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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

x      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2011

or

o         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to             

Commission File Number:  001-33783

THOMPSON CREEK METALS COMPANY INC.

(Exact name of registrant as specified in its charter)

(303) 761-8801

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 o No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). x Yes o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). o Yes x No

As of May 6, 2011 there were 167,480,460 shares of our common stock, no par value, outstanding.

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THOMPSON CREEK METALS COMPANY INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

See accompanying notes to consolidated financial statements.

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THOMPSON CREEK METALS COMPANY INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

See accompanying notes to consolidated financial statements.

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THOMPSON CREEK METALS COMPANY INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Supplementary cash flow information (Note 13)

See accompanying notes to consolidated financial statements.

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THOMPSON CREEK METALS COMPANY INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY and COMPREHENSIVE INCOME

Three Months Ended March 31, 2011

(Unaudited)

See accompanying notes to consolidated financial statements.

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THOMPSON CREEK METALS COMPANY INC.

Notes to the Consolidated Financial Statements — Unaudited

(US dollars in millions, except per share amounts)

1. Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q.  In compliance with those instructions, certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States (“US GAAP”) have been condensed or omitted. This report should be read in conjunction with Thompson Creek Metals Company Inc.’s (“TCM” or the “Company”) consolidated financial statements and notes contained in its Annual Report on Form 10-K for the year ended December 31, 2010 (the “2010 Form 10-K”) filed with the Securities and Exchange Commission (“SEC”). The information furnished herein reflects all adjustments which are, in the opinion of management, necessary for a fair statement of the results for the interim periods reported.  Operating results for the three months ended March 31, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011.

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. TCM bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances.  Accordingly, actual results may differ significantly from these estimates under different assumptions or conditions.  Certain comparative information has been reclassified to conform to the current year’s presentation.

The consolidated financial statements include the accounts of TCM and its subsidiaries, and intercompany accounts and transactions have been eliminated in consolidation.  Financial amounts are presented in United States (“US”) dollars unless otherwise stated.  References to C$ are Canadian dollars.

2. Terrane Acquisition

On October 20, 2010, TCM acquired 100% of the issued and outstanding equity of Terrane Metals Corp. (“Terrane”).  At December 31, 2010, the allocation of the purchase price was recorded using preliminary estimates related to the fair value of the mineral properties acquired.   As of March 31, 2011, there have been no adjustments to the allocation of the purchase price that was recorded using preliminary estimates at December 31, 2010.

3. Inventory

The carrying value of product inventory is as follows:

As of March 31, 2011 and December 31, 2010, the market value of TCM’s product inventory exceeded the carrying value.

4. Property, Plant and Equipment

Property, plant and equipment is comprised of the following: 

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The construction in progress balance included $265.7 million and $213.8 million related to the mill expansion project at the Endako Mine as of March 31, 2011 and December 31, 2010, respectively.  The mine development balance relates to the development of Mt. Milligan since the acquisition of Terrane by TCM.  No depreciation is currently being recognized on construction in progress or mine development as neither the new mill nor the Mt. Milligan project have yet been completed or placed into service.

5. Derivative Financial Instruments

TCM enters into various derivative financial instruments in its normal course of operations.  None of TCM’s derivative instruments are treated as hedges for accounting purposes, and all are recorded on the consolidated balance sheet at fair value with changes in fair value recorded to the consolidated statements of income, except those contracts for which TCM has elected to apply the normal purchases and normal sales scope exception. TCM is exposed to credit loss when counterparties with which it has entered into derivative transactions are unable to pay. To reduce counterparty credit exposure, TCM deals only with large credit-worthy financial institutions and companies and limits credit exposure to each. TCM believes the counterparties to the contracts to be credit-worthy entities, and therefore, TCM believes credit risk of counterparty non-performance is relatively low.  For information regarding the nature and types of TCM’s derivatives, see the references noted in the following tables.

The following table summarizes the location and fair value amounts of all derivative financial instruments in the consolidated balance sheets:

The following table sets forth the gains (losses) on derivative instruments for the three months ended March 31, 2011 and 2010:

(a)          Provisionally-Priced Contracts

Certain molybdenum sales contracts provide for provisional pricing as specified in such contracts.  These sales contain an embedded derivative related to the provisional pricing mechanism, which is bifurcated and accounted for as a derivative.

TCM also enters into provisionally-priced molybdenum purchase contracts that also contain an embedded derivative, which is bifurcated and accounted for as a derivative.  Changes to the fair values of the embedded derivatives related to provisionally-priced molybdenum purchases are included in operating expenses in the consolidated statements of income as the product is sold.

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TCM determines the fair value of its provisionally-priced contracts using a market approach based upon observable inputs from published market prices and contract terms.

The following table sets forth TCM’s outstanding provisionally-priced contracts as of March 31, 2011, which all mature in 2011:

(b)                               Fixed-Priced Contracts

TCM’s results of operations and operating cash flows are affected by changes in market prices for mineral products. To mitigate a portion of this risk, TCM enters into certain mineral product sales contracts where it sells future production at fixed prices. These fixed prices may be different than the quoted market prices at the date of sale. Forward sales contracts in place at March 31, 2011 for molybdenum cover the period through December 31, 2011.

The following table sets forth TCM’s outstanding fixed-priced molybdenum sales contracts as of March 31, 2011:

(c)                                Forward Currency Contracts

TCM transacts business in various currencies in the normal course of its operations and for capital expenditures.  Moreover, with all of its revenues denominated in U.S. dollars, TCM has an on-going foreign exchange risk with respect to its Canadian operations.  To help mitigate this risk, TCM, from time to time, enters into various hedging instruments such as foreign currency forward contracts and collars. The terms of these instruments are typically less than one year.  As of March 31, 2011, TCM had open forward currency contracts for the purchase of C$40 million at exchange rates ranging from $0.98 to $1.00 with another $100 million covered by foreign currency collars, of which $50 million expired on April 13, 2011.  At December 31, 2010, TCM had no open forward currency contracts.

(d)                               Common Stock Warrant Derivatives

As described in Note 8 of the consolidated financial statements in TCM’s 2010 Form 10-K under “Common stock warrant derivatives”, TCM is required to account for its common stock warrants as derivative liabilities with the changes in fair value recorded to the consolidated statements of income.

The following table summarizes common share warrant transactions during the current period:

6. Fair Value Measurement

US GAAP accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standards establish a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives

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the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

The following table sets forth TCM’s financial assets and liabilities measured at fair value by level within the fair value hierarchy. As required, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The following table sets forth a summary of the fair value of TCM’s Level 3 financial assets and liabilities for the three months ended March 31, 2011:

As of March 31, 2011 and December 31, 2010, the carrying values of TCM’s financial assets and liabilities are not significantly different from their fair values.

7. Long-term Debt

Credit facility

As of March 31, 2011, TCM has in place a senior secured revolving credit agreement (the “Credit Agreement”).  On February 24, 2011, TCM entered into the First Amendment to Credit Agreement (the “First Amendment”) to amend the total amount available for borrowing under the Credit Agreement.  Pursuant to the First Amendment, the total amount available for borrowing by TCM under the Credit Agreement increased from $290 million to $300 million.  The obligations of TCM in respect of the Credit

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Facility are secured by a senior lien on substantially all of the tangible and intangible assets of TCM.  The Credit Agreement includes both standard financial and non-financial covenants, including ratio tests for leverage and interest coverage and a liquidity test.  As of March 31, 2011, TCM was in compliance with the Credit Agreement financial covenants.

As of March 31, 2011, TCM had no outstanding borrowings under the Credit Agreement and had issued and outstanding $1.0 million in letters of credit. Interest and finance fees expense for the three months ended March 31, 2011 related to the Credit Agreement was $1.0 million.

Equipment financing facility

On March 30, 2011, TCM entered into an equipment financing facility (“Equipment Facility”) pursuant to which Caterpillar Financial Services Limited (“Caterpillar”) has agreed to underwrite up to $132 million in mobile fleet equipment financing for the Mt. Milligan project.  Each borrowing under the Equipment Facility will be for a term of 60 months.  TCM will pay interest on the amounts borrowed under the Equipment Facility at either floating or fixed rates, at TCM’s option.  TCM’s ability to borrow under the Equipment Facility will terminate 33 months following its effective date (or such later date as may be agreed upon by Caterpillar), and any unused commitments under the Equipment Facility will then terminate and no longer be available to TCM.  At the end of each 60-month lease period, TCM will have the option to purchase the underlying equipment for a nominal sum.  The Equipment Facility includes both standard financial and non-financial covenants, including ratio tests for leverage and interest coverage.  As of March 31, 2011, TCM had no outstanding borrowing under the Equipment Facility and was in compliance with its covenants.

8.  Commitments and Contingencies

Legal matters

Below are descriptions of certain legal actions which involve certain properties of TCM.  Although the results of legal actions cannot be predicted with certainty, it is the opinion of management that the resolution of these actions will not have a material adverse effect on TCM’s future consolidated financial position, results of operations or cash flows.

In  May 2010, the Stellat’en First Nation filed a petition in the Supreme Court of British Columbia against the British Columbia Minister of Energy, Mines and Petroleum Resources and TCM alleging that the Endako Mine and the mill expansion project at the Endako Mine represent infringements of the aboriginal title of the petitioners and impacts to their aboriginal rights, and that the government  breached its duty to consult with the Stellat’en First Nation in relation to the impacts of the Endako Mine and the mill expansion.  The petitioners seek a declaration that the Provincial Crown has not fulfilled its duty to consult with them in relation to the mill expansion project at the Endako Mine, a declaration that the mining permits and/or tenures held by TCM are invalid, an order quashing or setting aside the decision to issue a permit amendment to TCM, and an injunction prohibiting further construction or alterations to the Endako Mine relating to the mill expansion project at the Endako Mine.  The government and TCM filed materials in response to the petition, and the matter was heard by the Supreme Court of British Columbia in a hearing that took place in late February and early March of 2011.  The timing of the release of the judge’s decision in this matter is unknown.

In January, August and December of 2010, the Nak’azdli First Nation commenced three separate legal proceedings against Federal or Provincial governments in Canada asserting that it was not adequately consulted by such governments before Terrane was granted various approvals relating to the Mt. Milligan Project.  No claim of wrongdoing on the part of TCM or Terrane is alleged, and no claim for damages against TCM or Terrane is sought, in any of such three proceedings. TCM is not a party in any of the proceedings. Terrane has either been named or has had itself added as a participant in two of these proceedings because the relief that is sought in the proceedings would, if granted, have the potential to affect the work being done on the Mt. Milligan project.

Molybdenum purchases

In the normal course of operations, TCM enters into agreements for the purchase of molybdenum. As of March 31, 2011, TCM had commitments to purchase approximately 6.2 million pounds of molybdenum sulfide concentrate throughout the remainder of 2011, to be priced at a discount to the market price for molybdenum oxide at the time of purchase.

Capital purchase commitments

As of March 31, 2011, TCM had contractual obligations related to the mill expansion project at the Endako Mine of $0.3 million (75% share), and $283.5 million for engineering and equipment related to the development of Mt. Milligan.

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Guarantees

As discussed in the 2010 Form 10-K, on December 9, 2009, TCM entered into a credit support agreement with British Columbia Hydro and Power Authority (“BC Hydro”) related to the mill expansion project at the Endako Mine. Under this agreement, TCM is required to post financial assurance in an amount equal to BC Hydro’s estimated out-of-pocket costs for work on the Endako mill expansion project, estimated at C$16.5 million.  Subsequent to the commissioning of the new mill and subject to annual measurements of BC Hydro’s incremental revenues following the mill’s commissioning, some or all of this financial assurance may, thereafter, be released in amounts equal to the incremental revenues generated until such time as the full amount of financial assurance has been released or until such time as the expiration period has been reached. The new mill facility is currently scheduled for completion in late 2011. The amount of the guarantee as of March 31, 2011 was C$16.5 million. As part of the financial guarantee, TCM provided a surety bond for C$11.2 million for additional financial assurance to BC Hydro.  The surety bond can be drawn down in the event of a shortfall in incremental revenues after the commissioning of the new mill facility.  At this time, TCM does not anticipate having to post any additional financial assurance with respect to the BC Hydro credit support agreement.

As of March 31, 2011, a shortfall in Endako’s future electric power usage that would result in incremental payments to BC Hydro cannot be determined and is not deemed to be probable. As such, no accrual has been recorded. An accrual for any expected shortfall will be recorded if and when it is determined that a shortfall is probable and a reasonable estimate can be made.

9.  Income and Mining Taxes

Income and mining taxes for the three months ended March 31, 2011 and 2010 were $12.0 million and $4.9 million, respectively.  The effective tax rates of 8.5% and 81.7% for the three months ended March 31, 2011 and 2010, respectively, differ from the amounts that would result from applying the Canadian federal and provincial income tax rates primarily due to the US percentage depletion benefit and the non-taxable change in the fair value of common stock warrants.

The 2011 effective tax rate differs from the 2010 effective tax rate primarily due to the non-taxable change in the fair value of TCM’s common stock warrants.

10.  Stock-Based Compensation

On May 6, 2010, TCM’s shareholders approved the 2010 Long-Term Incentive Plan (“LTIP”) and the 2010 Employee Stock Purchase Plan (“ESPP”).  Under the LTIP, TCM can grant stock options, share appreciation rights, restricted shares, restricted share units, performance share units, or shares granted as bonus compensation.  As of March 31, 2011, TCM has granted stock options, performance share units and restricted share units under the LTIP, as discussed below.

a)            Stock Options

The expiration date and vesting provisions of options granted are established at the time an award is made. Options may be exercised by the holder upon vesting of the option award. When an option is exercised, TCM issues the requisite shares from authorized but unissued common stock. The exercise price of option grants awarded is equal to the weighted-average trading price of the underlying shares over the five consecutive trading days immediately before the award date.

The following table summarizes stock option activity during the three months ended March 31, 2011:

For the three months ended March 31, 2011 and 2010, TCM recorded compensation expense related to stock options of $1.3 million and $2.5 million, respectively.

b)            Performance Share Units

As of March 31, 2011, a total of 230,000 performance share units (“PSUs”) have been granted to eligible executives. The vesting of the PSUs is contingent upon employee service and the performance of TCM’s share price relative to the established award price.  At each anniversary date during the vesting period, if the per share closing price of TCM’s common stock on such date is at or higher than the award price, then the awards will vest one-third, and the requisite shares will be issued from authorized but unissued common stock.  If the closing price is less than the award price, and, therefore, the share price condition is not achieved, then those

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PSUs do not vest and are carried forward to the following anniversary date.  Any PSUs not vested at the end of the three-year vesting period  will expire.

PSUs granted are accounted for at fair value using a Monte Carlo simulation valuation model on the date of grant.  The Monte Carlo model is based on random projections of stock price paths.  The estimated fair value of the PSUs granted is $6.68 per unit, and TCM established an award price of $11.88 per unit.  For the three months ended March 31, 2011, TCM recorded $0.3 million of compensation expense related to the PSUs in its consolidated statements of income.

c)            Restricted Stock Units

As of March 31, 2011, a total of 209,050 restricted stock units (“RSUs”) have been granted to certain eligible employees and directors.  TCM accounts for RSUs at fair value, which is based on the market value of TCM’s common shares on the day of grant and recognized over the vesting period of three years.  Upon vesting, TCM will issue the requisite shares from authorized but unissued common stock.  The market value of RSUs granted was $9.13 per share, which resulted in TCM recording $0.2 million of compensation expense for the three months ended March 31, 2011 related to the RSUs granted.

11. Net Income per Share

The following is a reconciliation of net income and weighted-average common shares outstanding for purposes of calculating diluted net income per share for the three months ended March 31, 2011 and 2010:

For the three months ended March 31, 2011 and 2010, approximately 1.0 million stock options were excluded from the computation of diluted weighted-average shares as the exercise prices exceeded the average price of TCM’s common stock for the period.

12. Related Party Transactions

Total sales to TCM’s Endako Mine joint venture partner were $52.5 million and $33.6 million for the three months ended March 31, 2011 and 2010, respectively. This represented 25.4% and 26.3% of TCM’s total revenues for the three months ended March 31, 2011 and 2010, respectively.

For each of the three months ended March 31, 2011 and 2010, TCM recorded management fee income of $0.1 million, and selling and marketing expenses of $0.2 million, from this joint venture partner.

As of March 31, 2011 and December 31, 2010, TCM’s related accounts receivable, owing from this joint venture partner remained consistent at $10.0 million.

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13. Supplementary Cash Flow Information

14. Concentration of Credit Risk

TCM is exposed to counterparty risk from its cash and cash equivalent balances, its short-term cash investments, and its reclamation deposits held by financial institutions and governmental entities. TCM monitors its positions with, and the credit quality of, the financial institutions and companies in which it invests its cash, cash equivalents and short-term investments, and that hold its reclamation deposits. Counterparties to cash balances, money market instruments, government treasury securities and its reclamation deposits are US and Canadian institutions and the US and Canadian governments. TCM’s investment policy limits investments to government-backed financial instruments, other than balances maintained in various bank operating accounts.

TCM manages its credit risk from its accounts receivable through its collection activities. As of March 31, 2011, TCM had seven customers which owed TCM more than $3.0 million and accounted for approximately 41% of all receivables outstanding. Another 15 customers had balances greater than $1.0 million but less than $3.0 million that accounted for approximately 25% of total receivables.  All of these balances were compliant with credit terms and scheduled payment dates.

TCM’s maximum counterparty and credit risk exposure is the carrying value of its cash and accounts receivable. The carrying amounts of accounts receivable, accounts payable, accrued liabilities, and fixed rate debt approximate fair value as of March 31, 2011.

15. Segment Information

TCM has three reportable segments: US Operations Molybdenum, Canadian Operations Molybdenum, and Copper-Gold (Development). The US Operations segment includes all mining, milling, mine site administration, roasting and sale of molybdenum products from the Thompson Creek Mine and the Langeloth Facility, as well as all roasting and sales of third-party purchased material. The Canadian Operations Molybdenum segment includes all mining, milling, mine site administration, roasting and sale of molybdenum products from the 75% owned Endako Mine. The Copper-Gold (Development) segment includes all development expenditures and development site administration from Mt. Milligan. The Inter-segment represents the elimination of management fee income, and revenue and cost of sales of product transported from the Canadian Operations to the US Operations for processing. TCM’s chief operating decision makers (Chief Executive Officer and Chief Operating Officer) evaluate segment performance based on segment revenue less costs and expenses. TCM attributes other income and expenses to the reporting segments if the income or expense is directly related to segment operations, as described above. TCM does not allocate corporate expenditures such as general and administrative, exploration, and interest income and expense items to its reporting segments.  Segment information for the three months ended as of March 31, 2011 and 2010 is as follows:

For the three months ended March 31, 2011:

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For the three months ended March 31, 2010:

Reconciliation of segment income to net income

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Other segment information regarding capital expenditures, assets and liabilities, including the assets and liabilities attributed to corporate operations, is as follows: