Paladin Energy Ltd · ASX:PDN
Paladin Energy — Investor Presentation (September 2011)
44 slides from Paladin Energy's investor presentation, Sep 28, 2011
Slide 1: Investor update September 2011
Investor update September 2011 NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES THIS DOCUMENT MUST NOT BE DELIVERED IN CANADA OR MADE AVAILABLE IN ANY FORM TO CANADIANS AND PALADIN HAS NOT AUTHORISED ANYONE TO MAKE THIS DOCUMENT AVAILBLE IN CANADA, OR
Slide 2: Disclaimer
Disclaimer This document has been prepared by Paladin Energy Limited (ABN 47 061 681 098) (Paladin). No party other than Paladin has authorised or caused the issue of this document,, or takes responsibility p y for,, or makes any y statements,, representations p or undertakings in this document. Pre
Slide 3: Disclaimer (cont'd)
Disclaimer (cont’d) Forward-Looking Information: This document contains certain forward-looking information. The words 'anticipate', 'believe', expect , 'project', 'expect', project , 'forecast', forecast , 'estimate', estimate , 'likely', likely , 'intend', intend , 'should', should , 'could', coul
Slide 4: Disclaimer (cont'd)
Disclaimer (cont’d) Resources and Reserves: Unless otherwise indicated, the mineral reserve and mineral resource estimates contained in this document have been prepared in accordance with Joint Ore Reserves Committee Code for Reporting of Mineral Resources and Ore Reserves (the “JORC Code”) and Cana
Slide 5: Introduction
Introduction As an independent and established uranium producer, Paladin is uniquely positioned within the consolidating nuclear industry Project update — Langer Heinrich Mine (“LHM”) — annual production up 5% to 3.525Mlb — Stage 3 construction expanding operations to 5.2Mlb/yr — Kayelekera Mine (“K
Slide 6: Nuclear Industry
Nuclear Industry re-affirming re affirming commitment post-Fukushima post Fukushima SUPPLY SHORTAGE LOOMING… POST-FUKUSHIMA PRE-FUKUSHIMA (per IAEA as at 20/9/11) Reactor Status Operating 443 433 (8 German units shut) U d construction Under t ti 62 65 (3 new starts) t t ) Planned 142 155 Proposed 32
Slide 7: Sector Consolidation
Sector Consolidation Since 2009 downstream nuclear companies have been particularly active making significant acquisitions of upstream uranium companies / assets to ensure security of supply Announced Anno nced Country of Downstream Total Value Announced Date Target Name Acquirer Name acquirer inter
Slide 8: Presentation Outline
Presentation O tli Outline Company Status & Highlights Project Update Equity raising Outlook Key risks Additional materials 7
Slide 9: Company Snapshot and key highlights
Company Snapshot and key highlights Head Office Perth, Western Australia Operations in Namibia and Malawi Global development projects ASX, TSX and NSX (Namibian) Listed 778M issued i d capital it l (plus ( l US$625M CB) Year-on-year production growth GROWTH IN EXCESS Strong Growth OF 32%PA FROM FY20
Slide 10: Asset Rich – Organic & Inorganic Growth
Asset Rich – Organic & Inorganic Growth multi layered activity Two operations built and in production plus two expansions Six p j projects q acquired ((four by y takeovers, two by y direct p j project p purchase)) 600 LHM Construction LHM Production KM Construction KM Production 500 500M Aurora 400
Slide 11: Global Projects
Global Projects Actively developing in the world’s premier uranium regions NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES OR CANADA 10
Slide 12: Company Highlights
Company Highlights Production up 32% to 5.7Mlb U3O8 in FY2011 Production KM 126% production KM: d ti iincrease on 2010 4.8Mlb sales volume for FY2011 up 29% year-on-year Sales and Revenue Revenue of US$267M for FY2011 – up 32% year-on-year Average realised price of US$55/lb LHM costs (C1) at US$28/l
Slide 13: Presentation Outline
Presentation O tli Outline Company Status & Highlights Project Update Equity raising Outlook Key risks Additional materials 12
Slide 14: Langer Heinrich
Langer Heinrich Location: west coast of central Namibia, 80km E of Walvis Bay (port) and 400km W of Windhoek Infrastructure: road, grid power, water, skilled labour, port Ownership: 100% Fiscal: tax 37.5%; royalty 3% of gross revenues; depreciation over three years Processing: crush → scrub → alkali
Slide 15: Langer Heinrich: Operational Update
Langer Heinrich: Operational Update Quarterly production up 13% to 896,761lb — recovered from past record rain in March 2011 quarter — record production in June of 355,513lb (82% of Stage 3 capacity) Annuall production A d ti up 5% to t 3.525Mlb 3 525Mlb — scrub and wash efficiencies from new Stage
Slide 16: Kayelekera
Kayelekera Location: northern Malawi, 575km north of Lilongwe (capital), 52km west of Karonga Infrastructure: road, power (diesel gensets), water Ownership: 85%/15% Paladin/Malawi Govt Fiscal: tax 27.5%; royalty 1.5% of gross revenues for 3 years, 3% thereafter; depreciation 100% or immediate Mi i M
Slide 17: Kayelekera: Operational update
Kayelekera: Operational update June quarter of 566,248lb; second highest achieved Production for year of 2.169Mlb (126% increase from past year) Overall recovery y at 80% for quarter ((target g 85%)) Focus areas: — drying and packaging plant relocation to be completed end October — acid plant remedi
Slide 18: Pipeline Project Status
Pipeline Project Status monetising selected Australian assets Mount Isa, Qld (part JV with Summit) — exploration targeted on resource expansion — feasibility commences late 2012 Angela NT (50% JV with Cameco) Angela, — preliminary scoping study will define exploration Bigrlyi JV, NT (44% JV with Ene
Slide 19: Presentation Outline
Presentation O tli Outline Company Status & Highlights Project Update Equity raising Outlook Key risks Additional materials 18
Slide 20: Offer details
Offer details Placement to raise up to approximately A$70 Offer structure million Offer Price Offer Price to be determined by way of a bookbuild Ranking of New New Shares issued under the Placement will rank Shares equally with existing shares New Shares issued on the TSX will be subject to a four m
Slide 21: Paladin's debt position
Paladin’s debt position Secured bank loans — covenants are market practice with coverage ratios at achievable levels — US$141M project finance facility for the reimbursement of funds committed to the Langer Heinrich Stage 3 expansion and refinance of Stage 1 facility consists of a US$135M Project
Slide 22: Indicative Timetable
Indicative Timetable Event Date Pre-market 28 September 2011 (AEST) Trading halt on ASX Evening 27 September 2011 (CDST) 9:30am 28 September p 2011 ((AEST)) B kb ild opens Bookbuild 7:30pm 27 September 2011 (CDST) Bookbuild closes (subject to Global Joint Lead Arrangers) 28 September 2011 10:00am 29
Slide 23: Presentation Outline
Presentation O tli Outline Company Status & Highlights Project Update Equity raising Outlook Key risks Additional materials 22
Slide 24: Entering the Next Phase - Optimisation
Entering the Next Phase - Optimisation From developer to stable producer – focus on optimisation Operations – cost & production optimisation Corporate – cost optimisation 16 CURRENT Development + Ramp Up Optimisation Growth to Tier 1 14 FOCUS 12 (in addition, Paladin 10 expanded project pipeline n (
Slide 25: Strong Growth
Strong Growth Production growth delivered and anticipated 16 Development & Consolidation & Expected Growth Growth Optimisation (in feasibility) 14 13.5 23% 12 8 Production (Mlb) 11.0 10 26% 8% 2% 8 8.5 8.7 7.4-7.9 39% U3O8 6 32% 5.7 4 4.3 60% 59% 2.7 2 1.7 0 07/08 08/09 09/10 10/11 11/12 12/13 13/14
Slide 26: Project Pipeline
Project Pipeline NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES OR CANADA 25
Slide 27: Key Takeaways: Turning the corner
Key Takeaways: Turning the corner Outlook — cost and production optimisation across all operations — reduction in corporate overheads — opportunity for selective monetisation of non-producing assets — maintain strong organic production growth profile — access strategic opportunities Positioned to ma
Slide 28: Presentation Outline
Presentation O tli Outline Company Status & Highlights Project Update Equity raising Outlook Key risks Additional materials 27
Slide 29: Summary of Key Risks
Summary of Key Risks There are various risks associated with an investment in Paladin and many of these are outside the control of the Company Company. Please refer to the expanded key risks on the following pages of this presentation Key risk factors include: — uncertainty of development and expans
Slide 30: Key Risks
Key Risks There are various risks associated with investing in Paladin, as with any stock market investment, and specifically because of the nature of Paladin’s business and the present stage of development of Paladin’s operations. This includes projects in which Paladin has an interest. A reference
Slide 31: Key Risks (cont'd)
Key Risks (cont’d) Commodity prices and exchange rates Paladin derives the majority of its revenue from the sale of uranium. Difficulties encountered in negotiations with customers may adversely affect Paladin’s financial performance if the price that customers are willing to pay and/or the quantity
Slide 32: Key Risks (cont'd)
Key Risks (cont’d) Changes in capital and operating cost estimates Whilst every care has been made in estimating the capital cost and future operating costs for Paladin’s projects, the actual costs structure experienced in constructing the facilities and operating the mine and process plant may vary
Slide 33: Key Risks (cont'd)
Key Risks (cont’d) Environmental and social risk Uranium exploration and mine development is an environmentally hazardous activity which may give rise to substantial costs for environmental rehabilitation, damage control and losses. With increasingly heightened government and public sensitivity to e
Slide 34: Presentation Outline
Presentation O tli Outline Company Status & Highlights Project Update Equity raising Outlook Key risks Additional materials 33
Slide 35: Ore Reserves and Mineral Resources
Ore Reserves and Mineral Resources Project Measured & Indicated Resources Inferred Resources Total Reserves 100% project basis Attributable to Paladin Attributable to Paladin C t ff Cut-off C t ff Cut-off t U3O8 Mlb U3O8 % U3O8 t U3O8 Mlb U3O8 % U3O8 U3O8 ppm t U3O8 Mlb U3O8 % U3O8 U3O8 ppm Langer H
Slide 36: Important Notice
Important Notice International Offer Restrictions: This document does not constitute an offer of new ordinary shares ("New Shares") of the Company in any jurisdiction in which it would be unlawful. New Shares may not be offered or sold in any country outside Australia except to the extent permitted
Slide 37: Important Notice (cont'd)
Important Notice (cont’d) Hong Kong WARNING This WARNING: Thi document d t has h nott been, b and d will ill nott be, b registered i t d as a prospectus t under d the th Companies C i Ordinance O di (C (Cap. 32) off Hong Kong (the "Companies Ordinance"), nor has it been authorised by the Securities
Slide 38: Important Notice (cont'd)
Important Notice (cont’d) Italy Th offering The ff i off theth New N Shares Sh in i the th Republic R bli off It Italy l hhas nott b been authorized th i d b by th the It Italian li SSecurities iti and dE Exchange h Commission (Commissione Nazionale per le Società e la Borsa, "CONSOB") pursuant to t
Slide 39: Important Notice (cont'd)
Important Notice (cont’d) Japan Th New The N Sh Shares h have nott bbeen and d willill nott b be registered i t d under d AArticle ti l 4 4, paragraphh 1 off th the Fi Financial i l IInstruments t t anddEExchange h Law of Japan (Law No. 25 of 1948), as amended (the "FIEL") pursuant to an exemption f
Slide 40: Important Notice (cont'd)
Important Notice (cont’d) Norway Thi d This documentt h has nott b been approved db by, or registered i t d with, ith any NNorwegiani securities iti regulator l t pursuantt tto th the N Norwegian i Securities Trading Act of 29 June 2007. Accordingly, this document shall not be deemed to constitute a
Slide 41: Important Notice (cont'd)
Important Notice (cont’d) Singapore Thi d This documentt and d any other th materials t i l relating l ti tto th the N New Sh Shares h have nott bbeen, andd will ill nott b be, llodged d d or registered i t d as a prospectus in Singapore with the Monetary Authority of Singapore. Accordingly, this do
Slide 42: Important Notice (cont'd)
Important Notice (cont’d) United Arab Emirates N ith thi Neither this d documentt nor th the N New Sh Shares h have b been approved, d di disapproved d or passed d on iin any way b by th the C Central t lBBank k off th the United Arab Emirates, the Emirates Securities and Commodities Authority or an
Slide 43: Important Notice (cont'd)
Important Notice (cont’d) United Kingdom N ith th Neither the iinformation f ti iin thi this d documentt nor any other th d documentt relating l ti tto th the offer ff hhas b been ddelivered li d ffor approvall tto th the Financial Services Authority in the United Kingdom and no prospectus (within t
Slide 44: Paladin Energy Ltd Contact Details
Paladin Energy Ltd Contact Details Head Office Level 4, 502 Hay Street Subiaco Western Australia 6008 PO Box B 201,201 S Subiaco bi Western Australia 6904 Telephone: +61 (0) 8 9381 4366 Facsimile: +61 (0) 8 9381 4978 Email: paladin@paladinenergy.com.au Website: www www.paladinenergy.com.au paladinen
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