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Highlights
- Q3 Financial Results: Taseko Mines achieved $48 million in Adjusted EBITDA and $156 million in revenue from copper and molybdenum sales.
- Operational Setbacks: Maintenance and project delays at Gibraltar led to lower-than-expected copper output, with annual guidance adjusted to 105-110 million pounds.
- Positive Outlook for 2025: Higher copper grades and increased production forecasted, bolstered by new contracts and a strategic hedging program.
Taseko Mines Limited (TSX:TKO; NYSE American:TGB; LSE:TKO) reported robust financials for Q3 2024, including Adjusted EBITDA of $48 million and mining earnings (excluding amortization and one-off items) of $55 million. Total revenue reached $156 million, derived from the sale of 26 million pounds of copper and 348,000 pounds of molybdenum. However, the company faced operational challenges that slightly dampened production and led to a minor net loss of $0.2 million.
During the third quarter, Gibraltar mine produced 27.1 million pounds of copper and 421,000 pounds of molybdenum, driven by a steady copper grade of 0.23%. While tons milled increased from Q2, unplanned downtimes—largely due to the crusher relocation project and scheduled maintenance—impacted mill availability and throughput. This led to a revised 2024 copper production forecast, now expected at 105-110 million pounds, down from the initial 115-million-pound target.
Operational Review and Future Projections
In Q3, copper recoveries rose modestly to 79%, while molybdenum production saw a 33% uptick in grade due to ore from the new Connector pit. Taseko’s operations benefited from its prudent hedging strategy, securing minimum copper prices through contracts covering 21 million pounds of copper for Q4 2024 at $3.75 per pound and 108 million pounds for 2025 at $4.00 per pound. Copper collar contracts have ceiling prices ranging from $5.00 to $5.40 per pound, giving Taseko significant protection during the Florence construction period.
Looking ahead, Gibraltar's operations are expected to improve, with the recently completed crusher relocation expected to enhance mill throughput in Q4. The Connector pit will serve as the primary ore source moving forward, while mining at the Gibraltar pit is set to wrap up by Q1 2025. The company is also refurbishing its SX/EW plant, idle since 2015, with plans to restart it by mid-2025.
Revised 2025 Guidance and Strategic Contracts
For 2025, Taseko anticipates improved copper head grades and increased production, with copper output forecasted at 120-130 million pounds. To support production, lower-grade ore stockpiles will supplement mined ore in early 2025, with copper production weighted towards the latter half of the year. Additionally, molybdenum output is expected to rise due to higher grades in the Connector pit.
Taseko recently secured new offtake contracts for Gibraltar’s copper concentrate, expecting to reduce Treatment Charges and Refining Charges (TCRCs) to nil by 2025. This strategic move, along with hedging initiatives, positions the company favorably against market fluctuations.
Financial Performance
In Q3, the company achieved cash flow from operations of $65 million, including a $26.3 million insurance settlement. While recording a net loss of $0.2 million, Taseko posted an adjusted net income of $8 million, or $0.03 per share. With higher anticipated production levels and a growing presence in copper and molybdenum markets, Taseko’s outlook for 2025 remains positive.
