teck-20251231

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Teck Resources Limited

Consolidated Financial Statements

For the Years Ended December 31, 2025 and 2024

Management’s Responsibility for Financial Reporting

Management is responsible for the integrity and fair presentation of the financial information contained in this annual report. Where appropriate, the financial information, including financial statements, reflects amounts based on the best estimates and judgments of management. The financial statements have been prepared in accordance with IFRS® Accounting Standards as issued by the International Accounting Standards Board. Financial information presented elsewhere in the annual report is consistent with that disclosed in the financial statements.

Management is responsible for establishing and maintaining adequate internal control over financial reporting. Any system of internal control over financial reporting, no matter how well-designed, has inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. The system of controls is also supported by a professional staff of internal auditors who conduct periodic audits of many aspects of our operations and report their findings to management and the Audit Committee.

Management has used the Committee of Sponsoring Organizations of the Treadway Commission (COSO) 2013 framework to evaluate the effectiveness of our internal control over financial reporting. Based on this assessment, management has concluded that as at December 31, 2025, our internal control over financial reporting was effective.

The Board of Directors oversees management’s responsibility for financial reporting and internal control systems through an Audit Committee, which is composed entirely of independent directors. The Audit Committee meets periodically with management, our internal auditors and independent auditors to review the scope and results of the annual audit, and to review the financial statements and related financial reporting and internal control matters before the financial statements are approved by the Board of Directors and submitted to the shareholders.

PricewaterhouseCoopers LLP, an independent registered public accounting firm, appointed by the shareholders, have audited our financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States) and have expressed their opinion in the Report of Independent Registered Public Accounting Firm.

Jonathan H. Price

President and Chief Executive Officer

Crystal J. Prystai

Executive Vice President and Chief Financial Officer

February 18, 2026

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of Teck Resources Limited

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Teck Resources Limited and its subsidiaries (the Company) as of December 31, 2025 and 2024, and the related consolidated statements of income, of comprehensive income (loss), of changes in equity and of cash flows for the years then ended, including the related notes (collectively referred to as the consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control ‒ Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and its financial performance and its cash flows for the years then ended in conformity with IFRS Accounting Standards as issued by the International Accounting Standards Board. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control ‒ Integrated Framework (2013) issued by the COSO.

PricewaterhouseCoopers LLP

PwC Place, 250 Howe Street, Suite 1400

Vancouver, British Columbia, Canada V6C 3S7

T.: +1 604 806 7000, F.: +1 604 806 7806,

Fax to mail: ca_vancouver_main_fax@pwc.com

“PwC” refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.

Basis for Opinions

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting, appearing in Management’s Discussion and Analysis. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Goodwill Impairment Test of the Quebrada Blanca Cash Generating Unit (the QB CGU)

As described in Notes 3, 4, and 8 to the consolidated financial statements, management performs its annual goodwill impairment test as of October 31 of each year, or when there is an indication that the goodwill may be impaired. An impairment loss exists if the carrying amount of a CGU, including goodwill, exceeds its recoverable amount. The total carrying value of the goodwill allocated to the QB CGU as of December 31, 2025 was $421 million. During the third quarter of 2025, management identified an indicator of impairment and as a result, performed an impairment test as of September 30, 2025. Management used a discounted cash flow model that covers the current expected mine life with an estimate of the in situ value applied to the remaining resources to determine the recoverable amount of the QB CGU. The recoverable amount of the QB CGU exceeded the carrying value, and as a result, no impairment loss was recognized by management. Significant assumptions used in preparing the discounted cash flow model for the QB CGU goodwill impairment test include long-term copper price, discount rate, operating costs and capital expenditures estimates, reserves and resources, mine production rates and the fair value per pound of copper equivalent used in the determination of the in situ value. The reserves and resources for the QB CGU have been prepared by or under the supervision of qualified persons and management’s experts (management’s specialists).

The principal considerations for our determination that performing procedures relating to the goodwill impairment test for the QB CGU is a critical audit matter are (i) significant judgment by management when determining the recoverable amount of the QB CGU; (ii) management’s specialists were used to estimate the reserves and resources; (iii) a high degree of auditor judgment, subjectivity and effort in performing procedures to evaluate significant assumptions used in the determination of the recoverable amount, relating to long-term copper price, discount rate, operating costs and capital expenditures estimates, reserves and resources, mine production rates, and the fair value per pound of copper equivalent used in the determination of the in situ value; and (iv) the audit effort involved the use of professionals with specialized skills and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management’s QB CGU goodwill impairment test, including controls over the determination of the recoverable amount of the QB CGU. These procedures also included, among others, testing management’s process for determining the recoverable amount of the QB CGU, including evaluating the appropriateness of the discounted cash flow model and the in situ fair value approach, testing the completeness and accuracy of underlying data and evaluating the reasonableness of the significant assumptions used in the determination of the recoverable amount. Evaluating the reasonableness of management’s significant assumptions involved considering their consistency with (i) external market and industry data for long-term copper prices, (ii) recent actual capital expenditures incurred for capital expenditures estimates, (iii) recent actual operating costs incurred as well as market and industry data for operating costs and (iv) recent actual mine production rates and other third party information for mine production rates. The work of management’s specialists was used in performing the procedures to evaluate the reasonableness of reserves and resources. As a basis for using this work, management’s specialists’ qualifications were understood and the Company’s relationship with management’s specialists was assessed. The procedures performed also included evaluation of the methods and assumptions used by management’s specialists, tests of the data used by management’s specialists, and an evaluation of their findings. Professionals with specialized skill and knowledge assisted in this evaluation, as applicable. Professionals with specialized skill and knowledge were also used to assist in the evaluation of the reasonableness of the discount rate and the fair value per pound of copper equivalent used in the determination of the in situ value.

/s/PricewaterhouseCoopers LLP

Chartered Professional Accountants

Vancouver, Canada

February 18, 2026

We have served as the Company’s auditor since 1964.

Teck Resources Limited

Consolidated Statements of Income

Years ended December 31


(CAD$ in millions, except for share data)	2025		2024
Revenue (Note 6)	$	10,756	$	9,065
Cost of sales	(8,099)		(7,458)
Gross profit	2,657		1,607
Other operating income (expenses)
General and administration	(269)		(275)
Exploration	(90)		(87)
Research and innovation	(35)		(50)
Asset impairment (Note 8)	—		(1,053)
Other operating income (expense) (Note 9)	(15)		(151)
Profit (loss) from operations	2,248		(9)
Finance income (Note 10)	271		234
Finance expense (Note 10)	(912)		(953)
Non-operating income (expense) (Note 11)	52		7
Share of profit (loss) of joint venture and associate (Note 15)	(3)		3
Profit (loss) from continuing operations before taxes	1,656		(718)
Provision for income taxes from continuing operations (Note 23(a))	(584)		(205)
Profit (loss) from continuing operations for the year	1,072		(923)
Profit from discontinued operations (Note 5(c))	—		1,206
Profit for the year	$	1,072	$	283

Profit (loss) from continuing operations attributable to:
Shareholders of the company	$	1,401	$	(467)
Non-controlling interests	(329)		(456)
Profit (loss) from continuing operations for the year	$	1,072	$	(923)

Profit (loss) attributable to:
Shareholders of the company	$	1,401	$	406
Non-controlling interests	(329)		(123)
Profit for the year	$	1,072	$	283

Earnings (loss) per share from continuing operations
Basic	$	2.84	$	(0.90)
Diluted	$	2.83	$	(0.90)
Earnings per share from discontinued operations
Basic	$	—	$	1.69
Diluted	$	—	$	1.68
Earnings per share
Basic	$	2.84	$	0.79
Diluted	$	2.83	$	0.78
Weighted average shares outstanding (millions)	493.8		516.0
Weighted average diluted shares outstanding (millions)	495.4		520.0
Shares outstanding at end of year (millions)	488.5		506.3

The accompanying notes are an integral part of these consolidated financial statements.

Teck Resources Limited

Consolidated Statements of Comprehensive Income (Loss)

Years ended December 31


(CAD$ in millions)	2025		2024
Profit for the year	$	1,072	$	283

Other comprehensive income (loss) from continuing operations for the year
Items that may be reclassified to profit
Currency translation differences (net of taxes of $1 and $7)	(1,133)		1,684
Change in fair value of debt securities (net of taxes of $nil and $nil)	4		4
Share of other comprehensive loss of joint venture and associate (net of taxes of $nil and $nil)	(1)		—
	(1,130)		1,688
Items that will not be reclassified to profit
Change in fair value of marketable equity securities (net of taxes of $(3) and $(7))	27		50
Remeasurements of retirement benefit plans (net of taxes of $(13) and $nil)	14		(5)
	41		45
Total other comprehensive income (loss) from continuing operations for the year	$	(1,089)	$	1,733

Other comprehensive income from discontinued operations for the year
Items that will not be reclassified to profit
Remeasurements of retirement benefit plans (net of taxes of $nil and $(30))	—		51

Total comprehensive income (loss) for the year	$	(17)	$	2,067

Total comprehensive income (loss) attributable to:
Shareholders of the company	$	248	$	2,156
Non-controlling interests	(265)		(89)
	$	(17)	$	2,067

Total comprehensive income attributable to shareholders of the company from:
Continuing operations	$	248	$	1,231
Discontinued operations	—		925
	$	248	$	2,156

The accompanying notes are an integral part of these consolidated financial statements.

Teck Resources Limited

Consolidated Statements of Cash Flows

Years ended December 31


(CAD$ in millions)	2025		2024
Operating activities
Profit (loss) from continuing operations	$	1,072	$	(923)
Depreciation and amortization	1,757		1,726
Provision for income taxes from continuing operations	584		205
Asset impairment	—		1,053
Net finance expense	641		719
Income taxes paid	(1,235)		(1,833)
Expenditures on decommissioning and restoration provisions	(106)		(76)
QB variable consideration to IMSA and Codelco	(142)		51
Foreign exchange (gains) losses	41		(146)
Embedded derivatives and other	(155)		(70)
Net change in non-cash working capital items	(978)		(276)
Net cash provided by continuing operating activities	1,479		430
Net cash provided by discontinued operating activities	—		2,360
	1,479		2,790
Investing activities
Expenditures on property, plant and equipment	(1,838)		(2,262)
Capitalized stripping costs	(224)		(373)
Expenditures on investments and other assets	(187)		(68)
Net proceeds from sale of steelmaking coal business	—		9,483
Proceeds from sale of investments and other assets	88		55
Proceeds from interest and dividend income	251		194
Net cash provided by (used in) continuing investing activities	(1,910)		7,029
Net cash used in discontinued investing activities	—		(856)
	(1,910)		6,173
Financing activities
Proceeds from debt	308		77
Redemption, purchase or repayment of debt	(733)		(2,549)
Repayment of lease liabilities	(112)		(68)
QB advances from SMM/SC	476		652
Sale of minority interest in steelmaking coal business	—		1,675
Interest and finance charges paid	(686)		(863)
Issuance of Class B subordinate voting shares	26		172
Purchase and cancellation of Class B subordinate voting shares	(1,011)		(1,240)
Dividends paid	(246)		(514)
Net contributions from non-controlling interests	157		263
Settlement of other liabilities	(25)		(102)
Net cash used in continuing financing activities	(1,846)		(2,497)
Net cash used in discontinued financing activities	—		(68)
	(1,846)		(2,565)
Increase (decrease) in cash and cash equivalents	(2,277)		6,398
Effect of exchange rate changes on cash and cash equivalents	(298)		445
Cash and cash equivalents at beginning of year	7,587		744
Cash and cash equivalents at end of year	$	5,012	$	7,587

Supplemental cash flow information (Note 12)

The accompanying notes are an integral part of these consolidated financial statements.

Teck Resources Limited

Consolidated Balance Sheets

As at December 31


(CAD$ in millions)	2025		2024
ASSETS
Current assets
Cash and cash equivalents (Note 12)	$	5,012	$	7,587
Current income taxes receivable	317		267
Trade and settlement receivables	2,564		1,661
Inventories (Note 13)	2,748		2,598
Prepaids and other current assets	523		461
	11,164		12,574
Financial assets (Note 14)	1,058		764
Investment in joint venture and associate (Note 15)	1,231		1,223
Property, plant and equipment (Note 16)	29,721		30,568
Intangible assets (Note 17)	169		196
Deferred income tax assets (Note 23(b))	931		572
Goodwill (Note 8(b))	421		442
Other assets (Note 18)	741		698
	$	45,436	$	47,037
LIABILITIES AND EQUITY
Current liabilities
Trade accounts payable and other liabilities (Note 19)	$	3,404	$	2,735
Current portion of debt (Note 20)	403		423
Current portion of lease liabilities (Note 21(c))	169		175
Current income taxes payable	182		850
Current portion of provisions (Note 25)	245		187
	4,403		4,370
Debt (Note 20)	3,501		4,108
Lease liabilities (Note 21(c))	789		776
QB advances from SMM/SC (Note 22)	4,745		4,483
Deferred income tax liabilities (Note 23(b))	2,460		2,293
Retirement benefit liabilities (Note 24(a))	351		373
Provisions (Note 25)	2,340		2,439
Financial and other liabilities (Note 26)	840		1,099
	19,429		19,941
Equity
Attributable to shareholders of the company	25,096		26,077
Attributable to non-controlling interests (Note 28)	911		1,019
	26,007		27,096
	$	45,436	$	47,037

Contingencies (Note 5(b) and Note 29)

Commitments (Note 30)

The accompanying notes are an integral part of these consolidated financial statements.

Approved on behalf of the Board of Directors

/s/Una M. Power

/s/Paul G. Schiodtz

Una M. Power

Paul G. Schiodtz

Chair of the Audit Committee

Director

Teck Resources Limited

Consolidated Statements of Changes in Equity

Years ended December 31


(CAD$ in millions)	2025		2024
Class A common shares	$	6	$	6
Class B subordinate voting shares
Beginning of year	6,435		6,458
Share repurchases (Note 27(i))	(246)		(251)
Issued on exercise of options	35		228
End of year	6,224		6,435
Retained earnings
Beginning of year	17,061		19,618
Profit for the year attributable to shareholders of the company	1,401		406
Dividends paid (Note 27(h))	(246)		(514)
Share repurchases (Note 27(i))	(779)		(1,010)
Sale of steelmaking coal business (Note 5(b))	—		(1,485)
Remeasurements of retirement benefit plans	14		46
End of year	17,451		17,061
Contributed surplus
Beginning of year	178		213
Share option compensation expense (Note 27(d))	16		21
Transfer to Class B subordinate voting shares on exercise of options	(9)		(56)
End of year	185		178
Accumulated other comprehensive income attributable to shareholders of the company (Note 27(f))
Beginning of year	2,397		693
Other comprehensive income (loss)	(1,153)		1,750
Remeasurements of retirement benefit plans recorded in retained earnings	(14)		(46)
End of year	1,230		2,397
Non-controlling interests (Note 28)
Beginning of year	1,019		1,304
Loss for the year attributable to non-controlling interests	(329)		(123)
Other comprehensive income attributable to non-controlling interests	64		34
Change from the NSC/POSCO transaction (Note 5(b))	—		3,155
Sale of steelmaking coal business (Note 5(b))	—		(3,261)
Contributions from non-controlling interests	160		263
Distributions to non-controlling interests	(3)		(353)
End of year	911		1,019
Total equity	$	26,007	$	27,096

The accompanying notes are an integral part of these consolidated financial statements.

Notes to Consolidated Financial Statements

Years ended December 31, 2025 and 2024

1. Nature of Operations

Teck Resources Limited and its subsidiaries (Teck, we, us or our) are engaged in mining and related activities including research, exploration and development, processing, smelting, refining and reclamation. Our major products are copper and zinc. We also produce lead, precious metals, molybdenum, fertilizers and other metals. Metal products are sold as refined metals or concentrates. We completed the sale of our steelmaking coal business, Elk Valley Resources (EVR), in 2024 (Note 5(b)).

Teck is a Canadian corporation and our registered office is at Suite 3300, 550 Burrard Street, Vancouver, British Columbia, Canada, V6C 0B3.

2. Basis of Preparation and New IFRS Accounting Standards and Amendments

a) Basis of Preparation

These annual consolidated financial statements have been prepared by management in accordance with IFRS® Accounting Standards as issued by the International Accounting Standards Board (IASB) (IFRS Accounting Standards) and were approved by the Board of Directors on February 18, 2026.

b) New IFRS Accounting Standards and Amendments

Amendments to IFRS 9 and IFRS 7 – Contracts Referencing Nature-dependent Electricity

In December 2024, the IASB issued Contracts Referencing Nature-dependent Electricity – Amendments to IFRS 9 and IFRS 7. These amendments aimed to ensure that nature-dependent electricity contracts, where contractual features can expose a company to variability in the underlying amount of electricity because the source of electricity generation depends on uncontrollable natural conditions, are appropriately reflected in the financial statements. The amendments include clarifying the application of the “own use” requirements to these contracts in assessing whether derivative accounting is required, permitting hedge accounting if these contracts are used as hedging instruments and requiring new disclosures that discuss the effect of these contracts on a company’s financial performance and cash flows.

The amendments are effective for annual periods beginning on or after January 1, 2026, with early application permitted. The clarifications regarding the “own use” requirements are applied retrospectively, but the guidance permitting hedge accounting is applied prospectively to new hedging relationships designated on or after the date of initial application. We do not expect these amendments to have a material effect on our financial statements.

Amendments to IFRS 9 and IFRS 7 – Amendments to the Classification and Measurement of Financial Instruments

In May 2024, the IASB issued Amendments to the Classification and Measurement of Financial Instruments – Amendments to IFRS 9 and IFRS 7. These amendments updated classification and measurement requirements in IFRS 9 Financial Instruments and related disclosure requirements in IFRS 7 Financial Instruments: Disclosures. The IASB clarified the recognition and derecognition date of certain financial assets and liabilities, and amended the requirements related to settling financial liabilities using an electronic payment system. It also clarified how to assess the contractual cash flow characteristics of financial assets in determining whether they meet the solely payments of principal and interest criterion, including financial assets that have environmental, social and corporate governance (ESG)-linked features and other similar contingent features. The IASB added disclosure requirements for financial instruments with contingent features that do not relate directly to basic lending risks and costs, and amended disclosures relating to equity instruments designated at fair value through other comprehensive income.

The amendments are effective for annual periods beginning on or after January 1, 2026, with early application permitted. For financial liabilities settled in cash using an electronic payment system, we expect to apply the election to deem these financial liabilities to be discharged before the settlement date. For equity instruments designated at fair value through other comprehensive income, we will separately present the fair value gain or loss on investments derecognized during the period and on investments held at the end of the period in the statement of comprehensive income (loss). We are continuing to assess the impact of these amendments on our consolidated financial statements.

2. Basis of Preparation and New IFRS Accounting Standards and Amendments (continued)

IFRS 18 – Presentation and Disclosure in Financial Statements

In April 2024, the IASB issued IFRS 18, Presentation and Disclosure in Financial Statements (IFRS 18), which replaces IAS 1, Presentation of Financial Statements. IFRS 18 introduces a specified structure for the income statement by requiring income and expenses to be presented into the three main categories of operating, investing and financing, and by specifying certain defined totals and subtotals. An entity may use certain subtotals of income and expenses in public communications outside the financial statements to communicate management’s view of an aspect of the financial performance of the entity as a whole to users, and these subtotals are not specifically required by IFRS Accounting Standards. IFRS 18 requires companies to disclose explanations around these measures, which are referred to as management-defined performance measures (MPMs). IFRS 18 also provides additional guidance on principles of aggregation and disaggregation that apply to the primary financial statements and the notes. IFRS 18 will not affect the recognition and measurement of items in the financial statements, nor will it affect which items are classified in other comprehensive income (loss) and how these items are classified. The standard is effective for reporting periods beginning on or after January 1, 2027, including for interim financial statements. Retrospective application is required and early application is permitted.

We are currently assessing and quantifying the effect of this standard on our financial statements. The standard is expected to result in changes to the presentation of our consolidated statements of income, by requiring all income and expenses to be classified into the three main categories of operating, investing and financing. Specifically, we anticipate changes to the presentation of certain income and expense items, for example, that foreign exchange gains and losses will be classified in the same category as the items that gave rise to the exchange difference, rather than being combined into one line. The cash flow statement will begin with the new IFRS 18-specified subtotal of operating profit. We will also have enhanced note disclosures on any identified MPMs, such as adjusted EBITDA. We expect to apply IFRS 18 on its effective date with full retrospective application, including restated comparative information.

3. Material Accounting Policy Information

The material accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all periods presented, unless otherwise stated.

Basis of Presentation

Our consolidated financial statements include the accounts of Teck and all of its subsidiaries. Our significant operating subsidiaries include Teck Metals Ltd. (TML), Teck Alaska Incorporated (TAK), Teck Highland Valley Copper Partnership (Highland Valley Copper), Compañía Minera Teck Quebrada Blanca S.A. (QB, QBSA or Quebrada Blanca) and Compañía Minera Teck Carmen de Andacollo (Carmen de Andacollo). Teck Coal Partnership (Teck Coal) was sold as part of our sale of the steelmaking coal business in 2024 (Note 5(b)).

All subsidiaries are entities that we control, either directly or indirectly. Certain of our business activities are conducted through joint arrangements. Our interests in joint operations include Galore Creek Partnership (Galore Creek, 50% share) in Canada; Antamina (22.5% share) in Peru; NewRange Copper Nickel LLC (NewRange, 50% share) in the U.S.; and Minas de San Nicolás, S.A.P.I. de C.V. (San Nicolás, 84% share) in Mexico. As contributions are made by our joint operation partner to San Nicolás, their incremental contributions will result in an increase in their share ownership and a reduction in our share ownership until a 50:50 ownership structure is achieved. We account for our interests in these joint operations by recording our share of the respective assets, liabilities, revenue, expenses and cash flows. We have an interest in a joint venture, NuevaUnión SpA (NuevaUnión, 50% share) in Chile and an immaterial investment in an associate in the United States that we account for using the equity method (Note 15).

On January 3, 2024, we completed the sale of a minority stake of our interest in our steelmaking coal business. On July 11, 2024, we completed the sale of our remaining 77% interest in our steelmaking coal business (Note 5(b)).

All dollar amounts are presented in Canadian dollars unless otherwise specified.

3. Material Accounting Policy Information (continued)

Material Accounting Policies Related to the Steelmaking Coal Business

While the sale of the steelmaking coal business was completed in 2024, profit from discontinued operations for 2024 is presented and disclosed in our consolidated financial statements. Therefore, we have continued to disclose the material accounting policies that are applicable to the steelmaking coal business.

Interests in Joint Operations and Joint Ventures

We are party to joint arrangements where we have joint control, which is when decisions about the activities that significantly affect the returns of the investee require unanimous consent of the parties sharing control. We have joint arrangements structured through separate vehicles and classified as joint operations, where the parties have rights to the assets and obligations for the liabilities relating to the arrangement. In these instances, we assessed the legal form of the separate vehicle, the terms of the contractual arrangement, and relevant other facts and circumstances. Regarding other facts and circumstances, we have determined that an arrangement is a joint operation if the arrangement is primarily designed for the provision of output to the parties, and that the liabilities incurred by the arrangement are, in substance, satisfied by the cash flows received from the parties through their purchases of the output. Joint operations are accounted for by recording our share of the respective assets, liabilities, revenue, expenses and cash flows.

We also have a joint arrangement structured through a separate vehicle that is classified as a joint venture. Joint ventures are accounted for as investments using the equity method.

Foreign Currency Translation

The functional currency of Teck, the parent entity, is the Canadian dollar, which is also the presentation currency of our consolidated financial statements.

Foreign operations are translated from their functional currencies, generally the U.S. dollar, into Canadian dollars on consolidation. Items in the consolidated statements of income and other comprehensive income (loss) are translated using weighted average exchange rates that reasonably approximate the exchange rate at the transaction date. Items on the balance sheet are translated at the closing spot exchange rate. Exchange differences on the translation of the net assets of entities with functional currencies other than the Canadian dollar, and any offsetting exchange differences on debt used to hedge those assets, are recognized in a separate component of equity through other comprehensive income (loss).

Revenue

Our revenue consists of sales of copper, zinc and lead concentrates, and refined zinc, lead and silver. We also sell other by-products, including molybdenum concentrates, various refined specialty metals, chemicals and fertilizers. Our performance obligations relate primarily to the delivery of these products to our customers, with each separate shipment representing a separate performance obligation. In the comparative year, revenue from our steelmaking coal business is included as part of profit from discontinued operations.

Revenue, including revenue from the sale of by-products, is recognized at the point in time when the customer obtains control of the product. Control is achieved when a product is delivered to the customer, we have a present right to payment for the product, significant risks and rewards of ownership have transferred to the customer according to contract terms and there is no unfulfilled obligation that could affect the customer’s acceptance of the product.

Base metal concentrates

For copper, zinc and lead concentrate sales, control of the product generally transfers to the customer when an individual shipment parcel is loaded onto a carrier accepted by the customer. Additionally, for a minority of copper concentrate sales, control of the product transfers to the customer when an individual shipment parcel is delivered to a specified location. We sell a majority of our concentrates on commercial terms where we are responsible for providing freight services after the date at which control of the product passes to the customer. We are the principal to this freight performance obligation. A minority of zinc concentrate sales are made on consignment. For consignment transactions, control of the product transfers to the customer and revenue is recognized at the time the product is consumed in the customer’s process.

3. Material Accounting Policy Information (continued)

The majority of our metal concentrates are sold under pricing arrangements where final prices are determined by quoted market prices in a period subsequent to the date of sale. For these sales, revenue is recorded based on the estimated consideration to be received at the date of sale, with reference to relevant commodity market prices. Adjustments are made to settlement receivables in subsequent periods based on movements in quoted commodity prices up to the date of final pricing. This adjustment mechanism is based on the market price of the commodity and, accordingly, the changes in value of the settlement receivables are not considered to be revenue from contracts with customers. The changes in fair value of settlement receivables related to price changes are recorded in other operating income (expense).

Metal concentrate sales are billed based on provisional weights and assays upon the passage of control to the customer. The first provisional invoice is billed to the customer at the time of transfer of control. As final prices, weights and assays are received, additional invoices are issued and cash is collected. In general, consideration is promptly collected from customers; however, the payment terms are customer-specific and subject to change based on market conditions and other factors. We generally retain title to these products until we receive the first contracted payment, which is typically received shortly after loading or shortly after arrival at the destination port, solely to manage the credit risk of the amounts due to us. This retention of title does not preclude the customer from obtaining control of the product.

Refined metals

For sales of refined metals, control of the product transfers to the customer when the product is loaded onto a carrier accepted by the customer. For these products, loading generally coincides with the transfer of title.

Our refined metals are sold under spot or average pricing contracts. For spot sales contracts, pricing is final when revenue is recognized. For refined metal sales contracts where pricing is not finalized when revenue is recognized, revenue is recorded based on the estimated consideration to be received at the date of sale with reference to commodity market prices. Adjustments are made to settlement receivables in subsequent periods based on movements in quoted commodity prices up to the date of final pricing. This adjustment mechanism is based on the market price of the commodity and, accordingly, the changes in value of the settlement receivables are not considered to be revenue from contracts with customers. The changes in fair value of settlement receivables are recorded in other operating income (expense).

We sell a portion of our refined metals on commercial terms where we are responsible for providing freight services after the date at which control of the product passes to the customer. We are the principal to this freight performance obligation.

Refined metal sales are billed based on final specification measures upon the passage of control to the customer. If pricing is not finalized when control of the product is transferred, a subsequent invoice is issued when pricing is finalized.

In general, consideration is promptly collected from customers; however, the payment terms are customer-specific and subject to change based on market conditions and other factors.

Steelmaking coal sales – presented as profit from discontinued operations

For steelmaking coal sales, control of the product generally transfers to the customer when an individual shipment parcel is loaded onto a carrier accepted by or directly contracted by the customer. For a majority of steelmaking coal sales, we are not responsible for the provision of shipping or product insurance after the transfer of control. For certain sales, we arrange shipping on behalf of our customers and are the agent to these shipping transactions.

Steelmaking coal is sold under spot or average pricing contracts. For spot price contracts, pricing is final when revenue is recognized. For average pricing contracts, the final pricing is determined based on quoted steelmaking coal price assessments over a specific period. Control of the goods may transfer and revenue may be recognized before, during or subsequent to the period in which final average pricing is determined. For all steelmaking coal sales under average pricing contracts where pricing is not finalized when revenue is recognized, revenue is recorded based on estimated consideration to be received at the date of sale with reference to steelmaking coal price assessments. For average pricing contracts, adjustments are made to settlement receivables in subsequent periods based on published price assessments up to the date of final pricing. This adjustment mechanism is based on the market price of the commodity and, accordingly, the changes in value of the settlement receivables are not considered to be revenue from contracts with customers.

3. Material Accounting Policy Information (continued)

Steelmaking coal sales are billed based on final quality and quantity measures upon the passage of control to the customer. If pricing is not finalized when control of the product is transferred, a subsequent invoice is issued when pricing is finalized. The payment terms generally require prompt collection from customers; however, payment terms are customer-specific and subject to change based on market conditions and other factors. We generally retain title to these products until we receive the first contracted payment, which is typically received shortly after loading, solely to manage the credit risk of the amounts due to us. This retention of title does not preclude the customer from obtaining control of the product.

Financial Instruments

Cash and cash equivalents

Cash and cash equivalents include cash on account, demand deposits and money market investments with maturities from the date of acquisition of three months or less, which are readily convertible to known amounts of cash and are subject to insignificant changes in value. Cash is classified as a financial asset that is subsequently measured at amortized cost. Cash equivalents are classified as a financial asset that is subsequently measured at amortized cost, except for money market investments, which are classified as subsequently measured at fair value through profit (loss).

Trade receivables

Trade receivables relate to amounts owing from sales under our spot pricing contracts for refined metals, chemicals and fertilizers. These receivables are non-interest bearing and are recognized at face amount, except when fair value is materially different, and are subsequently measured at amortized cost. Trade receivables recorded are net of lifetime expected credit losses.

Settlement receivables

Settlement receivables arise from base metal concentrate sales contracts and refined metals sales contracts, where amounts receivable vary based on underlying commodity prices. Settlement receivables are classified as fair value through profit (loss) and are recorded at fair value at each reporting period based on quoted commodity prices up to the date of final pricing. The changes in fair value are recorded in other operating income (expense).

Investments in marketable equity securities

All of our investments in marketable equity securities are classified, at our election, as subsequently measured at fair value through other comprehensive income (loss). Investment transactions are recognized on the trade date, with transaction costs included in the underlying balance. Fair values are determined by reference to quoted market prices at the balance sheet date.

When investments in marketable equity securities subsequently measured at fair value through other comprehensive income (loss) are disposed of, the cumulative gains and losses recognized in other comprehensive income (loss) are not recycled to profit (loss) and remain within equity. Dividends are recognized in profit (loss). These investments are not assessed for impairment.

Investments in debt securities

Investments in debt securities are classified as subsequently measured at fair value through other comprehensive income (loss) and recorded at fair value. Investment transactions are recognized on the trade date, with transaction costs included in the underlying balance. Fair values are determined by reference to quoted market prices at the balance sheet date.

Unrealized gains and losses on debt securities are recognized in other comprehensive income (loss) until investments are disposed of and the cumulative gains and losses recognized in other comprehensive income (loss) are reclassified from equity to profit (loss) at that time. Loss allowances and interest income are recognized in profit (loss).

Trade payables

Trade payables are non-interest bearing if paid when due and are recognized at face amount, except when fair value is materially different. Trade payables are subsequently measured at amortized cost.

3. Material Accounting Policy Information (continued)

Debt

Debt is initially recorded at fair value, net of transaction costs. Debt is subsequently measured at amortized cost, calculated using the effective interest rate method.

Derivative instruments

Derivative instruments, including embedded derivatives in executory contracts or financial liability contracts, are classified as at fair value through profit (loss) and, accordingly, are recorded on the balance sheet at fair value. Unrealized gains and losses on derivatives not designated in a hedging relationship are recorded as part of other operating income (expense) or non-operating income (expense) in profit (loss) depending on the nature of the derivative. Fair values for derivative instruments are determined using inputs based on market conditions existing at the balance sheet date or settlement date of the derivative. Derivatives embedded in non-derivative contracts are recognized separately unless they are closely related to the host contract.

Expected credit losses

For trade receivables, we apply the simplified approach to determining expected credit losses, which requires expected lifetime losses to be recognized upon initial recognition of the receivables.

Loss allowances on investments in debt securities and other receivables are initially assessed based on the expected 12-month credit loss. At each reporting date, we assess whether the credit risk for our debt securities and other receivables has increased significantly since initial recognition. If the credit risk has increased significantly since initial recognition, the loss allowance is adjusted to be based on the lifetime expected credit losses.

Hedging

For hedges of net investments in foreign operations, any foreign exchange gains or losses on the hedging instrument relating to the effective portion of the hedge are initially recorded in other comprehensive income (loss). Gains and losses are recognized in profit (loss) on the ineffective portion of the hedge, or when there is a disposition or partial disposition of a foreign operation being hedged.

Inventories

Finished products, work in process, raw materials and supplies inventories are valued at the lower of weighted average cost and net realizable value. Work in process inventory includes inventory in the milling, smelting or refining process and stockpiled ore at mining operations. Raw materials include concentrates for use at smelting and refining operations.

For work in process and finished product inventories, cost includes all direct costs incurred in production, including direct labour and materials, freight, depreciation and amortization and directly attributable overhead costs. Production stripping costs that are not capitalized are included in the cost of inventories as incurred. Depreciation and amortization of capitalized production stripping costs are included in the cost of inventory. For supplies inventories, cost includes acquisition, freight and other directly attributable costs.

When our operations are producing at reduced levels, fixed overhead costs are only allocated to inventory based on normal production levels.

When inventories have been written down to net realizable value, we make a new assessment of net realizable value in each subsequent period. If the circumstances that caused the write-down no longer exist, the remaining amount of the write-down on inventory not yet sold is reversed.

We use both joint-product and by-product costing for work in process and finished product inventories. Joint-product costing is applied to primary products where the profitability of the operations is dependent upon the production of these products. Joint-product costing allocates total production costs based on the relative values of the products. By-product costing is used for products that are not the primary products produced by the operation. The by-products are allocated only the incremental costs of processes that are specific to the production of that product.

3. Material Accounting Policy Information (continued)

Property, Plant and Equipment

Land, buildings, plant and equipment

Land is recorded at cost and buildings, plant and equipment are initially recorded at cost and subsequently measured at cost less accumulated depreciation and impairment losses. Cost includes the purchase price and the directly attributable costs to bring the assets to the location and condition necessary for them to be capable of operating in the manner intended by management.

Depreciation of mobile equipment, buildings used for production and plant and processing equipment at our mining operations is calculated on a units-of-production basis. Depreciation of buildings not used for production and of plant and equipment at our smelting operations is calculated on a straight-line basis over the assets’ estimated useful lives. Where components of our assets have different useful lives, depreciation is calculated on each component separately. Depreciation commences when an asset is ready for its intended use. Estimates of remaining useful lives and residual values are reviewed annually.

The expected useful lives of assets depreciated on a straight-line basis are as follows:

•Buildings and equipment (not used for production) 1–40 years

•Plant and equipment (smelting operations) 2–30 years

Mineral properties and mine development costs

The cost of acquiring and developing mineral properties or property rights, including pre-production waste rock stripping costs related to mine development and costs incurred during production to increase future output, are capitalized.

Waste rock stripping costs incurred in the production phase of a surface mine are recorded as capitalized production stripping costs within property, plant and equipment when it is probable that the stripping activity will improve access to the orebody, when the component of the orebody or pit to which access has been improved can be identified and when the costs relating to the stripping activity can be measured reliably. When the actual waste-to-ore stripping ratio in a period is greater than the expected life-of-component waste-to-ore stripping ratio for that component, the excess is recorded as capitalized production stripping costs.

Once available for use, mineral properties and mine development costs are depreciated on a units-of-production basis over the proven and probable reserves to which they relate. Since the stripping activity within a component of a mine improves access to the reserves of the same component, capitalized production stripping costs incurred during the production phase of a mine are depreciated on a units-of-production basis over the proven and probable reserves expected to be mined from the same component.

Exploration and evaluation costs

Property acquisition costs are capitalized. Other exploration and evaluation costs are capitalized if they relate to specific properties for which resources, as defined under National Instrument 43-101, Standards of Disclosure for Mineral Projects, exist or are near a specific property with a defined resource and it is expected that the expenditure can be recovered by future exploitation or sale. All other costs are recorded to profit (loss) in the year in which they are incurred. Capitalized exploration and evaluation costs are considered to be tangible assets. These assets are not depreciated, as they are not currently available for use. When proven and probable reserves are determined and development is approved, capitalized exploration and evaluation costs are reclassified to mineral properties within property, plant and equipment.

Construction in progress

Assets in the course of construction are capitalized as construction in progress. On completion, the cost of construction is transferred to the appropriate category of property, plant and equipment and depreciation commences when the asset is available for its intended use.

Repairs and maintenance

Repairs and maintenance costs, including shutdown maintenance costs, are recorded to expense as incurred, except when these repairs significantly extend the life of an asset or result in a significant operating improvement. In these instances, the portion of these repairs relating to the betterment is capitalized as part of plant and equipment.

3. Material Accounting Policy Information (continued)

Borrowing costs

Borrowing costs are capitalized at a rate based on our weighted average cost of borrowing or at the rate on the project-specific debt, as applicable. Borrowing costs are capitalized with the asset they relate to within mineral properties, land, buildings, plant and equipment, or construction in progress and are amortized over the useful life of the related asset. All other borrowing costs are expensed as incurred.

Capitalization of borrowing costs begins when there are borrowings, when expenditures on the construction of the asset are incurred and when activities are undertaken to prepare the asset for its intended use. We stop capitalization of borrowing costs when substantially all of the activities necessary to prepare the qualifying asset for its intended use are complete. In situations where we need to suspend the construction of a qualifying asset for an extended period of time, we will suspend capitalization of borrowing costs, and restart capitalization when construction activities resume.

Impairment and impairment reversal of non-current assets

The carrying amounts of assets included in property, plant and equipment and intangible assets are reviewed for impairment whenever facts and circumstances indicate that the recoverable amounts may be less than the carrying amounts. If there are indicators of impairment, the recoverable amount of the asset is estimated in order to determine the extent of any impairment. Where the asset does not generate cash flows that are independent from other assets, the recoverable amount of the cash-generating unit (CGU) to which the asset belongs is determined. The recoverable amount of an asset or CGU is determined as the higher of its fair value less costs of disposal (FVLCD) and its value in use. An impairment loss exists if the asset’s or CGU’s carrying amount exceeds the estimated recoverable amount and is recorded as an expense immediately.

Fair value is the price that would be received from selling an asset in an orderly transaction between market participants at the measurement date. Costs of disposal are incremental costs directly attributable to the disposal of an asset. For our assets, when a binding sale agreement is not readily available, FVLCD is usually estimated using a discounted cash flow approach, unless comparable market transactions on which to estimate fair value are available. Estimated future cash flows are calculated using estimated future commodity prices, operating costs, capital costs and, specifically for our mining assets, reserves and resources. All inputs used are those that an independent market participant would consider appropriate.

Value in use is determined as the present value of the future cash flows expected to be derived from continuing use of an asset or CGU in its present form. These estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU for which estimates of future cash flows have not been adjusted. A value in use calculation uses a pre-tax discount rate and a FVLCD calculation uses a post-tax discount rate.

Indicators of impairment for exploration and evaluation assets are assessed on a project-by-project basis or as part of the mining operation to which they relate.

Tangible or intangible assets that have been impaired in prior periods are tested for possible reversal of impairment whenever events or significant changes in circumstances indicate that the impairment may have reversed. Indicators of a potential reversal of an impairment loss mainly mirror the indicators present when the impairment was originally recorded. If the impairment has reversed, the carrying amount of the asset is increased to its recoverable amount, but not beyond the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognized for the asset in prior periods. A reversal of an impairment loss is recognized in profit (loss) immediately.

Intangible Assets

Intangible assets are mainly internally generated and primarily relate to our innovation and technology initiatives. We capitalize development costs for internally generated intangible assets when the process is clearly defined, the technical feasibility and usefulness of the asset have been established, we are committed and have the resources to complete the project, and the costs can be reliably measured.

Intangible assets are recorded at cost less accumulated amortization and impairment losses. Cost includes directly attributable costs necessary to create, produce and prepare the asset to be capable of operating in the manner intended by management. Costs associated with maintaining our innovation and technology initiatives, once implemented, are recognized as an expense as incurred.

3. Material Accounting Policy Information (continued)

Finite life intangible assets are amortized on a straight-line basis over their useful lives. Amortization commences when an asset is ready for its intended use. Estimates of remaining useful lives are reviewed annually. Changes in estimates are accounted for prospectively. The expected useful lives of our finite life intangible assets are between three and 20 years.

Goodwill

We allocate goodwill arising from business combinations to each CGU that is expected to receive the benefits from the business combination. The carrying amount of the CGU to which goodwill has been allocated is tested annually for impairment or when there is an indication that the goodwill may be impaired. An impairment loss exists if the CGU’s carrying amount, including goodwill, exceeds its recoverable amount. Any impairment is recognized as an expense immediately. Should there be a recovery in the value of a CGU, any impairment of goodwill previously recorded is not subsequently reversed.

Leases

Contracts are assessed to determine if the contracts are, or contain, a lease. As a lessee, we recognize a right-of-use asset, which is included in property, plant and equipment, and a lease liability at the commencement date of a lease. The commencement date is the date when the lessor makes the underlying asset available for use by us. The right-of-use asset is initially measured at cost, which is comprised of the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any decommissioning and restoration costs.

The right-of-use asset is subsequently depreciated from the commencement date to the earlier of the end of the lease term, or the end of the useful life of the asset. In addition, the right-of-use asset may be reduced due to impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

A lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by our incremental borrowing rate, as the rate implicit in the lease cannot be readily determined.

Our lease liabilities are remeasured when there is a change in future lease payments arising from a purchase, extension or termination option. Variable lease payments not included in the initial measurement of the lease liability are charged directly to profit (loss).

We have elected not to recognize right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low-value assets. The lease payments associated with these leases are recorded directly to profit (loss) on a straight-line basis over the lease term.

Income Taxes

Taxes, comprising both income taxes and resource taxes, are accounted for as income taxes under IAS 12, Income Taxes. In the comparative year, profit from discontinued operations includes the income tax expense related to the gain on sale of the steelmaking coal business, along with the income and resource taxes attributable to the operations of the steelmaking coal business until the business was sold.

Current taxes receivable or payable are based on estimated taxable income for the current year at the statutory tax rates enacted, or substantively enacted, less amounts paid or received on account.

Deferred tax assets and liabilities are recognized based on temporary differences and are calculated using enacted or substantively enacted tax rates for the periods in which the differences are expected to reverse. The effect of changes in tax legislation, including changes in tax rates, is recognized in the period of substantive enactment.

Deferred tax assets are recognized only to the extent where it is probable that the future taxable profits or capital gains of the relevant entity or group of entities in a particular jurisdiction will be available, against which the assets can be utilized.

Deferred tax liabilities are recognized for taxable temporary differences arising on investments in subsidiaries, joint ventures and associates. However, we do not recognize such deferred tax liabilities where the timing of the reversal of the temporary differences can be controlled without affecting our operations or business and where it is probable that the temporary differences will not reverse in the foreseeable future.

3. Material Accounting Policy Information (continued)

Deferred tax assets and liabilities are not recognized if the temporary differences arise from the initial recognition of goodwill or an asset or liability in a transaction, other than in a business combination, which will affect neither accounting profit nor taxable profit. However, we recognize deferred tax on transactions that, on initial recognition, give rise to equal amounts of taxable and deductible temporary differences.

We are subject to assessments by various taxation authorities, who may interpret tax legislation differently than we do. The final amount of taxes to be paid depends on a number of factors, including the outcomes of audits, appeals or negotiated settlements. We account for such differences based on our best estimate of the probable outcome of these matters.

We have applied the mandatory temporary exception to the accounting for deferred taxes arising from the implementation of the Organisation for Economic Co-operation and Development (OECD)/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS) Pillar Two Model Rules.

Employee Benefits

Defined benefit pension plans

Defined benefit pension plan obligations are based on actuarial determinations. The projected unit credit method, which sees each period of service as giving rise to an additional unit of benefit entitlement and measures each unit separately to build up the final obligation, is used to determine the defined benefit obligations, the related current service costs and, where applicable, the past service costs. Actuarial assumptions used in the determination of defined benefit pension plan assets and liabilities are based upon our best estimates, including discount rates, salary escalation, expected healthcare costs and retirement dates of employees.

Actuarial gains and losses can arise from differences between expected and actual outcomes or changes in actuarial assumptions. Actuarial gains and losses, changes in the effect of the asset ceiling and return on plan assets are collectively referred to as remeasurements of retirement benefit plans and are recognized immediately through other comprehensive income (loss) and directly into retained earnings. Measurement of our net defined benefit asset is limited to the lower of the surplus of assets less liabilities in the defined benefit plan and the asset ceiling less liabilities in the defined benefit plan. The asset ceiling is the present value of the expected economic benefit available to us in the form of refunds from the plan or reductions in future contributions to the plan.

The interest component of the defined benefit cost is recorded as part of finance expense. Depending on the classification of the salary of plan members, current service costs and past service costs are included in cost of sales, general and administration expenses, exploration expenses or research and innovation expenses.

Defined contribution pension plans

The cost of providing benefits through defined contribution plans is recorded to profit (loss) as the obligation to contribute is incurred.

Non-pension post-retirement plans

We provide healthcare benefits for certain employees when they retire. Non-pension post-retirement plan obligations are based on actuarial determinations. The cost of these benefits is expensed over the period in which the employees render services. We fund these non-pension post-retirement benefits as they become due.

Share-Based Payments

The fair value method of accounting is used for share-based payment transactions. Under this method, the cost of share options and other equity-settled share-based payment arrangements is recorded based on the estimated fair value at the grant date, including an estimate of the forfeiture rate, and recorded to other operating income (expense) over the vesting period.

3. Material Accounting Policy Information (continued)

Share-based payment expense relating to cash-settled awards, including deferred, restricted, performance and performance deferred share units, is accrued over the vesting period of the units based on the quoted market value of Class B subordinate voting shares. Performance share units (PSUs) and performance deferred share units (PDSUs) vest subject to a performance metric ranging from 0% to 200% based on corporate performance against grant-specific performance criteria. The performance metrics for PSUs and PDSUs issued in 2022 and 2023 were based on a balanced scorecard, with 20% related to each of: relative shareholder return as compared to our compensation peer group, change in five-year average return on capital employed for operating assets, operational production and cost performance as against the annual budget, strategic execution, and performance measured against a sustainability progress index. The performance metrics for PSUs and PDSUs issued in 2024 and 2025 were based on a balanced scorecard with four components, with 40% based on relative shareholder return as compared to our compensation peer group and 20% related to each of: strategic execution, performance measured against a sustainability progress index, and the change in five-year average return on capital employed for operating assets. As these awards will be settled in cash, the expense and liability are adjusted each reporting period for changes in the underlying share price as well as changes to the above-noted vesting factors, as applicable.

Decommissioning and Restoration Provisions

Future obligations to retire an asset and to restore a site, including dismantling, remediation and ongoing treatment and monitoring of the site related to normal operations, are initially recognized and recorded as a provision based on estimated future cash flows discounted at a credit-adjusted risk-free rate. These decommissioning and restoration provisions are adjusted at each reporting period for changes to factors including the expected amount of cash flows required to discharge the liability, the timing of such cash flows and the discount rate.

The provisions are also accreted to full value over time through periodic charges to profit (loss). This unwinding of the discount is recorded to finance expense in the consolidated statements of income (loss).

The amount of the decommissioning and restoration provisions initially recognized is capitalized as part of the related asset’s carrying value. The method of depreciation follows that of the underlying asset. For a closed site or where the asset that generated a decommissioning and restoration provision no longer exists, there is no longer any future benefit related to the costs and, as such, the amounts are expensed through other operating income (expense). For operating sites, a revision in estimates or a new disturbance will result in an adjustment to the provision with an offsetting adjustment to the capitalized asset retirement cost.

During the operating life of an asset, events such as infractions of environmental laws or regulations may occur. These events are not related to the normal operation of the asset. The costs associated with these provisions are accrued and recorded through other operating income (expense) in the period in which the event giving rise to the liability occurs. Changes in the estimated liability resulting in an adjustment to these provisions are also recorded to other operating income (expense) in the period in which the estimate changes.

Earnings (Loss) per Share

Earnings (loss) per share is calculated based on the weighted average number of shares outstanding during the year. For diluted earnings per share, dilution is calculated based upon the net number of common shares issued, should “in-the-money” options and warrants be exercised and the proceeds be used to repurchase common shares at the average market price in the year. In periods of loss, the loss per share and diluted loss per share are the same, since the effect of the issuance of additional common shares would be anti-dilutive.

4. Areas of Judgment and Estimation Uncertainty

In preparing our consolidated financial statements, we make judgments in applying our accounting policies. The judgments that have the most significant effect on the amounts recognized in our consolidated financial statements are outlined below.

In addition, we make assumptions about the future in deriving estimates used in preparing our consolidated financial statements. We have outlined information below about assumptions and other sources of estimation uncertainty as at December 31, 2025 that have a risk of resulting in a material adjustment to the carrying amounts of assets and liabilities within the next year.

4. Areas of Judgment and Estimation Uncertainty (continued)

a) Areas of Judgment

Assessment of Impairment and Impairment Reversal Indicators

Judgment is required in assessing whether certain factors would be considered an indicator of impairment or impairment reversal. We consider both internal and external information to determine whether there is an indicator of impairment or impairment reversal present and, accordingly, whether impairment testing is required. The information we consider in assessing whether there is an indicator of impairment or impairment reversal includes, but is not limited to, market transactions for similar assets, commodity prices, treatment charges, zinc premiums, discount rates, foreign exchange rates, our market capitalization, reserves and resources, operating results, mine plans and operating plans.

In the third quarter of 2025, as a result of continuing challenges with the pace of development of the tailings management facility (TMF) resulting in near-term production constraints and higher TMF-related capital expenditures, we performed an impairment test for our Quebrada Blanca cash-generating unit (Quebrada Blanca CGU) (Note 8(a)).

Property, Plant and Equipment – Determination of Available for Use Date

Judgment is required in determining the date that property, plant and equipment is available for use. An asset is available for use when it is in the location and condition necessary to operate in the manner intended by management.

We consider several factors when assessing the timing of when assets become available for use, the most significant of which are the status of asset commissioning and whether the assets are capable of operating near design capacity to ensure a reliable and consistent throughput rate to produce the expected quantity of outputs.

QB consists of property, plant and equipment that became available for use at different dates, with the majority of its assets becoming available for use in December of 2023. In May of 2024, the shiploader and related infrastructure at QB became available for use. In August of 2025, the molybdenum plant at QB became available for use (Note 16(c)).

In June of 2024, the KIVCET boiler at our Trail Operations became available for use.

Joint Arrangements

We are a party to a number of arrangements over which we do not have control. Judgment is required in determining whether joint control over these arrangements exists and, if so, which parties have joint control and whether each arrangement is a joint venture or a joint operation. In assessing whether we have joint control, we analyze the activities of each arrangement and determine which activities most significantly affect the returns of the arrangement over its life. These activities are determined to be the relevant activities of the arrangement. If unanimous consent is required over the decisions about the relevant activities, the parties whose consent is required would have joint control over the arrangement. The judgments around which activities are considered the relevant activities of the arrangement are subject to analysis by each of the parties to the arrangement and may be interpreted differently. When performing this assessment, we generally consider decisions about activities such as managing the asset while it is being designed, developed and constructed, during its operating life and during the closure period. We may also consider other activities, including the approval of budgets, expansion and disposition of assets, financing, significant operating and capital expenditures, appointment of key management personnel, representation on the board of directors and other items. When circumstances or contractual terms change, we reassess the control group and the relevant activities of the arrangement.

4. Areas of Judgment and Estimation Uncertainty (continued)

If we have joint control over the arrangement, an assessment of whether the arrangement is a joint venture or a joint operation is required. This assessment is based on whether we have rights to the assets, and obligations for the liabilities, relating to the arrangement or whether we have rights to the net assets of the arrangement. In making this determination, we review the legal form of the arrangement, the terms of the contractual arrangement and other facts and circumstances. In a situation where the legal form and the terms of the contractual arrangement do not give us rights to the assets and obligations for the liabilities, an assessment of other facts and circumstances is required, including whether the activities of the arrangement are primarily designed for the provision of output to the parties and whether the parties are substantially the only source of cash flows contributing to the arrangement. The consideration of other facts and circumstances may result in the conclusion that a joint arrangement is a joint operation. This conclusion requires judgment and is specific to each arrangement. Other facts and circumstances have led us to conclude that Antamina, NewRange and San Nicolás are joint operations for the purposes of our consolidated financial statements. The other facts and circumstances considered for these arrangements include the provision of output to the parties of the joint arrangements and the funding obligations. For Antamina, NewRange and San Nicolás, we take our share of the output from the assets directly over the life of the arrangement. We have concluded that this gives us direct rights to the assets and obligations for the liabilities of these arrangements proportionate to our ownership interests.

Streaming Transactions

When we enter into a long-term streaming arrangement linked to production at specific operations, judgment is required in assessing the appropriate accounting treatment for the transaction on the closing date and in future periods. We consider the specific terms of each arrangement to determine whether we have disposed of an interest in the reserves and resources of the respective operation or executed some other form of arrangement. This assessment considers what the counterparty is entitled to and the associated risks and rewards attributable to them over the life of the operation. These include the contractual terms related to the total production over the life of the arrangement as compared to the expected production over the life of the mine, the percentage being sold, the percentage of payable metals produced, the commodity price referred to in the ongoing payment and any guarantee relating to the upfront payment if production ceases.

For our silver and gold streaming arrangements at Antamina and Carmen de Andacollo, respectively, there is no guarantee associated with the upfront payment. We have concluded that control of the rights to the silver and gold mineral interests were transferred to the buyers when the contracts came into effect. Therefore, we consider these arrangements a disposition of a mineral interest.

Based on our judgment, control of the interest in the reserves and resources transferred to the buyer when the contracts were executed. At that time, we recognized the amount of the gain related to the disposition of the reserves and resources, as we had the right to payment, the customer was entitled to the commodities, the buyer had no recourse in requiring Teck to mine the product, and the buyer had significant risks and rewards of ownership of the reserves and resources.

We recognize the amount of consideration related to refining, mining and delivery services as the work is performed.

Deferred Tax Assets and Liabilities

Judgment is required in assessing whether deferred tax assets and certain deferred tax liabilities are recognized on the balance sheet and what tax rate is expected to be applied in the year when the related temporary differences reverse. We also evaluate the recoverability of deferred tax assets based on an assessment of our ability to use the underlying future tax deductions before they expire against future taxable profits or capital gains. Deferred tax liabilities arising from temporary differences on investments in subsidiaries, joint ventures and associates are recognized unless the reversal of the temporary differences is not expected to occur in the foreseeable future and can be controlled. Judgment is also required on the application of income tax legislation. These judgments are subject to risk and uncertainty and could result in an adjustment to the deferred tax provision.

4. Areas of Judgment and Estimation Uncertainty (continued)

b) Sources of Estimation Uncertainty

Impairment Testing

For required impairment testing, discounted cash flow models are used to determine the recoverable amount of respective CGUs. These models are prepared internally or with assistance from third-party advisors when required. When relevant market transactions for comparable assets are available, these are considered in determining the recoverable amount of assets.

Significant assumptions used in preparing the discounted cash flow model for our Quebrada Blanca CGU’s September 2025 impairment test and October 2025 goodwill impairment test include long-term copper price, discount rate, our assumptions about throughput optimization and asset expansion, recovery rates, operating costs and capital expenditures estimates, reserves and resources, mine production rates and the fair value per pound of copper equivalent used in the determination of the in situ value.

Significant assumptions used in preparing the discounted cash flow model for our Trail CGU impairment test in 2024 include the long-term zinc price, long-term zinc treatment charges, long-term zinc premiums, U.S. dollar to Canadian dollar foreign exchange rates, zinc production rates, operating costs, capital costs and discount rate.

Note 8 outlines the significant inputs used when performing goodwill and other asset impairment testing. These inputs are based on management’s best estimates of what an independent market participant would consider appropriate. Changes in these inputs may alter the results of impairment testing, the amount of the impairment charges or reversals recorded in the consolidated statements of income (loss) and the resulting carrying values of assets.

Estimated Recoverable Reserves and Resources

Mineral reserve and resource estimates are based on various assumptions relating to operating matters as set forth in National Instrument 43-101, Standards of Disclosure for Mineral Projects. Assumptions used include production costs, mining and processing recoveries, cut-off grades, sales volumes, long-term commodity prices, exchange rates, inflation rates, tax and royalty rates and capital costs. Cost estimates are based on prefeasibility or feasibility study estimates or operating history. Estimates are prepared by or under the supervision of appropriately qualified persons, but will be affected by forecasted commodity prices, inflation rates, exchange rates, capital and production costs and recoveries, among other factors. Estimated recoverable reserves and resources are used in performing impairment testing, to determine the depreciation of property, plant and equipment at operating mine sites, in accounting for capitalized production stripping costs and also in forecasting the timing of settlement of decommissioning and restoration costs. Changes in reserve and resource estimates are most significant to estimating the recoverable amount in impairment tests.

Decommissioning and Restoration Provisions

Decommissioning and restoration provisions (DRPs) are based on future cost estimates, using information available at the balance sheet date, that are developed by management’s experts (Note 25). DRPs represent the present value of estimated costs of future decommissioning and other site restoration activities, including costs associated with the management of water and water quality in and around each closed site. DRPs are adjusted at each reporting period for changes to factors such as the expected amount of cash flows required to discharge the liability, the timing of such cash flows and the credit-adjusted discount rate. DRPs require significant estimates and assumptions, including the requirements of the relevant legal and regulatory framework and the timing, extent and costs of required decommissioning and restoration activities. Our estimates of the costs associated with the management of water and water quality in and around each closed site include assumptions with respect to the volume and location of water to be treated, the methods used to treat the water and the related water treatment costs. Changes in the estimated life of mine can affect the timing of decommissioning activities and the related cost estimates. This may result in future actual expenditures differing materially from the amounts currently recorded as part of provisions in the consolidated balance sheets. To the extent the actual costs differ from these estimates, adjustments will be recorded, and the consolidated statements of income (loss) may be affected.

4. Areas of Judgment and Estimation Uncertainty (continued)

Financial Liability due to Codelco

We have a financial liability for the preferential dividend stream from QBSA to Corporación Nacional del Cobre de Chile (Codelco) (Note 11). This financial liability is significantly affected by copper prices, the interest rate on the subordinated loans provided by us and Sumitomo Metal Mining Co., Ltd. and Sumitomo Corporation (together referred to as SMM/SC) to QBSA, operating cost estimates and capital expenditure estimates, which all affect the timing of when QBSA repays the loans. A floating interest rate is used based on the Secured Overnight Financing Rate (Term SOFR) plus an applicable margin. To the extent these significant inputs differ from our estimates, adjustments will be recorded and the consolidated statements of income (loss) will be affected.

Provision for Income Taxes

We calculate current and deferred tax provisions for each of the jurisdictions in which we operate. Actual amounts of income tax expense are not final until tax returns are filed and accepted by the relevant authorities. This occurs subsequent to the issuance of our consolidated financial statements and the final determination of actual amounts may not be completed for a number of years. Therefore, profit (loss) in subsequent periods will be affected by the amount that estimates differ from the final tax assessment.

Deferred Tax Assets and Liabilities

Assumptions about the generation of future taxable profits and repatriation of retained earnings depend on management’s estimates of future production and sales volumes, commodity prices, reserves and resources, operating costs, decommissioning and restoration costs, capital expenditures, dividends and other capital management transactions. These estimates could result in an adjustment to the deferred tax provision and a corresponding adjustment to profit (loss).

5. Transactions

a) Proposed Teck and Anglo American Merger

On September 9, 2025, we entered into an arrangement agreement with Anglo American plc (Anglo American) with respect to a proposed merger of equals between the two companies (the Merger). The Merger will be implemented by means of a plan of arrangement pursuant to which Anglo American will issue 1.3301 ordinary shares for each outstanding Teck Class A common share and Class B subordinate voting share.

On December 9, 2025, shareholders of both Teck and Anglo American approved the Merger as required under the arrangement agreement. On December 15, 2025, Teck and Anglo American received regulatory approval from the Government of Canada under the Investment Canada Act for the Merger.

The Merger remains subject to customary closing conditions for a transaction of this nature, including regulatory approvals in multiple jurisdictions globally.

As the transaction had not closed as at December 31, 2025, no adjustments for the proposed Merger have been recognized in our consolidated financial statements. Transaction-related costs incurred to date have been expensed and are presented as part of non-operating income (expense).

b) Sale of Steelmaking Coal Business

In January of 2024, we completed the sale of a minority stake of our interest in our steelmaking coal business, EVR, to NSC and POSCO. NSC acquired a 20% interest in EVR in exchange for its 2.5% interest in the Elkview Operations plus $1.7 billion (US$1.3 billion) in cash. POSCO exchanged its 2.5% interest in the Elkview Operations and its 20% interest in the Greenhills Operations for a 3% interest in EVR. These transactions were accounted for as equity transactions with non-controlling interests, reducing retained earnings by $1.5 billion and increasing non-controlling interests balances. In determining the net assets of EVR to calculate the non-controlling interests and the related adjustment to retained earnings, we included the steelmaking coal business' goodwill balance and excluded deferred income tax liabilities not attributable to the non-controlling interests.

5. Transactions (continued)

In July of 2024, we completed the sale of our remaining 77% interest in EVR to Glencore plc (Glencore). We received cash proceeds of $9.9 billion (US$7.3 billion) and correspondingly derecognized $20 billion of assets (including $17 billion of property, plant and equipment and $256 million of cash), $8 billion of liabilities (including $2 billion of decommissioning and restoration provisions) and $3 billion of non-controlling interests related to the steelmaking coal business. This resulted in a gain (net of taxes of $897 million, which is based on the taxable gain as computed under Canadian tax law) of approximately $81 million, which is presented in profit from discontinued operations upon closing of this transaction. Settlements of customary closing adjustments were recorded as part of discontinued operations.

Pursuant to the terms of the steelmaking coal business sale transaction, Teck agreed to indemnify Glencore for a portion of certain water-related liabilities. In July of 2024, the Public Prosecution Service of Canada charged Teck Coal Limited with five counts of violating s.36(3) of the Fisheries Act. Glencore has notified Teck that it is seeking indemnification with respect to liabilities arising out of these charges.

The agreements for the sale of the steelmaking coal business include customary representations, warranties and covenants. In July of 2025, NSC and Glencore provided separate notices of claims to Teck that they are seeking indemnification with respect to certain representations and warranties and covenants contained in the respective agreements for the sale of the steelmaking coal business. After having reviewed each notice of claims and the information provided to substantiate each claim, Teck responded separately to NSC on July 31, 2025 and to Glencore on September 5, 2025 to reject their respective claims. Glencore responded on October 4 and Teck management is assessing Glencore’s October 4 response.

In November of 2025, NSC commenced formal dispute resolution proceedings against Teck regarding its indemnity claim under the sales agreement. Teck disputes the claim and is defending the matter. The outcome of these proceedings is uncertain at this time; however, the amount claimed, and any potential award, could be material.

c) Results of Discontinued Operations

Results of discontinued operations of the steelmaking coal business for 2024 are shown below.


(CAD$ in millions)	2024
	Steelmaking Coal
Revenue	$	4,640
Cost of sales	(2,718)
Gross profit	1,922
Other operating income (expenses)	(252)
Net finance expense	(63)
Non-operating income	24
Profit from discontinued operations before taxes	1,631
Provision for income taxes	(506)
Profit from discontinued operations after taxes	1,125
Gain on sale (net of tax expense of $897)	81
Profit from discontinued operations	$	1,206

Profit from discontinued operations attributable to:
Shareholders of the company	$	873
Non-controlling interests	333
Profit from discontinued operations	$	1,206

6. Revenue

a) Total Revenue by Major Product Type and Reportable Segment

The following table shows our revenue disaggregated by major product type and by reportable segment (Note 31). A reportable segment can have revenue from more than one commodity, as it can include an operation that produces more than one product. Intra-segment revenue is accounted for at current market prices as if the sales were made to arm’s-length parties and are eliminated on consolidation.


(CAD$ in millions)	2025
	Copper		Zinc		Total
Copper	$	5,829	$	—	$	5,829
Zinc	324		2,683		3,007
Silver	130		857		987
Lead	15		479		494
Molybdenum	260		—		260
Germanium	—		207		207
Gold	61		128		189
Fertilizers and other	—		326		326
Intra-segment	—		(543)		(543)
	$	6,619	$	4,137	$	10,756


(CAD$ in millions)	2024
	Copper		Zinc		Total
Copper	$	5,035	$	—	$	5,035
Zinc	183		2,743		2,926
Silver	89		503		592
Lead	1		421		422
Molybdenum	186		—		186
Germanium	—		73		73
Gold	48		56		104
Fertilizers and other	—		274		274
Intra-segment	—		(547)		(547)
	$	5,542	$	3,523	$	9,065

6. Revenue (continued)

b) Total Revenue by Region

The following table shows our revenue disaggregated by geographical region. Revenue is attributed to regions based on the destination port or delivery location as designated by the customer.


(CAD$ in millions)	2025		2024
Asia
China	$	2,560	$	2,669
Japan	1,283		1,095
South Korea	1,089		870
India	420		452
Australia	299		167
Other	101		83
Americas
United States	1,342		1,285
Canada	1,018		642
Chile	689		615
Other	14		8
Europe
Germany	922		410
Spain	594		326
Belgium	200		92
Netherlands	112		24
Finland	75		118

Other	38		209
	$	10,756	$	9,065

No customer accounted for more than 10% of total revenue in 2025 and 2024.

7. Expenses by Nature


(CAD$ in millions)	2025		2024
Employment-related costs:
Wages and salaries	$	908	$	910
Employee benefits and other wage-related costs	202		196
Bonus payments	271		217
Post-employment benefits and pension costs	84		84
	1,465		1,407
Transportation	585		546
Depreciation and amortization	1,686		1,679
Raw material purchases	872		755
Fuel and energy	867		875
Operating supplies consumed	710		646
Maintenance and repair supplies	670		610
Contractors and consultants	983		1,003
Overhead costs	431		439
Royalties	553		466
Other operating costs net of recoveries	54		(12)
	8,876		8,414
Adjusted for:
Capitalized stripping costs	(224)		(373)
Change in inventory	(159)		(171)
Total cost of sales, general and administration, exploration and research and innovation expenses	$	8,493	$	7,870

8. Asset and Goodwill Impairment Testing

a) Impairment Testing

Quebrada Blanca Cash Generating Unit (CGU) – 2025

In the third quarter of 2025, as a result of continuing challenges with the pace of development of the TMF resulting in near-term production constraints and higher TMF-related capital expenditures, we performed an impairment test for our Quebrada Blanca CGU. Consistent with the methodology used to perform our annual goodwill impairment testing, we used a discounted cash flow model to calculate the FVLCD for our Quebrada Blanca CGU. Cash flow projections used in the analysis as at September 30, 2025 cover the current expected mine life of Quebrada Blanca and a projected asset expansion, totalling 44 years, with an estimate of in situ value applied to the remaining resources. The recoverable amount incorporated inputs from the study in progress for the Quebrada Blanca asset expansion, which includes the current expected technical performance of the deposit, along with estimated operating costs and capital expenditures for the life of the operation.

The determination of the FVLCD utilized the following significant assumptions: long-term copper price, discount rate, our assumptions about throughput optimization and asset expansion, recovery rates, operating costs and capital expenditures estimates, reserves and resources, mine production rates and the fair value per pound of copper equivalent used in the determination of the in situ value. The fair value measurement was categorized as a Level 3 measurement based on the inputs used in the discounted cash flow model (Note 33).

As at September 30, 2025, the recoverable amount of our Quebrada Blanca CGU was greater than its carrying value by approximately US$900 million.

Long-Term Copper Price

A long-term real copper price per pound in 2030 and beyond of US$4.50 (2024 – long-term real copper price per pound in 2029 of US$4.20) was used in preparing the discounted cash flow model.

8. Asset and Goodwill Impairment Testing (continued)

Discount Rate

A discount rate of 7.25% (2024 – 7.0%) was used in preparing the discounted cash flow model, based on market participant mining weighted average costs of capital, adjusted for risks specific to the asset, where appropriate.

Throughput Optimization, Asset Expansion and Recoveries

The calculation of FVLCD includes judgments that the TMF development will no longer constrain production beyond 2027, aligned with the completion of the action plan from the Comprehensive Operational Review, and that our throughput optimization will subsequently be achieved. There are also judgments that the asset expansion will occur in the future, and that design recovery rates of 86% to 92% are expected to be achieved.

Operating Costs and Capital Expenditures Estimates

Near-term operating costs and capital expenditures incorporate costs to address current TMF issues which, in our judgment, are not anticipated to affect costs beyond the near term. Subsequently, operating costs and capital expenditures are based on life of mine plans and internal management forecasts. Cost estimates incorporate management's experience and expertise, current operating costs, the nature and location of the operation, and the risks associated with the operation. Future capital expenditures are based on management’s best estimate of expected future capital requirements, with input from management’s experts where appropriate. All committed and anticipated capital expenditures based on future cost estimates have been included in the projected cash flows.

Reserves and Resources and Mine Production

Future mineral production is included in projected cash flows based on plant capacities, reserve and resource estimates, and related exploration and evaluation work undertaken by appropriately qualified persons.

In Situ Value

The fair value of resources beyond production in the current life of mine plan included in the discounted cash flow model are estimated using a dollar per pound multiple, on a copper equivalent basis, using available market data.

Interrelation of Key Assumptions

The key assumptions used in our determination of recoverable amounts interrelate significantly with each other and with our operating plans. For example, a decrease in long-term commodity prices could result in amendments to the mine plans that would partially offset the effect of lower prices through lower operating costs and capital expenditures. It is difficult to determine how all of these factors would interrelate, but in estimating the effect of changes in these assumptions on fair values, we believe that all of these factors need to be considered together. A linear extrapolation of these effects becomes less meaningful as the change in assumption increases.

Sensitivity Analysis

We performed a sensitivity analysis to determine the value by which the most sensitive key assumptions must individually change in order for the Quebrada Blanca CGU's recoverable amount to approximate its carrying amount. Due to the complexity by which key assumptions interrelate significantly with each other and with our operating plans, the analysis was performed for each assumption individually with all other assumptions held constant. In isolation, a US$0.21 decrease in the long-term real copper price per pound, or a 51 basis point increase in the discount rate would result in the recoverable amount of the Quebrada Blanca CGU approximating its carrying value.

Trail CGU – 2024

In the third quarter of 2024, as a result of the challenging environment for treatment charges due to a global shortage of zinc concentrate, continued operating losses, combined with a fire in the electrolytic zinc plant affecting expected operations in the fourth quarter of 2024, we identified impairment indicators at our Trail CGU and consequently performed an impairment test. Using a discounted cash flow model to estimate the FVLCD, the estimated post-tax recoverable amount of the Trail CGU of $666 million was lower than our carrying value. As a result, we recorded a non-cash, pre-tax asset impairment for our Trail CGU of $1.1 billion (after-tax $828 million). The impairment affected the profit (loss) of our zinc reportable segment and our corporate activities (Note 31).

8. Asset and Goodwill Impairment Testing (continued)

Key assumptions used in the analysis included the long-term zinc price, long-term zinc treatment charges, long-term zinc premiums, U.S. dollar to Canadian dollar foreign exchange rates, zinc production rates, operating costs, capital costs and discount rate. The discount rate used was 5.5%. The FVLCD estimates are classified as a Level 3 measurement within the fair value measurement hierarchy (Note 33).

b) Goodwill


(CAD$ in millions)	Quebrada Blanca		Steelmaking Coal Business		Total
At January 1, 2024	$	406	$	702	$	1,108
Changes in foreign exchange rates	36		—		36
Sale of steelmaking coal business	—		(702)		(702)
At December 31, 2024	$	442	$	—	$	442
Changes in foreign exchange rates	(21)		—		(21)
At December 31, 2025	$	421	$	—	$	421

c) Annual Goodwill Impairment Testing – Quebrada Blanca CGU

Our Quebrada Blanca CGU has goodwill allocated to it. We performed our annual goodwill impairment testing at October 31, 2025, calculating the recoverable amount on a FVLCD basis and did not identify any goodwill impairment losses. The significant assumptions used and judgments made for the October 31, 2025 annual goodwill impairment test were consistent with that used for the September 2025 impairment testing, as no material changes to the significant assumptions used and judgments made were identified during the time interval. The sensitivity analysis performed for the September 2025 impairment testing remains applicable for the October 2025 goodwill impairment testing.

9. Other Operating Income (Expense)


(CAD$ in millions)	2025		2024
Settlement pricing adjustments (Note 32(b))	$	512	$	65
Share-based compensation (Note 27(e))	(66)		(91)
Environmental costs and remeasurement of DRPs for closed operations	(208)		—
Care and maintenance costs	(48)		(51)
Social responsibility and donations	(69)		(59)
Gain on disposal of assets	27		36
Fixed assets and equipment write-off	(122)		(9)
Impairment of intangible assets	—		(37)
Commodity derivatives	144		90
Enterprise systems	(52)		—
Depreciation of corporate assets	(71)		(47)
Other	(62)		(48)
	$	(15)	$	(151)

The $208 million of expense (2024 – $nil) in environmental costs and remeasurement of DRPs for closed operations includes $138 million of expense (2024 – $42 million of income) related to updated DRP costs and changes in discount rates and $70 million of expense (2024 – $42 million) related to additional study and environmental costs.

10. Finance Income and Finance Expense


(CAD$ in millions)	2025		2024
Finance income
Investment income	$	262	$	228
Accretion on long-term receivables	9		6
Total finance income	$	271	$	234

Finance expense
Debt interest	$	110	$	175
Interest on QB project financing	168		224
Interest on advances from SMM/SC	369		351
Interest on lease liabilities	51		49
Letters of credit and standby fees	21		28
Accretion on decommissioning and restoration provisions	147		121
Accretion on other liabilities	52		42
Other	17		29
	935		1,019
Less capitalized borrowing costs (Note 16)	(23)		(66)
Total finance expense	$	912	$	953

11. Non-Operating Income (Expense)


(CAD$ in millions)	2025		2024
QB variable consideration to IMSA and Codelco (a)	$	142	$	(51)
Foreign exchange gains (losses)	(41)		146
Other	(49)		(88)
	$	52	$	7

a) QB Variable Consideration to IMSA and Codelco

Variable consideration to IMSA

During the year ended December 31, 2025, we recorded $nil (2024 – $7 million) of expense (Note 32(b)) related to a derivative financial liability arising from the 2018 Inversiones Mineras S.A. (IMSA) acquisition. This derivative financial liability is carried at fair value, with changes in fair value being recognized in profit for the year. The derivative liability reflects contingent payments based on average copper prices exceeding US$3.15 per pound in each of the first three years following commencement of commercial production. The fair value of the IMSA liability is calculated using a discounted cash flow method based on quoted market prices and is considered a Level 2 fair value measurement with significant observable inputs on the fair value hierarchy (Note 33).

Commencement of commercial production occurred in March of 2024, setting the cumulative maximum payment to US$97 million. The derivative liability was reduced in April 2025 as a result of a US$50 million payment to IMSA.

The fair value of the derivative financial liability is $62 million (2024 – $132 million) as at December 31, 2025, based on our estimate that the future average copper prices will exceed the US$3.15 per pound contractual threshold during the measurement period.

The current portion of the financial liability is $62 million (2024 – $72 million) and is recorded in trade accounts payable and other liabilities (Note 19). The non-current portion is $nil (2024 – $60 million) and is recorded in financial and other liabilities (Note 26).

11. Non-Operating Income (Expense) (continued)

Variable consideration to Codelco

During the year ended December 31, 2025, we recorded $142 million of income (2024 – $44 million of expense) related to changes in the carrying value of the financial liability for the preferential dividend stream from QBSA to Codelco. The financial liability was previously owed to Empresa Nacional de Minería (ENAMI) but is now owed to Codelco, subsequent to Codelco’s acquisition of ENAMI’s interest in QBSA during 2024. As at December 31, 2025, the carrying value of this financial liability, which is measured at amortized cost, is $402 million (2024 – $548 million) (Note 26). This financial liability is significantly affected by copper prices, the interest rate on the subordinated loans provided by us and SMM/SC to QBSA, operating cost estimates and capital expenditure estimates, which all affect the timing of when QBSA repays the loans. The fair value of the financial liability is approximated by its carrying value, and is considered a Level 3 fair value measurement with significant unobservable inputs in the fair value hierarchy (Note 33).

12. Supplemental Cash Flow Information


(CAD$ in millions)	December 31, 2025		December 31, 2024
Cash and cash equivalents
Cash	$	1,889	$	2,343
Investments with maturities from the date of acquisition of three months or less	3,123		5,244
	$	5,012	$	7,587

Cash and cash equivalents as at December 31, 2025 include $48 million (2024 – $165 million) held in QBSA. These cash and cash equivalent balances are to be used within QBSA and cannot be transferred to other entities within the group.

Cash flow from operating activities


(CAD$ in millions)	2025		2024
Cash inflow (outflow) from changes in non-cash working capital items
Trade and settlement receivables	$	(957)	$	(347)
Inventories	(290)		(374)
Prepaids and other current assets	(139)		(29)
Trade accounts payable and other liabilities	408		474
Net change in non-cash working capital items	$	(978)	$	(276)

Trade and settlement receivables increased as at December 31, 2025 compared to December 31, 2024. The increase was primarily attributable to higher year-end copper commodity prices. In addition, the timing of copper sales late in December resulted in a greater amount of receivables outstanding at year-end compared with the prior period.

Cash flow from investing activities

In 2024, the net proceeds from the sale of the steelmaking coal business totalled $9.5 billion, including $9.9 billion in cash proceeds, net of $256 million in disposed cash and cash equivalents, and a $160 million payment for customary closing adjustments.

13. Inventories


(CAD$ in millions)	December 31, 2025		December 31, 2024
Supplies	$	1,225	$	1,235
Raw materials	277		260
Work in process	790		774
Finished products	810		636
	3,102		2,905
Less non-current portion (Note 18)	(354)		(307)
	$	2,748	$	2,598

Cost of sales of $8.1 billion (2024 – $7.5 billion) includes $6.5 billion (2024 – $6.3 billion) of production costs that were recognized as part of inventories and subsequently expensed when sold during the year.

No inventories were held at net realizable value as at December 31, 2025 (2024 – $nil). Total inventory write-downs in 2025 were $14 million (2024 – $42 million) and were included as part of cost of sales.

Non-current inventories consist of ore stockpiles and other in-process materials that are not expected to be sold within one year.

14. Financial Assets


(CAD$ in millions)	December 31, 2025		December 31, 2024
Non-current receivables and deposits	$	50	$	108
Marketable equity and debt securities carried at fair value	588		513
Derivative assets	420		143
	$	1,058	$	764

15. Investments in Joint Venture and Associate

In 2015, Teck and Newmont Corporation (Newmont) agreed to combine their respective Relincho and El Morro projects located in Chile. The combined project is a joint arrangement that is structured through a separate vehicle, classified as a joint venture named NuevaUnión, where Teck and Newmont each own 50%. The net assets of the NuevaUnión joint venture substantially relate to exploration and evaluation assets.


(CAD$ in millions)	NuevaUnión Joint Venture		Other Associate		Total
At January 1, 2024	$	1,116	$	—	$	1,116
Contributions	5		—		5
Changes in foreign exchange rates	99		—		99
Share of profit	3		—		3
At December 31, 2024	$	1,223	$	—	$	1,223
Investment in associate	—		58		58
Contributions	13		—		13
Changes in foreign exchange rates	(59)		—		(59)
Share of profit (loss)	4		(7)		(3)
Share of other comprehensive loss	—		(1)		(1)
At December 31, 2025	$	1,181	$	50	$	1,231

16. Property, Plant and Equipment


(CAD$ in millions)	Exploration and Evaluation		Mineral Properties		Land, Buildings, Plant and Equipment		Capitalized Production Stripping Costs		Construction In Progress		Total
At January 1, 2024
Cost	$	1,565	$	20,693	$	32,532	$	9,738	$	4,361	$	68,889
Accumulated depreciation	—		(6,423)		(10,845)		(6,056)		—		(23,324)
Net book value	$	1,565	$	14,270	$	21,687	$	3,682	$	4,361	$	45,565
Year ended December 31, 2024
Opening net book value	$	1,565	$	14,270	$	21,687	$	3,682	$	4,361	$	45,565
Additions	315		1		533		846		1,447		3,142
Disposals	(7)		(4)		(50)		—		(2)		(63)
Change from the NSC/POSCO transaction (Note 5(b))	—		115		105		83		39		342
Sale of steelmaking coal business (Note 5(b))	—		(9,609)		(4,214)		(2,090)		(1,360)		(17,273)
Asset impairment	—		—		(961)		—		(54)		(1,015)
Depreciation and amortization	—		(396)		(1,459)		(586)		—		(2,441)
Transfers between classifications (c)	—		106		3,217		—		(3,323)		—
Changes in decommissioning, restoration and other provisions	—		39		(9)		—		—		30
Capitalized borrowing costs (Note 10)	—		—		—		—		66		66
Changes in foreign exchange rates	82		357		1,500		95		181		2,215
Closing net book value	$	1,955	$	4,879	$	20,349	$	2,030	$	1,355	$	30,568
At December 31, 2024
Cost	$	1,955	$	6,988	$	29,313	$	4,417	$	1,355	$	44,028
Accumulated depreciation	—		(2,109)		(8,964)		(2,387)		—		(13,460)
Net book value	$	1,955	$	4,879	$	20,349	$	2,030	$	1,355	$	30,568
Year ended December 31, 2025
Opening net book value	$	1,955	$	4,879	$	20,349	$	2,030	$	1,355	$	30,568
Additions	478		13		153		232		1,700		2,576
Disposals	(8)		—		(107)		—		(5)		(120)
Depreciation and amortization	—		(274)		(1,107)		(462)		—		(1,843)
Transfers between classifications (c)	(238)		250		1,381		—		(1,393)		—
Changes in decommissioning, restoration and other provisions	11		(206)		27		—		—		(168)
Capitalized borrowing costs (Note 10)	—		—		—		—		23		23
Changes in foreign exchange rates	(59)		(209)		(913)		(57)		(77)		(1,315)
Closing net book value	$	2,139	$	4,453	$	19,783	$	1,743	$	1,603	$	29,721
At December 31, 2025
Cost	$	2,139	$	6,752	$	29,389	$	4,508	$	1,603	$	44,391
Accumulated depreciation	—		(2,299)		(9,606)		(2,765)		—		(14,670)
Net book value	$	2,139	$	4,453	$	19,783	$	1,743	$	1,603	$	29,721

16. Property, Plant and Equipment (continued)

a) Exploration and Evaluation

In 2025, significant exploration and evaluation projects in property, plant and equipment include the Red Dog Mine Life Extension, formerly named the Anarraaq and Aktigiruq Extension Program, Galore Creek, Zafranal, San Nicolás and NewRange. In 2024, significant exploration and evaluation projects included the Highland Valley Copper Mine Life Extension, the Red Dog Mine Life Extension, Galore Creek, Zafranal, San Nicolás and NewRange.

b) Borrowing Costs

Borrowing costs are capitalized at a rate based on our weighted average cost of borrowing or at the rate of the project-specific debt, as applicable. Capitalized borrowing costs are classified with the asset they relate to within mineral properties, land, buildings, plant and equipment, or construction in progress. Our weighted average borrowing rate used for capitalization of borrowing costs in 2025 was 7.2% (2024 – 7.4%).

c) Transfers Between Classifications

Of the $1.6 billion in transfers in 2025 (2024 – $3.3 billion) the largest component related to QB assets which became available for use throughout the year.

17. Intangible Assets


(CAD$ in millions)	Total
At January 1, 2024
Cost	$	608
Accumulated amortization and impairment	(263)
Net book value	$	345
Year ended December 31, 2024
Opening net book value	$	345
Additions – internal development	17
Amortization	(43)
Impairment	(75)
Change in foreign exchange rates	3
Sale of steelmaking coal business	(51)
Closing net book value	$	196
At December 31, 2024
Cost	$	577
Accumulated amortization and impairment	(381)
Net book value	$	196
Year ended December 31, 2025
Opening net book value	$	196
Additions – internal development	12
Amortization	(37)
Change in foreign exchange rates	(2)
Closing net book value	$	169
At December 31, 2025
Cost	$	352
Accumulated amortization and impairment	(183)
Net book value	$	169

The $75 million impairment in 2024 includes $38 million that was presented as part of asset impairment expense related to the impairment of the Trail CGU (Note 8(a)).

18. Other Assets


(CAD$ in millions)	December 31, 2025		December 31, 2024
Pension plans in a net asset position (Note 24(a))	$	316	$	320
Non-current portion of inventories (Note 13)	354		307
Other	71		71
	$	741	$	698

19. Trade Accounts Payable and Other Liabilities


(CAD$ in millions)	December 31, 2025		December 31, 2024
Trade accounts payable and accruals	$	1,918	$	1,547
Commercial and government royalties	579		546
Payroll-related liabilities	264		318
QB variable consideration to IMSA (Note 11(a) and Note 26)	62		72
Settlement payables (Note 32(b))	144		70
Accrued interest	51		55
Capital project accruals	277		39
Current portion of downstream pipeline take-or-pay toll commitment (Note 26)	33		32

Current portion of derivative liabilities (Note 26)	30		23
Other	46		33
	$	3,404	$	2,735

20. Debt


($ in millions)	December 31, 2025						December 31, 2024
	Face Value (US$)		Fair Value (CAD$)		Carrying Value (CAD$)		Face Value (US$)		Fair Value (CAD$)		Carrying Value (CAD$)
3.9% notes due July 2030 (a)	$	142	$	192	$	194	$	143	$	196	$	204
6.125% notes due October 2035 (a)	179		264		243		187		273		266
6.0% notes due August 2040 (a)	190		268		259		194		273		278
6.25% notes due July 2041 (a)	243		338		329		245		350		349
5.2% notes due March 2042 (a)	167		204		226		167		212		237
5.4% notes due February 2043 (a)	108		139		147		108		141		154
	1,029		1,405		1,398		1,044		1,445		1,488
QB project financing facility (b)	1,618		2,276		2,197		1,912		2,847		2,719
Antamina loan agreement (c)	225		309		309		225		324		324
	$	2,872	$	3,990	$	3,904	$	3,181	$	4,616	$	4,531
Less current portion of debt	(294)		(403)		(403)		(294)		(423)		(423)
	$	2,578	$	3,587	$	3,501	$	2,887	$	4,193	$	4,108

The fair values of debt are determined using market values if available, which are considered Level 1 fair value measurements on the fair value hierarchy. If market values are unavailable, the fair values of debt are determined using discounted cash flows based on our cost of borrowing. These are considered Level 2 fair value measurements with significant other observable inputs on the fair value hierarchy (Note 33).

20. Debt (continued)

a) Long-Term Notes

All of our outstanding notes are redeemable at any time by repaying the greater of the principal amount and the present value of the sum of the remaining scheduled principal and interest amounts discounted at a comparable treasury yield plus a stipulated spread, plus, in each case, accrued interest to, but not including, the date of redemption. In addition, all of our outstanding notes, except for notes due October 2035, are callable at 100% (plus accrued interest to, but not including, the date of redemption) within three to six months of maturity.

In 2025, we purchased US$15 million aggregate principal amount of our outstanding term notes (US$1 million of the 3.9% notes due 2030, US$7 million of the 6.125% notes due 2035, US$4 million of the 6.0% notes due 2040, and US$3 million of the 6.25% notes due 2041) via open market repurchases. The total cash cost of the purchases was $22 million (US$15 million), which was funded from cash on hand.

In 2024, we purchased US$1.4 billion aggregate principal amount of our outstanding term notes pursuant to the cash tender offers made on July 4, 2024, and through open market purchases in the third and fourth quarters of 2024. The total principal amount of the notes purchased comprised US$360 million of the 3.9% notes due 2030, US$149 million of the 6.125% notes due 2035, US$279 million of the 6.0% notes due 2040, US$151 million of the 6.25% notes due 2041, US$228 million of the 5.2% notes due 2042 and US$259 million of the 5.4% notes due 2043. The total cash cost of the purchases was $2.0 billion (US$1.4 billion), which was funded from cash on hand.

Certain of our notes are subject to a change of control provision requiring repurchase in the event a downgrade follows a change of control. Our notes are also subject to covenants regarding liens on certain assets and certain restricted subsidiaries, and to customary events of default, including non-payment of principal and interest, bankruptcy or insolvency, covenant non-compliance, material final judgments, or other material indebtedness becoming due prior to maturity as a result of a default. An unremedied event of default may result in an acceleration of the repayment of the notes, causing them to become due and payable ahead of scheduled maturity. As at December 31, 2025, we are in compliance with our covenants.

b) QB Project Financing Facility

As at December 31, 2025, the limited recourse QB project financing facility had a balance of US$1.6 billion. Amounts drawn under the facility bear interest at Term SOFR plus applicable margins that vary over time. The facility is being repaid in 17 equal semi-annual instalments of US$147 million, which began on June 15, 2023.

The facility was guaranteed pre-final completion on a several basis by Teck and SMM/SC pro rata to the respective equity interests in the Series A shares of QBSA. The project met all the completion requirements, submitted all the completion test-related certificates and achieved final completion as defined under the facility in March 2025. As a result, these guarantees have been released.

The facility is secured by pledges of Teck’s and SMM/SC’s interests in QBSA and by security over QBSA’s assets, which consist primarily of QB project assets. The facility is subject to customary project financing covenants and terms, including with respect to granting security in assets and accounts, maintenance of insurance, periodic reporting, restrictions on certain activities (such as incurring additional debt beyond agreed thresholds), and other operational covenants. Breach of the project finance covenants could lead to enforcement action by the project lenders, including the acceleration of repayment of the facility, among other consequences. As at December 31, 2025, we are in compliance with our covenants.

c) Antamina Loan Agreement

On June 11, 2025, Antamina entered into an updated US$1.0 billion loan agreement maturing in June 2030, replacing the existing five-year agreement entered into in 2021. As at December 31, 2025, the loan was fully drawn and our 22.5% share of the principal value of the loan is US$225 million. Amounts outstanding under this facility bear interest at Term SOFR plus an applicable margin. The loan is non-recourse to us and the other Antamina shareholders.

20. Debt (continued)

d) Revolving Credit Facilities

We maintain a US$3.0 billion sustainability-linked revolving credit facility maturing in October 2029. The facility has pricing adjustments where the cost will increase, decrease or remain unchanged based on our sustainability performance. Our sustainability performance over the term of the facility is measured by non-financial variables that are specific to our greenhouse gas emissions intensity, the percentage of women in our workforce, and our high-potential safety incidents, with targets that evolve and progress over the term of the facility. In 2024 and 2025, our sustainability performance resulted in no change in pricing.

As at December 31, 2025, the facility was undrawn. Any amounts drawn under this facility can be repaid at any time and are due in full at maturity. Amounts outstanding under the facility bear interest at Term SOFR plus an applicable margin based on credit ratings and our sustainability performance, as described above. This facility requires our total net debt-to-capitalization ratio to not exceed 0.60 to 1.0 (Note 34). Following the sale of the steelmaking coal business in July 2024, cash and cash equivalents have increased significantly and as a result, our cash balances were greater than our debt balances at December 31, 2025. Therefore, we do not exceed the required net debt-to-capitalization ratio. This facility does not have an earnings or cash flow-based financial covenant, a credit rating trigger or a general material adverse effect borrowing condition.

In addition to that financial covenant, the facility is subject to customary covenants including limits on subsidiary debt, change of control repayment requirements, and the prohibition on agreements that may restrict subsidiary dividend payments or loan repayments to Teck. Breach of these covenants could lead to an inability to borrow under the facility, or an enforcement action by lenders, including accelerating any outstanding debt repayment. As at December 31, 2025, we are in compliance with our covenants.

We maintain uncommitted bilateral credit facilities primarily for the issuance of letters of credit to support our future reclamation obligations. As at December 31, 2025, we had $2.0 billion (December 31, 2024 – $1.5 billion) of letters of credit outstanding. We also had $549 million (December 31, 2024 – $441 million) in surety bonds outstanding at December 31, 2025 to support current and future reclamation obligations.

e) Scheduled Principal Payments

At December 31, 2025, scheduled principal payments during the next five years and thereafter are as follows:


($ in millions)	US$		CAD$ Equivalent
2026	$	294	$	403
2027	294		403
2028	294		403
2029	294		403
2030	661		906
Thereafter	1,035		1,418
	$	2,872	$	3,936

20. Debt (continued)

f) Debt Continuity


($ in millions)	US$				CAD$ Equivalent
	2025		2024		2025		2024
At January 1	$	3,149	$	4,940	$	4,531	$	6,534
Cash flows
Proceeds from debt	225		56		308		77
Redemption, purchase or repayment of debt	(534)		(1,870)		(733)		(2,544)
Non-cash changes
(Gain)/Loss on debt redemption or purchase	1		(4)		1		(5)
Changes in foreign exchange rates	—		—		(213)		458
Finance fees, discount amortization and other	7		27		10		11
At December 31	$	2,848	$	3,149	$	3,904	$	4,531

21. Leases

a) Significant Individual Lease Arrangements

TAK leases road and port facilities from the Alaska Industrial Development and Export Authority, through which it ships all concentrates produced at the Red Dog mine. The lease requires TAK to pay a minimum annual user fee of US$6 million until 2040. As at December 31, 2025, the related lease liability was $81 million (2024 – $89 million).

QBSA has a contract with Transelec S.A. to lease an electrical power transmission system to connect the QB project with the Chilean national power grid. The lease requires QBSA to pay approximately US$23 million per year, escalating by 2.2% annually. As at December 31, 2025, the related lease liability was $441 million (2024 – $465 million). The corresponding right-of-use asset was $425 million (2024 – $466 million).

b) Right-of-Use Assets

Our significant lease arrangements include contracts for leasing office premises, mining equipment, railcars, road and port facilities and electrical power transmission systems. As at December 31, 2025, $1.0 billion (2024 – $1.0 billion) of right-of-use assets are recorded as part of property, plant and equipment.


(CAD$ in millions)	2025		2024
Opening net book value	$	1,011	$	1,108
Additions	164		187
Depreciation	(78)		(84)
Depreciation – steelmaking coal business	—		(53)
Changes in foreign exchange rates and other	(54)		49
Sale of steelmaking coal business	—		(196)
Closing net book value	$	1,043	$	1,011

21. Leases (continued)

c) Lease Liability Continuity


(CAD$ in millions)	2025		2024
At January 1	$	951	$	1,061
Cash flows
Principal payments	(112)		(68)
Principal payments – steelmaking coal business	—		(52)
Interest payments	(46)		(52)
Non-cash changes
Additions	164		182
Interest expense	51		49
Changes in foreign exchange rates and other	(50)		40
Sale of steelmaking coal business	—		(209)
At December 31	$	958	$	951
Less current portion of lease liabilities	(169)		(175)
Non-current lease liabilities	$	789	$	776

22. QB Advances from SMM/SC

In conjunction with the subscription arrangement with SMM/SC in 2019, QBSA entered into a subordinated loan facility agreement with SMM/SC to advance QBSA up to US$1.3 billion. QBSA subsequently entered into six additional subordinated loan facility agreements with SMM/SC to advance QBSA an additional US$2.5 billion. The six additional subordinated loan facilities contain similar terms to the original subordinated loan facility. The advances for all seven facility agreements are due to be repaid in full at maturity on January 15, 2038. Amounts outstanding under the facilities bear interest at Term SOFR plus applicable margins that vary over time. As at December 31, 2025, US$3.5 billion was outstanding and US$343 million remained undrawn.


($ in millions)	December 31, 2025						December 31, 2024
	Face Value (US$)		Fair Value (CAD$)		Carrying Value (CAD$)		Face Value (US$)		Fair Value (CAD$)		Carrying Value (CAD$)
QB advances from SMM/SC	$	3,485	$	4,958	$	4,745	$	3,136	$	4,707	$	4,483

The fair value of the advances is determined using discounted cash flows based on our cost of borrowing. This is considered a Level 2 fair value measurement with significant observable inputs on the fair value hierarchy (Note 33).

QB Advances from SMM/SC Carrying Value Continuity


($ in millions)	US$				CAD$ Equivalent
	2025		2024		2025		2024
At January 1	$	3,116	$	2,644	$	4,483	$	3,497
Cash flows
Advances	346		471		476		652
Non-cash changes
Finance fee amortization	1		1		1		1
Changes in foreign exchange rates	—		—		(215)		333
At December 31	$	3,463	$	3,116	$	4,745	$	4,483

23. Income Taxes

a) Tax Rate Reconciliation to the Canadian Statutory Income Tax Rate


(CAD$ in millions)	2025		2024
Profit (loss) from continuing operations before taxes	$	1,656	$	(718)
Profit from discontinued operations (Note 5(c))	—		1,631
Gain on sale of discontinued operations (Note 5(c))	—		978
Profit for the year from continuing and discontinued operations before taxes	$	1,656	$	1,891

Tax expense at the Canadian statutory income tax rate of 27%	$	447	$	511
Tax effect of:
Resource taxes	183		229
Non-deductible expenses (non-taxable income)	(27)		(20)
Derecognition (recognition) of deferred tax assets	(96)		206
Remeasurement of deferred Chilean mining royalty liability	63		88
Effect of taxes in foreign jurisdictions	20		15
Revisions to prior year estimates	(6)		11
Non-controlling interests	—		(77)
Effect from sale of discontinued operations	—		633
Other	—		12
Total income taxes from continuing and discontinued operations	$	584	$	1,608

Represented by:
Current income taxes	749		1,594
Deferred income taxes	(165)		14
Total income taxes from continuing and discontinued operations	$	584	$	1,608

Provision for income taxes from continuing operations	584		205
Provision for income taxes from discontinued operations	—		1,403
Total income taxes from continuing and discontinued operations	$	584	$	1,608

Current income taxes are accrued and paid in all jurisdictions in which we operate.

23. Income Taxes (continued)

b) Continuity of Deferred Tax Assets and Liabilities


(CAD$ in millions)	January 1, 2025		Through Profit (Loss)		Through OCI		Transfer		December 31, 2025


Net operating loss and capital loss carryforwards	$	1,172	$	562	$	(65)	$	—	$	1,669
Property, plant and equipment	(814)		(254)		39		71		(958)
Decommissioning and restoration provisions	127		22		(4)		(16)		129
Other temporary differences (TDs)	87		39		1		(36)		91
Deferred income tax assets	$	572	$	369	$	(29)	$	19	$	931
Net operating loss and capital loss carryforwards	$	(2)	$	(7)	$	—	$	—	$	(9)
Property, plant and equipment	3,169		(15)		(72)		(76)		3,006
Decommissioning and restoration provisions	(1,183)		113		13		—		(1,057)
Unrealized foreign exchange	(41)		10		(1)		—		(32)
Withholding taxes	151		34		(8)		—		177
Inventories	193		(51)		—		—		142
Partnership income deferral and other TDs	6		120		12		95		233
Deferred income tax liabilities	$	2,293	$	204	$	(56)	$	19	$	2,460


(CAD$ in millions)	January 1, 2024		Through Profit (Loss)		Through OCI		Transfer		Sale of Steelmaking Coal Business		December 31, 2024

Net operating loss and capital loss carryforwards	$	61	$	536	$	66	$	509	$	—	$	1,172
Property, plant and equipment	(167)		(10)		(116)		(521)		—		(814)
Decommissioning and restoration provisions	167		(77)		(2)		39		—		127
Other TDs	4		70		70		(57)		—		87
Deferred income tax assets	$	65	$	519	$	18	$	(30)	$	—	$	572
Net operating loss and capital loss carryforwards	$	(652)	$	140	$	—	$	509	$	1	$	(2)
Property, plant and equipment	7,894		166		112		(521)		(4,482)		3,169
Decommissioning and restoration provisions	(1,167)		13		(20)		39		(48)		(1,183)
Unrealized foreign exchange	(75)		41		(7)		—		—		(41)
Withholding taxes	116		25		10		—		—		151
Inventories	161		9		(1)		5		19		193
Partnership income deferral and other TDs	(89)		139		23		(62)		(5)		6
Deferred income tax liabilities	$	6,188	$	533	$	117	$	(30)	$	(4,515)	$	2,293

23. Income Taxes (continued)

c) Deferred Tax Assets and Liabilities Not Recognized

We have not recognized $249 million (2024 – $266 million) of deferred tax assets to the extent where it is not probable future taxable profits will be available against which deductible temporary differences can be utilized.

Deferred tax liabilities of approximately $879 million (2024 – $905 million) have not been recognized on the unremitted foreign earnings associated with investments in subsidiaries and interests in joint arrangements where we control the timing of the reversal of the temporary differences and it is probable that such differences will not reverse in the foreseeable future.

d) Loss Carryforwards

At December 31, 2025, we had $60 million (2024 – $147 million) of Canadian net operating loss carryforwards, which expire at various dates between 2032 and 2044, and $6.1 billion (2024 – $4.2 billion) of Chilean net operating losses with an indefinite carryforward period. Deferred tax benefits of $1.7 billion (2024 – $1.2 billion) related to these tax pools have been recognized.

24. Retirement Benefit Plans

We have defined contribution pension plans for certain groups of employees. Our share of contributions to these plans is expensed in the year earned by employees.

We have multiple defined benefit pension plans registered in various jurisdictions that provide benefits based principally on employees’ years of service and average annual remuneration. These plans are only available to certain qualifying employees and some are now closed to additional members. The plans are “flat-benefit” or “final-pay” plans and may provide for inflationary increases in accordance with certain plan provisions. All of our registered defined benefit pension plans are governed and administered in accordance with applicable pension legislation in either Canada or the United States. Actuarial valuations are performed at least every three years to determine minimum annual contribution requirements as prescribed by applicable legislation. For the majority of our plans, current service costs are funded based on a percentage of pensionable earnings or as a flat dollar amount per active member depending on the provisions of the pension plans. Actuarial deficits are funded in accordance with minimum funding regulations in each applicable jurisdiction. All of our defined benefit pension plans were actuarially valued within the past three years. While the majority of benefit payments are made from registered held-in-trust funds, there are also several unregistered and unfunded plans where benefit payment obligations are met as they fall due.

We also have several post-retirement benefit plans that provide post-retirement medical, dental and life insurance benefits to certain qualifying employees and surviving spouses. These plans are unfunded and we meet benefit obligations as they come due.

24. Retirement Benefit Plans (continued)

a) Actuarial Valuation of Plans


(CAD$ in millions)	2025				2024
	Defined Benefit Pension Plans		Non-Pension Post- Retirement Benefit Plans		Defined Benefit Pension Plans		Non-Pension Post- Retirement Benefit Plans
Defined benefit obligation
Balance at beginning of year	$	1,360	$	307	$	1,929	$	370
Current service cost	28		16		29		16
Benefits paid	(103)		(23)		(104)		(28)
Interest expense	63		14		61		15
Sale of steelmaking coal business	—		—		(599)		(52)
Obligation experience adjustments	1		(14)		34		(13)
Effect from change in financial assumptions	(23)		(7)		(5)		(1)
Effect from change in demographic assumptions	(4)		—		5		—
Changes in foreign exchange rates	(6)		(1)		10		—
Balance at end of year	1,316		292		1,360		307
Fair value of plan assets
Fair value at beginning of year	1,809		—		2,491		—
Interest income	82		—		80		—
Return on plan assets, excluding amounts included in interest income	37		—		56		—
Benefits paid	(103)		(23)		(104)		(28)
Sale of steelmaking coal business	—		—		(730)		—
Contributions by the employer	15		23		7		28
Changes in foreign exchange rates	(6)		—		9		—
Fair value at end of year	1,834		—		1,809		—
Funding surplus (deficit)	518		(292)		449		(307)
Less effect of the asset ceiling
Balance at beginning of year	195		—		191		—
Sale of steelmaking coal business	—		—		(45)		—
Interest on asset ceiling	9		—		7		—
Change in asset ceiling	57		—		42		—
Balance at end of year	261		—		195		—
Net accrued retirement benefit asset (liability)	$	257	$	(292)	$	254	$	(307)

Represented by:
Pension assets (Note 18)	$	316	$	—	$	320	$	—
Accrued retirement benefit liability	(59)		(292)		(66)		(307)
Net accrued retirement benefit asset (liability)	$	257	$	(292)	$	254	$	(307)

A number of the plans have a surplus totalling $261 million at December 31, 2025 (2024 – $195 million), which is not recognized on the basis that future economic benefits are not available to us in the form of a reduction in future contributions or a cash refund.

In 2024, pension assets and accrued retirement benefit liabilities related to employees of the steelmaking coal business were transferred to the purchaser and accordingly, were derecognized (Note 5(b)).

24. Retirement Benefit Plans (continued)

We expect to contribute $5 million to our defined benefit pension plans in 2026 based on minimum funding requirements. The weighted average duration of the defined benefit pension obligation is 12 years and the weighted average duration of the non-pension post-retirement benefit obligation is 12 years.

Defined contribution expense for 2025 was $40 million (2024 – $39 million).

b) Significant Assumptions

The discount rate used to determine the defined benefit obligations and the net interest cost was determined by reference to the market yields on high-quality debt instruments at the measurement date with durations similar to the duration of the expected cash flows of the plans.

Weighted average assumptions used to calculate the defined benefit obligation at the end of each year are as follows:


	December 31, 2025				December 31, 2024
	Defined Benefit Pension Plans		Non-Pension Post- Retirement Benefit Plans		Defined Benefit Pension Plans		Non-Pension Post- Retirement Benefit Plans
Discount rate	4.78	%	4.98	%	4.60	%	4.72	%
Rate of increase in future compensation	3.25	%	3.25	%	3.25	%	3.25	%
Medical trend rate	—		5.00	%	—		5.00	%

c) Sensitivity of the Defined Benefit Obligation to Changes in the Weighted Average Assumptions

2025

Effect on Defined Benefit Obligation

1% Increase in

Assumption

1% Decrease in

Assumption

Discount rate

Decrease by 10%

Increase by 11%

Rate of increase in future compensation

Increase by 0%

Decrease by 0%

Medical cost claim trend rate

Increase by 1%

Decrease by 1%

2024

Effect on Defined Benefit Obligation

1% Increase in

Assumption

1% Decrease in

Assumption

Discount rate

Decrease by 10%

Increase by 11%

Rate of increase in future compensation

Increase by 0%

Decrease by 0%

Medical cost claim trend rate

Increase by 1%

Decrease by 1%

The above sensitivity analyses are based on a change in each actuarial assumption while holding all other assumptions constant. The sensitivity analyses on our defined benefit obligation are calculated using the same methods as those used for calculating the defined benefit obligation recognized on our balance sheet. The methods and types of assumptions used in preparing the sensitivity analyses did not change from the prior period.

24. Retirement Benefit Plans (continued)

d) Mortality Assumptions

Assumptions regarding future mortality are set based on management’s best estimate in accordance with published mortality tables and expected experience. These assumptions translate into the following average life expectancies for an employee retiring at age 65:

2025

2024

Male

Female

Male

Female

Retiring at the end of the reporting period

85.4 years

87.8 years

85.4 years

87.8 years

Retiring 20 years after the end of the reporting period

86.4 years

88.7 years

86.4 years

88.7 years

e) Significant Risks

The defined benefit pension plans and post-retirement benefit plans expose us to a number of risks, the most significant of which include asset volatility risk, changes in bond yields and any changes in life expectancy.

Asset volatility risk

The discount rate used to determine the defined benefit obligations is based on AA-rated corporate bond yields. If our plan assets underperform this yield, the surplus will decrease. Our strategic asset allocation includes a significant proportion of equities that increases volatility in the value of our assets, particularly in the short term. We expect equities to outperform corporate bonds in the long term.

Changes in bond yields

A decrease in bond yields increases plan liabilities, which are partially offset by an increase in the value of the plans’ bond holdings.

Life expectancy

The majority of the plans’ obligations are to provide benefits for the life of the member. Increases in life expectancy will result in an increase in the plans’ liabilities.

f) Investment of Plan Assets

The assets of our defined benefit pension plans are managed by external asset managers under the oversight of the Teck Resources Limited Executive Pension Committee.

Our pension plan investment strategies support the objectives of each defined benefit plan and are related to each plan’s demographics and timing of expected benefit payments to plan members. The objective for the plan asset portfolios is to achieve annualized portfolio returns over five-year periods in excess of the annualized percentage change in the consumer price index plus a certain premium.

Strategic asset allocation policies have been developed for each defined benefit plan to achieve this objective. The policies also reflect an asset/liability matching framework that seeks to reduce the effect of interest rate changes on each plan’s funded status by matching the duration of the bond investments with the duration of the pension liabilities. We do not use derivatives to manage interest rate risk. Asset allocation is monitored at least quarterly and rebalanced if the allocation to any asset class exceeds its allowable allocation range. Portfolio and investment manager performance is monitored quarterly and the investment guidelines for each plan are reviewed at least annually.

24. Retirement Benefit Plans (continued)

The defined benefit pension plan assets at December 31, 2025 and 2024 are as follows:


(CAD$ in millions)	2025						2024
	Quoted		Unquoted		Total %		Quoted		Unquoted		Total %
Equity securities	$	440	$	—	24	%	$	559	$	—	31	%
Debt securities	$	1,033	$	—	56	%	$	847	$	—	47	%
Real estate and other	$	55	$	306	20	%	$	100	$	303	22	%

25. Provisions


(CAD$ in millions)	2025		2024
At December 31	$	2,585	$	2,626
Less current portion of provisions	(245)		(187)
Non-current provisions	$	2,340	$	2,439

The following table summarizes the movements in provisions for the year ended December 31, 2025:


(CAD$ in millions)	Decommissioning and Restoration Provisions		Other Provisions		Total
At January 1, 2025	$	2,328	$	298	$	2,626
Settled during the year	(106)		(37)		(143)
Change in discount rate	26		3		29
Change in amount and timing of cash flows	(56)		51		(5)
Accretion	147		7		154
Changes in foreign exchange rates	(65)		(11)		(76)
At December 31, 2025	$	2,274	$	311	$	2,585
Less current portion of provisions	(199)		(46)		(245)
Non-current provisions	$	2,075	$	265	$	2,340

Decommissioning and Restoration Provisions

The decommissioning and restoration provisions represent the present value of estimated costs for required future decommissioning and other site restoration activities. These activities include removal of site structures and infrastructure, recontouring and revegetation of previously mined areas and the management of water and water quality in and around each closed site. The majority of the decommissioning and site restoration expenditures occur near the end of, or after, the life of the related operation.

After the end of the life of certain operations, water quality management costs may extend for periods in excess of 100 years. Our provision for these expenditures was $601 million as at December 31, 2025 (2024 – $568 million).

In 2025, the decommissioning and restoration provisions were calculated using nominal discount rates between 6.14% and 7.09% (2024 – 6.33% and 7.03%). We also used an inflation rate of 2.00% (2024 – 2.00%) over the long term in our cash flow estimates. Total decommissioning and restoration provisions include $578 million (2024 – $459 million) in respect of closed operations.

During the fourth quarter of 2025, our decommissioning and restoration provisions increased by $163 million compared to the third quarter of 2025. The increase in decommissioning and restoration provisions was due to an increase of $121 million in reclamation cash flows, primarily related to updated cost estimates at our closed operations and an increase of $42 million associated with a decrease in the rates used to discount decommissioning and restoration provisions.

26. Financial and Other Liabilities


(CAD$ in millions)	December 31, 2025		December 31, 2024
Long-term portion of derivative liabilities (current portion – $30 (2024 – $23) Note 19)	$	21	$	24
Codelco preferential dividend liability (Note 11(a))	402		548
QB variable consideration to IMSA (current portion – $62 (2024 – $72) Note 11(a) and Note 19)	—		60
Downstream pipeline take-or-pay toll commitment (current portion – $33 (2024 – $32) Note 19)	254		285
Other liabilities	163		182
	$	840	$	1,099

27. Equity

a) Authorized Share Capital

Our authorized share capital consists of an unlimited number of Class A common shares without par value, an unlimited number of Class B subordinate voting shares without par value and an unlimited number of preferred shares without par value issuable in series.

Class A common shares carry the right to 100 votes per share. Class B subordinate voting shares carry the right to one vote per share. Each Class A common share is convertible, at the option of the holder, into one Class B subordinate voting share. In all other respects, the Class A common shares and Class B subordinate voting shares rank equally.

The attributes of the Class B subordinate voting shares contain so-called “coattail provisions”, which provide that, in the event that an offer (an “Exclusionary Offer”) to purchase Class A common shares, which is required to be made to all or substantially all holders thereof, is not made concurrently with an offer to purchase Class B subordinate voting shares on identical terms, then each Class B subordinate voting share will be convertible into one Class A common share at the option of the holder during a certain period, provided that any Class A common shares received upon such conversion are deposited to the Exclusionary Offer. Any Class B subordinate voting shares converted into Class A common shares pursuant to such conversion right will automatically convert back to Class B subordinate voting shares in the event that any such shares are withdrawn from the Exclusionary Offer or are not otherwise ultimately taken up and paid for under the Exclusionary Offer.

The Class B subordinate voting shares will not be convertible in the event that holders of a majority of the Class A common shares (excluding those shares held by the offeror making the Exclusionary Offer) certify to Teck that they will not, among other things, tender their Class A common shares to the Exclusionary Offer.

If an offer to purchase Class A common shares does not, under applicable securities legislation or the requirements of any stock exchange having jurisdiction, constitute a “take-over bid” or is otherwise exempt from any requirement that such offer be made to all or substantially all holders of Class A common shares, the coattail provisions will not apply.

b) Sunset of Dual Class Share Structure

On April 26, 2023, Teck’s shareholders approved a six-year sunset for the multiple voting rights attached to the Class A common shares of Teck (the Dual Class Amendment). On May 12, 2023, each Teck Class A common share was acquired by Teck in exchange for (i) one new Class A common share and (ii) 0.67 of a Class B subordinate voting share, recognized as a $302 million increase to Class B shares and reduction to retained earnings. The terms of the new Class A common shares are identical to the previous terms of Class A common shares, except that on May 12, 2029, the new Class A common shares will automatically convert into Class B subordinate voting shares, which will then be renamed common shares, on a one-for-one basis, and for no additional consideration or premium.

27. Equity (continued)

c) Class A Common Shares and Class B Subordinate Voting Shares Issued and Outstanding


Shares (in 000’s)	Class A Common Shares	Class B Subordinate Voting Shares
At January 1, 2024	7,655	509,668
Class A common shares conversion	(55)	55
Shares issued on options exercised (d)	—	8,178
Cancelled pursuant to normal course issuer bid (i)	—	(19,158)
At December 31, 2024	7,600	498,743

Shares issued on options exercised (d)	—	1,032
Cancelled pursuant to normal course issuer bid (i)	—	(18,898)
At December 31, 2025	7,600	480,877

d) Share Options

The maximum number of Class B subordinate voting shares issuable to full-time employees pursuant to options granted under our current stock option plan is 46 million. As at December 31, 2025, 8,373,635 share options remain available for grant. The exercise price for each option is the closing price for our Class B subordinate voting shares on the last trading day before the date of grant. Our share options are settled through the issuance of Class B subordinate voting shares.

During the year ended December 31, 2025, we granted 780,150 share options to employees. These share options have a weighted average exercise price of $57.74, vest in equal amounts over three years and have a term of 10 years.

The weighted average fair value of share options granted in the year was estimated at $22.31 per option (2024 – $21.21) at the grant date based on the Black-Scholes option-pricing model using the following assumptions:


	2025			2024
Weighted average exercise price	$	57.74		$	52.85
Dividend yield	0.86		%	0.96		%
Risk-free interest rate	2.58		%	3.46		%
Expected option life	5.6 years			5.8 years
Expected volatility	41		%	42		%

The expected volatility is based on a statistical analysis of historical daily share prices over a period equal to the expected option life.

Outstanding share options are as follows:


	2025			2024
	Share Options (in 000’s)	Weighted Average Exercise Price		Share Options (in 000’s)	Weighted Average Exercise Price
Outstanding at beginning of year	5,467	$	36.12	13,067	$	25.92
Granted	780	57.74		1,082	52.85
Exercised	(1,040)	25.00		(8,165)	21.07
Forfeited	(172)	53.74		(512)	51.23
Expired	(17)	46.22		(5)	27.26
Outstanding at end of year	5,018	$	41.15	5,467	$	36.12
Vested and exercisable at end of year	3,501	$	34.88	3,524	$	27.43

27. Equity (continued)

The average Class B subordinate voting share price during 2025 was $55.00 (2024 – $62.98).

Information relating to share options outstanding at December 31, 2025, is as follows:


Outstanding Share Options (in 000’s)	Exercise Price Range	Weighted Average Remaining Life of Outstanding Options (months)
969	$5.34 – $26.90	42
963	$26.91 – $45.44	44
822	$45.45 – $51.42	56
1,477	$51.43 – $55.90	81
787	$55.91 – $70.34	109
5,018	$5.34 – $70.34	67

Total share option compensation expense recognized for the year was $16 million (2024 – $21 million).

e) Deferred Share Units, Restricted Share Units, Performance Share Units and Performance Deferred Share Units

We have issued and outstanding deferred share units (DSUs), restricted share units (RSUs), performance share units (PSUs) and performance deferred share units (PDSUs) (collectively, Units).

DSUs are granted to directors only. RSUs may be granted to both employees and directors. PSUs and PDSUs are granted to certain officers only. DSUs entitle the holder to a cash payment equal to the closing price of one Class B subordinate voting share on the Toronto Stock Exchange on the day prior to redemption. RSUs entitle the holder to a cash payment equal to the weighted average trading price of one Class B subordinate voting share on the Toronto Stock Exchange over 20 consecutive trading days prior to the payout date. PSUs and PDSUs vest subject to a performance metric ranging from 0% to 200% based on corporate performance against grant-specific performance criteria. The performance metrics for PSUs and PDSUs issued in 2022 and 2023 were based on a balanced scorecard, with 20% related to each of: relative shareholder return as compared to our compensation peer group, change in five-year average return on capital employed for operating assets, operational production and cost performance as against the annual budget, strategic execution, and performance measured against a sustainability progress index. The performance metrics for PSUs and PDSUs issued in 2024 and 2025 were based on a balanced scorecard with four components, with 40% based on relative shareholder return as compared to our compensation peer group and 20% related to each of: strategic execution, performance measured against a sustainability progress index, and the change in five-year average return on capital employed for operating assets. Once vested, PSUs and PDSUs entitle the holder to a cash payment equal to the weighted average trading price of one Class B subordinate voting share on the Toronto Stock Exchange over 20 consecutive trading days prior to the payout date. Officers can elect to receive up to 50% of their Units as PDSUs, which pay out following termination of employment as described below.

PSUs and PDSUs vest on March 1 of the third year following the grant date. RSUs vest on various dates depending on the grant date. DSUs granted to directors vest immediately. Units vest on a pro rata basis if employees retire or are terminated without cause and unvested units are forfeited if employees resign or are terminated with cause.

DSUs and PDSUs may be redeemed on or before December 15 of the first calendar year commencing after the date on which the participant ceases to be a director or employee, as applicable. RSUs and PSUs pay out on the vesting date.

Additional Units are issued to Unit holders to reflect dividends paid and other adjustments to Class B subordinate voting shares.

In 2025, we recognized compensation expense of $50 million for Units (2024 – $70 million). The total liability and intrinsic value for vested Units as at December 31, 2025 was $100 million (2024 – $113 million).

In 2025, we recognized total share-based compensation expense of $66 million (2024 – $91 million) in other operating income (expense) (Note 9).

27. Equity (continued)

The outstanding Units are summarized in the following table:


(in 000’s)	December 31, 2025		December 31, 2024
	Outstanding	Vested	Outstanding	Vested
DSUs	444	444	491	491
RSUs	1,284	—	1,307	—
PSUs	756	—	946	—
PDSUs	36	6	116	69
	2,520	450	2,860	560

f) Accumulated Other Comprehensive Income


(CAD$ in millions)	2025		2024
Accumulated other comprehensive income – beginning of year	$	2,397	$	693
Currency translation differences:
Unrealized gain (loss) on translation of foreign subsidiaries	(1,203)		1,697
Foreign exchange differences on debt designated as a hedge of our investment in foreign subsidiaries (net of taxes of $1 and $7) (Note 32(b))	6		(47)
	(1,197)		1,650
Gain on marketable equity and debt securities (net of taxes of $(3) and $(7))	31		54
Share of other comprehensive loss of joint venture and associate (net of taxes of $nil and $nil)	(1)		—
Remeasurements of retirement benefit plans (net of taxes of $(13) and $(30))	14		46
Total other comprehensive income (loss)	(1,153)		1,750
Remeasurements of retirement benefit plans recorded in retained earnings	(14)		(46)
Accumulated other comprehensive income – end of year	$	1,230	$	2,397

g) Earnings (Loss) Per Share

The following table reconciles our basic and diluted earnings (loss) per share:


(CAD$ in millions, except per share data)	2025		2024
Profit (loss) from continuing operations attributable to shareholders of the company	$	1,401	$	(467)
Profit from discontinued operations attributable to shareholders of the company (Note 5(c))	—		873
Profit attributable to shareholders of the company	$	1,401	$	406

Weighted average shares outstanding (000’s)	493,778		516,011
Dilutive effect of share options (000’s)	1,574		4,031
Weighted average diluted shares outstanding (000’s)	495,352		520,042

Earnings (loss) per share from continuing operations
Basic	$	2.84	$	(0.90)
Diluted	$	2.83	$	(0.90)
Earnings per share from discontinued operations
Basic	$	—	$	1.69
Diluted	$	—	$	1.68
Earnings per share
Basic earnings per share	$	2.84	$	0.79
Diluted earnings per share	$	2.83	$	0.78

27. Equity (continued)

At December 31, 2025, 2,230,600 (2024 – 1,036,929) potentially dilutive shares were not included in the diluted earnings per share calculation because their effect was anti-dilutive.

For the year ended December 31, 2024, there was a loss from continuing operations attributable to shareholders. Accordingly, all share options would be considered anti-dilutive and have been excluded from the calculation of diluted loss per share from continuing operations attributable to shareholders. The weighted average shares outstanding and weighted average diluted shares outstanding are therefore the same for continuing operations.

h) Dividends

In 2025, we declared and paid dividends on our Class A common and Class B subordinate voting shares of $0.125 per share in each quarter, totalling $246 million. During the interim period prior to the closing of the Merger, the arrangement agreement restricts us from declaring or paying additional dividend amounts exceeding $0.125 per share per fiscal quarter without the prior approval of Anglo American.

In 2024, we declared and paid dividends on our Class A common and Class B subordinate voting shares of $0.125 per share in each of the first, second, and fourth quarters and $0.625 per share in the third quarter, totalling $514 million.

i) Normal Course Issuer Bid

On occasion, we purchase and cancel Class B subordinate voting shares pursuant to normal course issuer bids that allow us to purchase up to a specified maximum number of shares over a one-year period.

In November 2024, we renewed our regulatory approval to conduct a normal course issuer bid, under which we were able to purchase up to 40 million Class B subordinate voting shares during the period from November 22, 2024 to November 21, 2025. As a result of the proposed Merger transaction with Anglo American, we have not executed share buybacks since July 25, 2025, as we are restricted from issuing or repurchasing securities under the Merger arrangement agreement, and we did not renew our normal course issuer bid in the fourth quarter of 2025.

In 2025, we recorded $1.03 billion in equity for the purchase and cancellation of 18,798,430 Class B subordinate voting shares, which includes an accrual of $19 million related to tax on repurchases of shares. We paid $1.01 billion in cash for these repurchases.

In 2024, we recorded $1.3 billion in equity for the purchase of 19,258,016 Class B subordinate voting shares. The $1.3 billion includes an accrual of $15 million related to tax on repurchases of shares. For these share repurchases, we paid $1.2 billion in cash in 2024 and $6 million subsequent to the end of the year. In 2024, 19,158,016 Class B subordinate voting shares were cancelled, with the remaining 100,000 shares cancelled in 2025.

28. Non-Controlling Interests

Set out below is information about our subsidiaries with non-controlling interests and the non-controlling interest balances included in equity.


(CAD$ in millions)	Principal Place of Business	Percentage of Ownership Interest and Voting Rights Held by Non-Controlling Interest		December 31, 2025		December 31, 2024
Quebrada Blanca (a)	Region I, Chile	40	%	$	769	$	889
Carmen de Andacollo	Region IV, Chile	10	%	49		30
Compañía Minera Zafranal S.A.C. (b)	Arequipa Region, Peru	20	%	93		100
				$	911	$	1,019

28. Non-Controlling Interests (continued)

a) Quebrada Blanca

The non-controlling interest in QBSA consists of SMM/SC, who subscribed for a 30% indirect interest in QBSA in 2019, and Codelco, a Chilean state-owned company that holds a 10% preference share interest. Codelco’s interest in QBSA does not require Codelco to make contributions toward QBSA’s capital spending.

The following is the summarized financial information for Quebrada Blanca, at 100%, before intra-group eliminations. Quebrada Blanca has non-controlling interests that are considered material to our consolidated financial statements.


(CAD$ in millions)	December 31, 2025		December 31, 2024
Summarized balance sheet
Current assets	$	1,703	$	1,492
Current liabilities	1,370		1,286
Current net assets	333		206

Non-current assets	22,688		23,244
Non-current liabilities	17,605		17,358
Non-current net assets	5,083		5,886
Net assets	$	5,416	$	6,092

Accumulated non-controlling interests	$	769	$	889

Summarized statement of comprehensive income (loss)
Revenue	$	2,475	$	2,376

Loss for the period	(795)		(1,200)
Other comprehensive income (loss)	(93)		219
Total comprehensive loss	$	(888)	$	(981)

Loss allocated to non-controlling interests	$	(353)	$	(462)

Summarized cash flows
Cash flows provided by operating activities	$	368	$	554
Cash flows used in investing activities	(676)		(1,407)
Cash flows provided by financing activities	195		841
Effect of exchange rates on cash and cash equivalents	(4)		9
Decrease in cash and cash equivalents	$	(117)	$	(3)

b) Compañía Minera Zafranal S.A.C.

The majority of the net assets of the Zafranal copper-gold project located in the Arequipa Region of Peru relate to exploration and evaluation assets.

29. Contingencies

We consider provisions for all of our outstanding and pending legal claims to be adequate. The final outcome with respect to actions outstanding or pending as at December 31, 2025, or with respect to future claims, cannot be predicted with certainty. Significant contingencies not disclosed elsewhere in the notes to our consolidated financial statements are as follows:

Upper Columbia River Basin

Teck American Inc. (TAI) continues studies under the 2006 settlement agreement with the U.S. Environmental Protection Agency (EPA) to conduct a remedial investigation on the Upper Columbia River in Washington State.

In parallel, the Lake Roosevelt litigation involving Teck Metals Limited (TML) by the State of Washington and the Confederated Tribes of the Coleville Reservation (CCT) in the Federal District Court for the Eastern District of Washington continues. The case relates to historic discharges of slag and effluent from TML’s Trail metallurgical facility to the Upper Columbia River. TML prevailed against the plaintiffs on citizen suit claims, seeking injunctive relief, statutory penalties and attorney’s fees. In December 2012, on the basis of stipulated facts agreed between TML and the plaintiffs, the Court found in favour of the plaintiffs in phase one of the case, issuing a declaratory judgment that TML is liable under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) for the plaintiffs' response costs, the amounts of which were determined in the second phase of the case. Additional response costs not yet claimed may be recoverable. The third and final phase of the case pertains to the plaintiffs’ claims for natural resource damages.

In 2022, TML filed two motions for summary judgment in respect of the CERCLA natural resource damages claims, which were denied. Based on one of those rulings, in the first quarter of 2023, TML filed a motion seeking a ruling that the plaintiffs’ natural resource damages claims under CERCLA are not fully developed and they should therefore be dismissed. The motion was denied and TML sought motions seeking reconsideration and certification for an interlocutory appeal to the Ninth Circuit Court of Appeals, both of which were denied.

In October 2023, TML filed a motion for partial summary judgment on CCT’s tribal service loss claim. CCT’s tribal services loss claim comprises the bulk of CCT’s outstanding individual claims against TML except for natural resource damages assessment costs. On February 6, 2024, the District Court granted TML’s motion and dismissed CCT’s claim on the basis that tribal service loss claims are not cognizable as natural resource damages claims under CERCLA. The CCT filed a motion seeking reconsideration of the dismissal or in the alternative certification for an interlocutory appeal to the Ninth Circuit Court of Appeals. The District Court denied reconsideration but certified the matter for interlocutory review by the Ninth Circuit. The Ninth Circuit heard the interlocutory appeal on April 17, 2025. On September 3, 2025, the Ninth Circuit issued its ruling in the interlocutory appeal, reversing the District Court’s dismissal of the CCT’s claim for tribal services loss. TML has petitioned the Ninth Circuit for en banc review of the appeal.

The previously scheduled February 2024 trial with respect to natural resource damages and assessment costs has been postponed during the interlocutory appeal and a new trial date has not yet been scheduled.

Until the studies contemplated by the EPA settlement agreement and additional natural resource damage assessments are completed, it is not possible to estimate the extent and cost, if any, of any additional remediation that may be required by the EPA or restoration that may be demanded by the natural resource trustees or to assess the extent of Teck's potential liability for damages. The EPA studies may conclude, on the basis of risk, cost, technical feasibility or other grounds, that no remediation other than some additional residential soil removal should be undertaken. If other remediation is required, damage to natural resources are proved, and if the CCT’s dismissed tribal service loss claim is revived and subsequently proved, the cost of that remediation and restoration and compensation for natural resource damages may be material.

30. Commitments

a) Capital Commitments

As at December 31, 2025, we had contracted for $1.1 billion of capital expenditures that have not yet been incurred for the purchase and construction of property, plant and equipment. This amount includes $642 million for the Highland Valley Copper Mine Life Extension, $120 million for QB and $197 million for our 22.5% share of Antamina. The amount includes $793 million that is expected to be incurred within one year and $283 million within two to five years.

b) Red Dog Royalty

In accordance with the operating agreement governing the Red Dog mine, TAK pays a royalty to NANA Regional Corporation, Inc. (NANA) on the net proceeds of production. A 25% royalty became payable in the third quarter of 2007 after we had recovered cumulative advance royalties previously paid to NANA. The net proceeds of production royalty rate will increase by 5% every fifth year to a maximum of 50%. The increase to 40% of net proceeds of production occurred in the fourth quarter of 2022. An expense of $515 million was recorded in 2025 (2024 – $448 million) in respect of this royalty. The NANA royalty is expected to increase by 5% to 45% in the fourth quarter of 2027.

c) Antamina Royalty

Our interest in the Antamina mine is subject to a net profits royalty equivalent to 7.4% of our share of the mine’s free cash flow. An expense of $38 million was recorded in 2025 (2024 – $18 million) in respect of this royalty.

d) Purchase Commitments

We have a number of forward purchase commitments for the purchase of concentrates and other process inputs and for shipping and distribution of products, which are incurred in the normal course of business. The majority of these contracts are subject to force majeure provisions.

We have contractual arrangements for the purchase of power for QB. These contracts commenced between 2016 and 2025. These agreements supply power until 2042 and require payments of approximately US$247 million per year.

In 2020, we entered into a 11-year contractual arrangement to purchase power for Carmen de Andacollo. This arrangement requires payments of approximately US$44 million per year.

In 2018, we entered into a 20-year contractual arrangement to purchase power for our Trail Operations, with an option to extend for a further 10 years. This arrangement requires payments of approximately $75 million per year, escalating at 2% per year.

31. Segmented Information

Based on the primary products we produce, we have two reportable segments that we report to our President and Chief Executive Officer – copper and zinc. Corporate activities are not considered a reportable segment and are included as a reconciliation to total consolidated results. These corporate activities include all of our initiatives in other commodities and groups that provide administrative, technical, financial and other support to our reportable segments. Operating income (expense) – other includes general and administration, exploration, research and innovation and other operating income (expense). Sales between segments are carried out on terms that arm’s-length parties would use. Total assets do not include intra-group receivables between segments. Deferred tax assets have been allocated among segments.

As a result of the sale of our steelmaking coal business in July of 2024, we no longer present the associated steelmaking coal segment in the tables below. The segmented information related to the steelmaking coal business is disclosed as part of Note 5(c), Transactions.

31. Segmented Information (continued)


(CAD$ in millions)	2025
	Copper		Zinc		Corporate		Total
Revenue (Note 6(a))	$	6,619	$	4,137	$	—	$	10,756
Cost of sales	(4,846)		(3,253)		—		(8,099)
Gross profit	1,773		884		—		2,657
Operating income (expense) – other	369		(63)		(715)		(409)
Profit (loss) from operations	2,142		821		(715)		2,248
Finance income	10		1		260		271
Finance expense	(693)		(66)		(153)		(912)
Non-operating income (expense)	137		(4)		(81)		52
Share of profit (loss) of joint venture and associate	4		—		(7)		(3)
Profit (loss) from continuing operations before taxes	1,600		752		(696)		1,656

Depreciation and amortization	(1,423)		(259)		(75)		(1,757)
Capital expenditures	1,739		307		16		2,062
	December 31, 2025
Goodwill (Note 8(b))	421		—		—		421


Total assets	$	32,916	$	4,116	$	8,404	$	45,436


(CAD$ in millions)	2024
	Copper		Zinc		Corporate		Total
Revenue (Note 6(a))	$	5,542	$	3,523	$	—	$	9,065
Cost of sales	(4,497)		(2,961)		—		(7,458)
Gross profit	1,045		562		—		1,607
Asset impairment (Note 8(a))	—		(1,038)		(15)		(1,053)
Operating income (expense) – other	13		39		(615)		(563)
Profit (loss) from operations	1,058		(437)		(630)		(9)
Finance income	23		1		210		234
Finance expense	(687)		(66)		(200)		(953)
Non-operating income (expense)	(94)		6		95		7
Share of profit of joint venture and associate	3		—		—		3
Profit (loss) from continuing operations before taxes	303		(496)		(525)		(718)

Depreciation and amortization	(1,356)		(309)		(61)		(1,726)
Capital expenditures	2,267		345		23		2,635
	December 31, 2024
Goodwill (Note 8(b))	442		—		—		442
Total assets	$	34,433	$	4,187	$	8,417	$	47,037

31. Segmented Information (continued)

The geographical distribution of all our non-current assets in 2025 and 2024, other than financial instruments, deferred tax assets and post-employment benefit assets, is as follows:


(CAD$ in millions)	December 31, 2025		December 31, 2024
Canada	$	3,067	$	3,185
Chile	23,581		24,497
United States	2,433		2,485
Peru	2,565		2,381
Mexico	232		219
Other	35		35
	$	31,913	$	32,802

32. Financial Instruments and Financial Risk Management

a) Financial Risk Management

Our activities expose us to a variety of financial risks, which include foreign exchange risk, liquidity risk, interest rate risk, commodity price risk, credit risk and other risks associated with capital markets. From time to time, we may use foreign exchange, commodity price and interest rate contracts to manage exposure to fluctuations in these variables. Our use of derivatives is based on established practices and parameters to mitigate risk and is subject to the oversight of our Financial Risk Management Committee and our Board of Directors.

Foreign Exchange Risk

We operate on an international basis, and therefore, foreign exchange risk exposures arise from transactions denominated in a currency other than the functional currency of our legal entities. Our foreign exchange risk arises primarily with respect to the U.S. dollar, Chilean peso and Peruvian sol. Our cash flows from Canadian, Chilean and Peruvian operations are exposed to foreign exchange risk, as commodity sales are denominated in U.S. dollars and a substantial portion of operating expenses is denominated in local currencies. U.S. dollar cash and cash equivalents held in our Canadian functional currency entities also generate foreign exchange risk.

We also have various investments in U.S. dollar functional currency subsidiaries, whose net assets are exposed to foreign currency translation risk. Historically, this currency exposure was managed in part through our U.S. dollar denominated debt as a hedge against these net investments. In the third quarter of 2024, we discontinued the hedge of our U.S. dollar denominated debt against our U.S. dollar functional currency net investments because our U.S. dollar cash balances subject to foreign exchange risk were greater than our U.S. dollar debt balances with the receipt of proceeds from the sale of the steelmaking coal business. In the third quarter of 2025, we resumed the hedge of our U.S. dollar denominated debt against our U.S. dollar functional currency net investments because our U.S. dollar cash balances subject to foreign exchange risk are less than our U.S. dollar debt balances.

U.S. dollar financial instruments subject to foreign exchange risk consist of U.S. dollar denominated items held in Canada and are summarized below.


(US$ in millions)	December 31, 2025		December 31, 2024
Cash and cash equivalents subject to foreign exchange risk	$	958	$	2,517
Trade and settlement receivables	877		524
Trade accounts payable and other liabilities	(1,274)		(877)
Debt (Note 20)	(1,029)		(1,044)
Reduced by: Debt designated as a hedging instrument in our net investment hedge	315		—
Net U.S. dollar exposure	$	(153)	$	1,120

32. Financial Instruments and Financial Risk Management (continued)

As at December 31, 2025, with other variables unchanged, a $0.10 strengthening of the Canadian dollar against the U.S. dollar would result in a $15 million pre-tax gain (2024 – $112 million pre-tax loss) from our financial instruments. There would also be a pre-tax loss of $1.6 billion (2024 – $1.5 billion) in other comprehensive income (loss) from the translation of our foreign operations. The inverse effect would result if the Canadian dollar weakened by $0.10 against the U.S. dollar.

Liquidity Risk

Liquidity risk arises from our general and capital funding requirements. We have planning, budgeting and forecasting processes to help determine our funding requirements to meet various contractual and other obligations. Note 20(d) details our available credit facilities as at December 31, 2025.

Contractual undiscounted cash flow requirements for financial liabilities as at December 31, 2025 are as follows:


(CAD$ in millions)	Less Than 1 Year		2–3 Years		4–5 Years		More Than 5 Years		Total
Trade accounts payable and other liabilities	$	3,258	$	—	$	—	$	—	$	3,258
Debt (Note 20(e))	403		806		1,309		1,418		3,936
Lease liabilities	209		248		134		911		1,502
Codelco preferential dividend liability	—		—		—		559		559
QB advances from SMM/SC	—		—		—		4,776		4,776
QB variable consideration to IMSA	62		—		—		—		62
Financial and other liabilities	—		181		9		3		193
Estimated interest payments on debt	211		326		204		672		1,413
Estimated interest payments on QB advances from SMM/SC	360		691		676		810		2,537
Estimated interest payments on lease and other liabilities	11		13		7		48		79
Downstream pipeline take-or-pay toll commitment	33		69		74		198		374
	$	4,547	$	2,334	$	2,413	$	9,395	$	18,689

Interest Rate Risk

Our interest rate risk arises in respect of our holdings of cash, cash equivalents, floating rate debt, advances from SMM/SC and the financial liability due to Codelco. Our interest rate management policy is to borrow at both fixed and floating rates to offset financial risks.

Cash and cash equivalents have short terms to maturity and receive interest based on market interest rates.

A 1% increase in the short-term interest rate at the beginning of the year, with other variables unchanged, would have resulted in a $24 million pre-tax decrease in our profit (2024 – $33 million), not considering applicable capitalization of borrowing costs. There would be no effect on other comprehensive income.

Commodity Price Risk

We are subject to price risk from fluctuations in market prices of the commodities that we produce. From time to time, we may use commodity price contracts to manage our exposure to fluctuations in commodity prices and to avoid mismatches in pricing reference periods. At the balance sheet date, we had zinc, lead and copper derivative contracts outstanding as described in (b) below.

Our commodity price risk associated with financial instruments primarily relates to changes in fair value caused by final settlement pricing adjustments to receivables and payables, derivative contracts for zinc, lead and copper, embedded derivatives in our TAK road and port contract, in the ongoing payments under our silver stream and gold stream arrangements and in the QB variable consideration to IMSA.

32. Financial Instruments and Financial Risk Management (continued)

The following represents the effect on profit attributable to shareholders from a 10% change in commodity prices, with other variables unchanged, based on outstanding receivables and payables subject to final pricing adjustments at December 31, 2025 and December 31, 2024. There is no effect on other comprehensive income (loss).


	Price on December 31, (US$/lb.)		Change in Profit Attributable to Shareholders (CAD$ in millions)
	2025	2024	2025		2024
Copper	5.64	3.97	$	89	$	52
Zinc	1.41	1.34	$	4	$	1

A 10% change in the price of copper, zinc, lead, silver and gold, with other variables unchanged, would change our net asset position of derivatives and embedded derivatives, excluding receivables and payables subject to final pricing adjustments, and would result in a change of our pre-tax profit attributable to shareholders by $73 million (2024 – $44 million). There would be no effect on other comprehensive income (loss).

Credit Risk

Credit risk arises from cash, cash equivalents, derivative contracts, debt securities and trade receivables. While we are exposed to credit losses due to the non-performance of our counterparties, there are no significant concentrations of credit risk and we do not consider this to be a material risk.

Our primary counterparties related to our cash, cash equivalents, derivative contracts and debt securities carry investment grade ratings as assessed by external rating agencies, which are monitored on an ongoing basis. All of our commercial customers are assessed for credit quality at least once a year or more frequently if business- or customer-specific conditions change based on an extensive credit rating scorecard developed internally using key credit metrics and measurements that were adapted from S&P’s and Moody’s rating methodologies. Sales to customers that do not meet the credit quality criteria are secured either by a parental guarantee, a letter of credit or prepayment.

For our trade receivables, we apply the simplified approach for determining expected credit losses, which requires us to determine the lifetime expected losses for all our trade receivables. The expected lifetime credit loss provision for our trade receivables is based on historical counterparty default rates and adjusted for relevant forward-looking information, as required. Since the majority of our customers are considered to have low default risk and our historical default rate and frequency of losses are low, the lifetime expected credit loss allowance for trade receivables is nominal as at December 31, 2025.

Our investments in debt securities carried at fair value through other comprehensive income (loss) are considered to have low credit risk, as our counterparties have investment grade credit ratings. The credit risk of our investments in debt securities has not increased significantly since initial recognition of these investments and accordingly, the loss allowance for investments in debt securities is determined based on the 12-month expected credit losses. The 12-month expected credit loss allowance is based on historical and forward-looking default rates for investment grade entities, which are low and, accordingly, the 12-month expected credit loss allowance for our investments in debt securities is nominal as at December 31, 2025. Our other receivables are carried at amortized cost and assessed using the 12-month expected credit loss. The credit risk is considered low and there has been no significant increase in credit risk since initial recognition. Accordingly, the 12-month expected credit loss allowance for other receivables is nominal as at December 31, 2025.

Cash and cash equivalents are held with high quality financial institutions. Substantially all of our cash and cash equivalents held with financial institutions exceeds government-insured limits. We have established credit policies that seek to minimize our credit risk by entering into transactions with investment grade creditworthy and reputable financial institutions and by monitoring the credit standing of the financial institutions with whom we transact. We seek to limit the amount of exposure with any one counterparty.

32. Financial Instruments and Financial Risk Management (continued)

b) Derivative Financial Instruments, Embedded Derivatives and Hedges

Sale and Purchase Contracts

We record adjustments to our settlement receivables and payables for provisionally priced sales and purchases, respectively, in periods up to the date of final pricing based on movements in quoted market prices. These arrangements are based on the market price of the commodity and the value of our settlement receivables and payables will vary, as prices for the underlying commodities vary in the metal markets. These final pricing adjustments result in gains (losses from purchases) in a rising price environment and losses (gains from purchases) in a declining price environment and are recorded in other operating income (expense).

The table below outlines our outstanding settlement receivables and payables, which were provisionally valued at December 31, 2025 and December 31, 2024.


	Outstanding at December 31, 2025		Outstanding at December 31, 2024
	Volume (pounds in millions)	Price (US$/lb.)	Volume (pounds in millions)	Price (US$/lb.)
Receivable positions
Copper	214	5.64	178	3.97
Zinc	189	1.41	141	1.34
Lead	13	0.90	6	0.88
Payable positions
Zinc	89	1.41	84	1.34
Lead	22	0.90	32	0.88

At December 31, 2025, total outstanding settlement receivables were $2.4 billion (2024 – $1.5 billion) (Note 33) and total outstanding settlement payables were $144 million (2024 – $70 million) (Note 19 and Note 33). These amounts are included in trade and settlement receivables and in trade accounts payable and other liabilities, respectively, on the consolidated balance sheets.

Zinc, Lead and Copper Swaps

Due to ice conditions, the port serving our Red Dog mine is normally only able to ship concentrates from July to October each year. As a result, zinc and lead concentrate sales volumes are generally higher in the third and fourth quarters of each year than in the first and second quarters. During 2025 and 2024, we purchased and sold zinc and lead swaps to match our economic exposure to the average zinc and lead prices over our shipping year, which is from July of one year to June of the following year. The copper swaps are used to manage timing differences between purchase and sales.

All zinc, lead and copper swaps derivative contracts mature in 2026. These contracts are not designated as hedging instruments and are recorded at fair value in prepaids and other current assets and trade accounts payable and other liabilities on the consolidated balance sheets.

The fair value of our commodity swaps is calculated based on forward metal prices and is considered a Level 2 fair value measurement with significant observable inputs on the fair value hierarchy (Note 33). A summary of these derivative contracts and related fair values as at December 31, 2025 is as follows:


Derivatives not designated as hedging instruments	Quantity (million lbs.)	Average Price of Purchase Commitments (US$/lb.)	Average Price of Sale Commitments (US$/lb.)	Fair Value Asset (Liability) (CAD$ in millions)
Zinc swaps	226	1.39	1.41	$	5
Copper swaps	47	5.63	5.31	$	(21)
Lead swaps	72	0.90	0.89	$	(1)
				$	(17)

32. Financial Instruments and Financial Risk Management (continued)

Derivatives Not Designated as Hedging Instruments and Embedded Derivatives


(CAD$ in millions)	Amount of Gain (Loss) Recognized in Other Operating Income (Expense) and Non-Operating Income (Expense)
	2025		2024
Zinc swaps	$	(38)	$	(8)
Lead swaps	(1)		(4)
Copper swaps	(93)		27
Settlement receivables and payables (Note 9)	512		65
Contingent zinc escalation payment embedded derivative	2		1
Gold stream embedded derivative	138		51
Silver stream embedded derivative	136		22
QB variable consideration to IMSA (Note 11(a))	—		(7)
Other	38		(3)
	$	694	$	144

Embedded Derivatives

The TAK road and port contract contains a contingent zinc escalation payment that is considered to be an embedded derivative. The fair value of this embedded derivative was $29 million at December 31, 2025 (2024 – $32 million), of which $8 million (2024 – $8 million) is included in trade accounts payables and other liabilities and the remaining $21 million (2024 – $24 million) is included in financial and other liabilities.

The gold stream and silver stream agreements each contain an embedded derivative in the ongoing future payments due to us. The gold stream’s 15% ongoing payment contains an embedded derivative relating to the monthly average gold price at the time of each delivery. The fair value of this embedded derivative was $236 million at December 31, 2025 (2024 – $106 million), of which $27 million (2024 – $11 million) is included in prepaids and other current assets and the remaining $209 million (2024 – $95 million) is included in financial assets. The silver stream’s 5% ongoing payment contains an embedded derivative relating to the spot silver price at the time of delivery. The fair value of this embedded derivative was $183 million at December 31, 2025 (2024 – $52 million), of which $12 million (2024 – $3 million) is included in prepaids and other current assets and the remaining $171 million (2024 – $49 million) is included in financial assets.

Accounting Hedges

Net investment hedge

We manage the foreign currency translation risk of our various investments in U.S. dollar functional currency subsidiaries in part through the designation of our U.S. dollar denominated debt as a hedge against these net investments. We designate the spot element of the U.S. dollar debt as the hedging instrument. As only the spot rate element of the debt is designated in the hedging relationship, no ineffectiveness is expected and no ineffectiveness was recognized in profit for the years ended December 31, 2025 and 2024. The hedged foreign currency risk component is the change in the carrying amount of the net assets of the U.S. dollar functional currency subsidiaries arising from spot U.S. dollar to Canadian dollar exchange rate movements.

32. Financial Instruments and Financial Risk Management (continued)

In July of 2024, we received proceeds from the sale of the steelmaking coal business (Note 5(b)) and as a result, our U.S. dollar cash balances subject to foreign exchange risk were greater than our U.S. dollar debt balances. Accordingly, we discontinued the designation of our U.S. dollar denominated debt as a hedge against our U.S. dollar functional currency net investments in the third quarter of 2024. While we discontinued the net investment hedge in the third quarter of 2024, the hedge was effective prior to that date. In the third quarter of 2025, we resumed the designation of our U.S. dollar denominated debt as a hedge against our U.S. dollar functional currency net investments. At December 31, 2025, US$315 million of our debt and U.S. dollar investment in foreign operations were designated in a net investment hedging relationship. During the year ended December 31, 2025, $5 million (2024 – $54 million) of foreign exchange translation on our U.S. dollar investment in foreign operations was hedged by an offsetting amount of foreign exchange translation on our U.S. dollar denominated debt. Refer to Note 27(f) for the effect of our net investment hedges on other comprehensive income (loss).

33. Fair Value Measurements

Certain of our financial assets and liabilities are measured at fair value on a recurring basis and classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Certain non-financial assets and liabilities may also be measured at fair value on a non-recurring basis and classified in their entirety based on the lowest level of input that is significant to the fair value measurement. There are three levels of the fair value hierarchy that prioritize the inputs to valuation techniques used to measure fair value, with Level 1 inputs having the highest priority. The levels and the valuation techniques used to value our financial assets and liabilities are described below:

Level 1 – Quoted Prices in Active Markets for Identical Assets

Level 1 inputs are unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Certain cash equivalents, certain marketable equity securities and certain debt securities are valued using quoted market prices in active markets. Accordingly, these items are included in Level 1 of the fair value hierarchy.

Level 2 – Significant Observable Inputs Other than Quoted Prices

Level 2 inputs are quoted prices in markets that are not active, quoted prices for similar assets or liabilities in active markets, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability.

Derivative instruments and embedded derivatives are included in Level 2 of the fair value hierarchy, as they are valued using pricing models or discounted cash flow models. These models require a variety of inputs, including, but not limited to, market prices, forward price curves, yield curves and credit spreads. These inputs are obtained from or corroborated with the market. Also included in Level 2 are settlement receivables and settlement payables from provisional pricing on concentrate sales and purchases and certain refined metal sales because they are valued using quoted market prices derived based on forward curves for the respective commodities.

Level 3 – Significant Unobservable Inputs

Level 3 inputs are unobservable (supported by little or no market activity).

We include investments in certain equity securities in non-public companies in Level 3 of the fair value hierarchy because they trade infrequently and have little price transparency.

33. Fair Value Measurements (continued)

The fair values of our financial assets and liabilities measured at fair value on a recurring basis at December 31, 2025 and 2024, are summarized in the following table:


(CAD$ in millions)	2025								2024
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Financial assets
Cash equivalents	$	3,123	$	—	$	—	$	3,123	$	5,244	$	—	$	—	$	5,244
Marketable and other equity securities	130		—		234		364		118		—		189		307
Debt securities	240		—		—		240		220		—		—		220
Settlement receivables (Note 32(b))	—		2,387		—		2,387		—		1,456		—		1,456
Derivative instruments and embedded derivatives	—		463		—		463		—		168		—		168
	$	3,493	$	2,850	$	234	$	6,577	$	5,582	$	1,624	$	189	$	7,395

Financial liabilities
Derivative instruments and embedded derivatives	$	—	$	113	$	—	$	113	$	—	$	179	$	—	$	179
Settlement payables (Note 32(b))	—		144		—		144		—		70		—		70
	$	—	$	257	$	—	$	257	$	—	$	249	$	—	$	249

Equity securities in non-public companies included in Level 3 of the fair value hierarchy are initially measured at fair value, with cost of the investment taken as the best estimate of fair value. Subsequent measurement is based on an implied value of the underlying business.

The discounted cash flow models used to determine the FVLCD of certain non-financial assets are classified as Level 3 measurements. Refer to Note 8 for information about these fair value measurements.

Unless disclosed elsewhere in our consolidated financial statements (Note 11, Note 20 and Note 22), the fair value of the remaining financial assets and financial liabilities approximate their carrying value.

34. Capital Management

Risk Management

The capital we manage is the total of equity and debt on our balance sheet. Our capital management objectives are to maintain access to the capital we require to operate and grow our business while minimizing the cost of such capital and providing for returns to our investors.

As defined in our internal policies, we target to maintain, on average, over time, a debt-to-adjusted EBITDA ratio of approximately 2.0x, consistent with an investment grade credit rating. This ratio is expected to vary from its target level from time to time, reflecting commodity price cycles and corporate activity, including the development of major projects. We may also review and amend such policy targets from time to time.

As at December 31, 2025, our debt-to-adjusted EBITDA ratio was 1.1x (2024 – 1.9x). Our debt-to-adjusted EBITDA ratio is calculated using total debt, which is the sum of debt plus lease liabilities, including the current portions of debt and lease liabilities. Adjusted EBITDA is EBITDA before the pre-tax effect of the adjustments that we make to adjusted profit from continuing operations attributable to shareholders. For adjusted profit from continuing operations attributable to shareholders, we adjust profit from continuing operations attributable to shareholders as reported to remove the after-tax effect of certain types of transactions that reflect measurement changes on our balance sheet or are not indicative of our normal operating activities. EBITDA is profit before net finance expense, provision for income taxes, and depreciation and amortization. These measures are non-GAAP measures and should not be considered in isolation or used in substitution for other measures of performance prepared in accordance with IFRS Accounting Standards. Additional information on these measures is available in our management’s discussion and analysis for the year ended December 31, 2025.

34. Capital Management (continued)

We manage the risk of not meeting our financial targets through the issuance and repayment of debt, our distribution policy, the issuance of equity capital and asset sales, as well as through the ongoing management of operations, investments and capital expenditures.

Loan Covenant

The sustainability-linked revolving facility as described in Note 20(d) requires our total net debt-to-capitalization ratio to not exceed 0.60 to 1.0. The net debt-to-capitalization ratio is calculated using the sum of debt plus lease liabilities, including the current portions of debt and lease liabilities, less unrestricted cash and cash equivalents, which is divided by debt plus lease liabilities, including the current portions of debt and lease liabilities plus equity attributable to shareholders. Net debt is a non-GAAP measure and should not be considered in isolation or used in substitution for other measures of performance prepared in accordance with IFRS Accounting Standards. Additional information on non-GAAP measures is available in our management’s discussion and analysis for the year ended December 31, 2025.

Following the sale of the steelmaking coal business in July 2024, cash and cash equivalents increased significantly and as a result, our cash balances were greater than our debt balances at December 31, 2025 and December 31, 2024. Therefore, we do not exceed the required net debt-to-capitalization ratio. This facility does not have an earnings or cash flow-based financial covenant, a credit rating trigger or a general material adverse effect borrowing condition.

35. Key Management Compensation

The compensation for key management recognized in total comprehensive income (loss) in respect of employee services is summarized in the table below. Key management consists of our directors, President and Chief Executive Officer, and executive vice presidents.


(CAD$ in millions)	2025		2024
Salaries, bonuses, director fees and other short-term benefits	$	16	$	19
Post-employment benefits	3		2
Share option compensation expense	4		7
Compensation expense related to Units	20		18
	$	43	$	46