Teck Resources Limited

TSX: TECK.A, TECK.B

NYSE: TECK

News Release

www.teck.com

For Immediate Release

Date: April 27, 2021

21-18-TR

Teck Reports Unaudited First Quarter Results for 2021

Delivering on Our Key Priorities

Vancouver, B.C. - Teck Resources Limited (TSX: TECK.A and TECK.B, NYSE: TECK) ("Teck") today announced its unaudited first quarter results for 2021.

"Strong first quarter operational performance, in line with plan, and higher commodity prices contributed to a very solid start to 2021," said Don Lindsay, President and CEO. "We achieved major milestones for our priority projects, including surpassing the half-way point at our flagship QB2 copper growth project and moving into the commissioning phase of our Neptune steelmaking coal terminal upgrade. We remain absolutely focused on implementing the necessary protocols to mitigate transmission of COVID-19 and protect the health and safety of our people and local communities."

Highlights

  • Adjusted profit attributable to shareholders1 of $326 million or $0.61 per share in Q1 2021, an increase of 247% compared to the same period last year.
  • Adjusted EBITDA1 of $967 million in Q1 2021, an increase of 59% compared to the same period last year.
  • Overall QB2 project progress surpassed the half-way point in April.
  • Our Neptune port upgrade is now in the commissioning phase and ramp-up will continue as planned. To date 18 vessels have been loaded using the new outbound system.
  • Our operations continue to be resilient despite ongoing challenges associated with COVID-19, with production in line with plan across our business units and sales meeting our Q1 2021 guidance.
  • Our copper business unit had a strong Q1 2021 with an increase in gross profit before depreciation and amortization1 of 76% compared to the same period last year, supported by an average realized copper price of US$3.92 per pound and copper production of 71,700 tonnes, in line with plan.
  • Sales of steelmaking coal were 6.2 million tonnes in Q1 2021, with approximately 2 million tonnes sold to Chinese customers based on CFR China prices, which were significantly higher than FOB Australia prices.
  • Teck Coal Limited has resolved Fisheries Act charges in connection with discharges of selenium and calcite from our steelmaking coal operations in the Elk Valley of British Columbia in 2012.
  • The Elkview Saturated Rock Fill (SRF) was successfully commissioned in Q1 2021, on schedule and below budget. The SRF is now treating and reducing selenium and nitrate and improving water quality in the receiving environment.
  • Liquidity of $6.3 billion as at April 27, 2021.

Note:

1. Non-GAAP Financial Measure. See "Use of Non-GAAP Financial Measures" section of the MD&A for further information and reconciliation.

All dollar amounts expressed in this news release are in Canadian dollars unless otherwise noted.

Reference:

Fraser Phillips, Senior Vice President, Investor Relations and Strategic Analysis

604.699.4621

Marcia Smith, Senior Vice President, Sustainability and External Affairs

604.699.4616

Additional corporate information is available at www.teck.com

Financial Summary Q1 2021

Financial Metrics

Q1 2021

Q1 2020

(CAD$ in millions, except per share data)

Revenues

$

2,547

$

2,377

Gross profit before depreciation and amortization1

$

1,032

$

776

Gross profit

$

654

$

398

Adjusted EBITDA1

$

967

$

608

Profit (loss) attributable to shareholders

$

305

$

(312)

Adjusted profit attributable to shareholders1

$

326

$

94

Basic earnings (loss) per share

$

0.57

$

(0.57)

Diluted earnings (loss) per share

$

0.57

$

(0.57)

Adjusted basic earnings per share1

$

0.61

$

0.17

Adjusted diluted earnings per share1

$

0.61

$

0.17

Note:

1. Non-GAAP Financial Measure. See "Use of Non-GAAP Financial Measures" section of the MD&A for further information and reconciliation.

Key Updates

Executing on our copper growth strategy - QB2 a long-life,low-cost operation with major expansion potential

  • Overall project progress surpassed the half-way point in April;
  • Pace of construction continues to trend upwards hitting new weekly records over the last month;
  • The project continues to manage through the current COVID-19 wave in Chile; and
  • First production continues to be expected in the second half of 2022.
  • Click herefor a photo gallery and click herefor a video of construction progress on QB2.

Neptune Bulk Terminals - securing a low-cost reliable supply chain for our steelmaking coal business unit

  • Our Neptune port upgrade project is now in the commissioning phase and ramp-up will continue as planned.
  • To date 18 vessels have been loaded using the new outbound system.Click herefor a video of the new rotary double dumper in operation.

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Teck Resources Limited 2021 First Quarter News Release

Guidance

  • There has been no change in our previously issued annual guidance, outlined in summary below. Our usual guidance tables, including three-year production guidance, can be found on pages 27 - 31.

2021 Guidance - Summary

Production Guidance

Copper (000's tonnes)

275 - 290

Zinc (000's tonnes)

585 - 610

Refined zinc (000's tonnes)

300 - 310

Steelmaking coal (million tonnes)

25.5

- 26.5

Bitumen (million barrels)

8.6

- 12.1

Sales Guidance - Q2 2021

Red Dog zinc in concentrate sales (000's tonnes)

35 - 45

Steelmaking coal sales (million tonnes)

6.0 - 6.4

Unit Cost Guidance

Copper net cash unit costs (US$/lb.)

$

1.30

- 1.40

Zinc net cash unit costs (US$/lb.)

$

0.40

- 0.45

Steelmaking coal adjusted site cash cost of sales (CAD$/tonne)

$

59 - 64

Steelmaking coal transportation costs (CAD$/tonne)

$

36 - 39

Bitumen adjusted operating costs (CAD$/barrel)

$

28 - 32

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Teck Resources Limited 2021 First Quarter News Release

Management's Discussion and Analysis

This management's discussion and analysis is dated as at April 27, 2021 and should be read in conjunction with the unaudited consolidated financial statements of Teck Resources Limited ("Teck") and the notes thereto for the three months ended March 31, 2021 and with the audited consolidated financial statements of Teck and the notes thereto for the year ended December 31, 2020. In this news release, unless the context otherwise dictates, a reference to "the company" or "us," "we" or "our" refers to Teck and its subsidiaries. Additional information, including our Annual Information Form and Management's Discussion and Analysis for the year ended December 31, 2020, is available on SEDAR at www.sedar.com.

This document contains forward-looking statements. Please refer to the cautionary language under the heading "CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION" below.

Overview

  • Our profitability in the first quarter improved from a year ago, as a result of increases in the prices for our principal products, most significantly copper, zinc and blended bitumen as shown in the table below. Realized steelmaking coal prices in the first quarter benefited from approximately 2 million tonnes of sales to Chinese customers, which were priced at a premium to FOB Australia price assessments.

Three months

Average Prices and Exchange Rates

ended March 31,

Change

2021

2020

Copper (LME cash - US$/pound)

$

3.86

$

2.56

51%

Zinc (LME cash - US$/ pound)

$

1.25

$

0.97

29%

Steelmaking coal (realized US$/tonne)

$

131

$

131

-%

Blended bitumen (realized US$/barrel)

$

47.58

$

28.92

65%

Average exchange rate (CAD$ per US$1.00)

$

1.27

$

1.34

(5%)

  • Steelmaking coal sales volumes in the first quarter were 9% higher than the same period last year and within our first quarter 2021 sales guidance range. This was partly offset by a decrease in the sales volumes of our other principal products, consistent with our plan.

Profit and Adjusted Profit

In the first quarter, our profit attributable to shareholders was $305 million, or $0.57 per share. This compares to a loss attributable to shareholders of $312 million, or $0.57 per share, in the first quarter of 2020, which included an after-tax impairment charge of $474 million on our interest in Fort Hills. The increase in profit compared to the same period last year is otherwise primarily due to a substantial increase in prices for most of our principal products, especially copper, zinc and blended bitumen, partially offset by the effect of the strengthening Canadian dollar.

Adjusted profit attributable to shareholders in the first quarter, taking into account the items identified in the table below, was $326 million, or $0.61 per share, compared with $94 million, or $0.17 per share, in the first quarter of 2020. The most significant first quarter adjustment to profit, reflected in the table below, is a gain of $33 million (after tax) relating to an increase in the rates used to discount our decommissioning and restoration provisions for closed operations.

4

Teck Resources Limited 2021 First Quarter News Release

Three months

ended March 31,

(CAD$ in millions)

2021

2020

Profit (loss) attributable to shareholders

$

305

$

(312)

Add (deduct) on an after-tax basis:

Asset impairment

-

474

COVID-19 costs

-

22

Environmental costs

(33)

(87)

Inventory write-downs (reversals)

(6)

27

Share-based compensation

10

(22)

Commodity derivatives

15

15

Other

35

(23)

Adjusted profit attributable to shareholders1

$

326

$

94

Adjusted basic earnings per share1

$

0.61

$

0.17

Adjusted diluted earnings per share1

$

0.61

$

0.17

Note:

1. Non-GAAP Financial Measure. See "Use of Non-GAAP Financial Measures" section for further information and reconciliation.

In addition to the items identified in the table above, our results include gains and losses due to changes in market prices in respect of pricing adjustments. Pricing adjustments resulted in $51 million of after-tax gains ($78 million, before tax) in the first quarter, or $0.10 per share. We do not adjust our profit for pricing adjustments.

5

Teck Resources Limited 2021 First Quarter News Release

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Disclaimer

Teck Resources Limited published this content on 27 April 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 April 2021 07:46:05 UTC.