Florida Canyon Gold — Argonaut Gold — Q3 2019 Earnings Presentation
19 slides from Florida Canyon Gold's earnings presentation, Nov 8, 2019
Slide 1: Q3 2019 Webcast Presentation
TSX:AR Gold producer with advanced exploration projects in the Americas Photo: La Colorada September 2019 WEBCAST PRESENTATION Third Quarter Ended September 30, 2019 Webcast & Conference Call November 8, 2019
Slide 2: Forward Looking Information
FORWARD LOOKING INFORMATION This presentation contains certain “forward-looking statements” and “forward-looking information” under applicable Canadian securities laws concerning the proposed transaction and the business, operations and financial performance and condition of Argonaut Gold Inc. (“Arg
Slide 3: Restructuring Operations to Maximize Cost Efficiencies
Restructuring Operations to Maximize Cost Efficiencies Eliminating redundant positions Restructuring of organization to right size for current operations Maximizing Cost Efficiencies and Profitability TSX:AR Q3 2019 Webcast & Conference Call – NOVEMBER 8, 2019 | ARGONAUT GOLD 3
Slide 4: Q3 2019 and Recent Highlights
Q3 2019 and Recent Highlights Financial Performance 44,712 Production GEOs2 • Net cash1 increase of $11.7M • Up 31% versus Q3 2018 • Revenue of $66.8M (+62% vs. Q3 2018) • The second half of Q3 saw daily production • Cash flow from operating activities before increase and trend positively heading to
Slide 5: Financial Performance
Financial Performance 3 Months ended September 30 9 Months ended September 30 % % 2019 2018 Change 2019 2018 Change Production & Sales Production (GEO)1 44,712 34,165 31% 139,094 113,459 23% Sales (GEO)1 45,567 34,248 33% 145,426 113,152 29% Revenue ($M) $66.8 $41.3 62% $196.8 $144.4 36% Profit & Lo
Slide 6: Q3 2019 Capital Spending and Cash Flow ($M)
Q3 2019 Capital Spending And Cash Flow ($M) Investing in the future Cash Flow Reconciliation Capital Spend Opening balance cash 23.9 Cash flow from ops excl. working capital 17.2 Sustaining Expansion Stripping Changes in working capital 2.3 El Castillo 3.5 - 0.9 Cash before investment & financing La
Slide 7: Operations Overview
Operations Overview 3 Months ended September 30 9 Months ended September 30 % % Production (GEOs)1 2019 2018 Change 2019 2018 Change El Castillo 14,592 10,368 41% 52,613 29,327 79% San Agustin 15,702 16,526 (5%) 43,765 49,822 (12%) La Colorada 14,418 7,271 98% 42,716 34,310 25% TOTAL 44,712 34,165 3
Slide 8: Updated 2019 Guidance
Updated 2019 Guidance Previous Updated Consolidated Consolidated Guidance Guidance GEO production2 In 000s 200 - 215 190 - 200 $ per Cash costs 1,3 ounce Au $800 - $900 $900 - $925 $ per AISC 1,3 ounce Au $1,025 - $1,125 $1,125 - $1,150 Capital1 $M $50 - $55 $50 - $55 1 Assumes a MXN:USD exchange ra
Slide 9: Recent Quarterly GEO Production Profile
Recent Quarterly GEO Production Profile 100 80 50k-60k 52k 54k GEOs1 60 45k 40k 40 20 0 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019E +10% Water issues Ramping up tonnage Returning to prior resolved at San at San Agustin & production rates Agustin La Colorada 1 GEOs are based on a conversion ratio of 75:
Slide 10: Looking Ahead – Poised for Strong Q4 2019
Looking Ahead – Poised for Strong Q4 2019 Stacked 55k Recoverable GEOs1 to Leach Pads during Q3 San Agustin ramping up to 30,000 tonnes per day and La Colorada at 14,000 tonnes per day Strong Finish to 2019 1GEOs are based on a conversion ratio of 75:1 for silver to gold for ounces. Expected recover
Slide 11: Argonaut's Vision & Strategy
Argonaut’s Vision & Strategy Transitioning our production and cost profile over the next five to seven years while minimizing equity dilution: High-Cost Producer Low Cost Intermediate Producer 190k – 200k oz 300k – 350k oz per year per year SUSTAINABLE GROWTH & REPLACEMENT of ounces Generating cash
Slide 12: Locking in Cash Flow
Locking in Cash Flow Lower capital ~25% of production locked Cash flow to build spending in in over next two years development capital in 2020 asset than 2019 Total zero-cost program through mid-2022 of 146k oz between $1,450 and $1,7071 Ensures profitability Locks in cash flow at Extends El Castill
Slide 13: Transformation Strategy - Next Tier Producer
Transformation Strategy - Next Tier Producer CURRENT OPERATIONS DEVELOPMENT ASSETS Capital Production LOM Cash Cost2 Production Cash Cost2 ($M) (oz/year) (years) (per oz) (oz/year) (per oz) Cerro del Gallo4 $155 95k 7.2 $516 Current ~200k San Antonio5 $84 74k 15 $553 Operations $900 - $925 GEOs1 Mag
Slide 14: Development Assets Provide Optionality
Development Assets Provide Optionality Analyst Consensus1 Market Cap Operating Assets + Development at November 1, 2019 Net Cash Assets2,3,4 $295M $360M $674M EVERY $100 MOVE HIGHER IN THE GOLD PRICE ADDS ~$140M IN DEVELOPMENT ASSET PORTFOLIO NPV 1 Analyst consensus NPVs are based on analyst consens
Slide 15: Near-Term Catalysts
Near-Term Catalysts H1 2019 H2 2019 EL CASTILLO COMPLEX RAMP Expansion of the San Agustin crushing & stacking system from 20ktpd to 30ktpd UP MAGINO Completed Federal & Provincial Environmental Assessment Advance construction permit, Mine Closure Plan and Schedule 2 TO 2020 authorizations Advance de
Slide 16: Our Focus
Our Focus RESTRUCTURE to maximize cost efficiencies and profitability BUILD balance sheet DE-RISK development projects TRANSFORMATION strategy TSX:AR Q3 2019 Webcast & Conference Call – NOVEMBER 8, 2019 | ARGONAUT GOLD 16
Slide 17: Additional Information
TSX:AR ADDITIONAL INFORMATION /ArgonautGoldInc @Argonaut_Gold Dan Symons Vice President, Investor Relations @ArgonautGoldInc Argonaut Gold Inc. company/Argonaut-Gold-Inc First Canadian Place 100 King St. West, Suite 5700 Toronto, ON M5X 1C7 T: 416-915-3107 Argonaut Gold Inc. Email: dan.symons@argona
Slide 18: Notes and Disclosures
Notes and Disclosures Argonaut Gold is a Canadian gold company engaged in exploration, mine development and production activities. Its primary assets are the production stage El Castillo mine and San Agustin mine, which together form the El Castillo Complex in Durango, Mexico and the production stag
Slide 19: Mineral Resource Notes and Disclosures
Mineral Resource Notes and Disclosures All Mineral Resources have been estimated in accordance with Canadian Institute of Mining Standards. Mineral Resources are not known with the same degree of certainty as Mineral Reserves and do not have demonstrated economic viability. In addition, the quantity