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Watchlist
Account
Wheaton Precious Metals
WPM
#456
Rank
A$76.54 B
Marketcap
๐จ๐ฆ
Canada
Country
A$168.54
Share price
-1.45%
Change (1 day)
13.51%
Change (1 year)
โ๏ธ Mining
โ๏ธ Silver Mining
โ๏ธ Gold mining
Categories
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Annual Reports (40-F)
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Wheaton Precious Metals
Annual Reports (40-F)
Financial Year 2022
Wheaton Precious Metals - 40-F annual report 2022
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false
FY
0001323404
DE
Presentation of historical figures have been revised to conform with current year classifications – see Note 2.
LTIs = long-term investments – common shares held.
Definitions as follows: “OCI” = Other Comprehensive Income (Loss); “SBC” = Equity Settled Stock Based Compensation; “Options” = Share Purchase Options; “RSUs” = Restricted Share Units; “LTI’s” = Long-Term Investments; “Warrants” = Share Purchase Warrants.
Refer to Note 23.1.
FVTOCI refers to Fair Value Through Other Comprehensive Income
FVTPL refers to Fair Value Through Profit or Loss
Expressed in thousands of United States dollars; excludes closing costs and capitalized interest, where applicable.
Please refer to Note 32 for details of when the remaining upfront consideration to be paid becomes due.
Once 90 million silver equivalent ounces attributable to Wheaton have been produced, the attributable production will decrease to 16.67% of gold production and 66.67% of silver production for the life of mine.
The weighted average price of share purchase options exercised and restricted share units released represents the respective exercise price.
The Company has implemented a dividend reinvestment plan (“DRIP”) whereby shareholders can elect to have dividends reinvested directly into additional Wheaton common shares. The weighted average price for common shares issued under the DRIP represents the volume weighted average price of the common shares on the five trading days preceding the dividend payment date, less a discount of 1%.
US$ share purchase options converted to Cdn$ using the exchange rate of 1.3544, being the Cdn$/US$ exchange rate at December 31, 2022.
LTIs refers to long-term investments in common shares held.
During the year ended December 31, 2022, the Company’s subsidiaries generated net earnings of $532 million, as compared to $564 million during the comparable period of the prior year.
The Company’s position, as reflected in its filed Canadian income tax returns and consistent with the terms of the PMPAs, is that the cost of the precious metal acquired under the Canadian PMPAs is equal to the market value while a deposit is outstanding (where applicable to an agreement), and the cash cost thereafter. For accounting purposes, the cost of the mineral stream interests is depleted on a unit-of-production basis as described in Note 4.2.
Debt and share financing fees are deducted over a five-year period for Canadian income tax purposes. For accounting purposes, debt financing fees are deducted over the term of the credit facility and share financing fees are charged directly to issued capital.
Other includes capital assets, cobalt inventory, charitable donation carryforward, and PSU and pension liabilities.
As at December 31, 2022, the Company had no non-capital losses available to recognize against deferred tax liabilities.
As at December 31, 2022, the Company had fully recognized the tax effect of non-capital losses.
Short-term employee benefits include salaries, bonuses payable within twelve months of the balance sheet date and other annual employee benefits.
As more fully disclosed in Notes 23.2 and 23.3, equity settled stock based compensation expense is recorded on a straight-line basis over the vesting period.
As more fully disclosed in Note 24.1, PSU compensation expense is recorded on a straight-line basis over the three year vesting period, with the expense being adjusted at the end of each reporting period to reflect (i) the fair value of common shares; (ii) the number of PSUs anticipated to vest; and (iii) the anticipated performance factor.
Under the terms of the San Dimas PMPA, the Company is entitled to an amount equal to 25% of the payable gold production plus an additional amount of gold equal to 25% of the payable silver production converted to gold at a fixed gold to silver exchange ratio of 70:1 from the San Dimas mine. If the average gold to silver price ratio decreases to less than 50:1 or increases to more than 90:1 for a period of 6 months or more, then the “70” shall be revised to “50” or “90”, as the case may be, until such time as the average gold to silver price ratio is between 50:1 to 90:1 for a period of 6 months or more in which event the “70” shall be reinstated. Currently, the fixed gold to silver exchange ratio is 70:1.
Projected payment date based on management estimate. Dates may be updated in the future as additional information is received.
Copper World Complex (formerly referred to as Rosemont in these financial statements). Figure includes contingent transaction costs of $1 million.
As more fully explained on the following page, assuming the Salobo III expansion project results in throughput being expanded beyond 35 Mtpa by January 1, 2024, the Company would expect to pay an expansion payment of $552 million.
Where a gold interest represents less than 10% of the Company’s sales, gross margin or aggregate asset book value and is not evaluated on a regular basis by the Company’s CEO for the purpose of assessing performance, the gold interest has been summarized under Other gold interests. Other gold interests are comprised of the operating 777, Minto and Marmato gold interests as well as the non-operating Copper World Complex (formerly referred to as Rosemont in these financial statements), Santo Domingo, Fenix, Blackwater, Marathon, Curipamba and Goose gold interests. On June 22, 2022, Hudbay announced that mining activities at 777 have concluded and closure activities have commenced.
As it relates to mine operator concentration risk: a. The counterparty obligations under the Salobo, Sudbury and Voisey’s Bay PMPAs are guaranteed by the parent company Vale. Total revenues relative to Vale PMPAs during the year ended December 31, 2021 were 32% of the Company’s total revenue. b. The counterparty obligations under the Antamina PMPA and the previously owned Yauliyacu PMPA (which is included as part of Other silver interests) are guaranteed by the parent company Glencore plc (“Glencore”) and its subsidiary. Total revenues relative to Glencore PMPAs during the year ended December 31, 2021 were 18% of the Company’s total revenue. c. The counterparty obligations under the Peñasquito PMPA are guaranteed by the parent company Newmont Corporation (“Newmont”). Total revenues relative to Newmont during the year ended December 31, 2021 were 17% of the Company’s total revenue. Should any of these mine operators become unable or unwilling to fulfill their obligations under their agreements with the Company, there could be a material adverse impact on the Company including, but not limited to, the Company’s revenue, net income and cash flows from operations.
Where a silver interest represents less than 10% of the Company’s sales, gross margin or aggregate asset book value and is not evaluated on a regular basis by the Company’s CEO for the purpose of assessing performance, the silver interest has been summarized under Other silver interests. Other silver interests are comprised of the operating Los Filos, Zinkgruvan, Stratoni, Aljustrel, Neves-Corvo, Minto, 777, Marmato and Cozamin silver interests, the non-operating Loma de La Plata, Copper World Complex (formerly referred to as Rosemont in these financial statements) and Pascua-Lama silver interests and the previously owned Keno Hill and Yauliyacu silver interests. The Stratoni mine was placed into care and maintenance during Q4-2021. On June 22, 2022, Hudbay announced that mining activities at 777 have concluded and closure activities have commenced. On September 7, 2022, the Keno Hill stream was terminated in exchange for $141 million of Hecla common stock (see Note 13). On December 14, 2022 the Company terminated the Yauliyacu PMPA in exchange for a cash payment of $132 million (see Note 13).
Where a gold interest represents less than 10% of the Company’s sales, gross margin or aggregate asset book value and is not evaluated on a regular basis by the Company’s CEO for the purpose of assessing performance, the gold interest has been summarized under Other gold interests. Other gold interests are comprised of the operating 777, Minto and Marmato gold interests as well as the non-operating Copper World Complex gold interest (formerly referred to as Rosemont in these financial statements). On June 22, 2022, Hudbay announced that mining activities at 777 have concluded and closure activities have commenced.
Comprised of the operating Coleman, Copper Cliff, Garson, Creighton and Totten gold interests as well as the non-operating Stobie and Victor gold interests.
As it relates to mine operator concentration risk: a. The counterparty obligations under the Salobo, Sudbury and Voisey’s Bay PMPAs are guaranteed by the parent company Vale. Total revenues relative to Vale PMPAs during the year ended December 31, 2022 were 35% of the Company’s total revenue. b. The counterparty obligations under the Antamina PMPA and the Yauliyacu PMPA (which is included as part of Other silver interests) are guaranteed by the parent company Glencore plc (“Glencore”) and its subsidiary. Total revenues relative to Glencore PMPAs during the year ended December 31, 2022 were 14% of the Company’s total revenue. c. The counterparty obligations under the Peñasquito PMPA are guaranteed by the parent company Newmont Corporation (“Newmont”). Total revenues relative to Newmont during the year ended December 31, 2022 were 16% of the Company’s total revenue. Should any of these mine operators become unable or unwilling to fulfill their obligations under their agreements with the Company, there could be a material adverse impact on the Company including, but not limited to, the Company’s revenue, net income and cash flows from operations
Where a silver interest represents less than 10% of the Company’s sales, gross margin or aggregate asset book value and is not evaluated on a regular basis by the Company’s CEO for the purpose of assessing performance, the silver interest has been summarized under Other silver interests. Other silver interests are comprised of the operating Los Filos, Zinkgruvan, Neves-Corvo, Aljustrel, Minto, Cozamin, Marmato and 777 silver interests, the non-operating Loma de La Plata, Stratoni, Pascua-Lama, Copper World Complex (formerly referred to as Rosemont in these financial statements), Blackwater and Curipamba silver interests and the previously owned Keno Hill and Yauliyacu silver interests. On June 22, 2022, Hudbay announced that mining activities at 777 have concluded and closure activities have commenced. The Stratoni mine was placed into care and maintenance during Q4-2021. On September 7, 2022, the Keno Hill stream was terminated in exchange for $141 million of Hecla common stock (see Note 13). On December 14, 2022 the Company terminated the Yauliyacu PMPA in exchange for a cash payment of $132 million (see Note 13).
See Notes 13 and 14 for more information.
See Note 14 for more information.
Includes the Pascua-Lama project, which straddles the border of Argentina and Chile.
The Local Community Investment Program supports organizations in Vancouver and the Cayman Islands, where Wheaton’s offices are located.
The Partner Community Investment Program supports the communities influenced by Mining Partners’ operations.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
40-F
[_]
REGISTRATION STATEMENT PURSUANT TO SECTION 12 OF THE SECURITIES
EXCHANGE ACT OF 1934
OR
[X]
ANNUAL REPORT PURSUANT TO SECTION 13(a) OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended
December 31
,
2022
Commission file number:
001-32482
WHEATON PRECIOUS METALS CORP.
(Exact Name of Registrant as Specified in its charter)
Ontario
,
Canada
1041
98-0459455
(Province or other jurisdiction of incorporation or
(Primary Standard Industrial
Classification Code)
(I.R.S. Employer Identification No.)
organization)
3500 – 1021 West Hastings Street
Vancouver
,
British Columbia
V6E 0C3
(
604
)
684-9648
(Address and telephone number of Registrant’s principal executive offices)
Puglisi & Associates
850 Library Avenue
,
Suite 204
Newark
,
DE
19711
Telephone: (
302
)
738-6680
(Name, address (including zip code) and telephone number (including area code) of agent for service in the United States)
Securities registered or to be registered pursuant to Section 12(b) of the Act:
Title of each class:
Trading Symbol(s):
Name of each exchange on which registered:
Common Shares
, no par value
WPM
New York Stock Exchange
Securities registered or to be registered pursuant to Section 12(g) of the Act:
None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:
None
For annual reports, indicate by check mark the information filed with this form:
[X]
Annual information form
[X]
Audited annual financial statements
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report:
452,318,526
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
[X]
Yes
[_] No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation
S-T
(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files).
[X]
Yes
[_] No
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule
12b-2
of the Exchange Act.
Emerging Growth Company
[ ]
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. [ ]
† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
Indicate by check mark whether the Registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
[
X
]
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. [ ]
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to
§240.10D-1(b).
[ ]
This annual report on Form
40-F
shall be incorporated by reference into the registrant’s Registration Statement on Form
S-8
(File
No. 333-128128),
on Form
F-10
(File
No. 333-255208)
and on Form
F-3D
(File
No. 333-194702)
under the Securities Act of 1933, as amended.
EXPLANATORY NOTE
Wheaton Precious Metals Corp. (the “
Company
”, “
Wheaton
” or the “
Registrant
”) is a Canadian issuer eligible to file its annual report pursuant to Section 13 of the Securities Exchange Act of 1934, as amended (the “
Exchange Act
”) on Form
40-F
pursuant to the multi-jurisdictional disclosure system of the Exchange Act. The Company is a “foreign private issuer” as defined in Rule
3b-4
under the Exchange Act. The common shares of the Company (the “
Common Shares
”) are accordingly exempt from Sections 14(a), 14(b), 14(c), 14(f) and 16 of the Exchange Act pursuant to Rule
3a12-3
thereunder.
FORWARD-LOOKING STATEMENTS
1
This annual report on Form
40-F
and the exhibits attached hereto contain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking statements, which are all statements other than statements of historical fact, include, but are not limited to statements with respect to:
•
the future price of commodities;
•
the estimation of future production from Mining Operations (including in the estimation of production, mill throughput, grades, recoveries and exploration potential) (as defined in the Company’s AIF);
•
the estimation of mineral reserves and mineral resources (including the estimation of reserve conversion rates) and the realization of such estimations);
•
the commencement, timing and achievement of construction, expansion or improvement projects by Wheaton’s PMPA (as defined in the Company’s AIF) counterparties at Mining Operations;
•
the payment of upfront cash consideration to counterparties under PMPAs, the satisfaction of each party’s obligations in accordance with PMPAs and royalty arrangements and the receipt by the Company of precious metals and cobalt production in respect of the applicable Mining Operations under PMPAs or other payments under royalty arrangements;
•
the ability of Wheaton’s PMPA (as defined in the Company’s AIF) counterparties to comply with the terms of a PMPA (including as a result of the business, mining operations and performance of Wheaton’s PMPA counterparties) and the potential impacts of such on Wheaton;
•
future payments by the Company in accordance with PMPAs, including any acceleration of payments;
•
the costs of future production;
•
the estimation of produced but not yet delivered ounces;
•
the impact of epidemics (including the
COVID-19
virus pandemic), including the potential heightening of other risks;
•
the future sales of Common Shares under, the amount of net proceeds from, and the use of the net proceeds from, the ATM Program;
•
continued listing of the Common Shares on the LSE, NYSE and TSX;
•
any statements as to future dividends;
•
the ability to fund outstanding commitments and the ability to continue to acquire accretive PMPAs;
•
projected increases to Wheaton’s production and cash flow profile;
•
projected changes to Wheaton’s production mix;
•
the ability of Wheaton’s PMPA counterparties to comply with the terms of any other obligations under agreements with the Company;
•
the ability to sell precious metals and cobalt production;
•
confidence in the Company’s business structure;
•
the Company’s assessment of taxes payable and the impact of the CRA Settlement (as defined in the Company’s AIF) for years subsequent to 2010;
2
•
possible audits for taxation years subsequent to 2015;
•
the Company’s assessment of the impact of any tax reassessments;
•
the Company’s intention to file future tax returns in a manner consistent with the CRA Settlement;
•
the Company’s climate change and environmental commitments; and
•
assessments of the impact and resolution of various legal and tax matters, including but not limited to audits.
Generally, these
forward-looking
statements can be identified by the use of
forward-looking
terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “projects”, “intends”, “anticipates” or “does not anticipate”, or “believes”, “potential”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”.
Forward-looking
statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Wheaton to be materially different from those expressed or implied by such
forward-looking
statements, including but not limited to:
•
the satisfaction of each party’s obligations in accordance with the terms of the Company’s PMPAs or royalty arrangements;
•
risks associated with fluctuations in the price of commodities (including Wheaton’s ability to sell its precious metals or cobalt production at acceptable prices or at all);
•
risks of significant impacts on Wheaton or the Mining Operations as a result of an epidemic (including the
COVID-19
virus pandemic);
•
risks related to the Mining Operations (including fluctuations in the price of the primary or other commodities mined at such operations, regulatory, political and other risks of the jurisdictions in which the Mining Operations are located, actual results of mining, risks associated with exploration, development, operating, expansion and improvement at the Mining Operations, environmental and economic risks of the Mining Operations, and changes in project parameters as Mining Operations plans continue to be refined);
•
absence of control over the Mining Operations and having to rely on the accuracy of the public disclosure and other information Wheaton receives from the owners and operators of the Mining Operations as the basis for its analyses, forecasts and assessments relating to its own business;
•
risks related to the uncertainty in the accuracy of mineral reserve and mineral resource estimation;
•
risks related to the satisfaction of each party’s obligations in accordance with the terms of the Company’s precious metal purchase agreements or PMPAs (as defined in the Company’s AIF”), including the ability of the companies with which the Company has PMPAs to perform their obligations under those PMPAs in the event of a material adverse effect on the results of operations, financial condition, cash flows or business of such companies, any acceleration of payments, estimated throughput and exploration potential;
•
risks relating to production estimates from Mining Operations, including anticipated timing of the commencement of production by certain Mining Operations;
•
Wheaton’s interpretation of, or compliance with, or application of, tax laws and regulations or accounting policies and rules, being found to be incorrect or the tax impact to the Company’s business operations being materially different than currently contemplated;
•
any challenge or reassessment by the CRA of the Company’s tax filings being successful and the potential negative impact to the Company’s previous and future tax filings;
•
risks in assessing the impact of the CRA Settlement for years subsequent to 2010 (including whether there will be any material change in the Company’s facts or change in law or jurisprudence);
•
risks relating to the potential implementation of a 15% global minimum tax;
•
counterparty credit and liquidity risks;
•
mine operator and counterparty concentration risks;
•
indebtedness and guarantees risks;
•
hedging risk;
3
•
competition in the streaming industry risk;
•
risks related to claims and legal proceedings against Wheaton or the Mining Operations;
•
risks relating to security over underlying assets;
•
risks related to governmental regulations;
•
risks related to international operations of Wheaton and the Mining Operations;
•
risks relating to exploration, development, operating, expansions and improvements at the Mining Operations;
•
risks related to environmental regulations;
•
risks related to climate change;
•
the ability of Wheaton and the Mining Operations to obtain and maintain necessary licenses, permits, approvals and rulings;
•
the ability of Wheaton and the Mining Operations to comply with applicable laws, regulations and permitting requirements;
•
lack of suitable supplies, infrastructure and employees to support the Mining Operations;
•
inability to replace and expand mineral reserves, including anticipated timing of the commencement of production by certain Mining Operations (including increases in production, estimated grades and recoveries);
•
uncertainties related to title and indigenous rights with respect to the mineral properties of the Mining Operations;
•
risks associated with environmental, social and governance matters;
•
the ability of Wheaton and the Mining Operations to obtain adequate financing;
•
the ability of the Mining Operations to complete permitting, construction, development and expansion;
•
challenges related to global financial conditions;
•
risks related to Wheaton’s acquisition strategy;
•
risks related to the market price of the Common Shares of Wheaton (the “Common Shares”);
•
risks associated with multiple listings of the Common Shares on the LSE, NYSE and TSX;
•
risks associated with a possible suspension of trading of Common Shares;
•
risks associated with the sale of Common Shares under the ATM Program, including the amount of any net proceeds from such offering of Common Shares and the use of any such proceeds;
•
risks associated with the ability to achieve climate change and environmental commitments at Wheaton and at the Mining Operations;
•
equity price risks related to Wheaton’s holding of
long-term
investments in other companies;
•
risks related to interest rates;
•
risks related to the declaration, timing and payment of dividends;
•
the ability of Wheaton and the Mining Operations to retain key management employees or procure the services of skilled and experienced personnel;
•
risks relating to activist shareholders;
•
risks relating to reputational damage;
•
risks relating to unknown defects and impairments;
•
risks related to ensuring the security and safety of information systems, including cyber security risks;
•
risks related to the adequacy of internal control over financial reporting;
•
risks related to fluctuations in commodity prices of metals produced from the Mining Operations other than precious metals or cobalt;
•
risks relating to future sales or the issuance of equity securities; and
•
other risks disclosed under the heading “Risk Factors” in the Company’s AIF.
Forward-looking
statements are based on assumptions management currently believes to be reasonable including, but not limited to:
•
that there will be no material adverse change in the market price of commodities;
•
that the Mining Operations will continue to operate and the mining projects will be completed in accordance with public statements and achieve their stated production estimates;
4
•
that the mineral reserves and mineral resource estimates from Mining Operations (including reserve conversion rates) are accurate;
•
that each party will satisfy their obligations in accordance with the PMPAs;
•
that Wheaton will continue to be able to fund or obtain funding for outstanding commitments;
•
that Wheaton will be able to source and obtain accretive PMPAs;
•
that neither Wheaton nor the Mining Operations will suffer significant impacts as a result of an epidemic (including the
COVID-19
virus pandemic);
•
that any outbreak or threat of an outbreak of a virus or other contagions or epidemic disease will be adequately responded to locally, nationally, regionally and internationally, without such response requiring any prolonged closure of the Mining Operations or having other material adverse effects on the Company and counterparties to its PMPAs;
•
that the trading of the Common Shares will not be adversely affected by the differences in liquidity, settlement and clearing systems as a result of multiple listings of the Common Shares on the LSE, the TSX and the NYSE;
•
that the trading of the Company’s Common Shares will not be suspended;
•
that expectations regarding the resolution of legal and tax matters will be achieved (including CRA audits involving the Company);
•
that Wheaton has properly considered the application of Canadian tax law to its structure and operations;
•
that Wheaton has filed its tax returns and paid applicable taxes in compliance with Canadian tax law;
•
that Wheaton’s application of the CRA Settlement for years subsequent to 2010 is accurate (including the Company’s assessment that there has been no material change in the Company’s facts or change in law or jurisprudence for years subsequent to 2010);
•
that any sale of Common Shares under the ATM Program will not have a significant impact on the market price of the Common Shares and that the net proceeds of sales of Common Shares, if any, will be used as anticipated;
•
the estimate of the recoverable amount for any PMPA with an indicator of impairment; and
•
such other assumptions and factors as set out herein.
Although Wheaton has attempted to identify important factors that could cause actual results, level of activity, performance or achievements to differ materially from those contained in
forward-looking
statements, there may be other factors that cause results, level of activity, performance or achievements not to be as anticipated, estimated or intended. There can be no assurance that
forward-
looking statements will prove to be accurate and even if events or results described in the
forward-looking
statements are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, Wheaton. Accordingly, readers should not place undue reliance on
forward-looking
statements and are cautioned that actual outcomes may vary. The
forward-looking
statements included herein are for the purpose of providing investors with information to assist them in understanding Wheaton’s expected financial and operational performance and may not be appropriate for other purposes. Any
forward-looking
statement speaks only as of the date on which it is made. Wheaton does not undertake to update any
forward-looking
statements that are included or incorporated by reference herein, except in accordance with applicable securities laws.
5
CURRENCY
Unless otherwise indicated, all dollar amounts in this annual report on Form
40-F
are in United States dollars. Based on the Bank of Canada daily average exchange rate, the exchange rate of Canadian dollars into United States dollars, on March 30, 2023, was CDN$1.00 = USD$0.7389.
NOTE TO UNITED STATES READERS-
DIFFERENCES IN UNITED STATES AND CANADIAN REPORTING PRACTICES
The Company’s audited annual Consolidated Financial Statements for the years ended December 31,
2022
and 2021 (the “
Audited Financial Statements
”) have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“
IFRS
”), which differs from U.S. generally accepted accounting principles utilized by U.S. companies.
Wheaton believes that there are no significant differences between its corporate governance practices and those required to be followed by United States domestic issuers under the NYSE listing standards. This confirmation is located on the Wheaton website at http://www.wheatonpm.com/company/corporate-governance/default.aspx.
The AIF, MD&A (as defined below) and the Audited Financial Statements have been prepared in accordance with the requirements of the securities laws in effect in Canada, which differ from the requirements of U.S. securities laws. The Company reports information regarding mineral properties, mineralization and estimates of mineral reserves and mineral resources in accordance with Canadian reporting requirements which are governed by, and utilize definitions required by, Canadian National Instrument
43-101
– Standards of Disclosure for Mineral Projects (“
NI
43-101
”) and the Canadian Institute of Mining, Metallurgy and Petroleum (the “
CIM
”) –
CIM Definition Standards on Mineral Resources and Mineral Reserves
, adopted by the CIM Council, as amended (the “
CIM Definition Standards
”). These definitions differ from the definitions adopted by the United States Securities and Exchange Commission (“
SEC
”) under the United States Securities Act of 1933, as amended (the “
Securities Act
”) which are applicable to U.S. companies. Accordingly, there is no assurance any mineral reserves or mineral resources that the Company may report as “proven mineral reserves”, “probable mineral reserves”, “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources” under NI
43-101
would be the same had the Company prepared the reserve or resource estimates under the standards adopted by the SEC.
Information contained in this annual report on Form
40-F
and the documents incorporated by reference herein containing descriptions of the Company’s mineral deposits may not be comparable to similar information made public by U.S. companies subject to reporting and disclosure requirements under the United States federal securities laws and the rules and regulations thereunder.
ANNUAL INFORMATION FORM
For the Company’s AIF, see Exhibit 99.1 filed as part of this annual report on Form
40-F.
6
AUDITED ANNUAL FINANCIAL STATEMENTS AND
MANAGEMENT’S DISCUSSION AND ANALYSIS
Management’s Discussion and Analysis
For the Company’s management’s discussion and analysis of results of operations and financial condition for the year ended December 31, 2022 (the Company’s “
MD&A
”), see Exhibit 99.2 filed as part of this annual report on Form
40-F.
Audited Annual Financial Statements
For the Company’s Audited Annual Financial Statements for the years ended December 31, 2022 and 2021, including the reports of the independent registered public accounting firm with respect thereto, see Exhibit 99.3 filed as part of this annual report on Form
40-F.
CERTIFICATIONS
See Exhibits 99.4, 99.5, 99.6 and 99.7 to this annual report on Form
40-F.
CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
At the end of the period covered by this annual report, an evaluation was carried out under the supervision of, and with the participation of, the Company’s management, including the Chief Executive Officer (“
CEO
”) and Chief Financial Officer (“
CFO
”), of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a – 15(e) and Rule 15d – 15(e) under the Exchange Act). Based on that evaluation, the CEO and the CFO have concluded that as of the end of the period covered by this annual report, the Company’s disclosure controls and procedures were effective in ensuring that information required to be disclosed by the Company in reports that it files or submits to the SEC under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to the Company’s management, including the CEO and CFO, as appropriate, to allow for timely decisions regarding required disclosure.
The Company’s management, including the CEO and CFO, does not expect that its disclosure controls and procedures or internal controls and procedures will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, control may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
Changes in Internal Control Over Financial Reporting
During the period covered by this annual report on Form
40-F,
no change occurred in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
7
MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
The Company’s management, with the participation of its Chief Executive Officer and Chief Financial Officer, are responsible for establishing and maintaining adequate internal control over financial reporting. Under the supervision of the Chief Financial Officer, the 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 IFRS. The Company’s controls include policies and procedures that:
•
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
•
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS, and that receipts and expenditures of the Company are being made only in accordance with authorizations of the Company’s management and directors; and,
•
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 annual financial statements or interim financial statements.
The Company’s management, including its Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s internal control over financial reporting using the framework and criteria established in Internal Control – Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management has concluded that the internal control over financial reporting was effective as of December 31, 2022.
The Company’s independent registered public accounting firm has issued an attestation report on management’s assessment of the Company’s internal control over financial reporting as of December 31, 2022, included in the “Report of Independent Registered Public Accounting Firm” that accompanies the Company’s Audited Financial Statements, which is incorporated by reference herein.
ATTESTATION REPORT OF THE REGISTERED PUBLIC ACCOUNTING FIRM
The required disclosure is included in the “Report of Independent Registered Public Accounting Firm” that accompanies the Company’s Audited Financial Statements, which is incorporated by reference herein.
NOTICES PURSUANT TO REGULATION BTR
There were no notices required by Rule 104 of Regulation BTR that the Registrant sent during the year ended December 31, 2022 concerning any equity security subject to a blackout period under Rule 101 of Regulation BTR.
AUDIT COMMITTEE
The Company’s Board of Directors has a separately designated standing Audit Committee established in accordance with section 3(a)(58)(A) of the Exchange Act. The members of the Company’s Audit Committee are identified on page 98 of the AIF, which is incorporated herein by reference. In the opinion of the Company’s Board of Directors, all members of the Audit Committee are independent (as determined under Rule
10A-3
of the Exchange Act and the rules of the New York Stock Exchange) and are financially literate.
Audit Committee Financial Expert
John Brough is an “audit committee financial expert” (as such term is defined in Form
40-F),
in that he has an understanding of generally accepted accounting principles and financial statements; is able to assess the general application of accounting principles in connection with the accounting for estimates, accruals and reserves; has experience preparing, auditing, analyzing or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the Company’s financial statements, or experience actively supervising one or more persons engaged in such activities; has an understanding of internal control over financial reporting and procedures for financial reporting; and has an understanding of audit committee functions, acquired through certain education or experience as required by paragraph (c) of General Instruction B.(8) to Form
40-F.
In addition, Mr. Brough is “independent” as that term is defined in the rules of the New York Stock Exchange.
8
CODE OF ETHICS
The Board of Directors has adopted a written Code of Business Conduct and Ethics (the “
Code
”) which applies to all of the Company’s officers, directors and employees, including its principal executive officer, principal financial officer, principal accounting officer or controller, and persons performing similar functions. In addition, the Board of Directors, through its meetings with management and other informal discussions with management, encourages a culture of ethical business conduct and believes the Company’s high caliber management team promotes a culture of ethical business conduct throughout the Company’s operations and is expected to monitor the activities of the Company’s employees, consultants and agents in that regard. The Board of Directors encourages any concerns regarding ethical conduct in respect of the Company’s operations to be raised by employees to their immediate supervisor and to the Company’s Chief Compliance Officer and by officers and directors to the Chairman and to the Company’s Chief Compliance Officer.
It is a requirement of applicable corporate law that directors and officers who are party to a material contract or transaction or proposed material contract or transaction with the Company, or who are directors or officers of, or have a material interest in, any person who is a party to a material contract or transaction or proposed material contract or transaction with the Company, must disclose in writing to the Company or request to have entered in the minutes of meetings of directors the nature and extent of his or her interest and, in the case of directors, they must not attend any part of a meeting of directors during which the contract or transaction is discussed and must not vote on any resolution to approve the contract or transaction, subject to certain exceptions. These requirements are also contained in the Company’s bylaws, which are made available to the directors and officers of the Company.
During the year ended December 31, 2022, the Code was updated to outline the Company’s commitments around climate change and mental health. All amendments to the Code, and all waivers of the Code, including an implicit waiver, with respect to any of the employees, officers and directors covered by it, have been and will be posted on the Company’s website within five business days of the amendment or waiver and provided in print to any shareholder who requests them. The Company’s Code of Business Conduct and Ethics is located on its website at
www.wheatonpm.com
. Information on or accessible through the Company’s website is not incorporated by reference into this annual report on Form
40-F.
PRINCIPAL ACCOUNTANT FEES AND SERVICES-INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
Deloitte LLP (Vancouver, Canada, PCAOB ID No.
1208
) was the Company’s independent registered public accounting firm for the financial years ended December 31, 2022 and 2021. The required disclosure is included on page
105
of the AIF, which is filed as Exhibit 99.1 to this annual report on Form
40-F,
for the total amount billed to the Company by Deloitte LLP for services performed in the last two financial years by category of service (for audit fees, audit-related fees, tax fees and all other fees) in Canadian dollars, and is incorporated by reference herein.
PRE-APPROVAL
OF AUDIT AND
NON-AUDIT
SERVICES PROVIDED BY
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The required disclosure is included on page 105 of the AIF filed as Exhibit 99.1 to this annual report on Form
40-F
and is incorporated by reference herein.
OFF-BALANCE
SHEET ARRANGEMENTS
The Company does not have any
off-balance
sheet arrangements that have or are reasonably likely to have a current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.
DISCLOSURE OF CONTRACTUAL OBLIGATIONS
The required disclosure is included under the heading “Management’s Discussion and Analysis — Contractual Obligations and Contingencies” on page 32 of the MD&A in Exhibit 99.2 to this annual report on Form
40-F
and is incorporated by reference herein.
MINE SAFETY DISCLOSURE
Not applicable.
9
UNDERTAKING
The Company undertakes to make available, in person or by telephone, representatives to respond to inquiries made by the SEC staff, and to furnish promptly, when requested to do so by the SEC staff, information relating to: the securities registered pursuant to Form
40-F;
the securities in relation to which the obligation to file an annual report on Form
40-F
arises; or transactions in said securities.
CONSENT TO SERVICE OF PROCESS
The Company has previously filed an Appointment of Agent for Service of Process and Undertaking on Form
F-X
with respect to the class of securities in relation to which the obligation to file this annual report on Form
40-F
arises.
Any change to the name or address of the agent for service of process of the Company shall be communicated promptly to the SEC by an amendment to the Form
F-X
referencing the file number of the Company.
10
EXHIBITS
99.1
Annual Information Form of the Company for the year ended December 31, 2022
99.2
Annual Report of the Company for the year ended December 31, 2022 – Management’s Discussion & Analysis
99.3
Annual Report of the Company for the year ended December 31, 2022 – Annual Financial Statements
99.4
CEO Certification pursuant to Rule
13a-14(a)
or
15d-14(a)
of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
99.5
CFO Certification pursuant to Rule
13a-14(a)
or
15d-14(a)
of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
99.6
CEO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.7
CFO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.8
Consent of Deloitte LLP, Independent Registered Public Accounting Firm
99.9
Consent of N. Burns
99.10
Consent of R. Ulansky
101
Interactive Data File (formatted as Inline XBRL)
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
11
SIGNATURES
Pursuant to the requirements of the Exchange Act, the Registrant certifies that it meets all of the requirements for filing on Form
40-F
and has duly caused this annual report to be signed on its behalf by the undersigned, thereto duly authorized.
WHEATON PRECIOUS
METALS CORP.
By:
/s/ Randy V. J. Smallwood
Name: Randy V. J. Smallwood
Title: Chief Executive Officer
Date: March 31, 2023
12