Teck Reports Unaudited Third Quarter Results for 2016

VANCOUVER, Oct. 27, 2016 - Teck Resources Limited (TSX: TCK.A and TCK.B, NYSE: TCK) ("Teck") reported profit attributable to shareholders of $234 million ($0.41 per share) and adjusted profit of $152 million ($0.26 per share) compared with $29 million ($0.05 per share) a year ago.

"Our operations have performed very well throughout the year, setting a number of quarterly and year-to-date production records while continuing to reduce costs," said Don Lindsay, President and CEO. "As a result of the recent increase in steelmaking coal prices, we are generating a significant amount of additional cash which we have used to reduce our debt by repurchasing $1.0 billion of our outstanding notes."


Highlights and Significant Items

- Adjusted EBITDA was $830 million in the third quarter, more than double the $389 million recorded a year ago.

- Gross profit before depreciation and amortization was $817 million in the third quarter compared with $670 million in the third quarter of 2015.

- Cash flow from operations was $854 million in the third quarter of 2016 compared with $560 million a year ago.

- In September and early October, we repurchased US$759 million (CAD$1.0 billion) face value debt in market transactions, recording a gain of approximately CAD$75 million. At October 26, our outstanding notes totaled US$6.1 billion, down from US$7.2 billion at September 30, 2015.

- Our liquidity remains strong at CAD$4.7 billion inclusive of approximately CAD$690 million in cash at October 26, 2016 and US$3.0 billion of undrawn, committed credit facilities. We now expect that we will exceed our original target and end the year with a cash balance of approximately CAD$1.0 billion after having retired CAD$1.0 billion of debt, which was not contemplated in our original guidance.

- We set a number of quarterly and year-to-date sales and production records while reducing total costs in each of our business units.

- We expect total steelmaking coal sales, including spot sales, to be at or above 6.5 million tonnes in the fourth quarter of 2016.

- Our average realized fourth quarter price for steelmaking coal is expected to be in our typical range, in percentage terms, relative to the US$200 per tonne benchmark price which has been reported for the highest quality steelmaking coal.

- Construction of the Fort Hills oil sands project has surpassed 70% completion. Project execution is now effectively site-based, as the module program has been completed and substantially all the remaining construction components are now on-site.

- The Red Dog concentrate shipping season is expected to be completed in the first week of November after a two week extension due to favourable ice conditions. We expect to ship approximately 1,075,000 tonnes of zinc concentrate and 220,000 tonnes of lead concentrate.

- For the seventh straight year, we have been named to the Dow Jones Sustainability World Index (DJSI), indicating that our sustainability practices are in the top 10% of the 2,500 largest companies in the S&P Global Broad Market Index.

This management's discussion and analysis is dated as at October 26, 2016 and should be read in conjunction with the unaudited consolidated financial statements of Teck Resources Limited ("Teck") and the notes thereto for the three and nine months ended September 30, 2016 and with the audited consolidated financial statements of Teck and the notes thereto for the year ended December 31, 2015. 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, 2015, 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

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