Igo Limited · ASX:IGO
Igo — Independence Group NL — Q4 FY2019 Earnings Presentation
31 slides from Igo's earnings presentation, Jul 31, 2019
Slide 1: 4Q19 Results Presentation
INDEPENDENCE GROUP NL 4Q19 Results Presentation For personal use only Operational outperformance from Nova; strong finish from Tropicana 31 July 2019 ASX:IGO / ADR:IIDDY
Slide 2: Cautionary Statements & Disclaimer
Cautionary Statements & Disclaimer • This presentation has been prepared by Independence Group NL (“IGO”) (ABN 46 092 786 304). It should not be considered as an offer or invitation to subscribe for or purchase any For personal use only securities in IGO or as an inducement to make an offer or invit
Slide 3: Competent Person's Statements
Competent Person’s Statements • Any references to IGO Mineral Resource and Ore Reserve estimates should be read in conjunction with IGO’s Annual Update of Exploration Results, Mineral Resources and Ore Reserves For personal use only dated 20 February 2019 (Annual Statement) and lodged with the ASX f
Slide 4: FY19 and 4Q19 Highlights
FY19 and 4Q19 Highlights Operational outperformance from Nova and strong finish from Tropicana For personal use only Operations Growth Financial Boston Shaker Solid underlying free Nova metal production cash flow generation Underground mine exceeded FY19 production guidance development 4Q19 A$77M co
Slide 5: Financial Results
Financial Results Strong operating cash flow generation continues despite lower sales revenue For personal use only Units 3Q19 4Q19 QoQ FY19(3) Revenue and Other Income A$M 232.8 204.1 (12%) 792.9 Underlying EBITDA(1) A$M 116.6 93.6 (20%) 340.7 Profit After Tax A$M 45.1 30.1 (33%) 76.1 Net Cash from
Slide 6: Net Profit After Tax
Net Profit After Tax QoQ change in NPAT driven by Nova sales and higher amortisation charges For personal use only A$M 50 45 40 35 22.9 1.6 30 7.9 9.2 25 45.1 0.4 10.5 3.3 20 6.8 4.2 15 30.1 10 5 3Q19 NPAT Nova EBITDA Tropicana Long EBITDA Exploration Corporate Mark-to-market D&A Other Tax 4Q19 NPAT
Slide 7: 4Q19 Cash Flow Reconciliation
4Q19 Cash Flow Reconciliation Record cash balance of A$348M at year end For personal use only A$M 400 350 0.7 17.9 26.3 1.5 16.1 0.4 6.1 300 74.4 250 200 348.2 150 257.2 100 50 Cash at Nova FCF Tropicana FCF Long FCF Exploration Payments for Corporate and Proceeds from Finance Costs Cash at 31 March
Slide 8: Nova
For personal use only Nova 8
Slide 9: Nova: Metal production performance exceeds FY19 guidance
Nova Metal production performance exceeds FY19 guidance For personal use only Metric Units 3Q19 4Q19 FY19 FY19 Guidance Nickel in concentrate t 8,375 7,906 30,708 27,000 – 30,000 Copper in concentrate t 3,731 3,462 13,693 11,000 – 12,500 Cobalt in concentrate t 297 280 1,090 850 – 950 Cash cost (pay
Slide 10: Nova: EBITDA margin of 57% maintained
Nova EBITDA margin of 57% maintained, while FCF margin increased to 61% For personal use only Nova Production Nova Cash Flow Reconciliation Tonnes A$/lb A$M 9,000 $3.00 100 $2.78 90 8,000 2.4 $2.50 80 7,000 $2.22 19.1 70 6,000 $1.94 $2.00 5.1 $1.50 60 5,000 $1.50 50 4,000 6,854 7,574 8,375 7,906 86.
Slide 11: Nova Cash Cost Analysis
Nova Cash Cost Analysis Full year cash costs impacted by lower by-product prices than forecast For personal use only A$/lb (payable nickel) 2.50 2.00 FY19 $0.45 Guidance Range $0.08 1.50 1.00 $2.07 $1.54 0.50 0.00 By Products prices Other Non-Controllable Costs Nova Nova Cash Costs FY19 Adjusted Fac
Slide 12: FY20 Nova Guidance
FY20 Nova Guidance(1) Consistent performance and high margin projected into FY20 For personal use only Metric Units FY20 Guidance Nickel in concentrate t 27,000 – 30,000 Copper in concentrate t 11,000 – 12,500 Cobalt in concentrate t 850 – 950 Cash cost (payable)(2) A$/Ib Ni 2.00 – 2.50 Sustaining/
Slide 13: Tropicana
For personal use only Tropicana 13
Slide 14: Tropicana: Higher QoQ milled grade, recoveries and gold prices
Tropicana Operation benefited from higher QoQ milled grade, recoveries and gold prices For personal use only Metric Units 3Q19 4Q19 FY19 FY19 Guidance Gold produced (100%) koz 123.2 132.9 518.2 500 – 550 Gold Sold (IGO 30%) koz 35.8 40.5 154.4 150 – 165 Cash cost A$/oz 722 684 680 635 – 705 AISC A$/
Slide 15: Tropicana: Improved EBITDA margin of 64%
Tropicana Improved EBITDA margin of 64% For personal use only Tropicana Production (100%) and AISC Tropicana Cash Flow Reconciliation A$M oz A$/oz 160,000 $1,200 60 $1,040 $990 140,000 $950 $1,000 50 $848 120,000 7.6 $800 40 0.2 1.4 100,000 80,000 $600 30 125,100 136,891 123,236 132,945 60,000 48.4
Slide 16: Boston Shaker Underground
Boston Shaker Underground Decline development progressing on schedule For personal use only • Key value enhancement project to improve gold production Boston Shaker Underground Development Layout(2) profile via high grade underground mineralisation • Decline development commenced in early May 2019 a
Slide 17: FY20 Tropicana Guidance
FY20 Tropicana Guidance(1) Consistent high margin production projected in FY20 For personal use only Metric Units FY20 Guidance Gold produced (100%) oz 450,000 – 500,000 Gold Sold (IGO 30%) oz 135,000 – 150,000 Cash cost A$/oz 700 – 780 AISC A$/oz 1,090 – 1,210 Sustaining/improvement (30%) A$M 13 –
Slide 18: Exploration
For personal use only Exploration 18
Slide 19: Nova System
Nova System Nova intrusive system now understood to be larger than originally apparent For personal use only Interpreted magmatic intrusions over the Nova mining lease Drilling of 3D Seismic targets has confirmed a larger, live mineralised system Corridor of stacked intrusions identified through Nov
Slide 20: Nova Exploration
Nova Exploration 3D Seismic has proven to be an invaluable tool in understanding the Nova system For personal use only • Three diamond drill rigs active from surface and underground during 4Q19 • 6 holes targeting 3D seismic features intersected mafic-ultramafic rocks with disseminated nickel and co
Slide 21: Fraser Range Regional Exploration
Fraser Range Regional Exploration RC and diamond drilling continuing to test high priority targets For personal use only • Spectrem Airborne EM survey completed with new targets identified at Regal, Rhea and Meera • Prospects defined at Themis and Pion(1) ─ Themis: 25m @ 2.4g/t Au ─ Pion: 4m @ 3.8g/
Slide 22: Lake Mackay
Lake Mackay RC drilling testing targets identified during prior quarters For personal use only • 42 RC holes completed for approx. 8,500m of drilling • Ground moving-loop EM conducted over 30 anomalies • Phreaker prospect identified with results including: ─ 14m @ 0.84% Cu, 0.15g/t Au, 4.1 g/t Ag fr
Slide 23: Exploration and Evaluation Guidance
Exploration and Evaluation Guidance Increased financial commitment to discovery in FY20 For personal use only • Increased exploration budget YoY to accelerate FY20 Exploration & Evaluation Guidance(1) activity at and proximal to Nova ─ Primarily to accelerate drilling on the Nova mining lease follow
Slide 24: Downstream Processing
For personal use only Downstream Processing 24
Slide 25: Downstream Processing
Downstream Processing Aligning IGO with the clean energy and energy storage markets For personal use only Lithium Ion Batteries High metal Lower emissions(1) extraction Lower cost (1) Lower waste(1) Battery grade nickel sulphate produced via the IGO Process 1) Compared to existing alternative proces
Slide 26: Downstream Processing: Highly positive results from testwork
Downstream Processing Highly positive results delivered from testwork For personal use only • Battery grade nickel sulphate with nickel and cobalt extraction rates of +97% produced in testwork • Study work continuing to focus on: ─ Flow sheet refinement and optimisation ─ Maximising by-product produ
Slide 27: ESG
For personal use only ESG 27
Slide 28: Safety
Safety Demonstrable improvement in lead and lag indicators through FY19 For personal use only Key Lag Injury Metrics(1,2) Key Lead Injury Metrics(3,4) 5 25 4 20 3 15 2 10 1 5 0 0 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 MTIFR 12 MMA LTIFR 12 M
Slide 29: Environment and Community
Environment and Community Committed to doing what is right – because we care For personal use only Positive community feedback received from a Social Impact Assessment completed at Nova & Fraser Range Conclusion of successful community engagement and progressive rehabilitation program at the Long Op
Slide 30: Concluding Comments
Concluding Comments Quarterly performance reflects IGO’s commitment to operational excellence and delivery For personal use only • Consistent operational performance at Nova and Tropicana throughout FY19 ─ Nova metal production exceeded FY19 guidance ─ Tropicana delivered within guidance ─ Strong EB
Slide 31: For personal use only
UM. wenn. AOLLOW US LIAS WE GO FROM STRENGTH TO STRENGTH igo.com.au © mo n af
Independence Group NL — Q4 FY2019 Earnings Presentation on 6ix