Evolution Mining Limited · ASX:EVN
Evolution Mining — 28th Global Metals and Mining Conference (BMO) February 2019
35 slides from Evolution Mining's conference presentation, Feb 25, 2019
Slide 1: 28th Global Metals and Mining Conference
For personal use only 28 TH GLOBAL METALS AND MINING CONFERENCE F E B R UA RY 2 0 1 9 JAKE KLEIN – EXECUTIVE CHAIRMAN 1
Slide 2: Forward Looking Statement
FORWARD LOOKING STATEMENT For personal use only These materials prepared by Evolution Mining Limited (or “the Company”) include forward looking statements. Often, but not always, forward looking statements can generally be identified by the use of forward looking words such as “may”, “will”, “expect
Slide 3: Evolution Snapshot February 2019
EVOLUTION REGISTER SNAPSHOT February 2019 For personal use only ASX code EVN Market capitalisation(1) US$4.6B North America, Average daily turnover(2) US$29M 29.0% Australia, Net debt(3) US$30M 51.0% Payout of 50% of UK and Dividend policy Europe, after tax earnings 17.7% FY19 production guidance 72
Slide 4: Clear and Consistent Strategy
CLEAR AND CONSISTENT STRATEGY For personal use only Focused portfolio of 6 – 8 assets Upgrade the quality of our asset portfolio Reduce costs and grow free cash flow per share Extend reserve life Ernest Mt Carlton Henry Deliver consistent returns to shareholders Mt Rawdon Cracow Mungari A globally r
Slide 5: Low Cost
LOW COST For personal use only ◼ Evolution is the lowest cost producer of the top 20 gold miners in the Van Eck Gold Miners Index (GDX)(1) All-in Sustaining Cost (US$/oz) 1,236 959 973 981 983 938 877 899 851 806 816 767 780 730 735 745 746 747 672 691 (2) (3) (3) (2) (3) (3) Newmont Regis Newcrest
Slide 6: EBITDA Margins
EBITDA MARGINS For personal use only ◼ Group EBITDA margin of 48% ◼ Improved portfolio quality in recent years ◼ Longer life assets generating highest margins Site FY19 H1 EBITDA margin 65% 58% 52% 46% 31% 34% Cowal Ernest Henry Mt Carlton Mt Rawdon Mungari Cracow 9+ years(1) 6-8 years(1) 3-5 years(
Slide 7: Return on Investment
RETURN ON INVESTMENT For personal use only ◼ Generating a return on investment a primary focus of the business Bubble size ◼ Longest life assets generating highest returns represents midpoint of FY19 ◼ Assets generating returns of up to 23% per annum production guidance ◼ Mt Carlton and Cracow have
Slide 8: Financial Position
FINANCIAL POSITION Operating cash flow (A$/oz) For personal use only ◼ 75% increase in operating cash flow per ounce since FY14 1,015 ◼ Balance sheet liquidity of A$664M 837 1,013 782 580 699 ◼ Cash balance: A$314M ◼ Undrawn revolver: A$350M available FY14 FY15 FY16 FY17 FY18 FY19 H1 Operating Cash
Slide 9: Cowal: Untapped Potential
Untapped potential COWAL E46 Resource 172koz For personal use only Galway Regal, E46 ▪ Sustainable, reliable, low cost Open Pit E42 production Reserves 3.0Moz Resource 486koz ▪ Developing a pathway to produce Resource 4.1Moz GRE46 UG Past Production 2.8Moz >300kozpa Total E42 Endowment Resource 604k
Slide 10: Pathway to 300kozpa
PATHWAY TO 300KOZPA For personal use only ▪ Float Tails Leach completed in December 2018 ▪ Recoveries expected to increase by 4 – 6% ▪ Stage H cutback (FY18 – FY21) ▪ Extends mine life to 2032 ▪ Plant expansion from 7.5Mtpa to 9.8Mtpa ▪ Regulatory approval granted in October 2018 ▪ Stage 1 expansion
Slide 11: GRE46 and Dalwhinnie Results
GRE46 AND DALWHINNIE RESULTS 2 kilometres For personal use only Planned exploration decline 6.0(4.2)@10.1 1535DD342A 10.5(6.8)@11.7 1535DD346 3.2(2.1)@29.1 1.6@58.2 19.0(11.7)@6.7 1535DD348A Stage G 1535DD348A 1535DD324 current surface 10.0(7.8)@9.5 1535DD352A MSO 46.0(27.2)@7.8 11.0(5.2)@6.5 shapes
Slide 12: Ernest Henry
ERNEST HENRY For personal use only ▪ History of reliable operational delivery ▪ Exceptionally high margins 1,200mRL ▪ Evolution’s interest generating free cash flow in excess of A$200M per year ▪ Planned drilling in December 2019 quarter to extend Drilling target mine life below 1,200mRL Current Min
Slide 13: Mungari
MUNGARI For personal use only ▪ Ore Reserves and Mineral Resources provide solid 10 year base load production platform ▪ Targeting 150koz through organic growth including: ▪ High-grade discoveries ▪ Improving plant efficiencies ▪ Best intercept from recent discovery drilling at Scottish Archer: ▪ 7.
Slide 14: Mt Carlton
MT CARLTON N Open pit For personal use only Stage 3 - ▪ Generating exceptional returns current ▪ Net mine cash flow averaged in excess of A$100M per year in FY16 – FY18 N ▪ Underground mine development to bring forward access to high-grade Link Zone Open pit ▪ Current mine life to FY25 with extensio
Slide 15: Cracow and Mt Rawdon
CRACOW AND MT RAWDON For personal use only FY19 GUIDANCE CRACOW MT RAWDON Gold production 80 – 85koz 95 – 105koz AISC US$905 – US$940/oz US$725 – US$760/oz QUEENSLAND EXPLORATION Drummond Exploration Project (Evolution earning 80%) ▪ Early-stage epithermal (low-sulphidation) vein project (520km2) Co
Slide 16: Discovery
DISCOVERY FY19 Discovery STRATEGY Guidance A$40-55M For personal use only Approach: Upgrade the pipeline People Tactics Deposit Styles Geographic Drummond • New, invigorated • Build land positions • Epithermal – Focus Project Mt Carlton world class team in key camps low/intermediate & • Emphasis in
Slide 17: Generating Superior Financial Returns
GENERATING SUPERIOR FINANCIAL RETURNS For personal use only Global leader in low cost production Strong track record in creating value Reputation for reliability and transparency Discovery team delivering transformational organic growth Shareholders rewarded through dividends and capital growth 17
Slide 18: Appendix
For personal use only APPENDIX
Slide 19: FY19 Guidance: Production and Costs
FY19 GUIDANCE: PRODUCTION AND COSTS For personal use only Gold production All-in sustaining cost* All-in sustaining cost* FY19 Guidance (oz) (A$/oz) (US$/oz) Cowal 240,000 – 250,000 975 – 1,075 705 – 780 Mungari 125,000 – 135,000 1,050 – 1,100 760 – 800 Mt Carlton 95,000 – 105,000 670 – 720 485 – 52
Slide 20: FY19 Guidance: Capital
FY19 GUIDANCE: CAPITAL For personal use only Major project capital items ◼ Cowal: Sustaining Major FY19 Guidance Capital Capital ◼ Stage H cut-back (A$70 – A$75M) (A$M) (A$M) ◼ Float Tails Leach (A$6 – A$9M) ◼ Other process plant projects (A$29 – A$36M) Cowal 55 – 60 105 – 120 ◼ Mt Carlton Mungari 1
Slide 21: FY19 Guidance: Discovery and Non-Cash
FY19 GUIDANCE: DISCOVERY AND NON-CASH For personal use only Depreciation & Fair Value Resource Discovery FY19 Guidance Amortisation* Unwind Definition** (A$M) (A$/oz) (A$M) (A$M) Cowal 430 – 480 10 – 15 3–7 15 – 20 Mungari 500 – 550 10 – 15 2–4 15 – 20 Mt Carlton 580 – 630 0–1 1–2 Mt Rawdon 550 – 60
Slide 22: Three Year Outlook: FY19 – FY21
3 YEAR OUTLOOK: FY19 – FY21 For personal use only Production Guidance koz AISC Guidance A$/oz 11 22 910 770 775 765 900 895 833 780 907 720 725 710 797 850 845 860 FY17 FY18 FY19 FY20 FY21 FY17 FY18 FY19 FY20 FY21 Production Low Production High Divested Assets AISC Low AISC High Sustaining Capital G
Slide 23: Production Target
PRODUCTION TARGET For personal use only Cautionary statement concerning the proportion of Exploration Targets1 Of Evolution’s Production Outlook, 2% is comprised of Exploration Targets. The potential quantity and grade of this exploration target is conceptual in nature and there has been insufficien
Slide 24: Dec 2018 Half-Year: Production and Cost Summary
DEC 2018 HALF-YEAR: PRODUCTION AND COST SUMMARY For personal use only December half-year FY19 Units Cowal Mungari Mt Carlton Mt Rawdon Cracow Ernest Henry Group Total ore mined kt 3,754 962 416 875 306 3,468 9,781 Total tonnes processed kt 3,957 791 398 1,681 292 3,568 10,687 Grade processed g/t 1.1
Slide 25: Evolution 2017 Gold Mineral Resources
EVOLUTION 2017 GOLD MINERAL RESOURCES For personal use only Group Gold Mineral Resources – December 2017 Gold Measured Indicated Inferred Total Resource Gold Gold Gold Gold Gold Gold Gold Gold Tonnes Tonnes Tonnes Tonnes CP3 Project Type Cut-Off Grade Metal Grade Metal Grade Metal Grade Metal (Mt) (
Slide 26: Evolution 2017 Gold Ore Reserves
EVOLUTION 2017 GOLD ORE RESERVES For personal use only Group Gold Ore Reserves – December 2017 Gold Proved Probable Total Reserve Gold Gold Gold Gold Gold Gold Tonnes Tonnes Tonnes CP3 Project Type Cut-Off Grade Metal Grade Metal Grade Metal (Mt) (Mt) (Mt) (g/t) (koz) (g/t) (koz) (g/t) (koz) Cowal1
Slide 27: Evolution 2017 Copper Reserves & Resources
EVOLUTION 2017 COPPER RESERVES & RESOURCES For personal use only Group Copper Mineral Resources Statement Copper Measured Indicated Inferred Total Resource Copper Copper Copper Copper Copper Copper Copper Copper Cut- Tonnes Tonnes Tonnes Tonnes CP3 Project Type Grade Metal Grade Metal Grade Metal Gr
Slide 28: Cowal Dec 2017 Mineral Resources and Ore Reserves
COWAL DEC 2017 MINERAL RESOURCES AND ORE RESERVES EVOLUTION 2017 GOLD ORE RESERVES For personal use only Cowal Gold Mineral Resources - December 2017 Measured Indicated Inferred Total Resource Mineral Resource Tonnes Grade Tonnes Grade Tonnes Grade Tonnes Grade Cont. Cont. Metal Cont. Metal Cont. Me
Slide 29: Sustainability
Total Recordable Injury Frequency (TRIF)* SUSTAINABILITY 24.4 For personal use only 19.9 ◼ Inaugural Sustainability Report published in December 2018 half-year 12.0 ◼ Driving safety culture where our people do the 9.6 9.7 8.0 7.3 right thing because they want to, not because they 5.5 have to ◼ HSE S
Slide 30: Environmental Stewardship
ENVIRONMENTAL STEWARDSHIP For personal use only ▪ Four environmental enhancement projects underway ▪ Environmental protocols implemented to manage environmental impacts and risk ▪ Life of mine environmental management plans developed for all sites ▪ Environmental assurance audit program and environm
Slide 31: Socio-Economic Contributions
SOCIO-ECONOMIC CONTRIBUTIONS ▪ Social licence to operate score 4.1 out of 5.0 For personal use only ▪ ‘High approval’ – a high level of social licence compared to other global miners1 ▪ Nine Shared Value projects underway – creating tangible, sustainable legacies in our communities beyond the life o
Slide 32: Our People
OUR PEOPLE For personal use only Attract, engage, develop and retain talent ▪ Developing our leaders via bespoke leadership programs ▪ Guiding Our Leaders Program (GOLD) completed by 119 of our senior leaders ▪ SILVER Program completed by 201 of our front line managers ▪ Supporting Graduate Programs
Slide 33: Cost Structure
COST STRUCTURE For personal use only ▪ Top seven expense groups account for ~78% of total costs ▪ Proactively managing input costs ▪ Cost reduction of 10% on A$100M of contracts in FY18 Other, 22% ▪ Continue to competitively test market for cost reductions Employee ▪ Major focus on productivity and
Slide 34: M&A Strategy
M&A STRATEGY Improve portfolio quality For personal use only ▪ The rules are simple: ▪ Improve the quality of the portfolio ▪ Logical ▪ Value accretive ▪ Opportunistic ▪ But delivery is not simple. It requires the ability to: ▪ Recognise the opportunity ▪ Execute the transaction ▪ Integrate acquired
Slide 35: For personal use only
For personal use only Evolution MIINTINE
Evolution Mining — 28th Global Metals and Mining Conference (BMO) February 2019 on 6ix