Major Drilling Group International Inc. · TSX:MDI
Major Drilling Group International — Investor Presentation (September 2024)
25 slides from Major Drilling Group International's investor presentation, September 2024
Slide 1: Investor Presentation
Investor Presentation September 2024 TSX: MDI QUALITY - SAFETY - RESULTS majordrilling.com QUALITY - SAFETY - RESULTS
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation includes certain information that may constitute “forward-looking information” under applicable Canadian securities legislation. All statements, other than statements of historical facts, included in this presentation that address future events, developme
Slide 3: Major Drilling: Company Overview
Major Drilling: Company Overview • Leading provider of specialized drilling FUNDAMENTALS services to the mining industry, registered in TSX: MDI REGISTERED IN OVER ACROSS over 20 countries, with a fleet of approx. 600 drills. 52 Week Range: $6.97 - $10.25 Market Cap: ~$777M 20 5 • Diversified portfo
Slide 4: Investment Proposition
Investment Proposition Ideally positioned to capture the mining upturn Specialized • Significant barriers to entry met with right experience & modern fleet Operations • Operating in challenging environments where largest new discoveries likely found Aligned To • Leverage to multi-year exploration
Slide 5: Diversified, Sustainable Revenue Sources
Diversified, Sustainable Revenue Sources Broad range of services, customers and leverage to Drilling Revenue by Customer premium commodities ensures sustainable revenue sources 15% • Major Drilling has historically been driven by a gold customer base, but the emergence of the battery metal demand
Slide 6: Contractor of Choice
Contractor of Choice Providing repeat services to the highest quality, investment grade customers • Diversified repeat customer base with low turnover. • Many larger customers consist of multiple ‘independent’ regional subsidiaries/projects. • 85% of Major Drilling revenue is sourced from operatio
Slide 7: Operational Diversification
Operational Diversification Diversified operations spread globally in highest-return regions • Registered in over 20 countries Key Projects across 5 continents. • MDI’s operations and customers provide protection against market volatility through diversification. Oyu Tolgoi Op: Rio Tinto • Global
Slide 8: Specialized Drilling
Specialized Drilling Surpassing customer expectations, industry leader in operational excellence and on-site safety • Specialized drilling services have significant barriers to entry, focus on areas more difficult to access. • Examples include: • Deep hole drilling • Arctic drilling • Helicopter p
Slide 9: Gold Reserves Need to be Replenished
Gold Reserves Need to be Replenished • Senior gold companies generating strong cash flows, however, gold reserves declining due to lack of material “While we look closely at all exploration. new business opportunities, • Prioritizing value-adding grassroots exploration and development programs. we b
Slide 10: Copper Heading for a Supply Crunch
Copper Heading for a Supply Crunch • Copper industry supply deficit starting to be recognized. • “…despite a very powerful green demand narrative, it's a • To close gap by 2030 requires 8 mines the size of BHP complete state of inaction from the supply side.” Escondida (world’s largest copper mine),
Slide 11: Upcycle Unfolding like Previous One…
Upcycle Unfolding like Previous One… Industry backdrop mirrors early 2000’s upcycle • Only at 60% of peak exploration. • Excluding inflation, at same level of efforts as 2006. • Industry still in discovery phase, with intense infill drilling needed to develop new mines. • New deposits will come fr
Slide 12: Upcycle Unfolding like Previous One…
Upcycle Unfolding like Previous One… Last cycle escalation 1998-2004 2004 2005 2006 2007-2012 6-year lack of Senior gold companies Junior gold financing Increased copper and Extensive definition exploration increase exploration to available; increased base metal budgets to drilling campaigns to buil
Slide 13: …and MDI is Optimally Positioned
…and MDI is Optimally Positioned What’s different for Major Drilling this time? Today 2002 Entered downturn net cash on hand. Current liquidity of $186M. • $28M net debt, $2M EBITDA and $0 to invest. Invested in fleet during downturn, kept • Minimal capex spent through downturn and fleet infra
Slide 14: Strategic Partnership: DGI & KORE
Strategic Partnership: DGI & KORE DGI borehole data acquisition services now available drillside. Experienced teams use turn-key data acquisition and interpretation services to meet each project’s specific needs and objectives. Added value to exploration projects, feasibility studies, production min
Slide 15: Strategic Partnership: DGI & KORE
Strategic Partnership: DGI & KORE KORE enhances operational efficiency through the rapid and automated processing of core logging. SPECTOR is an integrated technology platform offering high-quality core imagery, geologist-centric digital core logging software, and AI tools to automate various loggin
Slide 16: Rock5: Drill Analytics
Rock5: Drill Analytics QUALITY - SAFETY - RESULTS 16
Slide 17: Drillside GeoSolutions
Drillside Drilling Analytics GeoSolutions Specialized Drilling Borehole Survey Data AI Imaging & Logging QUALITY - SAFETY - RESULTS 17
Slide 18: Balance Sheet Strength
Balance Sheet Strength Clean balance sheet Robust Liquidity Position • Strong cash flow generation. • No long-term debt. Net Cash (Net Debt) Position 100 90 $186M $76.9M 80 70 LIQUIDITY NET CASH POSITION 60 50 BALANCE SHEET Q1 2025 Q4 2024 40 Cash ($M) 85.9 96.2 30 Total Liquidity ($M) 185.5 199.8
Slide 19: ESG: Culture of Sustainability
ESG: Culture of Sustainability Set a target to reduce scope 1 and scope 2 GHG Launched our Decarbonization Began deploying the Trailblazer emissions by 5% by 2030 Action Plan AquaLink Remote Water Pump system 72% increase of women in the 56% of our Board of Directors field during calendar 2023 was r
Slide 20: Appendix
Appendix 20 QUALITY - SAFETY - RESULTS
Slide 21: Q1 2025: Financial Review
Q1 2025: Financial Review Q1 2025 Q1 2024 Revenue $190.0 $199.0 Gross Margin 22.1% 24.6% Adjusted Gross Margin1 28.9% 30.1% General & Administrative Costs $18.5 $16.5 EBITDA2 $34.3 $40.3 Net Earnings $15.9 $21.8 Earnings per Share $0.19 $0.26 Note - All values in $CAD unless otherwise indicated. 1 -
Slide 22: Utilization
Utilization Q1 2025 Q1 2025 # Rigs Utilization Specialized 296 44% Conventional 117 44% Underground 196 47% Total 609 45% QUALITY - SAFETY - RESULTS 22
Slide 23: Majority of Activity Focused on Specialized
Majority of Activity Focused on Specialized Fleet activity reflects both market dynamics and Major Drilling strategy • With future deposits coming from areas more Drilling Revenue by Project Type difficult to access, there will be an increased need for specialized services in the future. 11% Speci
Slide 24: Revenue Breakdown
Revenue Breakdown Drilling Revenue by Customer Drilling Revenue by Commodity Seniors and intermediates continued with their Historically high % of copper drilling as demand expanded exploration. from battery metals drives business. 9% 8% 8% 18% 15% 5% 4% 24% 6% 11% 11% 13% 3% 6% 3% 4% 7% 5% 25% 23%
Slide 25: High Quality Customer Base
High Quality Aligned To Balance Sheet Specialized Experienced Customer Base Market Sustainability Operations Management QUALITY - SAFETY - RESULTS 25
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