designated
as hedged instruments through accumulated other comprehensive income. The time value of hedges for the year ended
December 31, 2024, of $50 million is also recognized in other comprehensive income.
As at the year ended December 31, 2024, the Company had copper zero cost collar unmargined sales contracts for 181,250
tonnes at weighted average prices of $4.17 per lb to $4.97 per lb outstanding with maturities to December 2025.
The Company is also exposed to commodity price risk on diesel fuel required for mining operations and sulphur required for
acid production. The Company’s risk management policy allows for the management of these exposures through the use of
derivative financial instruments. As at December 31, 2024, and December 31, 2023, the Company had not entered into any
fuel forward contracts.
The Company’s commodity price risk related to changes in fair value of embedded derivatives in accounts receivable
reflecting copper, nickel, gold and zinc sales provisionally priced based on the forward price curve at the end of each quarter.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 41
Derivatives designated as hedged instruments
The Company has elected to apply hedge accounting with the following contracts expected to be highly effective in offsetting
changes in the cash flows of designated future sales. Commodity contracts outstanding as at December 31, 2024, were as
follows:
Open Positions
(tonnes)
Average Contract
price
Closing Market
price
Maturities
Through
Commodity contracts:
Copper zero cost collar
181,250
$4.17/lb - $4.97/lb
$3.95/lb
Dec-25
For the year ended December 31, 2024 a fair value gain of $112 million (year ended December 31, 2023, nil) has been
recognized on derivatives designated as hedged instruments through accumulated other comprehensive income. The
effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized
in other comprehensive income. The time value of hedges for the year ended December 31, 2024, of $50 million (year
ended December 31, 2023, nil) is also recognized in other comprehensive income.
As at December 31, 2023, the Company held no commodity contracts designated as hedged instruments.
Other derivatives
As at December 31, 2024, the Company had entered into the following derivative contracts for copper, gold and nickel in
order to reduce the effects of fluctuations in metal prices between the time of the shipment of metal from the mine site when
the sale is provisionally priced and the date agreed for pricing the final settlement.
Excluding the contracts noted above, as at December 31, 2024, the following derivative positions were outstanding:
Open Positions
(tonnes/oz)
Average
Contract price
Closing Market
price
Maturities
Through
Embedded derivatives in provisionally priced sales contracts:
Copper
85,919
$4.27/lb
$3.95/lb
May-25
Gold
20,122
$2,645/oz
$2,611/oz
Jan-25
Nickel
3,181
$7.38/lb
$6.85/lb
Mar-25
Commodity contracts:
Copper
86,002
$4.27/lb
$3.95/lb
May-25
Gold
20,123
$2,645/oz
$2,611/oz
Jan-25
Nickel
3,168
$7.38/lb
$6.85/lb
Mar-25
As at December 31, 2023, the following derivative positions were outstanding:
Open Positions
(tonnes/oz)
Average Contract
price
Closing Market
price
Maturities
Through
Embedded derivatives in provisionally priced sales contracts:
Copper
109,097
$3.75/lb
$3.84/lb
April 2024
Gold
14,070
$2,049/oz
$2,078/oz
April 2024
Nickel
1,191
$7.69/lb
$7.39/lb
March 2024
Commodity contracts:
Copper
109,175
$3.75/lb
$3.84/lb
April 2024
Gold
14,077
$2,049/oz
$2,078/oz
April 2024
Nickel
1,188
$7.69/lb
$7.39/lb
March 2024
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 42
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
131
130
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
A summary of the fair values of unsettled derivative financial instruments for commodity contracts recorded on the
consolidated balance sheet.
December 31,
2024
December 31,
2023
Commodity contracts:
Asset position
204
14
Liability position
(38)
(62)
The following table shows the impact on net earnings from changes in the fair values of financial instruments of a 10%
change in the copper and gold commodity prices, based on prices at December 31, 2023. There is no impact of these
changes on other comprehensive income except indirectly through the impact on the fair value of investments. The impact of
a 10% movement in commodity prices is as follows:
Average contract price on
December 31
Impact of price change on net
earnings (loss)
2024
2023
2024
2023
Copper
$4.27/lb
$3.75/lb
–
–
Gold
$2,645/oz
$2,049/oz
–
–
Nickel
$7.38/lb
$10.59/lb
n/a
n/a
b)
Interest rate risk
The majority of the Company’s interest expense is fixed however it is also exposed to an interest rate risk arising from
interest paid on floating rate debt and the interest received on cash and short-term deposits.
Deposits are invested on a short-term basis to ensure adequate liquidity for payment of operational and capital expenditures.
To date, no interest rate management products are used in relation to deposits.
The Company manages its interest rate risk on borrowings on a net basis. The Company manages this via primary issuance
of debt on a fixed or floating basis and via interest swaps if deemed necessary. The Company has a policy allowing floating-
to-fixed interest rate swaps targeting 50% of exposure over a five-year period. As at December 31, 2024, and December 31
2023, the Company held no floating-to-fixed interest rate swaps.
At December 31, 2024, the impact on cash interest payable of a 100 basis point change in interest rate would be as follows:
December 31,
2024
Impact of interest rate change on
net earnings (loss)
100 basis point
increase
100 basis point
Interest-bearing deposits, cash at bank and bank
overdrafts
812
9
(9)
Floating rate borrowings drawn
1,987
(24)
24
At December 31, 2023, the impact on cash interest payable of a 100 basis point change in interest rate would be as follows:
December 31,
2023
Impact of interest rate change on
net earnings (loss)
100 basis point
increase
100 basis point
Interest-bearing deposits, cash at bank and bank
overdrafts
959
13
(13)
Floating rate borrowings drawn
2,555
(21)
21
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
First Quantum Minerals Ltd. | 31 December 2024 CONSOLIDATED FINANCIAL STATEMENTS 43
c)
Foreign exchange risk
The Company’s functional and reporting currency is USD. As virtually all of the Company’s revenues are derived in USD and
the majority of its business is conducted in USD, foreign exchange risk arises from transactions denominated in currencies
other than USD. Commodity sales are denominated in USD, the majority of borrowings are denominated in USD and the
majority of operating expenses are denominated in USD. The Company’s primary foreign exchange exposures are to the
local currencies in the countries where the Company’s operations are located, principally the Zambian Kwacha (“ZMW”),
Australian dollar (“A$”) Mauritanian ouguiya (“MRU”), the euro (“EUR”) and the Turkish lira (“TRY”); and to the local
currencies suppliers who provide capital equipment for project development, principally the A$, EUR and the South African
rand (“ZAR”).
The Company’s risk management policy allows for the management of exposure to local currencies through the use of
financial instruments at a targeted amount of up to 100% for exposures within one year down to 50% for exposures in five
years.
As at December 31, 2024, the Company is exposed to currency risk through the following assets and liabilities denominated
in currencies other than USD:
Cash and cash
equivalents
Trade and other
receivables
Investments
Financial
liabilities
CAD
1
–
1
3
GBP
1
–
–
4
AUD
3
–
–
21
ZMW
30
89
–
15
EUR
37
3
–
10
TRY
–
2
–
13
ZAR
4
1
–
9
MRU
–
–
–
5
Others
11
–
–
3
Total
87
95
1
83
Based on the above net exposures as at December 31, 2024, a 10% change in all of the above currencies against the USD
would result in a $10 million increase in the Company’s net earnings (loss) and would result in a $nil million increase or
decrease in the Company’s other comprehensive income.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
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132
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
Capital management
The Company takes a balanced approach to capital management in order to safeguard its ability to continue operate as a
going concern, ensuring sufficient liquidity is available for continued growth, cognizant of the requirements of shareholders
and debt holders the Company considers the items included in equity to be capital.
The Company manages the capital structure and makes adjustments in light of changes in economic conditions and the risk
characteristics of the Company’s assets. In the first quarter of 2024, the Company successfully completed a comprehensive
refinancing increasing the Company’s financial flexibility via the provision of additional liquidity and covenant headroom, as
well as reducing net leverage, and extending the debt maturity profile, to allow for the completion of the S3 Expansion while
the Company continues to focus on a resolution at Cobre Panamá. As a continued part of this strategy to ensure balance
sheet flexibility, the Company refinanced the FQM Trident loan in Q4-2024, maintaining bank support and extending the
maturity.
The Company uses a combination of short-term and long-term debt to finance its operations and development projects.
Typically, floating rates of interest are attached to short-term debt, and fixed rates on senior notes.
24. COMMITMENTS AND CONTINGENCIES
Capital commitments
The Company has committed to $102 million (December 31, 2023: $347 million) in capital expenditures, principally related to
the S3 project at Kansanshi.
Other commitments & contingencies
Due to the size, complexity and nature of the Company’s operations, various legal and tax matters are outstanding from time
to time. The Company is routinely subject to audit by tax authorities in the countries in which it operates and has received a
number of tax assessments in various locations, which are currently at various stages of progress with the relevant
authorities. The outcome of these audits and assessments are uncertain however, the Company is confident of its position
on the various matters under review.
Panama
Introduction
On March 8, 2023, MPSA and the Republic of Panama announced they had reached agreement on the terms and conditions
of a refreshed concession contract (“Refreshed Concession Contract”). MPSA and the Government of Panama ("GOP")
signed the Refreshed Concession Contract on June 26, 2023, and it was subsequently countersigned by the National
Comptroller of Panama. The Refreshed Concession Contract was presented before the Commerce Committee of the
National Assembly of Panama, who recommended the amendment of certain terms of the contract. The Company and GOP
agreed to modifications to the agreement based on these recommendations after a brief period of negotiation. The GOP
cabinet approved the amended terms of the Refreshed Concession Contract on October 10, 2023, and MPSA and the
Republic entered into the agreement the next day. On October 20, 2023, the National Assembly in Panama approved Bill
1100, being the proposal for approval of the Refreshed Concession Contract for the Cobre Panamá mine. On the same day,
President Laurentino Cortizo sanctioned Bill 1100 into Law 406 and this was subsequently published in the Official Gazette.
Panama Constitutional Proceedings and Mining Moratorium.
On October 26, 2023, a claim was lodged with the Supreme Court of Justice of Panama asserting that Law 406 was
unconstitutional. MPSA was not a party to that proceeding. The petitioner argued that Law 406, which gave legal effect to
the Refreshed Concession Contract, was unconstitutional.
On November 3, 2023, the National Assembly of Panama approved Bill 1110, which President Cortizo sanctioned into Law
407 and which was published the same day in the Official Gazette. Law 407 declares a mining moratorium for an indefinite
duration within Panama, including preventing any new mining concession from being granted or any existing mining
concessions from being renewed or extended.
On November 28, 2023, the Supreme Court issued a ruling declaring Law 406 unconstitutional and stating that the effect of
the ruling is that the Refreshed Concession Contract no longer exists. The ruling was subsequently published in the Official
Gazette on December 2, 2023. The Supreme Court did not order the closure of the Cobre Panamá mine.
On December 19, 2023, the (now former) Minister for Commerce and Industry announced plans for Cobre Panamá following
the ruling of the Supreme Court. The validity of Panama’s Mineral Resources Code which was established more than 50
years ago was reiterated by the Minister given the absence of retroactivity of the Supreme Court ruling. As part of these
plans, a temporary phase of environmental Preservation and Safe Management would be established during which
intervening period independent audits, review and planning activities would be undertaken. It was stated that Panama would
be the first country in the world to implement a sudden mine closure of this magnitude, and therefore the planning is
estimated by the GOP to take up to two years, and 10 years or more to implement. The (now former) Minister for Commerce
and Industry also announced plans to consider the economic impacts of the halt to operations of Cobre Panamá at both a
national and local level. The Company is of the view, supported by the advice of legal counsel, that it has acquired rights with
respect to the operation of the Cobre Panamá project, as well as rights under international law.
As at December 31, 2023, the Company is exposed to currency risk through the following assets and liabilities denominated
in currencies other than USD:
Cash and cash
equivalents
Trade and other
receivables
Investments
Financial
liabilities
CAD
1
—
1
6
GBP
2
—
—
8
AUD
3
1
—
72
ZMW
25
1
—
22
EUR
50
7
—
36
TRY
—
—
—
9
ZAR
4
—
—
70
MRU
—
—
—
72
Others
2
—
—
(13)
Total
87
9
1
282
Based on the above net exposures as at December 31, 2023, a 10% change in all of the above currencies against the USD
would result in a $19 million increase or decrease in the Company’s net earnings (loss) and would result in a $nil million
increase or decrease in the Company’s other comprehensive income.
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
2.
On November 14, 2023, First Quantum submitted a notice of intent to the GOP initiating the consultation period
required under the FTA. First Quantum submitted an updated notice of intent on February 7, 2024. First Quantum
is entitled to seek any and all relief appropriate in arbitration, including but not limited to damages and reparation
for Panama’s breaches of the Canada-Panama FTA. These breaches include, among other things, the GOP’s
failure to permit MPSA to lawfully operate the Cobre Panamá mine prior to the Supreme Court’s November 2023
decision, and the GOP’s pronouncements and actions concerning closure plans and P&SM at Cobre Panamá. The
Company has the right to file its arbitration claim under the FTA within three years of Panama's breaches of the
FTA.
Kansanshi – conversion of ZCCM dividend rights to royalty rights
On April 4, 2023 the Company’s subsidiary, Kansanshi Mining Plc and ZCCM-IH completed the agreement to convert
ZCCM-IH’s dividend rights to a 3.1% royalty interest in Kansanshi Mining Plc. The transaction also provides for 20% of the
KMP VAT refunds as at June 30, 2022 to be paid to ZCCM-IH, as and when these are received by KMP from the ZRA.
Accordingly, the non-controlling interest in the consolidated financial statements has been derecognized, with no gain or loss
arising. An adjustment has been made against the book value of Kansanshi Mining Plc’s mineral property within Property,
Plant and Equipment (note 6) and ZCCM IH’s right to VAT refunds has been recognized as a liability (note 11).
government required time to assess the situation concerning the mine. A final hearing for this matter is now
scheduled for February 2026.
Cobre Panamá currently remains in a phase of P&SM with production halted. Approximately 1,300 workers remain on site
and further workforce reductions may occur depending on the timing of the P&SM program that would permit the shipment of
121 thousand dry metric tonnes of copper concentrate that remains on site. Implementation of the P&SM program continues
to await approval from the Panamanian authorities.
At the request of the Ministry of Commerce and Industries (“MICI”), Cobre Panamá delivered a draft plan for the first phase
of the P&SM plan on January 16, 2024. Following a request for additional information and clarification from MICI, an updated
and expanded plan was presented to the Government of Panama (“GOP”) on March 26, 2024. On May 13, 2024, an
Intergovernmental Commission that had been convened to inspect the site and review the P&SM plan issued its Inspection
Report and recommendation for approval and implementation of the plan and its key activities, including the export of copper
concentrate that has been stored at site since operations were suspended, reactivation of the power plant, determining a
means of dealing with the sulphur containing ore stockpiles and providing material for the embankment walls of the tailings
facility. On June 11, 2024, the government, through MICI, requested additional updated information regarding the stability of
the Tailing Management Facility (“TMF”), which the company provided on June 17, 2024. Subsequently, there was an
election and a change of government on July 1, 2024. The incoming administration reviewed the P&SM plan upon taking
office in July 2024 and requested additional information, which was submitted by the Company on August 27, 2024, along
with a formal presentation to MICI on September 25, 2024. The plan is still pending government approval, and therefore not
all aspects of the plan have been able to be implemented by the Company.
The general elections were held in Panama during May 2024 and a new government took office on July 1, 2024 under the
leadership of President José Raúl Mulino. President Mulino has made public statements to the effect that his government
intends to address the Cobre Panamá mine in early 2025. The GOP also announced that an integrated audit of Cobre
Panamá would be conducted with international experts to establish a factual basis to aid in decision making for the future of
the mine.
On January 6, 2025, Panama’s Ministry of Environment (“MiAMBIENTE”) released the Terms of Reference for an
Environmental Audit of the Cobre Panamá mine. The audit will be conducted by international experts to provide updated
information on the status of the mine and support the GOP’s decision-making. The Terms of Reference for the
Environmental Audit were submitted to a public consultation process that concluded on February 7, 2025. Separately, an
independent audit of the copper concentrate stored on site was completed by the government in December 2024, which
confirmed the quantities of copper concentrate stored at the facilities.
Arbitration Proceedings
Steps towards two arbitration proceedings have been taken by the Company. One under the Canada-Panama Free Trade
Agreement (FTA), and another under the International Chamber of Commerce (“ICC”) pursuant to the arbitration clause of
the Refreshed Concession Contract.
1.
On November 29, 2023, Minera Panamá S.A. (“MPSA”) initiated arbitration before the ICC's International Court of
Arbitration pursuant to the ICC’s Rules of Arbitration and Clause 46 of the Refreshed Concession Contract, to
protect its rights under Panamanian law and the Refreshed Concession Contract that the GOP agreed to in
October 2023. The arbitration clause of the contract provides for arbitration in Miami, Florida. The GOP requested
an extension to the proceedings following the replacement of external legal counsel and on the basis that the new
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
Notes to the Consolidated Financial Statements
(expressed in millions of U.S. dollars, except where indicated and share and per share amounts)
FIRST QUANTUM MINERALS LTD. | 2024 ANNUAL REPORT
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136
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONT’D
Corporate Information
REGISTERED OFFICE
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MANAGEMENT
AND OFFICERS
TRISTAN PASCALL
Chief Executive Officer
RYAN MACWILLIAM
Chief Financial Officer
RUDI BADENHORST
Chief Operating Officer
SARAH COMBER
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JULIET WALL
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ZENON WOZNIAK
Director, Projects
JOHN GREGORY
Director, Mining
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2024 ANNUAL REPORT
FIRST QUANTUM MINERALS LTD.
www.first-quantum.com