Dpm Metals Inc. · TSX:DPM
Dpm Metals — Dundee Precious Metals — RBC Capital Markets Global Mining & Materials Conference 2021
33 slides from Dpm Metals's conference presentation, Nov 16, 2021
Slide 1: RBC Capital Markets Global Mining & Materials Conference
RBC Capital Markets Global Mining & Materials Conference November 16-17, 2021 Unlocking resources and generating value to thrive and grow together
Slide 2: Forward Looking Statements
Forward Looking Statements Certain statements and other information included in this presentation, including the oral discussion associated therewith, and our other disclosure documents constitute “forward looking information” or “forward looking statements” within the meaning of applicable securiti
Slide 3: Well-Positioned to Continue Delivering Value to Shareholders
Well-Positioned to Continue Delivering Value to Shareholders DPM’s strong fundamentals represent an attractive value opportunity Strong Production & Cost Profile Strong Free Cash Flow & Balance Sheet Returning Capital to Shareholders ▪ 280,000 Au oz. ▪ Generated $211M of free cash ▪ $0.03/sh quarter
Slide 4: Business Strategy
Business Strategy Unlocking resources and generating value to thrive and grow together ▪ Supported by foundation of core values that guide how DPM conducts its business & informs a set of complementary strategic pillars ▪ Resources allocated in-line with strategy to ensure DPM delivers value for all
Slide 5: An Industry Leader in ESG
An Industry Leader in ESG Achieving progress on a number of social and environmental initiatives Measuring Economic Robust Corporate Improving Contributing to our Environmental Impact Governance Wellbeing Local Communities Stewardship New strategic objective: Created 52 local jobs One of the lowest
Slide 6: Adding Value Through Innovation
Adding Value Through Innovation Leader in mining innovation and operational excellence Targeting technologies with potential to: ▪ Increase safety Integrated Mine Waste Facility ▪ Lower mining costs ▪ Improve operating performance ▪ Reduce environmental impact Innovation in action ▪ Integrated Mine
Slide 7: Focused on Shareholder Returns
Focused on Shareholder Returns Attractive entry point considering current share price Year-to-Date Share Price Performance (December 31, 2020 – November 15, 2021) US$1.5B market capitalization 1.6% dividend yield 15% free cash flow yield(7) 12/31/2020 1/30/2021 3/1/2021 3/31/2021 4/30/2021 5/30/2021
Slide 8: Our Global Portfolio
Our Global Portfolio Chelopech (100%) 1 Location Stage 2021 Guidance(1) Chelopech, Bulgaria Producing 156 – 171koz Au 34 – 39Mlbs Cu 6 2 Ada Tepe (100%) Location Stage 2021 Guidance(1) Southern Bulgaria Producing 115 – 141koz Au 3 Loma Larga (100%) Corporate head office, 41 7 Location Stage Producti
Slide 9: Solid Three-Year Outlook
Solid Three-Year Outlook Highlights strong production profile, attractive AISC and potential to generate significant free cash flow Strong Gold Production Profile Stable Copper Production Gold contained in concentrate produced (‘000s ounces) Copper contained in concentrate produced (Mlbs) 271 – 317
Slide 10: Q3 2021 Results Highlights
Q3 2021 Results Highlights Delivering another quarter of strong free cash flow generation Solid Metals Production Excellent All-in Sustaining Cost Performance Metals Contained in Concentrate Produced All-in sustaining cost(2) ($/oz. Au) Gold (K oz.) Copper (M lbs) 271 - 317 $701 $625 - $695 227.1 $6
Slide 11: Chelopech, Bulgaria: High-quality, low-cost flagship asset
Chelopech, Bulgaria: High-quality, low-cost flagship asset A strong, reliable performer ▪ Strong performance in 2020 with continued mine and mill optimization ▪ Focused on mine and process plant optimization Metals contained in concentrate produced (‘000s oz) Sustaining capital expenditures Gold ('0
Slide 12: Chelopech Near Mine Exploration to Add Resources
Chelopech Near Mine Exploration to Add Resources Focused on extending mine life through in-mine & brownfields exploration 2020 Brownfields Exploration ▪ West Shaft: Aggressive target delineation drilling ongoing with ~7,000 m completed. Vozdol Initial results include(i): Krasta ▪ X_WS_01: 19.7 m at
Slide 13: Ada Tepe, Bulgaria
Ada Tepe, Bulgaria Driving growth in production and cash flow ▪ One of the highest grade open pit mines in the world(i) with a LOM gold grade of 4.8 g/t (11) ▪ Contributing significant free cash flow generation to DPM’s portfolio ▪ Delivered impressive performance in 2020 and outperformed gold produ
Slide 14: Ada Tepe Brownfields Exploration to Add Resources
Ada Tepe Brownfields Exploration to Add Resources 2020 Brownfields Exploration ▪ Active exploration within mine concession – 8,000 m on Surnak, Synap and Kuklitsa ▪ Focused on sulphide mineralization, with goal of extending Ada Tepe’s mine life ▪ Chatal Kaya: 6,000 m of target delineation and infill
Slide 15: Loma Larga: Well-Aligned with DPM Core Strengths
Loma Larga: Well-Aligned with DPM Core Strengths & Unique Capabilities to Unlock Value Leverages DPM’s proven strengths in developing world-class assets and applying industry-leading ESG solutions Chelopech Ada Tepe Tsumeb ▪ Similar geology, mining method and ▪ Loma Larga will benefit from ▪ Project
Slide 16: Loma Larga Project: High-Quality Growth Asset
Loma Larga Project: High-Quality Growth Asset Potential to add meaningful low-cost production growth ▪ Activities focused on integration, stakeholder engagement and Feasibility Study Summary Metrics (April 2020)(6) review of technical and permitting schedules Initial mine life 12 years ▪ Progressing
Slide 17: Timok Project: Organic Growth with Upside Potential
Timok Project: Organic Growth with Upside Potential Several optimization initiatives to reduce initial capital and improve economics underway ▪ Project advancing to feasibility study, following positive PFS PFS Highlights (7) results Total ore mined (Mt) 19.2 ▪ PFS focused on oxide and transitional
Slide 18: Timok Gold Project, Serbia
Timok Gold Project, Serbia Adding value through exploration Bigar Hill conceptual BIDD134 37m @ 0.82 g/t Au open pit BIDD146 8m @ 2.96 g/t Au ▪ Prospective targets generating encouraging results ▪ Chocolate: oxide target located approximately 300 m SE of Bigar Hill deposit outlined in late 2020 Choc
Slide 19: Tsumeb, Namibia: Operating Consistency with Growth Potential
Tsumeb, Namibia: Operating Consistency with Growth Potential A secure processing outlet for Chelopech ▪ Growing cash flow generating custom toll business ▪ Focused on operational stability, efficiencies and cost reduction (2) ▪ Finalized new 3-year agreement to fill existing smelter capacity ▪ Optio
Slide 20: Additional Upside through Equity Interests
Additional Upside through Equity Interests Liquid investment portfolio provides upside exposure to high-quality gold projects Sabina Gold and Silver Corp. Velocity Minerals Ltd. Ownership: 8.9% Ownership: 8.5% Rationale: Originally a DPM project, supportive Rationale: DPM’s strong presence and capab
Slide 21: Disciplined Capital Allocation Framework with Quarterly Dividend
Disciplined Capital Allocation Framework with Quarterly Dividend Established to manage substantial free cash flow generation Balances financial strength, Options are not mutually exclusive reinvestment and return of capital Maintain balance sheet Reinvestment Return capital to strength shareholders
Slide 22: Attractive Valuation
Attractive Valuation DPM offers a compelling value opportunity ▪ Strong production & ▪ Strong free cash flow & ▪ Returning capital to AISC profile balance sheet shareholders ▪ Building our pipeline ▪ Unique capabilities ▪ Attractive valuation Price to 2021 Cash Flow Dividend Yield P/NAV 1.9 9.3 8.6
Slide 23: Key Value Generating Catalysts
Key Value Generating Catalysts Chelopech Ada Tepe Tsumeb Timok Gold Project Loma Larga Project ✓ Mine life extended to ▪ Drilling ~ 23,000 ▪ Continued ▪ Advance feasibility ✓ Addition of Loma Larga ▪ Additional free cash flow 2029 m to advance optimization study to growth pipeline with no further de
Slide 24: Appendix
Appendix Unlocking resources and generating value to thrive and grow together
Slide 25: 2021 Guidance
2021 Guidance YTD Previous 2021 Revised 2021 2021 Guidance(1) Guidance(1) Metals contained in concentrate produced Gold (K oz.) 227.2 271 – 317 On track N/A Copper (Mlbs) 25.5 34 – 39 Cash cost per tonne of ore processed ($/t) Chelopech $45 $42 – $45 $46 – $48 Reflects recent electricity price incre
Slide 26: Three-Year Outlook (2020-2022)
Three-Year Outlook (2020-2022) US millions, unless otherwise indicated 2020 Results 2021 Guidance 2022 Outlook 2023 Outlook Gold contained in concentrate produced (‘000s oz) (1)(2) Chelopech 179 156 – 176 145 – 165 150 – 170 Ada Tepe 119 115 – 141 95 – 115 115 – 140 Total 298 271 – 317 240 – 280 265
Slide 27: Operating in Mining Friendly Jurisdictions
Operating in Mining Friendly Jurisdictions Bulgaria Namibia Serbia ▪ Uninterrupted operations since 2003 ▪ Political party stability ▪ EU candidate since 2012 ▪ Member of the EU since 2007 ▪ 5th largest producer of uranium and 9th ▪ 3rd largest copper producer in Europe ▪ 4th largest gold producer i
Slide 28: Strong Mineral Resource and Reserve Base
Strong Mineral Resource and Reserve Base Mineral Reserves (13, A, B) Million Au Cu Au Cu (%) Mineral Resources (13, A, B) Million Au Cu Au Cu (%) Tonnes (Moz) (Mlbs) (g/t) Tonnes (Moz) (Mlbs) (g/t) Chelopech Chelopech Proven M&I 7.8 0.681 146 2.71 0.84 17.4 1.467 315 2.63 0.82 Probable Inferred 10.8
Slide 29: Hedge Position as at September 30, 2021
Hedge Position as at September 30, 2021 QP Hedges Volume Hedged Weighted Average Fixed Price Payable gold 45,095ounces $1,766.38/oz. Payable copper 11,640,394 pounds $4.24/pound Call options sold Put options purchased Percentage of Forecast Year of projected Amount Hedged Operating Cost FX Hedges Av
Slide 30: Top Shareholders & Analyst Coverage
Top Shareholders & Analyst Coverage ▪ Dundee Precious Metals has 182M shares outstanding (as of May 5, 2021) Top Shareholders Analyst Coverage Blackrock Inc. 10.9% Beacon Securities Bereket Berhe Van Eck Associates Corporate 10.0% CIBC World Markets Cosmos Chiu First Eagle Investment Management 6.9%
Slide 31: Footnotes and Disclaimers
Footnotes and Disclaimers 1. Forecast/guidance information is subject to a number of risks. 2021 guidance and the Company’s three-year outlook as disclosed in Management’s Discussion and Analysis (“MD&A”) for the period ended September 30, 2021, issued on November 11, 2021, which can be found on the
Slide 32: Footnotes and Disclaimers
Footnotes and Disclaimers Qualified Person Disclosure A. The Mineral Resource and Mineral Reserve estimates for Chelopech and other scientific and technical information which supports this press release was prepared by Petya Kuzmanova, MIMMM, CSci, Senior Resource Geologist, of the Company, under th
Slide 33: Corporate Head Office Investor Relations
Corporate Head Office 1 Adelaide Street East, Suite 500 Toronto, Ontario M5C 2V9 T: 416 365-5191 Investor Relations 1 Adelaide Street East, Suite 500 T: 416 219-6177 www.dundeeprecious.com Follow us on Twitter @DundeePrecious Visit our LinkedIn page linkedin.com/company/dundee-precious-metals-inc/
Dundee Precious Metals — RBC Capital Markets Global Mining & Materials Conference 2021 on 6ix