Don Lindsey (11.02.2015):
"We were pleased with our operating performance in 2015, meeting our guidance, reducing our costs and raising nearly $1 billion through two streaming transactions to strengthen our balance sheet," said Don Lindsay, President and CEO. "However, the commodity cycle continues to provide us with a very challenging environment such that our near-term priorities are to keep all of our operations cash flow positive, meet our commitment to Fort Hills with internal sources of funds, evaluate options to further strengthen our liquidity and maintain a strong financial position by ending the year without drawing on our lines of credit."
Highlights and Significant Items:
-Gross profit before depreciation and amortization in 2015 was $2.6 billion compared with $2.9 billion in 2014. Gross profit before depreciation and amortization was $614 million in the fourth quarter compared with $757 million in the fourth quarter of 2014.
-Cash flow from operations, before working capital changes, was $1.7 billion in 2015 compared with $2.0 billion last year. Cash flow from operations, before working capital changes, was $428 million in the fourth quarter of 2015 compared with $491 million a year ago.
-Our quarterly loss included impairment charges of $736 million on a pre-tax basis, including $45 million on our steelmaking coal assets, $93 million on copper and $598 million on the Fort Hills oil sand project resulting in a $536 million after-tax charge. For 2015, total pre-tax asset impairment charges were $3.6 billion and $2.7 billion on an after-tax basis.
-Adjusted EBITDA for 2015 (not including the non-cash impairment charges) was $2.0 billion compared with $2.4 billion in 2014.
Our liquidity remains strong with a cash balance of $1.8 billion at February 10, and US$3.0 billion available under our revolving credit facility which matures in 2020.
-Construction of the Fort Hills oil sands project is more than 50% complete and progressing substantially on schedule and on budget. As at February 10, our remaining cash funding to complete the project is $1.2 billion.
-We received a payment of $789 million (US$610 million) for the sale of a silver stream linked to our share of the Antamina mine.
Cash unit production costs were reduced at all of our operations in 2015 compared with a year ago as a result of the highly focused efforts on our cost reduction program and lower diesel prices.
-We have reached agreements with the majority of our steelmaking coal customers for the first quarter of 2016, based on a quarterly benchmark of US$81 per tonne for the highest quality product, and we expect total sales in the first quarter, including spot sales, to be at least 5.5 million tonnes of steelmaking coal.
We were recognized as one of the Global 100 Most Sustainable Corporations for the fourth consecutive year by media and investment research company Corporate Knights.
-Operating highlights in 2015 included:
all our operating mines, with the exception of Quebrada Blanca and Pend Oreille, remained cash positive in the fourth quarter and for 2015,
we achieved record annual production at Trail for refined zinc and silver, and
we achieved record annual mill throughput at Antamina.
If we meet our full year guidance for production, costs and capital expenditures, assuming current commodity prices and exchange rates and no unusual transactions or events, we should complete 2016 with at least $500 million in cash without any material change in our overall U.S. dollar debt level. |
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