MANAGEMENT'S DISCUSSION AND ANALYSIS

T H I R D Q U A R T E R E N D E D S E P T E M B E R 3 0 , 2 0 2 1

(In United States dollars, tabular amounts in millions, except where noted)

(in United States dollars, tabular amounts in millions, except where noted)

INDEX

THIRD QUARTER HIGHLIGHTS AND OVERVIEW

2

SUSTAINABILITY

5

COVID-19

5

LOGISTICS AND SHIPPING

6

DEVELOPMENT PROJECTS

6

EXPLORATION

7

OTHER DEVELOPMENTS

7

GUIDANCE

8

SUMMARY OPERATIONAL RESULTS

11

OPERATIONS REVIEW

15

SUMMARY FINANCIAL RESULTS

26

LIQUIDITY AND CAPITAL RESOURCES

33

ZAMBIAN VAT

38

JOINT VENTURE

40

PRECIOUS METAL STREAM ARRANGEMENT

40

MATERIAL LEGAL PROCEEDINGS

41

REGULATORY DISCLOSURES

44

SUMMARY QUARTERLY INFORMATION

53

APPENDICES

54

CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION

58

First Quantum Minerals Ltd. | Q3 2021 MANAGEMENT'S DISCUSSION AND ANALYSIS 1

(in United States dollars, tabular amounts in millions, except where noted)

First Quantum Minerals Ltd. ("First Quantum" or "the Company") is engaged in the production of copper, nickel, gold and silver, and related activities including exploration and development. The Company has operating mines located in Zambia, Panama, Finland, Turkey, Spain, Australia and Mauritania, and a development project in Zambia. The Company is progressing the Taca Taca copper-gold-molybdenum project in Argentina and is exploring the Haquira copper deposit in Peru.

The Company's shares are publicly listed for trading on the Toronto Stock Exchange and the Company has depository receipts listed on the Lusaka Stock Exchange.

This Management's Discussion and Analysis ("MD&A") should be read in conjunction with the unaudited consolidated financial statements of First Quantum Minerals Ltd. ("First Quantum" or "the Company") for the three and nine months ended September 30, 2021. The Company's results have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") applicable to interim reporting, IAS 34 Interim Financial Reporting, 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.sedar.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-lookinginformation" 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 has been prepared as of October 26, 2021.

THIRD QUARTER HIGHLIGHTS AND OVERVIEW

Another quarter of record copper production at Cobre Panama drove strong operational performance in the quarter and nine months year-to-date. Financial performance in the quarter was driven by an increase in revenue, with higher metal prices, together with strong operational performance resulting in a significant increase in comparative EBITDA 4,5 and net earnings, as well as notable further reduction in net debt 3.

Total copper production for the quarter was 209,859 tonnes, consistent with the third quarter of 2020 and the highest quarterly production for 2021, attributable to the record breaking quarterly production at Cobre Panama.

Cobre Panama delivered a record 87,242 tonnes of copper production, and achieved further quarterly milestones, including records in tonnes milled.

Kansanshi produced another consistent quarter, with copper production of 50,987 tonnes. The Kansanshi smelter processed 325,068 dry metric tonnes ("DMT") of copper concentrate, produced 75,929 tonnes of copper anode and 310,000 tonnes of sulphuric acid, and ramped up on schedule in early July, following scheduled maintenance.

Sentinel delivered its best quarter of the year, and produced 59,931 tonnes of copper. A record milling rate was achieved in August 2021 and improved ore grades were processed in September 2021. The fourth in-pit crusher at Sentinel is scheduled for commissioning in December 2021, which will enable the plant to ramp up throughput to 62 million tonnes per annum ("Mtpa") in 2022.

Total gold production for the quarter was 78,124 ounces, a 7% increase from the same period in 2020, with the increase attributable to another quarter of record production at Cobre Panama of 36,649 ounces.

Sales volumes in Zambia were impacted by port congestion and a global shortage in container shipping capacity and this is expected to continue into the fourth quarter.

Gross profit of $613 million and comparative EBITDA of $886 million for the third quarter of 2021 were significantly higher (77% and 38%, respectively) than the same period in 2020, attributable to increased sales volumes at Cobre Panama, as well as a 33% increase in the realized copper price. The realized copper price of $3.68 per lb achieved during the quarter reflected the reduced hedge profile in place.

Total C1 cash cost of $1.26 per lb was $0.19 per lb higher than the comparable third quarter of 2020, impacted by higher fuel costs and freight charges at Cobre Panama, together with lower production at both Zambian operations and cessation of open-pit mining at Las Cruces in August 2020. AISC of $1.87 per lb was also impacted by higher Zambia royalties due to higher copper prices.

First Quantum Minerals Ltd. | Q3 2021 MANAGEMENT'S DISCUSSION AND ANALYSIS 2

(in United States dollars, tabular amounts in millions, except where noted)

Financial results include net earnings attributable to shareholders of the Company of $303 million ($0.44 earnings per share), and comparative earnings of $197 million ($0.29 comparative earnings per share) which represents a significant improvement on the same quarter of 2020. Net earnings include foreign exchange gains of $180 million, largely unrealized, primarily due to the appreciation of the Zambian Kwacha ("ZMW") against the US dollar ("USD") during the quarter.

Cash flows from operating activities of $703 million ($1.02 per share) for the third quarter of 2021 were $251 million higher than the same period in 2020.

Net debt decreased by $449 million during the quarter, with a total reduction of $1,107 million during the nine months year- to-date, bringing the balance down to $6,302 million as at September 30, 2021. With the current strength in the copper price, a significant further reduction is expected in the last quarter of this year. On the basis of continued strong operational performance, the Company anticipates continued strong future cash flow and expects to be in a position to continue growth programs, to support Environmental, Social & Governance ("ESG") initiatives and to support increased dividend payments in 2022.

In September 2021, for cash consideration of $240 million, the Company completed the sale of a 30% equity interest in Ravensthorpe to POSCO, one of the world's leading integrated producer of materials for the electric vehicle ("EV") sector. The Company retains a 70% interest in Ravensthorpe and continues to be the operator. The proceeds of the transaction were used to pay down the Company's Revolving Credit Facility.

Commissioning of Shoemaker Levy at Ravensthorpe was largely completed towards the end of the third quarter, which enabled the successful introduction of first saprolite ore into the plant in September 2021. Completion of construction and commissioning works at the Shoemaker Levy Project and the delivery of limonite ore is the main priority for the fourth quarter of 2021.

At September 30, 2021, the Company had 12,500 tonnes of unmargined copper forward sales contracts at an average price of $3.01 per lb outstanding with periods of maturity to December 2021. In addition, the Company had 125,750 tonnes of unmargined zero cost copper collar sales contracts with maturities to June 2022 at weighted average prices of $3.45 per lb to $4.35 per lb outstanding. Copper sales in the quarter were 46% hedged. Approximately one sixth of expected copper sales for the next 12 months are hedged to unmargined forward and zero cost collar sales contracts, at an average floor price and average ceiling price of $3.41 per lb and $4.23 per lb, respectively.

The Company also had unmargined nickel forward sales contracts for 406 tonnes at an average price of $7.96 per lb outstanding, with maturities to December 2021. In addition, the Company has zero cost nickel collar unmargined sales contracts for 800 tonnes, at weighted average prices of $7.71 per lb to $8.58 per lb outstanding with maturities to May 2022.

Post quarter end, on October 14, 2021, the Company signed a new $2.925 billion Term Loan and Revolving Credit Facility (the "Facility"). This new Facility replaces the existing $2.7 billion Term Loan and Revolving Credit Facility due to mature December 2022. The new $2.925 billion Facility comprises a $1.625 billion Term Loan Facility and a $1.3 billion Revolving Credit Facility, maturing in 2025 and is syndicated to a group of long-standing relationship banks of First Quantum. The Facility will be used to fully prepay and cancel amounts outstanding on the existing facility ($1.66 billion as at September 30, 2021), to fully prepay and cancel a bilateral bank facility for $175 million and for general corporate purposes. Repayments on the term loan will commence in December 2022. The Facility has a single Net Debt to EBITDA ratio covenant set at 3.5 times over the Facility term.

By September 30, 2021, the Cobre Panama operations had reached COVID-19 vaccination levels of 97% in employees and contractors. As a result, post quarter end, on October 11, 2021, Cobre Panama removed the most stringent of health protocols on the site and, in particular, removed limit restrictions on the number of personnel onsite, as well as, removed the requirement for vaccinated staff to undergo preventative site quarantine prior to entering the site. This allows Cobre Panama to return to optimal staffing levels on the site.

First Quantum Minerals Ltd. | Q3 2021 MANAGEMENT'S DISCUSSION AND ANALYSIS 3

(in United States dollars, tabular amounts in millions, except where noted)

CONSOLIDATED OPERATING HIGHLIGHTS

Three months ended

Nine months ended

September 30

September 30

2021

2020

2021

2020

Copper production (tonnes) 1

209,859

211,396

614,612

575,740

Copper sales (tonnes)

194,278

197,533

608,802

547,430

Gold production (ounces)

78,124

72,926

237,547

196,365

Gold sales (ounces) 2

79,773

78,013

242,455

206,386

Nickel production (contained tonnes)

4,248

5,113

13,433

7,092

Nickel sales (contained tonnes)

4,055

4,986

13,322

6,777

CONSOLIDATED FINANCIAL HIGHLIGHTS

Three months ended

Nine months ended

September 30

September 30

2021

2020

2021

2020

Sales revenues

1,802

1,402

5,327

3,598

Gross profit

613

346

1,778

634

Net earnings (loss) attributable to shareholders

303

29

585

(189)

of the Company

Basic and diluted earnings (loss) per share

$0.44

$0.04

$0.85

($0.27)

Cash flows from operating activities

703

452

2,125

1,080

Net debt3

6,302

7,545

6,302

7,545

Comparative EBITDA4, 5

886

641

2,599

1,427

Comparative earnings (loss) 4

197

64

520

(99)

Comparative earnings (loss) per share 4

$0.29

$0.09

$0.76

($0.14)

Cash cost of copper production (C1) (per lb) 3

$1.26

$1.07

$1.26

$1.19

Total cost of copper production (C3) (per lb) 3

$2.22

$1.97

$2.18

$2.08

All-in sustaining cost (AISC) (per lb) 3

$1.87

$1.48

$1.83

$1.58

Realized copper price (per lb) 3

$3.68

$2.77

$3.48

$2.65

Net earnings (loss) attributable to shareholders of

303

29

585

(189)

the Company

Adjustments attributable to shareholders of the Company:

Adjustment for expected phasing of Zambian value-added

4

(16)

18

(75)

tax ("VAT") receipts

Loss on debt instruments

-

-

-

2

Total adjustments to comparative EBITDA excluding

(177)

61

(137)

198

depreciation 5

Tax and minority interest comparative adjustments

67

(10)

54

(35)

Comparative earnings (loss) 4

197

64

520

(99)

  • Production is presented on a contained basis, and is presented prior to processing through the Kansanshi smelter.
  • Excludes refinery-backed gold credits purchased and delivered under the precious metal streaming arrangement (see "Precious Metal Stream Arrangement").

First Quantum Minerals Ltd. | Q3 2021 MANAGEMENT'S DISCUSSION AND ANALYSIS 4

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First Quantum Minerals Ltd. published this content on 26 October 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 October 2021 20:15:12 UTC.