Lundin Mining Fourth Quarter and Full Year 2020 Results

TORONTO, Feb. 19, 2021

Marie Inkster, President and CEO commented, "We expect 2021 to be an exciting and rewarding year for Lundin Mining. We responded decisively with clear action plans to overcome our fourth quarter challenges and as a result we ended the year in a strong position. Candelaria and Chapada both returned to full production capacity in the fourth quarter of 2020, and the Zinc Expansion Project at Neves-Corvo officially restarted in January 2021. Eagle set a new record for annual throughput and achieved impressive cash costs to generate significant free cash flow and margins. Lastly, in its 164^th year of continuous production Zinkgruvan set new annual records for both tonnes hoisted from the mine and tonnes milled. 

We expect to benefit significantly in 2021 from the investments made in our operations the last several years, taking advantage of the favourable metal price environment, to generate meaningful free cash flow and returns for our shareholders."

 Summary Financial Results

	Three months ended					Twelve months ended
	December 31, 2020 ARIVA.DE Börsen-Geflüster Kurse Lundin Mining 10,40 $ -2,07%					December 31, 2020
US$ Millions (except per share amounts)	2020		2019			2020		2019
Revenue	529.5		568.4			2,041.5		1,892.7
Gross profit	179.4		145.5			498.1		440.4
Attributable net earnings1	119.2		97.0			168.8		167.3
Net earnings	120.8		104.8			189.1		189.2
Adjusted earnings 1,2	106.7		93.2			225.2		159.5
Adjusted EBITDA2	234.8		234.6			856.9		705.7
Basic and diluted net earnings per share1	0.16		0.13			0.23		0.23
Adjusted basic and diluted earnings per share1,2	0.15		0.13			0.31		0.22
Cash flow from operations	172.7		186.4			565.9		564.6
Adjusted operating cash flow2	175.7		206.7			644.6		550.7
Adjusted operating cash flow per share2	0.24		0.28			0.88		0.75
Cash and cash equivalents	141.4		250.6			141.4		250.6
Net debt2	63.2		60.2			63.2		60.2

Highlights

Operational Performance

Annual production of all metals met or exceeded the Company's most recent annual production guidance despite the operational challenges of the latter part of the year. The Company continued to effectively manage costs and all operations reported cash costs that were better than the most recent annual guidance. Annual capital expenditures of $431.2 million were modestly lower than the most recent guidance of $445.0 million.

In March 2020, the World Health Organization declared the COVID-19 outbreak a global pandemic. The Company has adapted to a new way of operating and continues to manage and respond to the COVID-19 pandemic. Preventative measures have been implemented across the organization to ensure the safety of its workforce, local communities and other key stakeholders. To date, production disruptions have been minimal and there has been no significant disruption in the delivery of concentrate or receipt of goods at our operations as a result of COVID-19.

Candelaria (80% owned): Candelaria produced, on a 100% basis, 126,702 tonnes of copper, approximately 76,000 ounces of gold and 1.1 million ounces of silver in concentrate during the year. Copper and gold production exceeded guidance for the current year but was lower than the prior year as a result of lower throughput in the fourth quarter of 2020 due to union strike work stoppages and ore hardness in the first half of 2020. Copper cash costs¹ of $1.45/lb were better than annual guidance and the prior year, largely due to the impact of favourable foreign exchange. The Candelaria Mill Optimization Project is now complete after the final ball mill motor installation in the fourth quarter.

Chapada (100% owned): Chapada produced 50,038 tonnes of copper and approximately 87,000 ounces of gold, both exceeding guidance due to a faster than anticipated recovery from the mill interruption at the end of the third quarter, resulting in higher than expected throughput in the fourth quarter. Full year copper cash costs $0.29/lb were also better than guidance, benefitting from higher mill throughput and favourable foreign exchange.

Eagle (100% owned): Eagle production for the year met guidance and exceeded the prior year, producing 16,718 tonnes of nickel and 18,663 tonnes of copper. A new annual mill throughput record was set at 761,000 tonnes. Nickel cash costs of $0.10/lb for the year were better than guidance and the prior year due primarily to higher copper by-product prices.

Neves-Corvo (100% owned): Neves-Corvo produced 32,032 tonnes of copper for the year, meeting guidance. Zinc production of 69,143 tonnes was marginally below guidance resulting from lower than planned grades in the fourth quarter. Overall metal production was lower than the prior year due to reduced throughput and grades. Copper cash costs of $2.09/lb for the year were in-line with guidance, but were higher than the prior year due to lower copper sales volumes.

Official restart of the Zinc Expansion Project ("ZEP") began in January 2021. During 2020, work continued to prepare the surface and underground construction sites for the restart including ventilation raise work, activities on the surface conveyor installations and SAG mill including commissioning with waste rock.

Zinkgruvan (100% owned): Zinc production of 73,601 tonnes and copper production of 3,346 tonnes both met guidance, and new annual production records were set for both tonnes hoisted from the mine and milled tonnes. Zinc and lead production (24,128 tonnes) were lower than the prior year, impacted by lower head grades resulting from a change in mine sequencing early in the year. Zinc cash costs of $0.52/lb for the year were better than guidance.

Total Production

(Contained metal in concentrate)	2020					2019
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