Quarterly production of 3.9M wmt, record sales of 3.4M dmt, revenue of $467M, EBITDA of $181M1 and EPS of $0.16 DRPF project advancing as planned for an expected commissioning in calendar H2 2025, including an additional $58M deployed in the quarter and cumulative investments to date of $154M High-purity iron ore added to the Canadian government's critical mineral list MONTRÉAL, July 30, 2024 /CNW/ - (Sydney, July 31, 2024) - Champion Iron Limited (TSX:CIA) (ASX: CIA) (OTCQX:CIAFF) ("Champion" or the "Company") reports its operational and financial results for its financial first quarter ended June 30, 2024. Champion's CEO, Mr. David Cataford, said, "I am proud of our people who efficiently deployed our emergency protocols in response to nearby forest fires. Their actions prioritized the safety of our employees and contractors by completing a rapid preventive evacuation of Bloom Lake and enabled a swift return to site as fires subsided." Mr. Cataford added, "With respect to our operations, I am happy to report robust quarterly production, record sales and strong financial results for the period. In conjunction with this, we continue to advance our DRPF project, which is expected to significantly reduce emissions in steelmaking, support higher premiums for our products and aligns with the government of Canada's recent recognition of high purity iron ore as a critical mineral." Conference Call Details Champion will host a conference call and webcast on July 31, 2024, at 9:00 AM (Montréal time) / 11:00 PM (Sydney time) to discuss the results of the financial first quarter ended June 30, 2024. Call details are set out at the end of this press release. 1. Quarterly Highlights Operations and Sustainability No serious injuries or major environmental incidents reported in the three-month period ended June 30, 2024; Quarterly production of 3.9 million wmt (3.8 million dmt) of high-grade 66.3% Fe concentrate for the three-month period ended June 30, 2024, up 18% from the previous quarter and up 14% over the same period last year. Production during the period benefited from work programs completed to solidify operations and no major scheduled semi-annual shutdowns; Record quarterly iron ore concentrate sales of 3.4 million dmt for the three-month period ended June 30, 2024, up 16% from the previous quarter and up 34% from the prior-year period; The Company continues to seek improvements from the rail operator to receive contracted haulage services to ensure that Bloom Lake's production, as well as iron ore concentrate currently stockpiled at Bloom Lake, is hauled over future periods. Iron ore concentrate stockpiled at Bloom Lake reached 3.0 million wmt as at June 30, 2024, up from 2.7 million wmt as at March 31, 2024; and Following a preventive evacuation of Bloom Lake in response to nearby forest fires on July 12, 2024, the Company announced a gradual return of its workforce on July 15, 2024, and confirmed that the events did not impact its facilities and third parties' infrastructure. With forest fires subsiding in the region, operational cadence subsequently returned to levels experienced prior to recent events. Financial Results Gross realized selling price of US$125.3/dmt1, compared to the P65 index average of US$126.1/dmt in the period; Net realized selling price of US$99.2/dmt1, representing a 20% increase quarter-on-quarter, and 15% year-on-year; C1 cash cost of $76.9/dmt1 (US$56.2/dmt)2, comparable quarter-on-quarter, and representing a decrease of 5% year-on-year; EBITDA of $181.2 million1, an increase of 113% quarter-on-quarter, and 175% year-on-year; Net income of $81.4 million, an increase of 215% quarter-on-quarter, and 388% year-on-year; EPS of $0.16, an increase of 220% quarter-on-quarter, and 433% year-on-year; Strong cash position of $294.7 million as at June 30, 2024, including $259.9 million in cash and cash equivalents and $34.8 million in restricted cash for the previously declared dividend payment, an overall decrease of $105.4 million since March 31, 2024, mainly due to the timing of customer payments associated with the concentration of sales at the end of the quarter, progress on the DRPF project, and tax payments primarily related to the previous financial year; and Available liquidity to support growth initiatives, including amounts available from the Company's credit facilities, totalled $860.8 million1 at quarter-end, compared to $942.1 million1 as at March 31, 2024. Growth and Development The DRPF project, upgrading half of Bloom Lake's capacity to DR quality pellet feed iron ore grading up to 69% Fe, remains on schedule and on budget, with commissioning scheduled for the second half of calendar year 2025; Completed first key construction milestones of the DRPF project as planned, with quarterly and cumulative investments of $58.5 million and $153.8 million, respectively, as at June 30, 2024, out of the estimated total capital expenditures of $470.7 million; High-purity iron ore was added to Canada's critical minerals list, joining other minerals such as nickel, copper and cobalt, recognizing its positive impact in reducing GHG emissions in steelmaking and its importance in the green steel supply chain; Received an additional hydroelectric power allocation from Hydro-Québec, providing access to renewable power that will enable the Company to support growth initiatives required for the green steel supply chain and further decarbonize its operations over time; and Acquired additional mining equipment, to be delivered in the near term, which should increase mine production capacity, including stripping activities, and ordered additional railcars to increase the Company's rail shipment flexibility. These additions are also expected to support the Company's ongoing commitment to address the bottleneck of operations and potentially increase Bloom Lake's production and sales beyond its current nameplate capacity in the future. 2. Bloom Lake Mine Operating Activities  During the three-month period ended June 30, 2024, the Company delivered strong operating results with both plants producing at their nameplate capacity. With no major semi-annual shutdowns at the two processing plants and despite a planned two-day annual power interruption during the three-month period ended June 30, 2024, the Company continued to solidify its operations, benefiting from improved mining equipment availability and plants performance, following major maintenance activities completed in the previous quarter. During the three-month period ended June 30, 2024, the Company exceeded its previous record for iron ore concentrate sold. However, as volumes transported continued to be lower than production, the iron ore concentrate stockpiled at Bloom Lake increased by 0.4 million wmt since March 31, 2024, reaching a total of 3.0 million wmt as at June 30, 2024. The Company continues to seek improvements from the rail operator to receive contracted haulage services to ensure that Bloom Lake's production, as well as iron ore concentrate currently stockpiled at Bloom Lake, is hauled over future periods. During the three-month period ended June 30, 2024, the Company continued to analyze work programs and investments required to structurally increase Bloom Lake's nameplate capacity beyond 15 Mtpa over time. The recently acquired additional mining equipment is expected to support the mine production capacity, as the Company evaluates opportunities to address the bottleneck of operations, and prepare for an increase of stripping activities in the future, per the mine plan. In July 2024, the Company ordered additional railcars to increase rail haulage flexibility over time as part of considerations to potentially increase production beyond Bloom Lake's existing nameplate capacity. In June 2024, Société Ferroviaire et Portuaire de Pointe-Noire, a Company's rail and transshipment service provider, concluded a 5-year collective bargaining agreement with its workers, providing additional stability for the Company's operations. Q1 FY25 Q4 FY24 Q/Q Change Q1 FY24 Y/Y Change Operating Data Waste mined and hauled (wmt) 6,733,700 6,498,700 4 % 5,198,500 30 % Ore mined and hauled (wmt) 10,779,300 9,471,200 14 % 9,593,500 12 % Material mined and hauled (wmt) 17,513,000 15,969,900 10 % 14,792,000 18 % Stripping ratio 0.62 0.69 (10) % 0.54 15 % Ore milled (wmt) 11,084,300 9,349,100 19 % 9,895,600 12 % Head grade Fe (%) 29.1 28.7 1 % 28.8 1 % Fe recovery (%) 79.3 80.2 (1) % 78.2 1 % Product Fe (%) 66.3 66.1 — % 66.1 — % Iron ore concentrate produced (wmt) 3,876,500 3,275,400 18 % 3,397,200 14 % Iron ore concentrate sold (dmt) 3,442,800 2,968,900 16 % 2,563,500 34 % During the three-month period ended June 30, 2024, 17.5 million tonnes of material were mined and hauled, compared to 14.8 million tonnes during the same period in 2023 and 16.0 million tonnes during the previous quarter, representing an increase of 18% and 10%, respectively. The increased production at the mine site was attributable to higher utilization and availability of mining equipment, and reduced trucking cycle time associated with the construction of additional ramp accesses in the previous quarters. The stripping ratio of 0.62 for the three-month period ended June 30, 2024, was higher than 0.54 for the same prior-year period, which was negatively impacted by forest fires and, consequently, by the focus on critical activities required to feed the plants. The stripping ratio for the three-month period ended June 30, 2024, was slightly lower than the 0.69 achieved in the previous quarter, when lower mills availability enabled the reallocation of mining equipment to move additional waste materials. The Company plans to maintain higher stripping activities in accordance with the LoM plan over the next quarters. During the three-month period ended June 30, 2024, the two plants at Bloom Lake processed 11.1 million tonnes of ore, compared to 9.9 million tonnes for the same prior-year period and 9.3 million tonnes in the previous quarter, an increase of 12% and 19%, respectively. Ore processed during the three-month period ended June 30, 2024, was positively impacted by lower maintenance activities, as the major semi-annual shutdowns were performed at both plants during the previous quarter. The iron ore head grade for the three-month period ended June 30, 2024, was 29.1%, compared to 28.8% for the same period in 2023, and 28.7% during the previous quarter. The variation in head grade was within expected normal variations in the mine plan. The Company's average Fe recovery rate was 79.3% for the three-month period ended June 30, 2024, compared to 78.2% for the same period in 2023, and 80.2% during the previous quarter. With continuous efforts made to optimize its recovery circuits, the Company expects ongoing and future work programs to improve recovery rates over time. With higher Fe recovery and comparable head grade, Bloom Lake produced 3.9 million wmt (3.8 million dmt) of high-grade iron ore concentrate during the three-month period ended June 30, 2024, an increase of 14% compared to 3.4 million wmt (3.3 million dmt) during the same period in 2023, and an increase of 18% compared to 3.3 million wmt (3.2 million dmt) during the previous quarter. 3. Financial Performance  Q1 FY25 Q4 FY24 Q/Q Change Q1 FY24 Y/Y Change Financial Data (in thousands of dollars) Revenues 467,084 332,673 40 % 297,162 57 % Cost of sales 264,911 227,496 16 % 208,485 27 % Other expenses 21,159 20,425 4 % 19,645 8 % Net finance costs 8,259 8,831 (6 %) 6,926 19 % Net income 81,357