Mgx Resources Limited · ASX:MGX
Mgx Resources — Mount Gibson Iron — CLSA Iron Ore Day 2014
24 slides from Mgx Resources's conference presentation, Feb 6, 2014
Slide 1: CLSA Iron Ore Day Presentation
CLSA Iron Ore Day Presentation For personal use only MGX Sydney 6 February 2014 1
Slide 2: Disclaimer
Disclaimer This Document is Confidential and may not be reproduced, redistributed or passed on, directly or indirectly, to For personal use only any other person, or published, in whole or in part, for any purpose without prior written approval from Mount Gibson Iron Limited. This Document is not a
Slide 3: MGX at a glance
MGX at a glance For personal use only Member S&P/ASX-200 FY14 sales guidance Market cap $1.1 billion 9.0 to 9.5 Mt *@ $1.06/share , 3/2/2014. 1,090.6m shares on issue Dividends paid Financially strong $130m since Sept 2011 $484m cash, minimal debt* Cash increased by $205m since end 2012 *at 31 Decem
Slide 4: Business overview
Business overview For personal use only Koolan Island Mine Premium DSO lump and fines Ramping up to 4 Mtpa by end 2014 Long life asset with life extension potential Simple logistics Mid West Region Tallering Peak, Extension Hill & Geraldton Port facilities Tallering Peak Extension Hill Min
Slide 5: Maximising value – a simple strategy
Maximising value ± a simple strategy For personal use only Cost reduction and elimination of waste Leverage off Operational optimisation and business improvement existing asset Extension of production profile: ± Optimise resources and reserves inventory base to extract ± Brownfields exploratio
Slide 6: Maximising value – strong results in FY2013
Maximising value ± strong results in FY2013 For personal use only Record ore sales of 8.8 Mt, up 68% Extracting Cash reserves increased by $97m maximum value Record sales revenue of $852.9m, up 32% Net profit after tax of $157.3m from existing Net operating cash flow up 220% to $179.7m F
Slide 7: Maximising value – years of achievement
Maximising value ± 2 years of achievement For personal use only 9 Completed executive team rebuild 9 Achieved permanent ongoing savings of ~$50m per annum 9 Optimised and implemented detailed Koolan Island ramp-up plan to 4 Mtpa 9 Koolan Island unit mining costs reduced to <$9/t moved in H1 2014, wi
Slide 8: Maximising value – a strong start to FY2014
Maximising value ± a strong start to FY2014 Cash increased to $484m @ 31 December, For personal use only up by $108m in the half year period Robust Group ore sales increased to 5.1 Mt December Half Koolan ore sales increased to 2.0 Mt Mid West ore sales of 3.1 Mt* performance On track to a
Slide 9: Market outlook remains positive
Market outlook remains positive For personal use only CHINESE IRON ORE PORT INVENTORIES ,QWKHVKRUWWHUP« Ore inventories at Chinese ports have only partly recovered from destocking in 2012 Port stocks remain lower than in 2011 and 2012 Chinese steel mill production remains at historic highs Sou
Slide 10: Focused on adding to the sales profile
Focused on adding to the sales profile For personal use only Ore sales history and current indicative outlook* 10 Actual Forecast Stage Two 8 target Stage One target 6 Ore Sales (Mwmt) 4 2 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Year to 30 June FY'14 gu
Slide 11: Koolan Island – a quality asset with upside
Koolan Island ± a quality asset with upside For personal use only Long life asset: +7 years Sought-after high-quality iron ore products Simple logistics - dedicated shiploader and no road or rail Optimised ramp up to 4Mtpa - reducing unit mining costs and increasing productivity Value-add
Slide 12: Koolan Island - a quality asset with upside
Koolan Island - a quality asset with upside For personal use only 1km West End exploration targets N Main Pit 12
Slide 13: Mid West footprint – our competitive edge
Mid West footprint ± our competitive edge For personal use only 13
Slide 14: Geraldton Port – established infrastructure
Geraldton Port ± established infrastructure For personal use only Ship Loader Rail Unloader MGX Berth 5 MGX Shed Berth 4 Shed 14
Slide 15: Tallering Peak – extracting extra value
Tallering Peak ± extracting extra value For personal use only Total ore sales of 2.5Mt targeted for FY2014 T6 pit life extended to Feb 2014 T1 ore production commenced in September 2013 Mining operations to conclude mid 2014 Stockpile sales of ~700kt in FY2014, final sales in Sept Qtr 2014
Slide 16: Extension Hill – simple low-cost operation
Extension Hill ± simple low-cost operation For personal use only Simple low-cost operation 3Mtpa operation with +3 years of mine life. Established road, rail and port solutions High potential near-mine exploration targets with known mineralisation 4 Potential processing hub for regional op
Slide 17: High potential to grow Mid West resources
High potential to grow Mid West resources For personal use only Extension Hill region shaping as a potential resources hub Initial RC drilling program completed at Extension Hill South ± results pending Positive initial drilling from Plateau Prospect at Fields Find Project 2nd round drilling
Slide 18: Extension Hill South
Extension Hill South For personal use only Multiple hematite targets located 1-3km from existing N crusher, with known mineralisation 65 RC holes completed at Iron Hill prospect in December 2013 ± results pending 2nd round drilling planned, subject to approvals 3km Extension Hill South Prospec
Slide 19: Plateau Prospect, Fields Find
Plateau Prospect, Fields Find Unconventional setting - iron-enriched laterite For personal use only over ultra-mafic basement 228 hole RC program completed November 2013* 114 significant intersections +50% Fe, including: 18m @ 59.2% Fe, 16m @ 58.4% Fe, 7m @ 60.5% Fe Only 5% of 10sqkm prosp
Slide 20: Shine – a quality near-term opportunity
Shine ± a quality near-term opportunity For personal use only Purchase agreement signed early December 2013* Reported Hematite Mineral Resource of 6.1 Mt @ 59.8% Fe* Potential for near term, low-capex development High grade hematite resource Substantial technical work completed Advanced
Slide 21: Summary
Summary An established mid-cap iron ore producer For personal use only On track to sell a record 9.0 - 9.5 million tonnes in FY2014 Strong operating cashflows and balance sheet Established transport infrastructure and long term customer contracts Exploration upside and disciplined value-fo
Slide 22: Thank You
Thank You For personal use only MGX For more information: Phone: +618 9426 7500 Email: admin@mtgibsoniron.com.au Web: www.mtgibsoniron.com.au 22
Slide 23: Appendix – Supplementary Reserves and Resources information
Appendix ² Reserves Supplementary and Resources information For personal use only Mineral Resources and Ore Reserves at 30 June 2013 Total Group Mineral Resources and Ore Reserves at 30 June 2013 Koolan Island Total Group Mineral Resources and Ore Reserves at 30 June 2013 Tonnes Fe SiO2 Al2O3 P mill
Slide 24: Appendix – Shine Hematite Mineral Resource
Appendix ² Reserves Supplementary and Resources information For personal use only Shine Hematite Mineral Resource Resource Tonnes Fe SiO2 Al2O3 P LOI Category (Mt) % % % % % Measured 2.2 60.5 6.76 1.96 0.085 3.99 Indicated 3.2 59.6 8.23 1.61 0.074 3.90 Inferred 0.7 58.6 9.04 1.37 0.078 4.63 Total 6.