February 12, 2019, Vancouver, BC – Taseko Mines Limited (TSX: TKO; NYSE American: TGB) (“Taseko” or the “Company”) reports financial results for the fourth quarter and full year ending December 31, 2018.

Russell Hallbauer, President and CEO of Taseko, commented, “In 2018, Gibraltar generated $149 million of earnings from mining operations before depletion and amortization*. The copper price volatility over the year, ranging from a high of US$3.25 to a low of US$2.60 per pound, made it a challenging environment for many aspects of our business, from mine planning to pricing, as we tried to maximize operating margin and returns. We expect, as do many industry analysts, increased copper prices in 2019 and a rebound in gross revenue and margins. With global copper inventories at multi-year lows and less scrap copper being used in the manufacture of final products combined with limited new production capacity, the growing copper deficit will only result in higher prices.”

Mr. Hallbauer continued, “We are pleased with the performance of Gibraltar, but the focus of shareholders should be on our Florence Copper Project, with it now transitioning from a development project to an operating asset and continuing to advance as planned. Since we began operating the commercial scale wellfield, we have been extremely pleased with the results. The main focus of this phase is to demonstrate to the regulators and key stakeholders that we are able to maintain hydraulic control of the leach solutions underground. All of the data gathered since we began injecting solutions indicate that copper mineralization is dissolving into copper solution as predicted. With operations underway, we have commenced detailed engineering and the process to finalize the commercial scale permits, with the goal of commencing construction of the commercial plant as soon as possible.”

“The fourth quarter of 2018 was generally in line with our expectations for sales which came in at 43 million pounds of copper and 738,000 pounds of molybdenum (100% basis). Copper production was slightly lower than anticipated due to a series of minor operational issues, particularly in December, which were compounded by higher work index ore and lower grade stockpile feed. We were able to ship most of the excess concentrate from the third quarter with copper inventory declining from 19 million pounds to two million pounds by year end,” Mr. Hallbauer continued.

“Gibraltar is expected to produce approximately 130 million pounds (+/-5%) on a 100% basis in 2019, comparable to the level achieved in 2018. While there will be quarterly fluctuations in both copper and molybdenum production, we do not anticipate those fluctuations to be as significant as last year. Even though we expect higher copper pricing in 2019, we have made a number of mine plan adjustments and spending curtailments to address the current weaker pricing environment,” added Mr. Hallbauer.

Mr, Hallbauer continued, “Our acquisition of Yellowhead Mining is expected to close in the coming days as the transaction was approved by Yellowhead shareholders at a special meeting held on February 8, 2019. I cannot emphasize how enthused we are to have acquired this quality, near-shovel-ready asset. The intrinsic value of the Yellowhead project to Taseko has not been recognized by the investment community. During the first seven years of operation, the mill will process head grades of 0.32% CuEQ. Simplistically put, the in-situ ore value is approximately US$22 per tonne at the long-term copper price. With a cost per tonne milled expected to be below C$10 per tonne, the mine site operating margin is approximately C$16 per tonne. At present design capacity of 70,000 tonnes per day of throughput the Yellowhead Mine will generate roughly $400 million in operating margin a year, and place it as one of the largest, long life copper mines in Canada.”

“As with all of our acquisitions of undervalued assets, we believe our operating and engineering expertise can create substantial long-term value. Based on Yellowhead’s 2014 technical report, the project has a pre-tax net present value in excess of C$1 billion, or approximately $4.00 per Taseko share. We expect to unlock further value for our shareholders in the months ahead,” concluded Mr. Hallbauer.

2018 Annual Review
•Earnings from mining operations before depletion and amortization* was $112.0 million and Adjusted EBITDA* was $98.2 million;
•Cash flows from operations were $94.1 million;
•The cash balance at the end of 2018 was $46 million, which is lower than the end of 2017 as the Company incurred expenditures of $36.5 million at the Florence Copper Project in the year;
•Net loss for the year was $35.8 million ($0.16 per share) includes an unrealized foreign exchange loss of $28.7 million. Adjusted net loss* was $8.5 million ($0.04 per share);
•The Gibraltar Mine (100% basis) produced 125.2 million pounds of copper and 2.4 million pounds of molybdenum. Copper head grades for the year were 3% lower than the life of mine average reserve grade;
•Site operating costs, net of by-product credits* were US$1.60 per pound produced, and Total operating costs (C1)* were US$1.93 per pound produced; and
•Construction of the Production Test Facility (“PTF”) for the Florence Copper Project in Arizona was completed on time and on budget and commenced operation in the fourth quarter. Results to date have been in line with management’s expectations.

Fourth Quarter Review
•Fourth quarter earnings from mining operations before depletion and amortization* were $28.5 million, and Adjusted EBITDA was $26.5 million;
•Net loss was $19.7 million ($0.09 per share) includes an unrealized foreign exchange loss of $17.9 million. Adjusted net loss* was $1.3 million ($0.01 per share);
•Net loss and adjusted net loss for the fourth quarter include a $1.7 million write-down to reduce the net realizable value of ore stockpile inventories, as a result of the decline in copper prices;
•Cash flow from operations was $44.1 million;
•Total copper sales for the quarter were 42.7 million pounds (100% basis) as the excess inventory on hand at the end of the third quarter was sold in the fourth quarter;
•Copper production in the fourth quarter was 25.8 million pounds (100% basis) as a result of reduced head grades and mill throughput; and
•Site operating costs, net of by-product credits* were US$1.62 per pound produced and Total operating costs (C1)* were US$2.11 per pound produced.

*Non-GAAP performance measure. See end of news release.

HIGHLIGHTS

Financial Data (includes 75% share of Gibraltar) Year ended
December 31, Three Months Ended
December 31,
(Cdn$ in thousands, except for per share amounts) 2018 2017 Change 2018 2017 Change
Revenues 343,870 378,299 (34,429) 111,121 95,408 15,713
Earnings from mining operations before depletion and amortization* 112,003 177,716 (65,713) 28,450 32,696 (4,246)
Earnings from mining operations 41,222 129,994 (88,772) 10,578 18,135 (7,557)
Net income (loss) (35,774) 34,262 (70,036) (19,720) (7,600) (12,120)
Per share - basic (“EPS”) (0.16) 0.15 (0.31) (0.09) (0.03) (0.06)
Adjusted net income (loss)* (8,508) 41,420 (49,928) (1,310) (1,544) 234
Per share - basic (“adjusted EPS”)* (0.04) 0.18 (0.22) (0.01) (0.01) -
EBITDA* 71,483 163,757 (92,274) 7,886 22,350 (14,464)
Adjusted EBITDA* 98,217 161,749 (63,532) 26,489 28,639 (2,150)
Cash flows provided by operations 94,078 211,079 (117,001) 44,120 31,899 12,221
Operating Data (Gibraltar - 100% basis) Year ended
December 31, Three Months Ended
December 31,
2018 2017 Change 2018 2017 Change
Tons mined (millions) 111.6 93.1 18.5 28.4 26.9 1.5
Tons milled (millions) 30.1 29.8 0.3 7.1 7.9 (0.8)
Production (million pounds Cu) 125.2 141.2 (16.0) 25.8 25.5 0.3
Sales (million pounds Cu) 126.5 143.7 (17.2) 42.7 32.0 10.7

*Non-GAAP performance measure. See end of news release.

REVIEW OF OPERATIONS
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