Download/view Q1 2010 Report for the full text of this release (196KB)

Excerpt:

Vancouver, BC Teck Resources Limited (TSX: TCK.A and TCK.B, NYSE: TCK) announced record quarterly earnings of $908 million, or $1.54 per share, for the first quarter of 2010. Our operating profit before depreciation was $844 million and EBITDA was $1.5 billion in the first quarter.

Don Lindsay, President and CEO said, "The results of the quarter reflect two important themes. First, our ongoing operations continue to produce strong results, and second, completing the previously announced asset sales has allowed us to achieve our balance sheet targets and to return to investment grade credit metrics earlier than planned. Our operating results reflect strong copper prices, but do not yet reflect the substantial increases in steelmaking coal prices that have been negotiated. The remainder of the year is also expected to see the benefit of increased copper production from the Andacollo concentrate project, which is the first in our pipeline of copper expansion projects.

Highlights and Significant Items

On April 19, we gave notice to our term lenders to repay the remainder of our term loan on April 22, 2010. At that time we will have retired all of the original US$9.8 billion Fording acquisition debt.

Including the payment noted above, we will have made debt repayments of $2.4 billion on a year-to-date basis. In the 18 months since the Fording acquisition we will have reduced our total debt by $8.0 billion, from $13.4 billion to $5.4 billion.

Since April 1, 2010 each of Standard Poors, Dominion Bond Rating Service and Fitch Ratings have rated Teck investment grade.

EBITDA was $1.5 billion in the first quarter on record first quarter revenues of $1.9 billion.

We completed the sale of a number of our non-core assets in the quarter, including the sale of a one-third interest in the Waneta Dam, an interest in future gold production from Carmen de Andacollo and certain Turkish gold properties for total proceeds of $1.1 billion.

At the Carmen de Andacollo concentrator project, first ore was delivered to the mill on January 19, 2010. The process water supply issues have been resolved and the project was commissioned in the first quarter. Design capacity is expected to be reached by the third quarter. The new plant is expected to produce approximately 80,000 tonnes of copper and 55,000 ounces of gold in concentrate annually over the first 10 years of the project. The first shipment of concentrate is scheduled for April 29.

We have agreed on coal prices with the majority of our customers for the quarter that commenced April 1, 2010. Early pricing settlements, covering most of our tonnage for that quarter, were reached at the US$200 per tonne level for our highest quality coal, and our recent settlements have reached as high as US$235 per tonne. We are currently taking all reasonable steps to maximize our production levels in light of the tight market for steelmaking coal.

Coal transportation costs have decreased in the first quarter compared to the same period in 2009 primarily because of lower rail rates for the westbound transportation of coal from our five mines in British Columbia. Those savings will continue based on the one year contract that has been agreed for the year commencing April 1, 2010. Transportation costs are expected to decline further beyond March 31, 2011 when port charges will decline due to the elimination of the remaining link between the price of our coal and the port charges paid to Westshore Terminals.

Red Dog received a new water discharge permit and a wetlands permit to allow the mine to extend mining into the new Aqqaluk ore body. Discussions continue with the EPA to address concerns arising from the withdrawal of key conditions in the water permit as a result of an appeal.

Download/view Q1 2010 Report for the full text of this release (196KB)

This managements discussion and analysis is dated as at April 20, 2010 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, 2010 and with the audited consolidated financial statements of Teck and the notes thereto for the year ended December 31, 2009. 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 managements discussion and analysis for the year ended December 31, 2009, 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.

CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION

This news release contains certain forward-looking information and forward-looking statements as defined in applicable securities laws. All statements other than statements of historical fact are forward looking statements. These forward-looking statements, principally under the heading Outlook, but also elsewhere in this document, include estimates, forecasts, and statements as to managements expectations with respect to, among other things, our future production, earnings and cash flow, our plans for our oil sands investments and other development projects, forecast production and operating costs, expected progress and costs of our Andacollo concentrate and Antamina expansion projects, the sensitivity of our earnings to changes in commodity prices and exchange rates, the potential impact of transportation and other potential production disruptions, the impact of currency exchange rates, future trends for the company, progress in development of mineral properties, future production and sales volumes, capital expenditures and mine production costs, demand and market outlook for commodities, future commodity prices and treatment and refining charges, the settlement of coal contracts with customers, access to and treatment and disposal of process water at our operations, the outcome of mine permitting currently underway, particularly our ability to obtain the permits necessary for the development at the Aqqaluk deposit at our Red Dog mine in light of appeals to those permits, and the outcome of legal proceedings involving the company. These forward-looking statements involve numerous assumptions, risks and uncertainties and actual results may vary materially.

These statements are based on a number of assumptions, including, but not limited to, assumptions regarding general business and economic conditions, interest rates, the supply and demand for, deliveries of, and the level and volatility of prices of, zinc, copper and coal and other primary metals and minerals as well as oil, and related products, the timing of the receipt of regulatory and governmental approvals for our development projects and other operations, our costs of production and production and productivity levels, as well as those of our competitors, power prices, market competition, the accuracy of our reserve estimates (including with respect to size, grade and recoverability) and the geological, operational and price assumptions on which these are based, conditions in financial markets and the future financial performance of the company. The foregoing list of assumptions is not exhaustive. Events or circumstances could cause actual results to vary materially.

Factors that may cause actual results to vary materially include, but are not limited to, changes in commodity and power prices, changes in interest and currency exchange rates, acts of foreign governments and the outcome of legal proceedings, inaccurate geological and metallurgical assumptions (including with respect to the size, grade and recoverability of mineral reserves and resources), unanticipated operational difficulties (including failure of plant, equipment or processes to operate in accordance with specifications or expectations, cost escalation, unavailability of materials and equipment, government action or delays in the receipt of government approvals, industrial disturbances or other job action, adverse weather conditions and unanticipated events related to health, safety and environmental matters), political risk, social unrest, failure of customers or counterparties to perform their contractual obligations, changes in our credit ratings, and changes or further deterioration in general economic conditions.

Statements concerning future production costs or volumes, and the sensitivity of the companys earnings to changes in commodity prices and exchange rates are based on numerous assumptions of management regarding operating matters and on assumptions that demand for products develops as anticipated, that customers and other counterparties perform their contractual obligations, that operating and capital plans will not be disrupted by issues such as mechanical failure, unavailability of parts and supplies, labour disturbances, interruption in transportation or utilities, adverse weather conditions, and that there are no material unanticipated variations in the cost of energy or supplies.

We assume no obligation to update forward-looking statements except as required under securities laws. Further information concerning risks and uncertainties associated with these forward looking statements and our business can be found in our Annual Information Form for the year ended December 31, 2009, filed on SEDAR and on EDGAR under cover of Form 40F.

WEBCAST

Teck will host an Investor Conference Call to discuss its Q1/2010 financial results at 11:00 AM Eastern time, 8:00 AM Pacific time, on Wednesday, April 21, 2010. A live audio webcast of the conference call, together with supporting presentation slides, will be available at our website at www.teck.com. The webcast is also available at www.teck.com. The webcast is also available at www.earnings.com. The webcast will be archived at www.teck.com.

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