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Teck Resources Ltd (TECK - Free Report) reported fourth-quarter 2020 adjusted earnings per share of 35 cents, which beat the Zacks Consensus Estimate of 30 cents. The bottom line also improved from the 31 cents in the prior year quarter as significant increases in copper and zinc prices were partially offset by substantial decline in steelmaking coal prices.
Including one-time items, the company reported a loss of 67 cents compared with a loss of $2.52 in the prior-year quarter.
Net sales were $1,969 million, which declined 2% year over year. However, the top line surpassed the Zacks Consensus Estimate of $1,918 million. Sales volumes of copper and refined zinc were higher in the fourth quarter on a year-over-year basis. This was offset by a decrease in the sales volumes of steelmaking coal and zinc in concentrate.
Gross profit, before depreciation and amortization, went up 5.7% year over year to $701 million. Gross margin came in at 35.7% compared with the year-ago quarter’s 33.0%. Adjusted EBITDA was $645 million, up 8.5% from the prior-year quarter. EBITDA margin came in at 33% in the fourth quarter compared with the year-earlier quarter’s 30%.
Teck Resources Ltd Price, Consensus and EPS Surprise
The Steelmaking Coal segment reported sales of $662 million, reflecting a year-over-year plunge of 21%. The segment reported an adjusted operating loss of $70 million against an operating profit of $145 in the prior-year quarter.
Copper segment’s net sales were up 41% year over year to $631 million in the December-end quarter. The segment’s operating profit was $305 million in the reported quarter, reflecting a year-over-year jump of 267%.
The Zinc segment’s net sales inched up 1% year over year to $568 million during the reported quarter. The segment’s operating profit climbed 14% year over year to $75 million during this period.
The Energy segment’s net sales slumped 33% year over year to $108 million in the fourth quarter. The segment reported an operating loss of $51 million compared with the prior-year quarter’s loss of $28 million.
Financials
Teck Resources had cash and cash equivalents of $354 million as of Dec 31, 2020, compared with $789 million as of Dec 31, 2019. Total debt was $4,823 million at the end of 2020 compared with $3,178 million as of Dec 31, 2019.
Guidance
Teck Resources expects steelmaking coal production between 25.5 million tons and 26.5 million tons in 2021. Copper production is expected within 275,000-290,000 tons. Zinc production is projected between 585,000 tons and 310,000 tons. The company expects Bitumen production for 2021 between 8.6 million barrels and 12.1 million barrels.
Price Performance
The company’s shares have surged 66.2% over the past year, compared with the industry’s rally of 46.3%.
Zacks Rank & Stocks to Consider
Teck Resources currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are Fortescue Metals Group Limited (FSUGY - Free Report) , BHP Group (BHP - Free Report) and Impala Platinum Holdings Limited (IMPUY - Free Report) .
BHP has an expected earnings growth rate of 62.3% for the current fiscal. The company’s shares have gained around 49.8% in the past year. It currently carries a Zacks Rank #2.
Impala has an expected earnings growth rate of 195.9% for the current fiscal. The company’s shares have rallied around 48.3% in the past year. It currently sports a Zacks Rank #1.
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Teck Resources' (TECK) Q4 Earnings & Revenues Beat Estimates
Teck Resources Ltd (TECK - Free Report) reported fourth-quarter 2020 adjusted earnings per share of 35 cents, which beat the Zacks Consensus Estimate of 30 cents. The bottom line also improved from the 31 cents in the prior year quarter as significant increases in copper and zinc prices were partially offset by substantial decline in steelmaking coal prices.
Including one-time items, the company reported a loss of 67 cents compared with a loss of $2.52 in the prior-year quarter.
Net sales were $1,969 million, which declined 2% year over year. However, the top line surpassed the Zacks Consensus Estimate of $1,918 million. Sales volumes of copper and refined zinc were higher in the fourth quarter on a year-over-year basis. This was offset by a decrease in the sales volumes of steelmaking coal and zinc in concentrate.
Gross profit, before depreciation and amortization, went up 5.7% year over year to $701 million. Gross margin came in at 35.7% compared with the year-ago quarter’s 33.0%. Adjusted EBITDA was $645 million, up 8.5% from the prior-year quarter. EBITDA margin came in at 33% in the fourth quarter compared with the year-earlier quarter’s 30%.
Teck Resources Ltd Price, Consensus and EPS Surprise
Teck Resources Ltd price-consensus-eps-surprise-chart | Teck Resources Ltd Quote
Segment Performance
The Steelmaking Coal segment reported sales of $662 million, reflecting a year-over-year plunge of 21%. The segment reported an adjusted operating loss of $70 million against an operating profit of $145 in the prior-year quarter.
Copper segment’s net sales were up 41% year over year to $631 million in the December-end quarter. The segment’s operating profit was $305 million in the reported quarter, reflecting a year-over-year jump of 267%.
The Zinc segment’s net sales inched up 1% year over year to $568 million during the reported quarter. The segment’s operating profit climbed 14% year over year to $75 million during this period.
The Energy segment’s net sales slumped 33% year over year to $108 million in the fourth quarter. The segment reported an operating loss of $51 million compared with the prior-year quarter’s loss of $28 million.
Financials
Teck Resources had cash and cash equivalents of $354 million as of Dec 31, 2020, compared with $789 million as of Dec 31, 2019. Total debt was $4,823 million at the end of 2020 compared with $3,178 million as of Dec 31, 2019.
Guidance
Teck Resources expects steelmaking coal production between 25.5 million tons and 26.5 million tons in 2021. Copper production is expected within 275,000-290,000 tons. Zinc production is projected between 585,000 tons and 310,000 tons. The company expects Bitumen production for 2021 between 8.6 million barrels and 12.1 million barrels.
Price Performance
The company’s shares have surged 66.2% over the past year, compared with the industry’s rally of 46.3%.
Zacks Rank & Stocks to Consider
Teck Resources currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are Fortescue Metals Group Limited (FSUGY - Free Report) , BHP Group (BHP - Free Report) and Impala Platinum Holdings Limited (IMPUY - Free Report) .
Fortescue has a projected earnings growth rate of 78.4% for the current fiscal. The company’s shares have soared around 160% in a year. It currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
BHP has an expected earnings growth rate of 62.3% for the current fiscal. The company’s shares have gained around 49.8% in the past year. It currently carries a Zacks Rank #2.
Impala has an expected earnings growth rate of 195.9% for the current fiscal. The company’s shares have rallied around 48.3% in the past year. It currently sports a Zacks Rank #1.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>