The mining company also said it has held talks with its lenders about the terms of its $3 billion senior debt facility, $350 million Kansanshi facility, and $100 million equipment finance facility with Caterpillar Financial Services Corp.
First Quantum said changes to the Zambian corporate tax and mining put the company at risk of falling short of a key covenant on the loans, but that its lead bankers have "responded favourably" to its cost cutting.
"They have agreed to change the affected covenant to reflect current circumstances and provided confirmation that they will recommend such a change to the company's broader lending group who remain supportive," the company said.
First Quantum earned a fourth-quarter profit of US$453.2 million, or 75 cents per diluted share, including about $382 million due to a revaluation of Zambian deferred taxes under the new royalty regime introduced in December. In the fourth quarter of 2013, First Quantum had US$131.3 million of net income.
On an adjusted basis, the company said it earned US$76.9 million or 13 cents US per share compared with US$133.8 million or 23 cents per share in the fourth quarter of 2013.
Revenue dropped to $821.2 million from $897 million in the fourth quarter of 2013, as copper production and sales volume declined and the realized copper price fell to US$2.91 per pound from $3.26 per pound. Sales volumes of nickel and gold also fell compared with the fourth quarter of 2013, contributing to the lower revenue.
The company also announced its dividend rate has been lowered to 10 per cent of what it calls its comparative earnings from 15 per cent.
First Quantum said the second instalment of its 2014 dividend will be 4.87 cents Cdn per share following an interim payment of 5.04 cents Cdn in September. The company paid a total of 15.13 cents Cdn the previous year.
First Quantum previously announced that its 2015 capital spending plan would be reduced to between US$1.2 billion and Us$1.4 billion, and said on Friday that it's working on other ways to reduce operational costs beyond the savings it expects from lower fuel prices.