Lundin Mining Corporation · TSX:LUN
Lundin Mining — Merger or Acquisition (March 2023)
23 slides from Lundin Mining's merger presentation, Mar 28, 2023
Slide 1: Acquisition of a Majority Interest in the Caserones Copper Mine
TSX: LUN Nasdaq Stockholm: LUMI Acquisition of a Majority Interest in the Caserones Copper Mine March 28, 2023
Slide 2: Cautionary Statements
Cautionary Statements Caution Regarding Forward-Looking Information and Non-IFRS Performance Measures Certain of the statements made and information contained herein is “forward-looking information” within the meaning of applicable Canadian securities laws. All statements other than statements of hi
Slide 3: Acquisition of Majority Interest (51%) in the Caserones Copper Mine
Acquisition of Majority Interest (51%) in the Caserones Copper Mine Caserones open pit, Chile Caserones open pit, Chile Participants Peter Rockandel CEO Teitur Poulsen SVP & CFO Caserones facilities, Chile Caserones control room, Chile Juan Andres Morel SVP & COO Quinn Yong VP, Corporate Development
Slide 4: A Highly Complementary Acquisition
A Highly Complementary Acquisition Acquisition of 51% of Caserones Copper Mine Totoralillo PRO FORMA FY 2022 Metal Mix Revenue by Metal1, 2 Caldera ~105 km CHILE Moly Other Copiapó Other Gold Gold Zinc Zinc Over Over Candelaria $3.0B in Revenue $4.1B Punta Padrones Port and Desalination Plant, Calde
Slide 5: Transaction Rationale
Transaction Rationale Caserones is a large-scale producer that provides copper growth while leveraging mutual synergies, infrastructure and efficiencies • ~50% pro forma increase in 2022 copper output • immediately accretive on key financial metrics • significant untapped exploration potential • pos
Slide 6: Transaction Summary
Transaction Summary Lundin Mining to acquire a 51% equity interest in SCM Minera Lumina Copper Chile (“Lumina Copper”) Transaction • Lumina Copper operates the Caserones copper-molybdenum mine in Chile Upfront cash consideration of US$800M paid at closing, subject to any adjustments from the effecti
Slide 7: Ideal Operator of Caserones
Ideal Operator of Caserones We know the region and its true potential very well Since Lundin Mining’s 2014 Acquisition of Candelaria: Mine life Nearly Over Over extended 160% 175% 240% and production profile improved1 in forecast copper production in M&I Mineral Resource1,2 increase in M&I Mineral R
Slide 8: Enhances Production Profile
Enhances Production Profile Pro Forma Impact to 2022 Actual Production1 Copper Nickel Zinc Gold Silver Lead Molybdenum Copper Molybdenum Copper Equivalent kt Cu kt Mo kt CuEq2 557 3 374 +34% CuEq +50% Cu 417 250 374 374 250 250 - + + + 1. Production shown on a 100% basis for Candelaria and Caserones
Slide 9: Strategic Copper Asset in Chile
Strategic Copper Asset in Chile Asset Overview Historical Copper Production & Cost Profile1 kt Cu | US$/lb ▪ large-scale, open-pit mine located in the highly prospective Atacama region in Chile - ~800 km north of Santiago and ~160 km southeast 25 5-Yr Average: 129kt Cu from the Copiapó airport 28 22
Slide 10: Site Overview
Site Overview access to paved roads • linked to Copiapó via Site ~160 km asphalt/gravel Access road • easy access to ports Primary Crusher from Copiapó Mine Pit Dump Leaching Pad reliable power supply • 220 kV highly-reinforced Grinding Plant power line connected to Power the national grid Flotation
Slide 11: Caserones and Lundin Share ESG Values
Caserones and Lundin Share ESG Values 1 2 3 4 Community Tailings Environmental Health & Safety Engagement ▪ Strategy to achieve ambitious environmental goals in place ▪ Committed to the highest ▪ Health and safety is a core ▪ Committed to giving back to the standards of tailings ▪ Established proced
Slide 12: Land Package Remains Highly Prospective
Land Package Remains Highly Prospective Lundin Mining will aim to achieve exploration success similar to Candelaria The acquired land package is within a well-known and highly prospective area: 58,525 hectares of total land area covered by granted and applied for mining concessions Map of Mining Con
Slide 13: Balance Sheet Remains Solid with Low Leverage
Balance Sheet Remains Solid with Low Leverage Net Debt1 Net Leverage US$15M as of February 22, 2023 Net Debt to 2022A EBITDA1,2 Lundin Adjusted EBITDA Only $1,750M 0.63x Lundin + Caserones Adjusted EBITDA2 Availability 0.46x post Acquisition $815M $15M 0.01x Revolving + Credit + Facility Note: Assum
Slide 14: FY2022 Key Financial Metrics
FY2022 Key Financial Metrics Revenue1,2 Adjusted EBITDA1,2 Adjusted Earnings1,2 of over $4.1B of nearly $1.8B of over $550M $4,104 $1,770 $551 $483 $68 $1,063 $477 $3,041 $1,293 $483 $483 $3,041 $3,041 $1,293 $1,293 LUN Pro Forma LUN Pro Forma LUN Pro Forma Adjusted Operating Cash Flow1,2 Free Cash
Slide 15: Copper growth to supply the world's needs
Eagle Copper Ni Co Cu PGM 2022A 67 Kt CuEq3 u/g 4+ years growth to supply Zinkgruvan our world’s Candelaria1 Zn Cu 2022A 48 u/g 10+ years transition 2022A o/p + u/g Pb Kt CuEq3 Cu Au 174 20+ years Kt CuEq3 Neves-Corvo Caserones2 Cu Zn 2022A u/g Pb Ag 68 10+ years Cu 2022A o/p Kt CuEq3 Mo 139 10+ yea
Slide 16: Meaningful Scale & Material Growth, High Quality Operations, Financial Strength
High Quality Meaningful Scale & Financial Operations Material Growth Strength www.lundinmining.com | TSX: LUN | Nasdaq Stockholm: LUMI
Slide 17: Appendices
Appendices Caserones, Chile 17
Slide 18: Caserones Historical Estimates
Caserones Historical Estimates Caserones Historical Estimates1 Tonnes Grade Contained (As of April 2021) (Mt) (% CuT) (ppm Mo) (CuT kt) (Mo kt) Proven 419 0.35% -- 1,467 -- Probable 473 0.31% -- 1,466 -- 2P Reserves 892 0.33% -- 2,933 -- Measured 486 0.34% 129 1,659 63 Indicated 1,109 0.26% 97 2,924
Slide 19: NI 43-101 Technical Information
NI 43-101 The Technical Information in this presentation has been prepared in accordance with NI 43-101 and has been reviewed and approved by Jeremy Weyland, P.Eng., Director, Studies of the Company, a "Qualified Person" under NI 43-101. Mr. Weyland has verified the data disclosed in this presentati
Slide 20: Non-GAAP and Other Performance Measures
Non-GAAP and Other Performance Measures Adjusted EBITDA, Adjusted Earnings Adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”) and adjusted earnings are non-GAAP measures and are not a standardized financial measure under IFRS, the financial reporting framewor
Slide 21: Non-GAAP and Other Performance Measures cont.
Non-GAAP and Other Performance Measures cont. Net (Debt) Cash and Net (Debt) Cash / Adjusted EBITDA Net (debt) cash is a performance measure used by the Company to assess its financial position. Management believes that in addition to conventional performance measures prepared in accordance with IFR
Slide 22: Non-GAAP and Other Performance Measures cont.
Non-GAAP and Other Performance Measures cont. Adjusted Operating Cash Flow Free Cash Flow from Operations Adjusted operating cash flow per share is a performance measure used by the Free cash flow from operations is indicative of the Company’s ability to generate cash Company to assess its ability t
Slide 23: Non-GAAP and Other Performance Measures cont.
Non-GAAP and Other Performance Measures cont. C1 Cash Cost C1 Cash Cost and All-in Sustaining Cost can be reconciled to Lumina Copper’s cost of sales as follows: Copper, zinc and nickel cash costs per pound are key performance measures that management uses to For the Year Ended December 31, 2022 (fi