Mr. Philip Pascall reports

FIRST QUANTUM MINERALS REPORTS FOURTH QUARTER AND FULL YEAR 2018 RESULTS

First Quantum Minerals Ltd. had comparative earnings of $182-million (26 cents per share), net earnings attributable to shareholders of the company of $198-million (29 cents per share) and cash flows from operating activities of $338-million (49 cents per share) for the three months ended Dec. 31, 2018 (in United States dollars, except where noted otherwise).

For the full year 2018, the company reports comparative earnings of $487-million (71 cents per share), net earnings attributable to shareholders of the company of $441-million (64 cents per share) and cash flows from operating activities of $1,980-million ($2.88 per share).

Fourth quarter and full year 2018 summary:

• Operations delivered solid results with lower costs:
  • 158,304 tonnes of copper produced in the fourth quarter:
    • Record Q4 production at Sentinel of 60,840 tonnes, reflecting continued improvement quarter over quarter in production and costs.
  • Q4 unit cost of copper production: All-in sustaining cost equal to $1.68 per pound; cash cost equal to $1.23 per pound; total cost equal to $2.04 per pound;
  • 605,853 tonnes of copper produced for the full year;
  • 2018 full year unit cost of copper production: AISC equal to $1.74 per pound; C1 equal to $1.28 per pound; C3 equal to $2.11 per pound.
• Strong operating cash flows and continued liquidity; dividend declared:
  • $338-million of cash flows from operating activities (49 cents per share) during the quarter, an increase of 67 per cent from the comparable prior-year period;
  • $1,980-million of cash flows from operating activities ($2.88 per share) during all of 2018;
  • Ended the quarter and year with $788-million in net unrestricted cash and cash equivalents, $700-million of committed undrawn facilities, and in full compliance with all financial covenants;
  • Final dividend declared of 0.5 cent in respect of the 2018 year-end; total dividends for the full year 2018 were one cent.
• Cobre Panama project nears completion as of year-end:
  • The focus at the Cobre Panama project remains on construction completion, commissioning of the process plant, and commissioning and ramp-up of the power station. During the quarter, project prestrip was completed, engineering and procurement were essentially completed, and the tailings management facility earthworks advanced to 87-per-cent completion. Construction of the two power sets was completed in the quarter with commissioning being well advanced with the reliability and ramp-up program for set 1 completed in January, 2019. Set 2 is in full commissioning with synchronization to the grid having occurred in January, 2019. Extensive process plant commissioning and testing were continuing throughout the quarter in preparation for production. First ore was introduced to the mill on Feb. 11, 2019. The project remains scheduled for ramp-up over 2019 and 2020.
  • During 2019, Cobre Panama mine is expected to produce 140,000 to 175,000 tonnes of contained copper and by year-end be running at an annualized rate of 72 million tonnes per year. Limited copper production is expected in the first half of 2019 while the commissioning and start-up continue with approximately 80 per cent of production expected to occur in the second half of the year. Commercial production will be declared in arrears and is expected to occur in the final quarter of 2019.
  • In 2020, contained copper production of between 270,000 to 300,000 tonnes is expected as a throughput rate of 85 million tonnes per year is reached. In 2021, production of approximately 300,000 tonnes of contained copper is expected, increasing in 2022 to 350,000 tonnes. In 2022, the C1 unit cost of production is estimated at $1.20 per pound and $1.50 per pound all-in sustaining. Both estimates are net of an assumed byproduct credit principally gold as well as some molybdenum and silver, of approximately 25 cents per pound. Gold production in 2020 and 2021 is estimated at approximately 100,000 ounces per year.

Chief executive officer's comments

"Two thousand eighteen was a very important year for the company with the development of Cobre Panama nearing completion. We achieved record production for the year, ahead of target, and in line with the expected low unit production costs. Much of this was due to a 17-per-cent increase in production at Sentinel," noted Philip Pascall, chairman and chief executive officer. "Our financial results for the quarter and the full year reflect this strong operating performance through the year.

"Two thousand nineteen will be another important year for the company. With Cobre Panama starting operation and the continuing steady production from our existing mines, we expect significantly higher output. I appreciate and laud our staff and employees for what was accomplished in 2018 and look forward to another exciting and productive year," Mr. Pascall concluded.

                              OPERATING HIGHLIGHTS
                         (U.S. dollars where applicable) 
  
                             Three months ended Dec. 31,   Full year ended Dec. 31,
                                      2018         2017         2018          2017

Copper
Production (tonnes)                158,304      154,319      605,853       573,963
Sales (tonnes)                     156,212      151,905      596,513       580,130
Cost of production
AISC (per lb)                        $1.68        $1.76        $1.74         $1.65
C1 (per lb)                          $1.23        $1.30        $1.28         $1.23
C3 (per lb)                          $2.04        $2.16        $2.11         $2.05
Realized price (per lb)              $2.83        $2.50        $2.84         $2.33
Gold
Production (ounces)                 48,039       51,904      185,414       199,736
Sales (ounces)                      53,221       50,723      193,072       201,376

                                      FINANCIAL HIGHLIGHTS
                        (U.S. dollars in millions, unless otherwise noted) 

                                               Three months ended Dec. 31,     Full year ended Dec. 31,
                                                       2018          2017           2018          2017

Sales revenue                                        $1,054          $885         $3,966        $3,310
Gross profit                                            280           117            978           335
Net earnings (loss) attributable to
shareholders of the company                             198          (115)           441          (316)
Basic and diluted earnings (loss) per share            0.29         (0.27)          0.64         (0.46)
Comparative EBITDA                                      481           318          1,737         1,154
Comparative earnings (loss)                             182           (36)           487          (111)
Comparative earnings (loss) per share                  0.26         (0.05)          0.71         (0.16)
Cash flow from operating activities                     338           203          1,980           914

Other

On Jan. 23, 2019, the company announced a land slippage at Cobre Las Cruces, and production at the hydrometallurgical plant was suspended immediately. Prior to the incident, mine personnel identified a risk and immediately implemented safety protocols. Following the incident, the pit was evacuated and no injuries occurred. On Feb. 1, 2019, the production resumed at the processing plant with the processing of lower-grade stockpiled ore, which is expected to continue for the next several months while the necessary regulatory approvals are obtained to begin the mining of phase 6, an area unaffected by the incident.

On Feb. 6, 2019, the company signed a new $2.7-billion term loan and revolving credit facility underwritten by three core relationship banks. This new facility replaces the existing $1.5-billion revolving credit facility. The new $2.7-billion facility (with an accordion feature to increase it up to $3.0-billion before the end of 2019) comprises a $1.5-billion term-loan facility and a $1.2-billion revolving credit facility (which can be upsized to $1.5-billion if the accordion feature is activated), maturing on Dec. 31, 2022. This financing includes revised financial covenants, extends the debt maturity profile of the business, demonstrates the company's access to a diverse range of capital markets and improves the financial flexibility of the company through the added liquidity. The facility will be used for the redemption of the $1,121-million senior notes due February, 2021, in full, or in part, and for general corporate purposes.

                    PRODUCTION AND COST OUTLOOK
                             (000s)   

                                                 2019       2020     2021

Total copper (tonnes)                         700-735    840-870      820
Cobre Panama -- copper (tonnes)               140-175    270-300      300
Copper (tonnes) -- excluding Cobre Panama         560        570      520
Gold (ounces) -- excluding Cobre Panama           185        180      170
Zinc (tonnes)                                      12          2        -

Production guidance for Las Cruces reflects the land slippage in January, 2019, with lost production currently estimated at 25,000 tonnes in 2019. Production at Las Cruces for 2020 has also been reduced by a further 25,000 tonnes from amounts previously disclosed as certain high-grade ore is no longer planned to be mined as part of the open-pit operation. The open-pit mining operations are expected to be completed in the second half of 2020.

In terms of quarterly phasing of annual production, it is expected that production at Zambian operations will be at its lowest in the first quarter. The first and second quarters will also be impacted by lower production at Las Cruces following the land slippage.

The wet season in Zambia generally starts in November and continues through April, with the heaviest rainfall normally experienced in the months of December, January, February and March. As a result of the wet season, pit access and the ability to mine ore are lower in the first quarter of the year than other quarters and the cost of mining is higher.

Cash costs and AISC guidance in the attached tables do not include any costs in respect of Cobre Panama.

Copper                  2019          2020          2021

C1 (per lb)      $1.20-$1.40   $1.20-$1.40   $1.20-$1.40
AISC (per lb)    $1.70-$1.85   $1.70-$1.85   $1.70-$1.85

Increase in AISC guidance reflects higher Zambian royalty and gold sales levy rates effective Jan. 1, 2019. This has increased AISC by five cents per pound in all three years. It is expected that a Zambian sales tax will be introduced from April 1, 2019, and that this will result in increased C1 and AISC unit costs. However, guidance given excludes the impact of the sales tax as the rate to be introduced has not yet been confirmed by the government of the Republic of Zambia.

Conference call and webcast

Conference call and webcast details:

Date:  Feb. 15, 2019

Time:  9 a.m. ET; 2 p.m. GT; 6 a.m. PT

Webcast:  First Quantum website

Dial-in (North America) (toll-free):  877-291-4570

Dial-in North America and international:  1-647-788-4919

Dial-in United Kingdom (toll-free):  0-800-051-7107

Replay:  available from noon ET on Feb. 15, 2019, until 11:59 p.m. ET on March 3, 2019

North America (toll-free):  800-585-8367

North America and international:  1-416-621-4642

Passcode:  5469795

Complete financial statements and management's discussion and analysis

The complete consolidated financial statements and management's discussion and analysis for the year ended Dec. 31, 2018, are available on the First Quantum website and should be read in conjunction with this news release.

We seek Safe Harbor.