First Quantum Minerals Reports Operational And Financial Results For Three Months And Year Ended December 31, 2004.VANCOUVER, British Columbia British Columbia, province (2001 pop. 3,907,738), 366,255 sq mi (948,600 sq km), including 6,976 sq mi (18,068 sq km) of water surface, W Canada. Geography -- (All figures expressed in US dollars) First Quantum Minerals First Quantum Minerals Ltd. is a growing mining and metals company whose principle activities include mineral exploration, development and mining. The Company produces LME grade "A" copper cathode, copper in concentrate, gold and sulphuric acid. Ltd. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :FM)(OTCBB OTCBB See OTC Bulletin Board (OTCBB). :FQVLF)(LSE LSE - Language Sensitive Editor :FQM FQM Fédération Québécoise des Municipalités (Canada) FQM Fédération Québécoise des Massothérapeutes FQM Food Quality Management FQM Fundamental Query and Manipulation FQM Field Quality Management ) is pleased to announce results for the three months and year ended December 31, 2004. The complete financial statements are available for review at www.first-quantum.com.
Summary Table
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2004 2003
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Fourth Twelve Fourth Twelve
Quarter Months Quarter Months
Financial Data (millions) (Oct-Dec) (Jan-Dec) (Oct-Dec) (Jan-Dec)
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Revenues $30.7 $113.5 $19.9 $60.4
Cash flow, (before operating
working capital movements) $n9.8 $ 46.3 $ 8.4 $18.1
Cash flow, (after operating
working capital movements) $ 2.9 $ 30.7 $ 8.2 $16.9
Net earnings $ 9.3 $ 28.0 $ 1.4 $ 4.6
Weighted average shares
outstanding ('000) 60,942 60,123 55,984 50,668
Per Share Data
Cash flow, (before operating
working capital movements) $0.16 $ 0.77 $0.15 $0.36
Cash flow, (after operating
working capital movements) $0.05 $ 0.51 $0.15 $0.33
Net earnings $0.16 $ 0.47 $0.02 $0.09
Operating Data
Finished Copper
Production (tonnes) 10,942 41,546 9,558 29,513
Sulphuric Acid
Produced (tonnes) 35,671 140,200 33,035 132,951
Sulphuric Acid
Sold (tonnes) 9,664 66,460 15,689 75,228
Realized Copper
Price (US$/lb) $1.20 $ 1.13 $0.84 $0.75
Total Cost (C3)
Copper (US$/lb) $0.59 $ 0.62 $0.66 $0.62
Cash Cost (C1)
Copper (US$/lb) $0.48 $ 0.46 $0.47 $0.44
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Notable Events - Kansanshi commissioning underway, ZESCO ZESCO Zambia Electricity Supply Corporation ZESCO Zoll Equipment Supply Company power line energized - New copper discovery at Kashime in Zambia Financial Results (see attached financial statements) Fourth quarter revenues were $30.7 million (Q3: $31.2m; Q2: $26.3m; Q1: $25.3m; Q4'03: $19.9m) which principally comprised copper revenues of $29.2 million (Q3: $28.6m; Q2: $23.4m; Q1: $22.1m; Q4'03: $17.5m) and acid revenues of $1.5 million (Q3: $2.6m; Q2: $2.9m; Q1: $3.2m; Q4'03: $2.4m). Copper revenues were consistent with the third quarter as a result of a 3% increase in the realized copper price which was offset by slightly lower copper sales (2%). Acid revenues have fallen by approximately $1.1 million on the lower acid available for sale at Bwana Mkubwa. The availability of acid for sale was reduced as the gangue gangue also gang n. Worthless rock or other material in which valuable minerals are found. [French, from German Gang, lode, from Middle High German ganc acid consumption ratio (tonnes of acid consumed per tonne tonne measure of weight or mass; 1 tonne=1000 kg. See also ton. of copper produced) increased to 2.3 (Q3: 1.7; Q2: 1.6; Q1: 1.4; Q4'03: 1.8) at Bwana Mkubwa. Gross profit for the fourth quarter of 2004 was $16.2 million (Q3: $17.1m; Q2: $13.2m; Q1: $13.2m; Q4'03: $7.0m) reflecting the increased copper revenues from Bwana Mkubwa. The cash flow from operating activities, after changes in working capital, was $2.9 million (Q3: $10.4m; Q2: $10.8m; Q1: $6.6m; Q4'03: $8.2m) or $0.05 per share (Q3: $0.17; Q2: $0.18; Q1: $0.11; Q4'03: $0.15). Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses was adversely impacted by movements in working capital of $7.0 million for the quarter. The cash flow from operating activities, before changes in non-cash working capital, was $9.8 million (Q3: $12.9m; Q2: $11.5m; Q1: $12.1m; Q4'03: $8.4m) or $0.16 per share (Q3: $0.21; Q2: $0.19; Q1: $0.21; Q4'03: $0.15). Net earnings for the fourth quarter were $9.3 million (Q3: $7.9m; Q2: $4.1m; Q1: $6.7m; Q4'03: $1.4m) or $0.16 per share (Q3: $0.13; Q2: $0.07; Q1: $0.11; Q4'03: $0.02). The realized copper price rose to $1.20 per pound (Q3: $1.16/lb; Q2: $1.11/lb; Q1: $1.03/lb; Q4'03: $0.84/lb). The average LME See London Metal Exchange. LME See London Metal Exchange (LME). price for the fourth quarter was $1.31 per pound (Q3: $1.27/lb; Q2: $1.23/lb; Q1: $1.23/lb; Q4'03: $0.89/lb). The difference between the LME price and the realized price was due to realization charges and copper forward contracts entered into in 2003. During the three months ended, December 31, 2004, the company delivered into 3,000 tonnes of copper forward sales forward sales npl → ventas fpl a término contracts at an average realized price of $0.88 per pound. As at January 1, 2005, the company no longer has any forward copper sales contracts Sales Contract Contract between a seller and buyer for the sale of goods, services, or both. in place at Bwana. For 2004, revenues increased to $113.5 million (2003: $60.4m; 2002: $51.1m) which comprised copper revenues of $103.3 million (2003: $49.4m; 2002: $17.0m) and acid revenues of $10.2 million (2003: $11.0m; 2002: $12.8m). Revenues were up 88% on the comparative period due to improved copper prices and a 40% increase in copper sales at Bwana Mkubwa. Acid revenues have remained consistent with the comparative periods as slightly higher acid prices and acid production has offset higher internal consumption due to the increase in copper production at Bwana Mkubwa. Gross profit for 2004 was $59.7 million (2003: $19.1m; 2002: $4.0m) reflecting the increased copper revenues from Bwana Mkubwa. The cash flow from operating activities, after changes in working capital, was $30.7 million (2003: $16.9m; 2002: ($4.1m)) or $0.51 per share (2003: $0.33; 2002: ($0.09)). Cash flow from operating activities was impacted by movements in operating working capital of $15.6 million for the year. The cash inflow in·flow n. 1. The act or process of flowing in or into: an inflow of water; an inflow of information. 2. from operating activities, before changes in working capital, was $46.3 million (2003: $18.1m; 2002: ($0.6m)) or $0.77 per share (2003: $0.36; 2002: ($0.01)). Net earnings for 2004 increased to $28.0 million (2003: $4.6m; 2002: ($3.8m)) or $0.47 per share (2003: $0.09; 2002: ($0.09)). The realized copper price rose to $1.13 per pound (2003: $0.75/lb; 2002: $0.65/lb). The LME copper price remained strong for 2004 with LME copper inventories falling and demand remaining strong from China. The average LME price for 2004 was $1.23 per pound (2003: $0.81/lb; 2002: $0.71/lb). The difference between the LME price and the realized price was due to realization charges and hedging copper forward contracts entered into in 2003. During 2004, the company delivered into 12,000 tonnes of copper forward sales contracts at an average realized price of $0.87 per pound. Bwana Mkubwa SX/EW Facility, Zambia (100%) During the fourth quarter 2004, copper production was 10,942 tonnes (Q3: 11,330t; Q2: 9,585t; Q1: 9,689t, Q4'03: 9,558t). The small decrease from the third quarter can be attributed to the failure of a rectiformer and an electrical short that occurred during the period in the electrowinning plant at Bwana Mkubwa. Cash costs (C1) were $0.48 per pound (Q3: $0.45/lb; Q2: $0.48/lb; Q1: $0.39/lb, Q4'03: $0.47/lb) and total costs (C3) were $0.59 per pound (Q3: $0.68/lb; Q2: $0.67/lb; Q1: $0.53/lb, Q4'03: $0.66/lb). The increase in C1 costs can be attributed to the higher gangue acid consumption which has impacted the cash costs in two distinct ways. Firstly, the C1 costs are up $0.02 per pound due to the higher acid consumption and secondly, the acid available for resale resale n. selling again, particularly at retail. In many states a "resale license" or "resale number" is required so that the state can monitor the collection of sales tax on retail sales. RESALE. has been reduced resulting in the acid credit falling by $0.03 per pound. The combined $0.05 per pound increase has been partially offset by an improvement in processing costs of $0.02 per pound on quarter three. Acid production decreased slightly to 35,671 tonnes (Q3: 35,920t; Q2: 34,265t; Q1: 34,344t, Q4'03: 33,035t) of which 9,664 tonnes (Q3: 16,884t; Q2: 19,149t; Q1: 20,763t, Q4'03:15,689t) of surplus acid production was sold. The decrease in surplus acid sold was as a result of the higher gangue acid consumption at Bwana. For the year ended December 31, 2004, copper production increased to 41,546 tonnes (2003: 29,513t; 2002: 11,878t). The 40% increase in production has resulted from a steady state of production being reached as well as Bwana Mkubwa realizing the benefits of the new ore-delivery system and other processing initiatives. In addition, the electrical current flow through the new tank house at Bwana Mkubwa has been increased which has enabled more copper to be plated. Cash costs (C1) for the year were $0.46 per pound (2003: $0.44/lb; 2002: $0.27/lb) and total costs (C3) were $0.62 per pound (2003: $0.62/lb; 2002: $0.52/lb). Cash costs (C1) have risen from 2003 to 2004 principally due to the acid credit per pound of copper produced has fallen from $0.08 to $0.06 per pound. Acid production was 140,200 tonnes (2003: 132,951t; 2002: 140,263t), of which 66,460 tonnes (2003: 75,228t; 2002: 88,198t) was surplus acid production that was sold to external customers. The increase in acid production was due to problems experienced in 2003 that were resolved by the start of 2004. The maintenance programs undertaken in 2003 were also more extensive in 2004. Although the acid production has actually increased, the acid available for resale has decreased due to the increased acid consumption through the Bwana Mkubwa copper circuit. Acid consumption during 2004 was 73,298 tonnes (2003: 57,573t; 2002: 51,392t), which has meant that less acid was available for resale. The increase of 27% in acid consumption has been driven by a 41% increase in copper production less the effects of a slightly improved acid consumption rate per tonne of copper produced of 1.8 (2003: 2.0; 2002: 4.3). Lonshi Copper Mine, Democratic Republic of Congo (100%) During the fourth quarter 2004, approximately 261,000 tonnes (Q3: 257,000t; Q2: 85,000t; Q1: 66,000t) of ore grading 6.4% (Q3: 4.7%; Q2: 5.2%; Q1: 5.4%) and approximately 2,926,000 tonnes (Q3: 4,213,000t; Q2: 2,854,000t; Q1: 1,036,000t) of waste were mined from Lonshi. The strip ratio (ratio of waste to ore) for the quarter was approximately 11:1. The total material mined was 3,187,000 tonnes (Q3: 4,470,000t; Q2: 2,939,000t; Q1: 1,102,000t). The 29% reduction in mined material was due to constraints CONSTRAINTS - A language for solving constraints using value inference. ["CONSTRAINTS: A Language for Expressing Almost-Hierarchical Descriptions", G.J. Sussman et al, Artif Intell 14(1):1-39 (Aug 1980)]. surrounding sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. drilling capacity at Lonshi. During the quarter, the push-backs to the east of pit encountered dolomitic dol·o·mite n. 1. A white or light-colored mineral, essentially CaMg(CO3)2, used in fertilizer, as a furnace refractory, and as a construction and ceramic material. 2. rocks which required drilling and blasting Before the advent of tunnel boring machines, drilling and blasting was the only economical way of excavating long tunnels through hard rock, where digging is not possible. Even today, the method is still used in the construction of particularly long tunnels, where a TBM is . Waste mining in the Southern push-back has continued from the third quarter with the expectation that the ore zone will be reached in the first quarter of 2005. The company has also continued its efforts to improve the dewatering Dewatering (dē′wöd·ər·iŋ) is the removal of water from solid material or soil by wet classification, centrifugation, filtration, or similar solid-liquid separation processes. of the Lonshi pit, with more in-pit pumps and bigger boreholes being used. These initiatives will add to the company's ability to manage the water ingress An entrance. Contrast with "egress," which means exit. See ingress traffic. See also Ingres 2006. and continue to mine efficiently in the wet season. In 2004, approximately 669,000 tonnes (2003: 711,000t; 2002: 1,195,000t) of ore grading 5.5% (2003: 4.8%; 2002: 4.6%) and approximately 11,029,000 tonnes (2003: 4,487,000t; 2002: 4,156,000t) of waste were mined in total. Due to the increased copper production at Bwana Mkubwa and the need to re-establish a strategic stockpile stock·pile n. A supply stored for future use, usually carefully accrued and maintained. tr.v. stock·piled, stock·pil·ing, stock·piles To accumulate and maintain a supply of for future use. , the size of the mining fleet at Lonshi has increased significantly to cope with this increased demand. The strip ratio for the year was 16:1 (2003: 6:1; 2002: 3:1). As a result, the Company has deferred costs of approximately $3.4 million since December 31, 2003 associated with its mining program at Lonshi. In 2003, the company had provided for an additional $2.7 million associated with the mining program at Lonshi. On April 1, 2004 as a result of the on-going exploration program at Lonshi, the mine reserve was increased to 225,000 tonnes of acid soluble soluble /sol·u·ble/ (sol´u-b'l) susceptible of being dissolved. sol·u·ble adj. Capable of being dissolved, especially easily dissolved. copper as at April 1, 2004. In the light of this reserve increase, and the prevailing improvement in copper price, a new mine plan was generated. The new mine plan has a life-of-mine stripping ratio of 12:1 compared to the previous plan of 8:1. Kansanshi Copper-Gold Deposit, Zambia (80%) At Kansanshi, construction was completed. Waste stripping and ore stockpiling stock·pile n. A supply stored for future use, usually carefully accrued and maintained. tr.v. stock·piled, stock·pil·ing, stock·piles To accumulate and maintain a supply of for future use. commenced. The new 330Kv ZESCO power line was energized and commissioning began. Commissioning has been prioritized, with the staged introduction of water and ore through the plant, commencing with the sulphide sulphide: see sulfide. circuit, and followed by the oxide oxide, chemical compound containing oxygen and one other chemical element. Oxides are widely and abundantly distributed in nature. Water is the oxide of hydrogen. Silicon dioxide is the major component of sand and quartz. circuit. During fourth quarter 2004, approximately 1,346,000 tonnes (Q3: 0t) of ore grading 2.4% and approximately 2,857,000 tonnes of waste (Q3: 1,175,000t) were mined. The strip ratio for the quarter was 2:1 which was greater than the life of mine mine strip ratio. This resulted in costs of approximately $0.4 million being deferred for the quarter. The ore was comprised of 307,000 tonnes of sulphide ore and 1,039,000 tonnes of oxide ore. Mining has been concentrated in the Main pit as this is the principal source of the sulphide ores. The phased start up at Kansanshi has meant that the focus has been on providing sulphide ores as the sulphide circuit was commissioned first. As expected with any commissioning, the mining program at Solwezi has faced a number of challenges including rain delays of up to 4 hours per day which have restricted access to the pit, and reduced truck availability resulting from problems associated with the supply of tyres, and spare parts Spare parts, also referred to as Service Parts is a term used to indicate extra parts available and in proximity to the mechanical item, such as a automobile, boat, engine, for which they might be used. Spare parts are also called “spares. , as well as fuel system faults. Notwithstanding these challenges the company as at December 31, 2004 has still managed to stockpile 157,000 tonnes of sulphide ore and 1,039,000 tonnes of oxide ore for future processing. In the fourth quarter, Kansanshi crushed 94,270 dry tonnes of ore and milled 59,316 dry tonnes of ore. This in combination with the commissioning at the sulphide circuit has meant that as at the end of December 2004, Kansanshi had produced 441 tonnes of copper concentrate. Frontier (formerly Lufua) Copper Deposit, Democratic Republic of Congo (100%) In May, First Quantum announced the results of an independent copper-cobalt resource estimate completed at its wholly owned Frontier Project located in Haut Katanga Province For other uses, see Katanga (disambiguation). Katanga is the southern province of the Democratic Republic of the Congo, due under the new constitution to be replaced by four smaller provinces by February 2009. , Democratic Republic of Congo. The 43-101 compliant resource, at a 0.5% cutoff, is 87.6 million tonnes grading 1.17% copper or one million tonnes of contained copper. In addition, drilling has outlined a discrete, high grade cobalt Cobalt, town, Canada Cobalt (kō`bôlt), town (1991 pop. 1,470), E Ont., Canada, NE of Sudbury, near Lake Timiskaming. Once a center for cobalt and silver mining, the area is now economically depressed. resource of 5.6 million tonnes grading 0.169% cobalt that occurs within the larger copper resource. Frontier is located near the town of Sakania in the DRC DRC Democratic Republic of Congo DRC Down (Stage) Right Center DRC Director(ate) of Reserve Components DRC Disability Rights Commission (United Kingdom) , within 2 km of the Zambian border, and the paved pave tr.v. paved, pav·ing, paves 1. To cover with a pavement. 2. To cover uniformly, as if with pavement. 3. To be or compose the pavement of. highway that parallels it, roughly equidistant e·qui·dis·tant adj. Equally distant. e  qui·dis tance n. between the city of Ndola (35 kilometres) to the
southeast and the Mopani Mopani or mopane can be:
Mineralization Mineralization The process by which the body uses minerals to build bone structure. Mentioned in: Rickets mineralization, n the bioprecipitation of an inorganic substance. at Frontier is hosted predominantly pre·dom·i·nant adj. 1. Having greatest ascendancy, importance, influence, authority, or force. See Synonyms at dominant. 2. within altered and veined Katangan metapelites, interpreted to be contained within a shallow northwest plunging plunge v. plunged, plung·ing, plung·es v.tr. 1. To thrust or throw forcefully into a substance or place: , north eastward dipping syncline, with the thickest mineralization developed on the west limb of this fold. Oxidation oxidation /ox·i·da·tion/ (ok?si-da´shun) the act of oxidizing or state of being oxidized.ox·idative ox·i·da·tion n. 1. The combination of a substance with oxygen. 2. extends to variable depths across the deposit, and is strongly influenced by post mineral faulting. The deposit is open along strike to the northwest, and is open down dip to the northeast. In-fill drilling to move the resource into the reserve category was completed. Metallurgical met·al·lur·gy n. 1. The science that deals with procedures used in extracting metals from their ores, purifying and alloying metals, and creating useful objects from metals. 2. testing and preliminary feasibility work contuniue. Updated resource/reserve statements, as well as a Project Engineering Report, are expected to be published in the first half of 2005. Guelb Moghrein Copper-Gold Deposit, Mauritania (80%) During the second quarter of 2004, First Quantum announced the purchase an 80% interest in the Guelb Moghrein copper - gold project in Mauritania. As at November 1, 2004, all agreements applying to the acquisition had been finalized See finalization. . The Guelb Moghrein copper-gold deposit is located 250 kilometres northeast of the nation's capital, Nouakchott, near the town of Akjoujt, and is accessible by paved highway. It consists of an open pit mineable, copper/gold deposit containing a measured and indicated resource of 23.7 million tonnes grading 1.88% total copper and 1.41 gram per tonne gold, as estimated by Kilborn-SNC Lavalin Europe Limited, for a previous owner. This resource was estimated in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the Australasian Code for Reporting of Identified Mineral Resources Noun 1. mineral resources - natural resources in the form of minerals natural resource, natural resources - resources (actual and potential) supplied by nature and Ore Reserves, July 1998, and hence is believed to have been done to the industry standards then pertaining per·tain intr.v. per·tained, per·tain·ing, per·tains 1. To have reference; relate: evidence that pertains to the accident. 2. . The resource, which First Quantum considers relevant, has not been verified by a Qualified Person for First Quantum as required by National Instrument 43-101. First Quantum is not treating the resource as a National Instrument 43-101 defined resource and therefore it should not be relied upon. First Quantum intends to establish a new resource under National Instrument 43-101 guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. in due course. First Quantum intends to develop Guelb Moghrein with production expected by the fourth quarter of 2005. Production will be initially targeted at approximately 30,000 tonnes of copper and 50,000 ounces of gold per year in the form of a copper-gold concentrate which will be trucked to the port of Nouakchott and exported to International smelters. Kashime Copper Prospect, Zambia (100%) In December, First Quantum announced the results of a reverse circulation drill program completed at the Kashime prospect (Kashime). Kashime is located approximately 40 kilometres north of the town of Mkushi, which has paved highway access to the Copperbelt, as well as limited services. Kashime is approximately 140 kilometres by paved and dirt road dirt road n (US) → camino sin firme dirt road n → chemin non macadamisé or non revêtu dirt road dirt n from First Quantum's Bwana Mkubwa SX/EW facility, near Ndola. Mineralization at Kashime occurs as disseminated disseminated /dis·sem·i·nat·ed/ (-sem´i-nat?ed) scattered; distributed over a considerable area. dis·sem·i·nat·ed adj. Spread over a large area of a body, a tissue, or an organ. to semi massive bornite bornite Common copper-ore mineral, copper and iron sulfide (Cu5FeS4). Typical occurrences are found in Mount Lyell, Tasmania; Chile; Peru; and Butte, Mont. Bornite may form isometric crystals but occurs most commonly as irregular masses. and chalcopyrite chalcopyrite (kăl'kəpī`rīt, kăl`kōpī'rīt) or copper pyrites (pīrī`tēz, pə–), brass-yellow mineral, sometimes with an iridescent tarnish. , oxidized oxidized having been modified by the process of oxidation. oxidized cellulose see absorbable cellulose. in part, and is hosted by an altered, schistose schist n. Any of various medium-grained to coarse-grained metamorphic rocks composed of laminated, often flaky parallel layers of chiefly micaceous minerals. , carbonaceous car·bo·na·ceous adj. Consisting of, containing, relating to, or yielding carbon. carbonaceous Adjective of, resembling, or containing carbon Adj. 1. sandstone sandstone, sedimentary rock formed by the cementing together of grains of sand. The usual cementing material in sandstone is calcium carbonate, iron oxides, or silica, and the hardness of sandstone varies according to the character of the cementing material; quartz unit overlain o·ver·lain v. Past participle of overlie. by a barren bar·ren adj. 1. Not producing offspring. 2. Incapable of producing offspring. barren see infertility. barren adjective Gynecology Infertile, sterile, fruitless, inconceivable hanging wall dolomitic marble. The mineralized min·er·al·ize v. min·er·al·ized, min·er·al·iz·ing, min·er·al·iz·es v.tr. 1. To convert to a mineral substance; petrify. 2. To transform a metal into a mineral by oxidation. 3. unit dips southwards south·ward adv. & adj. Toward, to, or in the south. n. A southward direction, point, or region. south at 10 - 20 degrees, and depth of oxidation is controlled by proximity to faulting. The drill program tested the most anomalous a·nom·a·lous adj. 1. Deviating from the normal or common order, form, or rule. 2. Equivocal, as in classification or nature. 1000 metre metre In poetry, the rhythmic pattern of a poetic line. Various principles have been devised to organize poetic lines into rhythmic units. Quantitative verse, the metre of Classical Greek and Latin poetry, measures the length of time required to pronounce syllables, long section of a 2000 metre long, +300 parts per million parts per million mg/kg or ml/l; see ppm. copper soil anomaly Abnormality or deviation. Pronounced "uh-nom-uh-lee," it is a favorite word among computer people when complex systems produce output that is inexplicable. See software conflict and anomaly detection. . Highlights from the 13 hole drill program included 56 metres grading 2.08% copper; 55 metres grading 1.20% copper and 101 metres grading 0.92% copper. Follow up drilling to further test the prospect is underway. Investments -Carlisa The Company holds an 18.8% interest in Carlisa Investment Corporation (Carlisa), which holds a 90% interest in Mopani Copper Mines Plc (Mopani). Mopani is a privately held company privately held company A firm whose shares are held within a relatively small circle of owners and are not traded publicly. registered in Zambia. The carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. of this investment as at September 30, 2004 is $9.5 million (Dec 2003: $9.5m; Dec 2002: $9.5m). There were no movements in this investment during the first nine months of 2004. As the majority owner of Mopani is a private company, only limited public information is available for dissemination dissemination Medtalk The spread of a pernicious process–eg, CA, acute infection Oncology Metastasis, see there . Notwithstanding, in a recent article, Mopani Chief Executive Officer Tim Henderson told Reuters copper production for 2004 was expected to increase 23 percent to 165,000 tonnes, 5,000 tonnes higher than the initial budget, from 134,000 tonnes last year. In addition Mr. Henderson said an expansion program at Mopani will boost finished copper output to 190,000 tonnes in 2005. Henderson said the Mufulira smelter, which currently has a handling capacity of 420,000 tonnes of copper concentrate per year, would eventually be expanded to handle 850,000 tonnes of copper concentrate. Outlook The Bwana Mkubwa SX/EW processing facility is expected to produce between 40,000 to 45,000 tonnes of copper cathode in 2005. C1 (cash) costs are expected to range between $0.50 and $0.55 per pound of finished copper as high gangue acid consuming ores are treated in 2005. During the first two months of 2005 (February being a short month), Bwana Mkubwa produced approximately 7,712 tonnes of copper cathode. All production from Bwana Mkubwa is unhedged. At Kansanshi in Zambia, commissioning of the new mine is well underway. The sulphide circuit is operating at design throughputs with average copper recoveries of approximately 88%. The first concentrate shipment left the mine on February 8, 2005. Commissioning of the oxide circuit is underway with build-up build·up also build-up n. 1. The act or process of amassing or increasing: a military buildup; a buildup of tension during the strike. 2. of in circuit inventory. First copper cathode is expected to be produced in March 2005. Commercial production is expected to begin in April of 2005. The original GRD GRD Guard GRD Grenada (ISO Country code) GRD Greek Drachma (old currency code; replaced by EUR) GRD Gulf Region Division (US Army Corps of Engineers) Minproc Definitive Feasibility Study The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. (DFS (Distributed File System) An enhancement to Windows NT/2000 and 95/98 that allows files scattered across multiple servers to be treated as a single group. With Dfs, a network administrator can build a hierarchical file system that spans the organization's LANs and ) for Kansanshi envisioned the treatment of 4 million tonnes of oxide ore and 2 million tonnes of sulphide ore to produce an average of 100,000 tonnes of finished copper production per year. Capital additions carried out to the sulphide milling circuit during initial construction at Kansanshi will double design capacity throughput of sulphide ore to 4 million tonnes per year. This will result in copper concentrate production substantially outperforming the DFS forecasts in 2005 when an aggregate production of 91,000 tonnes is planned at C1 (cash) costs of $0.45 per pound of copper. In addition, a $29 million capital program committed in 2005 will expand the sulphide circuit again to eight million tonnes of treatment capacity which will result in an average of 145,000 tonnes of finished copper production per year during the period of 2006-2009. Finally, an additional expansion of the sulphide circuit is under consideration to increase the sulphide treatment capacity to 12 million tonnes of sulphide ore to maintain annual finished copper production of 145,000 tonnes as oxide ore is depleted de·plete tr.v. de·plet·ed, de·plet·ing, de·pletes To decrease the fullness of; use up or empty out. [Latin d and sulphide ore grades Ore grade is a measure that describes the concentration of a valuable natural material (such as metals or minerals) in its surrounding ore. Ore grade is used to assess the economic feasibility of a mining operation: the cost of extracting a natural material from its ore is directly begin to fall. With the growing concentrate production from the Kansanshi mine and the potential future concentrate production from the Company's Frontier deposit, there will be a need for additional smelter capacity in the Copperbelt over the next several years. This additional smelter capacity may result from the further expansion of the Mopani Mufulira smelter or from the refurbishment re·fur·bish tr.v. re·fur·bished, re·fur·bish·ing, re·fur·bish·es To make clean, bright, or fresh again; renovate. re·fur of the Vedanta Nkana smelter. In an effort to reduce its reliance upon Copperbelt smelter capacity, First Quantum has investigated alternative processing routes for a portion of its future copper concentrates. To this end, the Company has purchased a complete "second-hand" pressure oxidation facility from Placer Dome's Turquoise turquoise, hydrous phosphate of aluminum and copper, Al2(OH)3PO4·H2O+Cu, used as a gem. It occurs rarely in crystal form, but is usually cryptocrystalline. Ridge operations in Nevada, USA. The pressure oxidation facility is currently being dismantled dis·man·tle tr.v. dis·man·tled, dis·man·tling, dis·man·tles 1. a. To take apart; disassemble; tear down. b. and over the next several months will be transported to the Kansanshi mine site in Zambia. Once on site, the pressure oxidation facility and ancillary Subordinate; aiding. A legal proceeding that is not the primary dispute but which aids the judgment rendered in or the outcome of the main action. A descriptive term that denotes a legal claim, the existence of which is dependent upon or reasonably linked to a main claim. equipment will be reconstructed re·con·struct tr.v. re·con·struct·ed, re·con·struct·ing, re·con·structs 1. To construct again; rebuild. 2. and commissioned for use. Additional information will be published as the project progresses. At the Frontier project in the DRC, in-fill drilling to expand the resource and move the resource into the reserve category was completed in 2004. Updated resource/reserve statements, as well as a Project Engineering Report, are expected to be published in the second quarter of 2005. At Guelb Moghrein, in Mauritania, MDM (Modular Digital Multitrack) An audio recorder that mixes and records multiple tracks of digital audio. The two major MDM technologies are ADAT and DTRS. See ADAT and DTRS. Processing, an Australian engineering company, has completed a Project Engineering Report (PER). The results of the PER will be published in the second quarter of 2005. The contracts for the plant engineering and construction have been awarded. Construction activities are underway. Guelb Moghrein is expected to be financed through a combination of cash on hand, project debt and end user/supplier finance. An exploration drill program of approximately 5,000 metres is underway on selected high priorities targets within the 10,000 square kilometer kilometer one thousand (103) meters; 3280.83 feet; five-eighths of a mile; abbreviated km. Guelb Moghrein exploration tenement A comprehensive legal term for any type of property of a permanent nature—including land, houses, and other buildings as well as rights attaching thereto, such as the right to collect rent. . At the newly discovered Kashime prospect exploration drilling recommenced in February, 2005. A substantial exploration program continues in the Zambia and the DRC Pedicle pedicle /ped·i·cle/ (ped´i-k'l) a footlike, stemlike, or narrow basal part or structure. ped·i·cle n. 1. A constricted portion or stalk. 2. region where First Quantum controls approximately 30,000 square kilometers of prospective geology geology, science of the earth's history, composition, and structure, and the associated processes. It draws upon chemistry, biology, physics, astronomy, and mathematics (notably statistics) for support of its formulations. . A program of more than 10,000 metres of reverse circulation and diamond core drilling Diamond core drill bits are used to bore large holes in brick, concrete and stone. They are not generally used in other materials. The bit consists of a metal cylinder, usually relatively soft steel mounted on an arbor. is planned for 2005. The drill program will focus on a number of attractive targets with similar geochemical and geophysics geophysics, study of the structure, composition, and dynamic changes of the earth, its atmosphere, hydrosphere and magnetosphere, based on the principles of physics. signatures to those demonstrated by Lonshi, Frontier and Kashime. Some of these new targets have had limited preliminary drilling in 2004 leading to the more extensive drill programs in 2005. In February 2005, First Quantum's, wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. company, International Quantum Resources Limited, sold its equity ownership stake in Anvil anvil Iron block on which metal is placed for shaping, originally by hand with a hammer. The blacksmith's anvil is usually of wrought iron (sometimes of cast iron), with a smooth working surface of hardened steel. Mining Limited ("Anvil") (TSX-AVM and ASX-AVM). The sale consisted of 4,029,617 Anvil common shares for net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). of US $22 million. First Quantum continues to hold 296,631 warrants to purchase 296,631 Anvil common shares at a price of US $0.92 per share. The warrants, which have an expiry date expiry date expire n → date f d'expiration; (on label) → à utiliser avant ... expiry date expire n → Ablauftermin m of January 15, 2006, are held for investment purposes and the shares issued on exercise may be sold in the future. A gain on the sale of approximately US $16 million will be booked in the first quarter of 2005. In March, the Board of Directors established a dividend policy under which First Quantum will pay an inaugural dividend of Canadian six cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. in respect of the year ended December 31, 2004. The dividend will be paid on April 25, 2005 to shareholders of record on April 11, 2005. The Board of Directors plans to implement a progressive dividend policy with future payments established in line with annual results and net cash generation. The Board of Directors expects First Quantum to pay two dividends a year. It is intended that in any year an interim dividend will declared upon announcement of the first six month results and a final dividend will be declared upon announcement of the full year results. It is proposed that the interim dividend will be set at approximately one-third of the total dividends paid in the previous financial year. On Behalf of the Board of Directors of First Quantum Minerals Ltd. G. Clive Newall 12g3-2b-82-4461 Listed in Standard and Poor's Noun 1. Standard and Poor's - a broadly based stock market index Standard and Poor's Index Sedar Profile #00006237 Certain of the information contained in this news release constitute "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such forward-looking statements, including but not limited to those with respect to the prices of gold, copper and sulphuric acid sulphuric acid: see sulfuric acid. , estimated future production, estimated costs of future production, the Company's hedging policy and permitting time lines, involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the actual prices of copper, gold and sulphuric acid, the factual results of current exploration, development and mining activities, changes in project parameters as plans continue to be evaluated, as well as those factors disclosed in the Company's documents filed from time to time with the British Columbia Securities Commission The British Columbia Securities Commission (BCSC) is a regulatory agency which administers and enforces securities legislation in the Canadian province of British Columbia. External links
The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge for the period ended December 31, 2002. The following discussion and analysis of the Company's results of operations should also be read in conjunction with the unaudited consolidated financial statements and related notes.
OPERATION STATISTICS by QUARTER - 2004
Bwana Mkubwa SX/ EW Facility, Zambia
Copper & Acid Production
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First Second Third Fourth Full
Quarter Quarter Quarter Quarter Year
Ore Processed - (tonnes) 208,667 236,887 278,392 256,066 980,012
Copper Grade - (acid
soluble %) 5.2 4.6 4.6 5.0 4.8
Contained Copper
- (tonnes) 10,904 10,813 12,908 12,824 47,449
Recovery - (%) 89 89 88 85 88
Finished Copper
Production (tonnes) 9,689 9,585 11,330 10,942 41,546
Total Cost (C3)
Copper ($/lb) 0.53 0.67 0.68 0.59 0.62
Cash Cost (C1)
Copper ($/lb) 0.39 0.48 0.45 0.48 0.46
Sulphuric Acid
Produced (tonnes) 34,344 34,265 35,920 35,671 140,200
Sulphuric Acid
Sold (tonnes) 20,763 19,149 16,884 9,664 66,460
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Notes:
C1 - costs are cash operating costs, including mining, processing,
site administration and refining; net of by product credits.
C3 - costs are total production costs, including mining, processing,
site administration and refining; depreciation and amortization
charges; royalties, related head office, interest costs and finance
charges; net of by product credits.
Consolidated Balance Sheets
As at December 31, 2004 and December 31, 2003
(expressed in thousands of US dollars)
2004 2003
$ $
(Restated)
Assets
Current assets
Cash and cash equivalents (note 19) 50,356 25,592
Restricted cash (note 9) 1,931 -
Accounts receivable and prepaid expenses 21,927 4,441
Inventory (note 4) 31,674 17,576
--------------------
105,888 47,609
Investments (note 5) 15,340 12,632
Exploration properties (note 6) 444 2,242
Property, plant and equipment (note 7) 319,222 96,603
Other assets and deferred charges (note 8) 32,167 3,049
--------------------
473,061 162,135
--------------------
--------------------
Liabilities
Current liabilities
Accounts payable and accrued liabilities 33,884 17,737
Current taxes payable (note 12) 3,248 -
Current portion of long-term debt (note 9) 22,865 12,993
Current portion of other liabilities (note 11) 12,012 3,333
--------------------
72,009 34,063
Long-term debt (note 9) 191,661 32,374
Asset retirement obligations (note 10) 3,762 4,182
Other liabilities (note 11) 33,286 3,114
Future income tax liability (note 12) 12,313 4,589
--------------------
313,031 78,322
Minority interests 2,190 2,190
--------------------
315,221 80,512
--------------------
Shareholders' Equity
Equity accounts (note 13) 161,776 113,102
Deficit (3,936) (31,479)
--------------------
157,840 81,623
--------------------
473,061 162,135
--------------------
--------------------
Commitments and contingencies (note 21)
Subsequent event (note 22)
Approved by the Board of Directors
R. Stuart. Angus, Director Robert A. Watts, Director
The notes are an integral part of these consolidated financial
statements.
For a copy of the notes visit our website at www.first-quantum.com
Consolidated Statements of Earnings and Deficit
For years ended December 31, 2004 and 2003
(expressed in thousands of US dollars)
2004 2003
$ $
(Restated)
Revenues
Copper 103,352 49,419
Acid 10,171 11,035
--------------------
113,523 60,454
--------------------
Costs and expenses
Cost of sales 53,770 41,299
Depletion and amortization 10,873 7,761
Exploration 3,063 620
Foreign exchange loss 260 969
General and administrative 6,171 2,852
Interest and financing fees on long-term debt 3,040 1,759
Other income (985) (419)
--------------------
76,192 54,841
--------------------
Earnings before income taxes and equity earnings 37,331 5,613
Income taxes (note 12) 11,006 1,397
Equity earnings (note 5) 1,685 366
--------------------
Net earnings for the year 28,010 4,582
Deficit - Beginning of year (note 2) (31,479) (36,061)
Prior period restatement (stock-based
compensation) (note 2) (467) -
--------------------
Deficit - End of year (3,936) (31,479)
--------------------
--------------------
Earnings per common share
Basic 0.47 0.09
Diluted 0.46 0.09
The notes are an integral part of these consolidated financial
statements.
For a copy of the notes visit our website at www.first-quantum.com
Consolidated Statements of Cash Flows
For years ended December 31, 2004 and 2003
(expressed in thousands of US dollars)
2004 2003
$ $
(Restated)
Cash flows from operating activities
Net earnings for the year 28,010 4,582
Items not affecting cash
Depletion and amortization 10,873 7,761
Accretion 416 702
Provision for deferred stripping - 2,718
Equity earnings (1,685) (366)
Unrealized foreign exchange (gain) loss (1,180) 1,253
Future income tax expense 7,724 1,386
Stock-based compensation expense 1,227 -
Other 878 16
--------------------
46,263 18,052
Change in non-cash operating working capital
Increase in accounts receivable and
prepaid expenses (9,455) (1,224)
Increase in inventory (14,514) (4,457)
Increase in accounts payable and
accrued liabilities 8,397 4,514
--------------------
30,691 16,885
--------------------
Cash flows from financing activities
Movement in restricted cash (1,931) -
Proceeds from long-term debt 179,455 47,283
Repayments of principal on long-term debt (17,401) (29,490)
Proceeds from issue of common
shares and warrants 46,983 24,164
Payment for deferred finance fees (7,635) (1,176)
--------------------
199,471 40,781
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Cash flows from investing activities
Net payments to acquire property,
plant and equipment (193,245) (39,158)
Payments for investments (1,023) -
Prepaid power payments (6,988) -
Payments for deferred exploration
and stripping costs (4,849) (1,248)
Proceeds on disposal of investments - 152
--------------------
(206,105) (40,254)
--------------------
Effect of exchange rate changes on cash 707 -
--------------------
Increase in cash and cash equivalents 24,764 17,412
Cash and cash equivalents - Beginning of year 25,592 8,180
--------------------
Cash and cash equivalents - End of year 50,356 25,592
--------------------
--------------------
The notes are an integral part of these consolidated financial
statements.
For a copy of the notes visit our website at www.first-quantum.com
Segmented Information
For the year ended December 31, 2004
(expressed in thousands of US dollars)
BLO KCP GMP CDA Total
$ $ $ $ $
External revenues 113,523 - - - 113,523
Costs and expenses
Cost of sales 53,770 - - - 53,770
Depletion and
amortization 9,552 - - 1,321 10,873
Exploration 1,975 - - 1,088 3,063
Foreign exchange
(gain) loss (153) - - 413 260
General and
administrative - - - 6,171 6,171
Interest and
financing fees 2,803 - - 237 3,040
Other income (77) - - (908) (985)
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Total costs and expenses 67,870 - - 8,322 76,192
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Segment profit (loss)
before the undernoted
items 45,653 - - (8,322) 37,331
Equity earnings - - - 1,685 1,685
Income tax 11,006 - - - 11,006
-------------------------------------------
Segment profit (loss) 34,647 - - (6,637) 28,010
-------------------------------------------
-------------------------------------------
Property, plant and
equipment additions 19,041 204,923 10,272 3,689 237,925
-------------------------------------------
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Total assets 154,132 304,284 10,475 180,317 649,208
Intercompany balances
included in total
assets (46,393) - - (129,754) (176,147)
-------------------------------------------
Total consolidated
assets 107,739 304,284 10,475 50,563 473,061
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Definitions:
BLO - Combined operations of Bwana/Lonshi
KCP - Kansanshi Copper Project
GMP - Guelb Moghrein Project
CDA - Corporate Development and Administration, includes Frontier,
Connemara and Carlisa
The notes are an integral part of these consolidated financial
statements.
For a copy of the notes visit our website at www.first-quantum.com
Segmented Information
For the year ended December 31, 2003
(expressed in thousands of US dollars)
BLO KCP GMP CDA Total
$ $ $ $ $
External revenues 60,454 - - - 60,454
Costs and expenses
Cost of sales 41,250 - - 49 41,299
Depletion and
amortization 7,632 - - 129 7,761
Exploration - - - 620 620
Foreign exchange
loss (gain) 1,591 - - (622) 969
Gain on disposal (138) - - - (138)
General and
administrative - - - 2,852 2,852
Interest and
financing fees 1,713 - - 46 1,759
Other income (52) - - (229) (281)
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Total costs and
expenses 51,996 - - 2,845 54,841
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Segment profit (loss)
before the undernoted
items 8,458 - - (2,845) 5,613
Equity earnings - - - 366 366
Income tax 1,397 - - - 1,397
-------------------------------------------
Segment profit (loss) 7,061 - - (2,479) 4,582
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Property, plant and
equipment additions 14,659 27,896 - 76 42,631
-------------------------------------------
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Total assets 84,545 44,731 - 130,798 260,074
Intercompany balances
included in total
assets (4,220) - - (93,719) (97,939)
-------------------------------------------
Total consolidated
assets 80,325 44,731 - 37,079 162,135
-------------------------------------------
-------------------------------------------
The notes are an integral part of these consolidated financial
statements.
For a copy of the notes visit our website at www.first-quantum.com
The Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. First Quantum Minerals Ltd. (TSX:FM) (OTC Bulletin Board OTC Bulletin Board An electronic quotation listing of the bid and asked prices of OTC stocks that do not meet the requirements to be listed on the NASDAQ stock-listing system. :FQVLF) (LSE:FQM) |
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