Kinross Gold Corporation · TSX:K
Kinross Gold — Q2 2020 Earnings Presentation
22 slides from Kinross Gold's earnings presentation, Jul 30, 2020
Slide 1: Second Quarter 2020 Results
Second Quarter 2020 Results July 30, 2020 Delivering Value. Kinross Gold Corporation
Slide 2: Cautionary Statement on Forward-Looking Information
Cautionary Statement on Forward-Looking Information All statements, other than statements of historical fact, contained or incorporated by reference in or made in giving this presentation and responses to questions, including but not limited to any information as to the future performance of Kinross
Slide 3: Well Positioned with Strong Outlook
Well Positioned with Strong Outlook Excellent second quarter results, with significant growth in margins, earnings and free cash flow Industry-leading operational track record Managing COVID-19 impacts well Strong balance sheet with peer-leading free cash flow yield Numerous projects to add mine lif
Slide 4: Operational and Financial Highlights
Second Quarter 2020 July 30, 2020 Operational and Financial Highlights Company tracking within original guidance ranges; portfolio of mines generated strong free cash flow • Increased cash position to ~$1.5 billion; overall liquidity of ~$2.3 billion • Investment grade balance Q2 2020 Results H1 202
Slide 5: Key Developments
Second Quarter 2020 July 30, 2020 Key Developments • 30-year exploitation license to be granted for Tasiast Sud Agreement in • Reinstatement of fuel tax Principle(i) exemption with the • Repayment of ~$40 million in VAT Government of refunds by the Government Mauritania • Updated royalty structure f
Slide 6: Disciplined Capital Allocation
Second Quarter 2020 July 30, 2020 Disciplined Capital Allocation • Kinross offers strong leverage to prevailing gold prices and currency rates • Current environment coupled with operational excellence presents numerous potential opportunities to 2020 Budget Spot(i) drive shareholder returns: Gold $1
Slide 7: Financial Results
—2 Financial Results
Slide 8: Second Quarter Financial Highlights
Second Quarter 2020 July 30, 2020 Second Quarter Financial Highlights Produced approximately 572,000oz.(1) at an average cost of sales of $725/oz.(1,2) and an all-in sustaining cost of $984/oz.,(1,2) tracking original guidance ranges Year-over-year improvements Quarter-over-quarter improvements 150%
Slide 9: Strong Liquidity and Financial Flexibility
Second Quarter 2020 July 30, 2020 Strong Liquidity and Financial Flexibility Liquidity Position Financial Flexibility ($ billion) • Available liquidity of ~$2.3 billion, including over $1.5 billion of cash • Further strengthened net debt to EBITDA As at • Subsequent to the quarter, repaid $250 June
Slide 10: Operating Results
Operating Results 10
Slide 11: COVID-19 Response
Second Quarter 2020 July 30, 2020 COVID-19 Response Prioritizing the health and safety of employees and host communities Managing the Pandemic and Minimizing Impacts • Early actions by Task Force helped protect sites and ensured business continuity; all sites remained in operation in H1 2020 • On-go
Slide 12: Continued Strong Performance at Paracatu
Second Quarter 2020 July 30, 2020 Continued Strong Performance at Paracatu Largest producer in the portfolio, with cost of sales below $600/oz.(1,2) • Production increased by ~15,000oz. Paracatu quarterly performance compared with Q1 2020 $1,000 • Enhanced performance reflects Asset Production cost
Slide 13: Robust Cash Flow from Kupol-Dvoinoye
Second Quarter 2020 July 30, 2020 Robust Cash Flow from Kupol-Dvoinoye Russian operations delivered another standout quarter, increasing production and reducing costs compared to Q1 2020 • Production increased by ~10,000oz. over Q1 2020 due to good throughput, grades Kupol-Dvoinoye quarterly perform
Slide 14: Encouraging Results at Chulbatkan
Second Quarter 2020 July 30, 2020 Encouraging Results at Chulbatkan ~35,500m of infill, step-out and metallurgical drilling completed by the end of Q2 • Exploration results support thesis for the project: o Large estimated resource with highly continuous mineralization open along strike and at depth
Slide 15: Lowest Costs at Tasiast
Second Quarter 2020 July 30, 2020 Lowest Costs at Tasiast Average daily throughput rates slightly higher than record performance of Q1 2020 • Delivered the lowest costs in the portfolio, despite pandemic-related challenges and 17-day strike o Adjusted for these impacts, daily throughput averaged ~17
Slide 16: U.S. Portfolio Highlights
Second Quarter 2020 July 30, 2020 U.S. Portfolio Highlights • Expect production to increase in H2, particularly weighted to Q4 Round Mountain, • Positive exploration results from Nevada Phase X, potentially the next major pushback after Phase W • Production increased by ~15% Bald Mountain, quarter-o
Slide 17: Targeting Mine Life Extension at Chirano
Second Quarter 2020 July 30, 2020 Targeting Mine Life Extension at Chirano 29,000 metres of drilling was completed at the Akwaaba, Tano, Obra and Mamnao West areas in H1 2020 • Attractive opportunity for mining beyond 2025 at Obra: o H1 2020 drilling yielded significant intercepts and extended the d
Slide 18: La Coipa Restart Project
Second Quarter 2020 July 30, 2020 La Coipa Restart Project Pre-stripping expected in early 2021; first production expected in mid-2022 • Leverages existing infrastructure, including plant and Maricunga mine fleet • Potential to extend mine life through satellite deposits • Work ramping up after COVI
Slide 19: Capital Expenditures Outlook
Second Quarter 2020 July 30, 2020 Capital Expenditures Outlook Adjustments to timing of capital program to capitalize on valuable opportunities and to accommodate various COVID-related restrictions across our operations Examples of Adjustments to Capex Spend Pushed to 2021: • Capitalized stripping d
Slide 20: Kinross Value Proposition
Kinross Value Proposition Operational Excellence Financial Strength & Flexibility Diverse portfolio of mines consistently meeting Maintaining a strong balance sheet continues to or outperforming operational targets be a priority objective Available liquidity of ~$2.3 billion, 8 Consecutive Met or ex
Slide 21: Endnotes
Second Quarter 2020 July 30, 2020 Endnotes 1. Unless otherwise noted, gold equivalent production, gold equivalent ounces sold and production cost of sales figures in this presentation are based on Kinross’ 90% share of Chirano production and sales. Also unless otherwise noted, dollar per ounce ($/oz
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