Sotkamo Silver Ab · NGM:SOSI
Sotkamo Silver Ab — Q2 2023 Earnings Presentation
23 slides from Sotkamo Silver Ab's earnings presentation, Jul 28, 2023
Slide 1: Improved profitability by enhanced operational efficiency and higher silver grade
SOTKAMO SILVER AB Improved profitability by enhanced operational efficiency and higher silver grade Half-Year Financial Report Q2/2023 1
Slide 2: Agenda of the day
Agenda of the day • Sotkamo Silver in brief • Strategy progress update • Highlights from Q2/2023 • Financial and operational update • Outlook • Q&A 2
Slide 3: Sotkamo Silver in brief
SOTKAMO SILVER AB Sotkamo Silver in brief 3
Slide 4: In brief
In brief Sotkamo Silver supports the global Key financials – Q2/2023 development towards green transition technologies and produces the metals Net sales EBITDA EBIT needed responsibly, taking local stakeholders into account 120 MSEK 53 MSEK 34 MSEK • The silver mine in Sotkamo, Finland, produces (90
Slide 5: Sotkamo Silver as an investment
Sotkamo Silver as an investment 1. 2. 3. 4. 5. A Strong Demand for Continuous Plans to Extend The Ore Prospecting Commitment to Silver on the Market Production the Life of the Programme, Promising Sustainable due to the Green and a Delivery Silver Mine Mineral Resources and Development Transition Co
Slide 6: Strategy progress update
SOTKAMO SILVER AB Strategy progress update 6
Slide 7: The cornerstones of our strategy
The cornerstones of our strategy Development of the silver Increase mineral resources Sustainable use of mine and ensuring a solid by continuing exploration natural resources foundation for the in the current mine and the Company's expansion Kainuu region Operational sustainability, sustainable deve
Slide 8: Focus on improving operational efficiency in 2023
Focus on improving operational efficiency in 2023 2022 2023 2024+ Sotkamo Silver launched a programme that has Strengthening the financial position through Continuation of the additional programme for enabled the Company to improve cost efficiency share issues and other financial arrangements infill
Slide 9: Strategy progress update 1/2
Strategy progress update 1/2 Strengthening the financial position Continuing infill-drilling for ensuring Transitioning to new mining levels, for through share issues and other financial cost-effective and stable production in improved head grade and turnover arrangements coming years • With the sha
Slide 10: Strategy progress update 2/2
Strategy progress update 2/2 Implementing risk management and Selling pyrite (by-product) to reduce the hedging policy to manage business- environmental impacts and increase related uncertainties resource efficiency • To manage business-related uncertainties, • Sotkamo Silver produces pyrite as by-
Slide 11: Highlights from Q2/2023
SOTKAMO SILVER AB Highlights from Q2/2023 11
Slide 12: Key takeaways from Q2/2023
Key takeaways from Q2/2023 In the second quarter, we have stabilized our mining operations and made stable progress toward our strategic targets for 2023. • Net sales increased by 33%, driven mainly by a higher average silver grade and positive development of silver price. • Profitability increased
Slide 13: Improved profitability and operational performance
Improved profitability and operational performance Net Sales MSEK EBITDA MSEK EBIT MSEK 160 60 53 40 34 140 50 30 120 120 40 20 100 100 90 30 10 19 80 66 67 20 0 6 6 -1 60 10 -10 -10 40 0 -20 -16 20 -10 -30 -10 -32 0 -20 -40 Q2/22 Q3/22 Q4/22 Q1/23 Q2/23 Q2/22 Q3/22 Q4/22 Q1/23 Q2/23 Q2/22 Q3/22 Q4/
Slide 14: Positive cash flow and improving financial position
Positive cash flow and improving financial position Equity ratio (%) Cash liquidity (%) Net debt-to-EBITDA 43 43 100 20 90 86 42 90 18 41 40 80 16 67 40 39 70 14 12 39 38 38 60 12 46 38 50 41 10 37 40 8 5 36 30 6 4 4 35 20 4 3 34 10 2 33 0 0 Q2/22 Q3/22 Q4/22 Q1/23 Q2/23 Q2/22 Q3/22 Q4/22 Q1/23 Q2/2
Slide 15: The silver head grade continued to improve
The silver head grade continued to improve Milled ore, tonnes Silver head grade, g/tonnes Silver production, kOz 250000 125 500 101 383 200000 100 400 169 209 82 154 377 294 137 869 136 529 69 72 281 150000 75 300 258 62 96 681 207 100000 50 200 50000 25 100 0 0 0 Q2/22 Q3/22 Q4/22 Q1/23 Q2/23 Q2/22
Slide 16: Several key drivers have improved
Several key drivers have improved Improved silver Strong silver price Lower electricity head grade momentum prices The silver grade is expected to Global silver demand reached a The price of electricity has fallen remain at the 90-110 g/tonne new high of 1.24 billion ounces and according to the fore
Slide 17: Outlook
SOTKAMO SILVER AB Outlook 17
Slide 18: Guidance for 2023 (unchanged)
Guidance for 2023 (unchanged) • The Company expects to produce 1.4 -1.5 million ounces of silver in 2023. However, Company’s primary target is to maximize the revenue and operative cash flow. To achieve this, Company adjusts the mix of metals in the ore feed which might have an impact on the produce
Slide 19: How to follow us? Financial calendar
How to follow us? Financial calendar • Our investor website: 30 Aug 2023 Pörssin Avoimet Ovet, Nasdaq https://www.silver.fi/en/investors • Follow our Inderes page: 25 Oct 2023 Q3/2023 interim report & webinar https://www.inderes.fi/fi/yhtiot/sotkamo-silver • Subscribe to our releases: https://www.si
Slide 20: Questions & Answers
SOTKAMO SILVER AB Questions & Answers 20
Slide 21: Thank you!
Thank you! 21
Slide 22: Key figures
Key figures MSEK Q2/23 Q2/22 Change, % H1/23 H1/22 Change, % 2022 Net sales 120 90 33 188 205 -8 371 EBITDA 53 6 721 59 44 34 53 EBITDA margin, % 44 7 32 22 14 EBIT 34 -16 24 -1 -34 EBIT margin, % 28 -18 13 -1 -9 Equity ratio, % 43 40 43 40 38 Cash liquidity, % 90 86 90 86 46 Net debt-to-EBITDA rati
Slide 23: Production of gold, lead and zinc
Production of gold, lead and zinc Gold production, oz Lead production, tonnes Zinc production, tonnes 900 829 836 450 1 000 796 790 401 874 800 400 900 824 365 700 350 800 317 304 662 700 647 600 516 300 600 500 250 232 515 500 400 200 400 300 150 300 200 100 200 100 50 100 0 0 0 Q2/22 Q3/22 Q4/22 Q