First Quantum Minerals Ltd.
LSE : FQM
TSX : FM

First Quantum Minerals Ltd.

November 08, 2005 13:22 ET

First Quantum Reports Operational and Financial Results for Three Months and Nine Months Ended September 30, 2005

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Nov. 8, 2005) - (All figures expressed in US dollars)

First Quantum Minerals Ltd. (TSX:FM)(LSE:FQM) is pleased to announce its results for the three months and nine months ended September 30, 2005. The complete Financial Statements and Management Discussion and Analysis are available for review at www.first-quantum.com and should be read in conjunction with this News Release.

Highlights - Three Months Ended September 30, 2005

- Net earnings of $39.5 million or $0.64 (CDN$0.75) per share

- Cash flows from operating activities, before working capital movements, of $81.1 million or $1.32 (CDN$1.55) per share

- Copper production of 36,196 tonnes (79.8 million pounds)

- Selling price before realization charges of $1.77 per pound of copper

- Production of contained copper from Kansanshi increased by 27% to 23,065 tonnes (50.8 million pounds) in the third quarter and to 10,239 tonnes (22.6 million pounds) in October 2005

- The Guelb Moghrein project construction in Mauritania reached 71% completion

- Interim dividend declared in August of CDN$0.02 per share

Financial Results (see attached financial statements)

Third quarter revenues were $143.0 million, which included copper revenues of $138.4 million ($88.8m Kansanshi and $49.6m Bwana/ Lonshi), gold revenues of $3.4 million, and acid revenues of $1.2 million. Copper revenues at Kansanshi comprised $57.5 million from copper cathodes and $31.3 million from copper concentrates. Copper revenues increased from the second quarter due to improvements in both the market price for copper and a 21% increase in copper production.

The realized copper price was $1.58 per pound for the quarter a significant increase from last year due to the increased market price for copper and the Company's unhedged copper position. The realized copper price is calculated by deducting treatment and refining charges (TC/RCs) and freight parity charges from the selling price before realization charges. The copper selling price, before realization charges, for the quarter was $1.77 per pound, which was higher than the average LME cash price of $1.71 per pound, due to favourable contract pricing adjustments.

Certain copper sales agreements entered into by the Company call for "provisional pricing" based on the average applicable copper price for a specified future monthly period. Included within copper revenue for the quarter was 28,315 tonnes of copper that has been provisionally priced using a provisional average LME copper price of $1.75 per pound. The average LME cash price for the month of October was $1.84.

Gold revenues represent a credit from the sale of copper concentrates. Each tonne of concentrate generally contains between 3 and 5 grams of gold for which a net credit is received by the Company after the deduction of the gold realization charges.

Cost of sales as a percentage of revenue decreased to 38% in the third quarter of 2005. Although unit costs have risen from 2004, the cost of sales has decreased as a percentage of revenue which is explained by rising copper prices and the addition of copper concentrates to the sales mix in 2005.

For the purposes of financial reporting, TC/RCs and freight parity charges are recognized as a revenue deduction and are not included within the cost of sales. However, to facilitate cross-industry comparison these costs are included in the determination of cash and total unit costs.

The cash inflow from operating activities, before working capital movements, was $81.1 million or $1.32 per share. The cash inflow from operating activities, after working capital movements, was $69.8 million or $1.13 per share. Included within operating cash flow, after working capital movements, is the receipt of $9.5 million relating to deferred revenue as the Company was prepaid for a portion of its copper concentrate sales which is to be delivered in the fourth quarter.

Net earnings for the quarter increased to $39.5 million or $0.64 per share compared with second quarter net earnings of $29.0 million or $0.47 per share.

Year to date revenues were $267.7 million which comprised copper revenues of $259.9 million, gold revenues of $4.0 million and acid revenues of $3.8 million. Copper revenues at Kansanshi were $133.3 million, comprised of $86.7 million for copper cathode and $46.6 million for copper in concentrate. Kansanshi revenue figures only include revenues from the commencement of commercial production (April 19, 2005). Copper revenues at Bwana/Lonshi were $126.6 million. Copper revenues increased due to improvements in both the market price for copper and an increase in copper production with the start of commercial production at Kansanshi and increased copper production from the Bwana/Lonshi operation.

The realized copper price was $1.50 per pound for the nine months, a significant increase from last year due to the rising market price for copper and the Company's unhedged copper position. The copper selling price, before realization charges, for the nine months was $1.63 per pound which was higher than the average LME cash price of $1.58 per pound, due to favourable contract pricing adjustments. Included within the year to date copper revenues were 28,315 tonnes of copper that has been provisionally priced using a provisional average LME copper price of $1.75 per pound. The average LME cash price for the month of October was $1.84.

Cost of sales increased by 167% to $105.0 million, which is consistent with the 180% increase in copper production due to the commencement of commercial production at Kansanshi and the increased copper production from the Bwana/Lonshi operation.

The cash flow from operating activities, before working capital movements, was $136.2 million or $2.22 per share. The cash inflow from operating activities, after working capital movements, was $87.4 million or $1.42 per share. The significant turnaround in cash flow from operations is attributable to the improvement in earnings resulting from increased copper production and the higher copper prices. The difference between the cash flow before and after working capital movements can be attributed principally to the increase in both accounts receivable and inventory at Kansanshi.

Net earnings for the nine months increased to $95.7 million or $1.56 per share, including the gain on sale from Anvil of $16.1 million or $0.26 per share.

Kansanshi Mining and Processing

During the quarter, 1,621,000 tonnes of ore and 6,064,000 tonnes of waste were mined. The increase in volumes mined from previous quarters has resulted from improved fleet availability (less trucks standing due to lack of tires), and the arrival of additional trucks during the quarter. The recent Zambian diesel shortage has not had a material impact on operations as contracted suppliers were able to continue steady deliveries. Notwithstanding, the Company is looking to build up diesel stocks to mitigate the potential for any future shortages. For the third quarter, contained copper production increased 27% to 23,065 tonnes. Kansanshi continues to ramp up production after commencing commercial production in April 2005. Based on production levels achieved in October, Kansanshi is currently producing at an annualized rate of in excess of 120,000 tonnes of contained copper.

During the quarter, Kansanshi produced 14,395 tonnes of copper cathode at a cash cost of $0.52 per pound and a total cost of $0.73 per pound. Costs continue to trend lower as the volume of copper cathode increases. During the quarter, Kansanshi produced 8,670 tonnes of contained copper in the form of concentrates at a cash cost of $0.71 per pound and a total cost of $0.90 per pound. The increase in cash costs for concentrate were due to higher realization charges resulting from a change in the sales mix between domestic and international off-take, higher fuel costs and the replacement of the sulphide mill lifters and liners that was required during the quarter. The combined cash cost for both concentrate and cathode was $0.59 per pound with a total cash cost of $0.80 per pound. The cash cost was slightly lower than the previous quarter principally due to the increased volumes offset by the slightly higher concentrate production costs.

For the nine months ended September 30, 2005, 5,791,000 tonnes of ore and 10,901,000 tonnes of waste had been mined. The world tire shortages and diesel shortages in Zambia have not impacted processing at Kansanshi. The tire shortage has meant that some waste stripping that was scheduled for the start of the year has been rescheduled. To date, the diesel shortage has only had a minimal impact on mining activities. Copper production increased to 48,754 tonnes, including 23,612 tonnes of copper in concentrate and 25,142 tonnes of copper cathode.

Included within the copper production figures for the year to date are 6,792 tonnes of copper in concentrate and 1,941 tonnes of finished copper cathode that were produced prior to commercial production.

Bwana/Lonshi Mining and Processing

Effective July 1, 2005, the Company adopted a new mine plan for Lonshi, the effect of which was to increase the remaining life of mine strip ratio from 12:1 to 26:1. The increase in the strip ratio is the result of the removal of dolomitic oxide ore and greater amounts of sulphide ore than in the previous mine plan. Due to the accelerated mining plan and significantly increased copper production at Bwana being achieved it is anticipated that the current reserves will be exhausted early in 2008.

During the third quarter, approximately 300,000 tonnes of ore and approximately 4,707,000 tonnes of waste were mined from Lonshi. The strip ratio for the quarter was 16:1. While minor mining production losses occurred (6 days in the quarter) due to the Zambian diesel shortage, a number of additional sources are now being used to supply diesel. By increasing site stock levels of diesel, it is expected that there will be no material impact on production if there is a continuation of the Zambian diesel shortage.

During the third quarter, copper production increased to a record 13,131 tonnes. Cash costs were $0.74 per pound and total costs were $1.01 per pound of copper. With the introduction of the new mine plan at Lonshi and the resulting increase in the strip ratio from 12:1 to 26:1, the cost of ore has increased by approximately $0.14 per pound compared with the second quarter of 2005. The ore cost has also increased as a result of the higher than budgeted fuel costs arising from the increase in world oil prices.

Acid production increased to 64,263 tonnes, of which 32,400 tonnes were produced at Ndola and 31,863 tonnes at Solwezi. Of the total acid produced, 7,120 tonnes were sold externally and 26,323 tonnes were sold to Kansanshi. The cash costs of $0.74 per pound include a $0.06 per pound credit from the Solwezi acid plant.

For the nine months ended September 30, 2005, approximately 771,000 tonnes of ore and approximately 11,328,000 tonnes of waste were mined from Lonshi. The strip ratio for the nine months was 15:1, which is less than the new mine life strip ratio established on July 1, 2005 of 26:1. The increased strip ratio combined with, the higher actual mining costs in 2005, has meant that the ore costs have risen $0.11 per pound compared with the same period last year.

Copper production increased to 36,876 tonnes. The 20% increase over the same period in 2004 was principally as a result of being able to operate the tankhouses at record high current densities.

Cash costs were $0.63 per pound and total costs were $0.86 per pound. The increase in cash costs from 2004, can be attributed to the increase in ore costs ($0.11 per pound) coupled with an increased acid costs ($0.05 per pound) due to the increased gangue acid consumption resulting from the increased levels of dolomitic and sulphide ore. The increased internal consumption of acid has also reduced the acid credit available from the Ndola plants. These costs have been slightly offset by the acid credit from the Solwezi acid plant of $0.06 per pound.

Acid production was 188,756 tonnes of which 99,645 tonnes were produced at Ndola and 89,111 tonnes at Solwezi. Of the total acid produced, 32,382 tonnes were sold externally and 49,576 tonnes were consumed at Kansanshi. Annual acid production capacity at Ndola and Solwezi is 146,000 tonne per site.

Guelb Moghrein Copper-Gold Deposit, Marutainia

Guelb is located 250 kilometres northeast of the nation's capital, Nouakchott, near the town of Akjoujt, in Mauritania. It consists of an open pit mineable copper/gold deposit. In January 2005, the detailed design and engineering contract was awarded with site establishment commencing in March 2005. Commissioning will start during the first quarter of 2006 with commercial production expected in the second quarter of 2006. Production will be initially targeted at approximately 30,000 tonnes of copper in concentrate and 70,000 ounces of gold per year.

As at September 30, 2005, the Company had capitalized acquisition and development costs totalling $32.1 million (2004: $10.3m). Of the capitalized amount, $7.6 million relates to the discounted value of the deferred acquisition payments.

Detailed design is now complete and overall the project is approximately 71% complete. The recent military coup in Mauritania has had no impact on the construction program and the new government has pledged to honour all existing agreements. Site civil works are largely complete and structural steel is currently being erected. During the quarter the Environmental and Social Impact Assessment report was submitted to the Ministry of Mines and Industry in Nouakchott and is expected to be approved shortly, which will result in the issuance of the mining license.

Frontier Copper Deposit, Democratic Republic of Congo

In May 2004, First Quantum announced the results of an independent copper-cobalt resource estimate completed at Frontier Project located in Haut Katanga Province, DRC.

As at September 30, 2005, the company had spent $6.8 million (2004: $3.7m) on this project. The current scoping study envisages an average annual production of 80,000 tonnes of contained copper. The Company expects to release this study in the fourth quarter.

Kashime Copper Prospect, Zambia

At the end of September, assay results from the initial 40 hole programme had been received and an additional 3 diamond drill holes had been completed to provide ore grade oxide material for metallurgical test-work. Drilling to date has located both oxide and sulphide copper mineralization over a strike length of 3500m. Oxide mineralization occurs as black copper minerals and malachite within residual dolomite overlying the Grand Conglomerate in a stratigraphic position equivalent to the Lonshi ore body. Significant oxide mineralization is confined to a shallow-dipping (10-15 degrees South) zone with approximate dimensions of 2500 x 400m and open to the west. Thickness of the oxide zone ranges from 6m to 45m and overburden varies from as little as 2m to 73m. Highlights from the diamond drill programme include oxide intersections (0.5%TCu cut-off) of 16.5m grading 6.81%TCu, 30.00m grading 3.06%TCu and 18.00m grading 3.23%TCu. An oxide resource estimate is expected to be available during the fourth quarter 2005.

Significant sulphide intersections include 65.00m grading 1.11%TCu and 93.00m grading 0.90%TCu. The Company has plans for infill drilling to improve definition of the oxide resource and additional exploration of the sulphide potential of the Kashime area.

During the nine months ended September 2005, the Company expensed $3.1 million (2004: $1.0m; 2003: $0.2m) on other exploration targets that were predominantly located within the DRC and Zambia. Of this amount, $0.7 million was related to the Kashime Copper Prospect. As at September 30, 2005, no costs associated with this exploration property have been deferred.

Investments - Carlisa

The Company holds an 18.8% interest in Carlisa Investment Corporation (Carlisa), which holds a 90% interest in Mopani Copper Mines Plc (Mopani). The carrying value of this investment as at June 30, 2004 is $9.5 million. There has been no movement in this investment since 2002.

For the first nine months of 2005, Mopani produced approximately 97,000 tonnes of finished copper and 1,300 tonnes of cobalt. As the majority owner of Mopani is a private company registered in Zambia, only limited public information is available.

Investments - Anvil

On February 28, 2005, the Company disposed of all of its 4,029,617 common shares in Anvil at a net price of CDN$6.75 per share. In the first quarter of 2005, the Company recognized a gain of approximately $16.1 million on this sale. The Company continues to hold 296,631 warrants in Anvil at an exercise price of CDN$1.13.

Outlook

Production at Kansanshi has continued to improve month over month since commercial production began in mid-April. In October, Kansanshi produced 10,239 tonnes of copper (6,530 tonnes of cathode copper and 3,709 tonnes of copper in concentrate) and production volumes are expected to continue at these levels for the remainder of 2005. Harder ore than predicted from the original testwork has reduced throughput volumes in the sulphide circuit and consequently there has been a slower ramp up in copper concentrate production. In the near term, the ore hardness issue is being managed via the blending of soft and hard ores, and a long term solution has been implemented through the modification of the mills to allow for pebble discharge and the addition of pebble crushing which will be completed at the same time as the upgrade referred to below. As a result of the slower ramp in concentrate production, Kansanshi is now expected to produce 88,000 tonnes of copper in 2005 of which 7,000 tonnes preceded commercial production.

The completion of a $29 million capital upgrade program this year will expand the sulphide circuit to eight million tonnes per year of treatment capacity which will result in an average of 145,000 tonnes of finished copper production per year during 2006-2009. An additional expansion of the sulphide circuit is also under consideration for 2009 to increase the sulphide treatment capacity to 12 million tonnes of sulphide ore to maintain annual copper production of 145,000 tonnes as oxide ore is depleted and sulphide ore grades begin to fall.

The Company has also been investigating alternative processing routes for a portion of the increased copper concentrate production. To this end, the Company has purchased a second-hand pressure oxidation facility. The pressure oxidation facility has been dismantled and is in Zambia enroute to Kansanshi. Once on site, the pressure oxidation facility and ancillary equipment will be rebuilt and commissioned for use at an estimated total cost of $37 million. Commissioning of this plant is expected to commence by early in the third quarter of 2006 despite a recent set back when one of the two high pressure autoclave vessels required was damaged while being transported to site. Fortunately the second-hand facility purchased incorporated three autoclaves so transport of the third vessel, which was being stored at Richards Bay in South Africa, has now commenced while assessment of the damaged autoclave is undertaken. The other autoclave is now on site.

As part of the new pressure leach facility the Company will also be expanding the SX/EW capacity by an additional 35,000 tonnes of copper cathode production at an estimated cost of $35 million. The company expects that when fully operational these initiatives will provide significant strategic and economic benefits including the generation of much of the acid required for oxide leaching and a substantial improvement in copper recovery in mixed ores resulting from the leach circuit operating at elevated temperatures. A full report of the operation and impact of this process route is being prepared by independent consultants, Bateman Engineering Pty Ltd.

The Bwana/Lonshi operation is currently on track to produce between 45,000 to 50,000 tonnes of copper cathode in 2005 with 36,876 tonnes of copper cathode already produced during the first nine months of 2005. A revised mine plan for Lonshi was required due to the higher than originally planned production rate at Bwana has resulted in an increased strip ratio of 26:1 which will result in higher ore costs for the remaining life of the mine. Full year cash costs are now expected to be between $0.65 per pound and $0.70 per pound. The Company is currently assessing the alternative and most beneficial uses for the Bwana processing plant after the Lonshi ore has been exhausted. In October, the Bwana/Lonshi operation produced 4,247 tonnes of copper cathode.

At Guelb, the detailed design is now complete and construction 71% complete. Commissioning will start in the first quarter of 2006 and commercial production will be achieved in the second quarter. The company remains unable to release an engineering report as the current resource statement is not compliant with National Instrument 43-101.

At Frontier, the scoping study is complete and will be published during the fourth quarter of 2005. Subject to a positive production decision and Board of Directors approval pre-stripping and construction of civil works will begin in April 2006. At the Kashime prospect initial diamond drilling has been completed with an initial reserve estimate expected once the final assay results are available.

On Behalf of the Board of Directors of First Quantum Minerals Ltd.

G. Clive Newall

12g3-2b-82-4461

Listed in Standard and Poor's

Sedar Profile #00006237

Certain of the information contained in this news release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, including but not limited to those with respect to the prices of gold, copper, cobalt and sulphuric acid, estimated future production, estimated costs of future production, the Company's hedging policy and permitting time lines, involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the actual prices of gold, copper, cobalt and sulphuric acid, the factual results of current exploration, development and mining activities, changes in project parameters as plans continue to be evaluated, as well as those factors disclosed in the Company's documents filed from time to time with the Alberta, British Columbia, Ontario and Quebec Securities Commission and the United States Securities and Exchange Commission and the Alternative Investment Market operated by the London Stock Exchange.

The preceding discussion and analysis and financial review should be read in conjunction with management's discussion of critical accounting policies, risk factors and comments regarding forward looking statements contained in the audited consolidated financial statements for the period ended December 31, 2004. The following discussion and analysis of the Company's results of operations should also be read in conjunction with the unaudited consolidated financial statements and related notes.



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Table 8: Summary of Quarterly Results (unaudited)
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2005 2005 2005 2004
Statement of Operations Q3 Q2 Q1 Q4
and Deficit
(millions, except
where indicated)
Total Revenues 143.0 86.5 $ 38.2 $ 30.7
Cost of Sales 53.8 35.0 16.2 14.5
Net Earnings (Loss) 39.5 29.0 27.2 9.3
Basic Earnings per
share $ 0.64 $ 0.47 $ 0.44 $ 0.16
Diluted Earnings per
share $ 0.63 $ 0.46 $ 0.43 $ 0.15

Realized copper price $ 1.58 $ 1.42 $ 1.44 $ 1.20
Cash Costs (C1) (per
lb)(1) $ 0.64 $ 0.60 $ 0.58 $ 0.48
Total Costs (C3) (per
lb)(1) $ 0.87 $ 0.80 $ 0.75 $ 0.59

Total Copper Sold
(tonnes)(2) 39,864 26,535 12,000 10,872
Total Copper Produced
(tonnes) 36,196 29,909 19,525 10,942

Financial Position
(millions)
Working Capital $ 32.2 $ 47.1 $ 61.4 $ 33.9
Total Assets $ 641.5 $ 561.9 $ 523.1 $ 473.1
Weighted Average #
Shares (000's) 61,583 61,499 61,267 60,942

Kansanshi Production
Statistics
Mining:
Waste Mine (000's) 6,064 3,185 1,651 2,857
Ore Mined (000's) 1,621 2,051 2,120 1,346
Ore Grade % 2.0 2.0 1.7 2.4
Processing:
Ore Processed (000's) 1,461 1,129 688 -
Contained Copper
(tonnes) 27,510 21,145 11,541 -
Recovery % 84 86 65 -
Copper Produced
(tonnes) 23,065 18,192 7,497 -
Combined Cash Costs:
Cash Costs (per lb)(1) $ 0.59 $ 0.63 - -
Total Costs (per lb)(1) $ 0.80 $ 0.80 - -
Cathode Cash Costs:
Cash Costs (per lb)(1) $ 0.52 $ 0.61 - -
Total Costs (per lb)(1) $ 0.73 $ 0.80 - -
Concentrate Cash Costs $ 0.71 $ 0.65 - -
Total Concentrate Cash
Costs $ 0.90 $ 0.81 - -
Revenue (000's)
Copper Cathodes 57,531 29,165 - -
Copper Concentrates 31,253 15,309 - -
Total Revenues 88,784 44,474 - -

Bwana/Lonshi
Production Statistics
Mining:
Waste Mined (000's) 4,707 4,025 2,596 2,926
Ore Mined (000's) 300 319 152 261
Ore Grade % 3.9 5.5 5.3 6.4
Processing:
Ore Processed (000's) 363 328 264 256
Contained Copper
(tonnes) 15,003 13,354 13,804 12,824
Grade % 4.14 4.1 5.2 5.0
Recovery % 88 88 87 85
Copper Produced
(tonnes) 13,131 11,717 12,028 10,942
Acid Produced (tonnes) 64,263 69,218 55,275 35,671
Surplus Acid (tonnes) 7,120 14,939 49 9,664
Cash Costs (per lb)(1) $ 0.74 $ 0.57 $ 0.58 $ 0.48
Total Costs (per lb)(1) $ 1.01 $ 0.79 $ 0.75 $ 0.59
Revenues ($000's)
Copper Cathodes 49,602 38,899 38,172 -
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2004 2004 2004 2003
Statement of Q3 Q2 Q1 Q4
Operations and Deficit
(millions, except
where indicated)
Total Revenues $ 31.2 $ 26.3 $ 25.3 $ 19.9
Cost of Sales 14.1 13.1 12.1 13.0
Net Earnings (Loss) 7.9 4.1 6.7 1.4
Basic Earnings per
share $ 0.13 $ 0.07 $ 0.11 $ 0.02
Diluted Earnings per
share $ 0.13 $ 0.07 $ 0.11 $ 0.02

Realized copper price $ 1.16 $ 1.11 $ 1.03 $ 0.84
Cash Costs (C1) (per
lb)(1) $ 0.45 $ 0.48 $ 0.39 $ 0.47
Total Costs (C3) (per
lb)(1) $ 0.68 $ 0.67 $ 0.53 $ 0.66

Total Copper Sold
(tonnes)(2) 1,674 19,299 9,700 9,537
Total Copper Produced
(tonnes) 11,330 9,585 9,689 9,558

Financial Position
(millions)
Working Capital $ 51.8 $ 28.0 $ 40.2 $ 13.5
Total Assets $ 385.0 $ 276.4 $ 241.8 $ 162.1
Weighted Average #
Shares (000's) 60,668 59,434 58,568 55,984

Kansanshi Production
Statistics
Mining:
Waste Mine (000's) 1,175 - - -
Ore Mined (000's) - - - -
Ore Grade % - - - -
Processing:
Ore Processed (000's) - - - -
Contained Copper
(tonnes) - - - -
Recovery % - - - -
Copper Produced
(tonnes) - - - -
Combined Cash Costs:
Cash Costs (per lb)(1) - - - -
Total Costs (per lb)(1) - - - -
Cathode Cash Costs:
Cash Costs (per lb)(1) - - - -
Total Costs (per lb)(1) - - - -
Concentrate Cash Costs - - -
Total Concentrate Cash
Costs - - - -
Revenue (000's)
Copper Cathodes - - - -
Copper Concentrates - - - -
Total Revenues - - - -

Bwana/Lonshi
Production Statistics
Mining:
Waste Mined (000's) 4,213 2,854 1,036 885
Ore Mined (000's) 257 85 66 439
Ore Grade % 4.7 5.2 5.4 5.5
Processing:
Ore Processed (000's) 278 237 209 197
Contained Copper
(tonnes) 12,908 10,813 10,904 10,790
Grade % 4.6 4.6 5.2 5.5
Recovery % 88 89 89 89
Copper Produced
(tonnes) 11,330 9,585 9,689 9,558
Acid Produced (tonnes) 35,920 34,265 34,344 33,035
Surplus Acid (tonnes) 16,884 19,149 20,763 15,689
Cash Costs (per lb)(1) $ 0.45 $ 0.48 $ 0.39 $ 0.47
Total Costs (per lb)(1) $ 0.68 $ 0.67 $ 0.53 $ 0.66
Revenues ($000's)
Copper Cathodes - - - -
(1) For the definition of cash and total costs, reference should be
made to section 8.
(2) Copper sold does not include tonnes sold prior to commercial
production
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Consolidated Balance Sheets
As at September 30, 2005 and December 31, 2004
(expressed in thousands of US dollars)
(unaudited)

2005 2004
$ $
Assets
Current assets
Cash and cash equivalents 63,623 50,356
Restricted cash (note 9) 3,469 1,931
Accounts receivable and
prepaid expenses 67,217 21,927
Inventory (note 5) 53,580 31,674
-------------- --------------
187,889 105,888
Investments (note 6) 9,522 15,340
Property, plant and equipment
(note 7) 417,816 319,222
Other assets and deferred
charges (note 8) 26,290 32,611
-------------- --------------
641,517 473,061
-------------- --------------
-------------- --------------
Liabilities
Current liabilities
Accounts payable and accrued
liabilities 59,960 33,884
Current taxes payable 10,978 3,248
Current portion of long-term
debt (note 9) 59,255 22,865
Current portion of other
liabilities (note 10) 25,456 12,012
-------------- --------------
155,649 72,009
Long-term debt (note 9) 159,572 191,661
Future income tax liability 24,961 12,313
Other liabilities (note 10) 35,990 37,048
-------------- --------------
376,172 313,031
Minority interests 12,276 2,190
-------------- --------------
388,448 315,221
-------------- --------------
Shareholders' Equity
Equity accounts (note 11) 165,340 161,776
Retained earnings (deficit) 87,729 (3,936)
-------------- --------------
253,069 157,840
-------------- --------------
641,517 473,061
-------------- --------------
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Commitments (note 14)

The accompanying notes are an integral part of these consolidated
financial statements.
For a copy of the notes visit our website at www.first-quantum.com.


Consolidated Statements of Earnings and Deficit
For three and nine months ended September 30, 2005 and 2004
(expressed in thousands of US dollars)
(unaudited)

Three months ended Nine months ended
September 30, September 30, September 30, September 30,
2005 2004 2005 2004
$ $ $ $
Revenues
Copper 138,386 28,624 259,931 74,104
Gold 3,438 - 4,023 -
Acid 1,198 2,576 3,765 8,673
-------------------------- --------------------------
143,022 31,200 267,719 82,777
Cost of sales 53,792 14,076 105,028 39,245
Depletion and
amortization 12,519 2,639 23,364 8,017
-------------------------- --------------------------
Operating
profit 76,711 14,485 139,327 35,515

Other expenses
Exploration 1,497 1,116 3,649 2,082
Foreign
exchange
(gain) loss 990 (499) (4,058) 1,033
General and
administrative 2,498 1,359 6,777 3,984
Interest and
financing
fees on
long-term
debt 5,821 846 10,054 2,359
Other
expenses
(income) 4,878 187 7,541 (849)
Gain on
disposal of
investment - - (16,127) -
-------------------------- --------------------------
15,684 3,009 7,836 8,609
-------------------------- --------------------------
Earnings
before income
taxes,
minority
interests
and equity
earnings 61,027 11,476 131,491 26,906
Income taxes 14,784 3,718 25,708 8,973
Minority
interests 6,770 - 10,085 -
Equity
earnings - 114 - 719
-------------------------- --------------------------
Net earnings
for the
period 39,473 7,872 95,698 18,652
Retained
earnings
(deficit) -
Beginning of
period 49,289 (21,166) (3,936) (31,946)
Dividends 1,033 - 4,033 -
-------------------------- --------------------------
Retained
earnings
(deficit) -
End of
period 87,729 (13,294) 87,729 (13,294)
-------------------------- --------------------------
-------------------------- --------------------------

Earnings per
common share
Basic $0.64 $0.13 $1.56 $0.31
Diluted $0.63 $0.13 $1.52 $0.31
Weighted
average shares
outstanding
(000's) 61,583 60,668 61,451 59,861

The accompanying notes are an integral part of these consolidated
financial statements.
For a copy of the notes visit our website at www.first-quantum.com.


Consolidated Statements of Cash Flows
For three and nine months ended September 30, 2005 and 2004
(expressed in thousands of US dollars)
(unaudited)

Three months ended Nine months ended
September 30, September 30, September 30, September 30,
2005 2004 2005 2004
$ $ $ $

Cash flows from
operating
activities
Net earnings
for the
period 39,473 7,872 95,698 18,652
Items not
affecting cash
Depletion and
amortization 12,519 2,639 23,364 8,017
Minority
interest 6,771 - 10,086 -
Provision
for deferred
stripping 5,901 - 2,772 -
Unrealized
foreign
exchange
(gain) loss (475) (1,131) (5,334) (140)
Future
income tax
expense 9,681 3,705 12,648 8,957
Stock-based
compensation
expense 672 216 2,041 683
Urealized
derivative
instruments
(gain) loss 4,935 (500) 8,561 230
Other 1,658 138 2,505 136
Gain on
disposal of
investment - - (16,127)
-------------------------------------------------------
81,135 12,939 136,214 36,535
-------------------------- --------------------------
-------------------------- --------------------------
Change in
non-cash
operating
working
capital
Decrease
(increase)
in accounts
receivable
and prepaid
expenses (25,998) (3,258) (43,932) (6,091)
(Increase)
decrease in
inventory (2,617) (1,275) (21,497) (438)
Increase
(decrease)
in accounts
payable and
accrued
liabilities 17,314 2,039 16,623 (2,069)
-------------------------- --------------------------
69,834 10,445 87,408 27,937
-------------------------- --------------------------
-------------------------- --------------------------
Cash flows from
financing
activities
Restricted
cash 827 (2,379) (1,538) (6,246)
Proceeds from
long-term
debt 11,500 90,172 43,023 131,544
Repayments
of long-term
debt (15,260) (9,067) (30,694) (14,093)
Issuance of
common
shares and
warrants 235 402 1,523 43,959
Dividends
paid (1,033) - (4,033) -
Deferred
premium
obligation
and finance
fees (1,390) (2,569) (11,372) (4,778)
-------------------------- --------------------------
(5,121) 76,559 (3,091) 150,386
-------------------------- --------------------------
-------------------------- --------------------------
Cash flows from
investing
activities
Property,
plant and
equipment and
investments (52,168) (66,484) (92,155) (146,918)
Deferred
exploration
and
stripping
costs (5,665) (3,264) (1,281) (6,733)
Proceeds
from sale of
investment - - 21,944 -
-------------------------- --------------------------
(57,833) (69,748) (71,492) (153,651)
-------------------------- --------------------------
-------------------------- --------------------------

Effect of
exchange
rate changes
on cash 279 999 442 (575)
Increase
(decrease)
in cash and
cash
equivalents 6,880 17,256 12,825 24,672
Cash and cash
equivalents -
beginning
of period 56,464 31,434 50,356 25,592
-------------------------- --------------------------
Cash and cash
equivalents -
end of
period 63,623 49,689 63,623 49,689
-------------------------- --------------------------
-------------------------- --------------------------


Segmented Information
For three months ended September 30, 2005 and 2004
(expressed in thousands of US dollars)
(unaudited)

--------------------------------------------------------------------
--------------------------------------------------------------------
For the three months ended September 30, 2005, segmented information
is presented as follows:
--------------------------------------------------------------------
--------------------------------------------------------------------
Inter-
BLO KCO GMP CDA segment Total
$ $ $ $ $ $
Revenues 55,028 92,227 - 2,901 (7,134) 143,022
----------------------------------------------------------
Segment
profit
(loss) 16,002 24,300 - (829) - 39,473
----------------------------------------------------------

Property,
plant and
equipment
additions 26,905 14,627 19,873 33 61,438
----------------------------------------------------------
Total
assets 199,653 409,616 42,622 237,772 889,663
Inter-
company
balances
included in
total
assets (66,923) - - (181,223) (248,146)
----------------------------------------------------------
Total
consoli-
dated
assets 132,730 409,616 42,622 56,549 641,517
--------------------------------------------------------------------
--------------------------------------------------------------------


--------------------------------------------------------------------
--------------------------------------------------------------------
For the three months ended September 30, 2004, segmented information
is presented as follows:
--------------------------------------------------------------------
--------------------------------------------------------------------
Inter-
BLO KCO GMP CDA segment Total
$ $ $ $ $ $
Revenues 31,200 - - 911 (911) 31,200
----------------------------------------------------------
Segment
profit
(loss) 9,456 - - (1,584) - 7,872
----------------------------------------------------------

Property,
Plant and
equipment
additions 509 77,116 - 166 - 77,791
----------------------------------------------------------
Total
assets 154,010 214,270 9,522 197,244 - 575,046
Inter-
company
balances
included
in total
assets (48,807) - - (141,196) - (190,003)
----------------------------------------------------------
Total
consoli-
dated
assets 105,203 214,270 9,522 56,048 - 385,043
--------------------------------------------------------------------
--------------------------------------------------------------------

Bwana / Lonshi Operation (BLO), Kansanshi Copper / Gold Operation
(KCO), Guelb Moghrein Project (GMP), Corporate Development and
Administration and Other (CDA)

--------------------------------------------------------------------
--------------------------------------------------------------------
For the nine months ended September 30, 2005, segmented information
is presented as follows:
--------------------------------------------------------------------
--------------------------------------------------------------------
Inter-
BLO KCO GMP CDA segment Total
$ $ $ $ $ $
Revenues 138,314 137,280 - 6,782 (14,657) 267,719
----------------------------------------------------------
Segment
profit
(loss) 44,661 41,011 - 10,026 - 95,698
----------------------------------------------------------

Property,
plant and
equipment
additions 44,358 49,879 31,620 - - 125,857
----------------------------------------------------------
Total
assets 199,653 409,616 42,622 237,772 - 889,663
Inter-
company
balances
included
in total
assets (66,923) - - (181,223) - (248,146)
----------------------------------------------------------
Total
consoli-
dated
assets 132,730 409,616 42,622 56,549 - 641,517
--------------------------------------------------------------------
--------------------------------------------------------------------


--------------------------------------------------------------------
--------------------------------------------------------------------
For the nine months ended September 30, 2004, segmented information
is presented as follows:
--------------------------------------------------------------------
--------------------------------------------------------------------
Inter-
BLO KCO GMP CDA segment Total
$ $ $ $ $ $
Revenues 82,777 - - 2,920 (2,920) 82,777
----------------------------------------------------------
Segment
profit
(loss) 23,952 - - (5,300) - 18,652
----------------------------------------------------------

Property,
plant and
equipment
additions 12,455 155,152 - 72 - 167,679
----------------------------------------------------------
Total
assets 154,010 214,270 9,522 197,244 - 575,046
Inter-
company
balances
included
in total
assets (48,807) - - (141,196) - (190,003)
----------------------------------------------------------
Total
consoli-
dated
assets 105,203 214,270 9,522 56,048 - 385,043
--------------------------------------------------------------------
--------------------------------------------------------------------

Bwana / Lonshi Operation (BLO), Kansanshi Copper / Gold Operation
(KCO), Guelb Moghrein Project (GMP), Corporate Development and
Administration and Other (CDA)


The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • First Quantum Minerals Ltd.
    Geoff Chater
    (604) 688-6577 or Toll Free: 1-888-688-6577
    or
    First Quantum Minerals Ltd.
    Bill Iversen
    (604) 688-6577 or Toll Free: 1-888-688-6577
    (604) 688-3818 (FAX)
    info@fqml.com
    www.first-quantum.com