Hudbay Minerals Inc · TSX:HBM
Hudbay Minerals — Merger or Acquisition (April 2023)
44 slides from Hudbay Minerals's merger presentation, Apr 13, 2023
Slide 1: Cautionary Information
CAUTIONARY INFORMATION Disclaimer This presentation, as supplemented or amended from time to time has been prepared in connection with the proposed acquisition by Hudbay Minerals Inc. ("Hudbay") of all of the issued and outstanding common shares of Copper Mountain Mining Corporation ("Copper Mountai
Slide 2: Today's Speakers
TODAY’S SPEAKERS H'!DBAY PETER KUKIELSKI PRESIDENT & CEO ‘More than 30 years of sector experience in base metals, precious metals and bulk materials across the globe, Including leadership postions at Nevsun, Anemka, ArcelorMittal, Teck and Noranda EUGENE LEI cro ‘Over 20 years of global mining inves
Slide 3: Transaction Overview
TRANSACTION OVERVIEW OVERVIEW Hudbay to acquire 100% of common shares of Copper Mountain Potential to unlock US$30 millon in annual operating efficiencies and synergies for the benefit of both sets of shareholders Expected to be accretive to Hudbay’s NAV per share Pro forma ownership to be 76% Hudba
Slide 4: On-Strategy Combination with Strong Industrial Logic
ON-STRATEGY COMBINATION WITH STRONG INDUSTRIAL LOGIC Commodity Efficiencies Diversification oe () Deleveraging Capital Allocation HIDBAY
Slide 5: Diversified Portfolio in Tier 1 Jurisdictions
DIVERSIFIED PORTFOLIO IN TIER 1 JURISDICTIONS MASON voiopmant Project SNOW LAKE o A Operating mine CONSTANCIA ] =e ‘avers peu [C4] [wo] [au] [40] +150kt Cu +300koz Au +200ktpa Cu 2023E Production’ Potential from Development Projects R operating Mine @® development Project HIDBAY
Slide 6: Copper Mountain Mine Overview
COPPER MOUNTAIN MINE OVERVIEW 75% Copper Mountain Mining Corporation MAMMARMMANE - 25% Mitsubishi Materials Corporation | + 20km south of Princeton, B.C. (Canada) + 6,702 hectares (67 square kilometers) + Copper-gold porphyry + Conventional open pit + 2011 + 45 ktpd nameplate capacity (permitted 50
Slide 7: Combination of Strong ESG Cultures
COMBINATION OF STRONG ESG CULTURES { J ReDuciNe caRBON FOOTPRINT ry WATER AND BIODIVERSITY STEWARDSHIP ‘@ Operations are well-positioned in the lower haif of the global GHG emissions curve for © Resioting ecosystems by progressively rehabatag copper mines © Committed to conserving biodiversity @ Pur
Slide 8: Leading Climate Change Initiatives
LEADING CLIMATE CHANGE INITIATIVES FURTHER IMPROVE CARBON FOOTPRINT WITH COPPER MOUNTAIN’S LEADING GHG INITIATIVES Copper Mountain has the potential to be the lowest-emitting, open-pit OPP copper mine in the world by 2035 through several net-zero carbon initiatives Ability to apply these leading car
Slide 9: Compelling Strategic Rationale
COMPELLING STRATEGIC RATIONALE
Slide 10: Enhanced Size and Scale
ENHANCED SIZE AND SCALE 2023E Production (kt Cu) 208 2023E Cash Costs (US$/Ib Cu) 185 1 ag $105 % rr ii ERO Lundin Copper Billets Copper Proforma Sandive OZ —_20Metals Now WEDBAY. Nouriin Resources (Mt Cu) Taseko Capstone Lundin Capstone Proforma OZ Sandie Taseko ERO HUDBAY 2023E EBITDA (USSM) $1227
Slide 11: Third Largest Copper Producer in Canada
THIRD LARGEST COPPER PRODUCER IN CANADA (ia) £2023 Canadian Copper Production (kt Cu) 130 Positioned among the largest copper producers in Canada with a resource base ae that could support further expansion 72 53 52 45 32 29 20 “ee newgold Teck We piippay Tasekor ciencore Qi" Senor Denied Sete sta P
Slide 12: Leading Shareholder Liquidity
LEADING SHAREHOLDER LIQUIDITY Pro Forma >< HUDBAY $5 ED Q Increased scale provides stronger liquidity, “ enhances valuation and improves Tundin mining = OC) attractiveness to investors E wy s 5 > 2 @ $ © © Taseko: st AATALAY c Bubble Size Based on Market Caj nexa O 0 50 400 150 200 250 300 2022 Copp
Slide 13: Balanced Geographical NAV Exposure
BALANCED GEOGRAPHICAL NAV EXPOSURE COMBINED COMPANY WILL REMAIN 100% IN TIER 1 JURISDICTIONS ie | | | I 62% | | | | | I | I | I | | 5% | —— | wipBay | ear _ ae ps mNorth America mSouth America mAfrica Europe Australia
Slide 14: Enhanced Copper Exposure
ENHANCED COPPER EXPOSURE PRIMARY COPPER PRODUCER WITH COMPLEMENTARY GOLD EXPOSURE fi» Reserves by Commodity (Cu Eq)" 20228, Revenue by Commodity (%) SEE ae. Pro Forma H'! DBAY conpen wounrain 27 H'!DBAY 16% @ 7 23% 19% (+2) =
Slide 15: The Hudbay Advantage - Efficient Operations
THE HUDBAY ADVANTAGE - EFFICIENT OPERATIONS CONSTANCIA IS ONE OF THE LOWEST COST COPPER MINES IN SOUTH AMERICA 2022 Mine Site Cost (USSitonne milled) Continuous operational improvements at Constancia have driven $309 costs down, while increasing efficiencies and productivity & Ed by yy V// Yi YI Yi
Slide 16: Hudbay Expects US$30 Million of Annual Efficiencies and Synergies
HUDBAY EXPECTS US$30 MILLION OF ANNUAL EFFICIENCIES AND SYNERGIES US$20M of Annual Operating Efficiencies from Copper Mountain Mine’ US$10M of Annual Corporate Synergies’ lity Improve productivity in key areas uw Increase throughput and reduce costs BZ] Achieve consistent and stable operations | ae
Slide 17: Potential to Unlock US$20 Million of Annual Efficiencies
POTENTIAL TO UNLOCK US$20 MILLION OF ANNUAL EFFICIENCIES FROM THE COPPER MOUNTAIN MINE‘ Key Similarities Between Copper Hudbay Can Apply its Constancia Mountain Mine and Constancia Operating Framework to Unlock Efficiencies? @ Large-Scale, Open Pit Operations Crusher Excavators Leading maintenance &
Slide 18: Copper Mountain Mine Near-Term Focus
COPPER MOUNTAIN MINE NEAR-TERM FOCUS Phase II —- Optimization @ Operational Integration @® Improve Beyond Base ~ Alignment of Standards (KPIs, Reconciliation) ~ Usage of Hudbay owned equipment - throughput improvement with low capital - Update Resource Modeling ~ Supplement Minesite Team with Hudbay
Slide 19: Decreasing Leverage Profile
DECREASING LEVERAGE PROFILE Pro Forma Hudbay to benefit from accelerated deleveraging to enhance credit profile and lower cost of capital 2025 Leverage Target for Copper World: 1.2x Net Debt / EBITDA Hudbay Pro Forma Hudbay Pro Forma Hudbay 2022A Net Debt / EBITDA 2023E Net Debt / EBITDA Range 2024E
Slide 20: Enhanced Capital Allocation
ENHANCED CAPITAL ALLOCATION + Immediately pursue high return and short payback initiatives + Increase EBITDA and strengthen balance sheet to execute brownfield expansions and transformational initiatives in Enhancements + Low-risk brownfield optimizations with minimal capital requirements on a relat
Slide 21: Hudbay Priority Pipeline Opportunities
HUDBAY PRIORITY PIPELINE OPPORTUNITIES Operation Enhancements Unlocking Copper Mountain’s full potential from current operations Recovery Programs recoveries at Stall and Constancia to extract more per tonne processed Brownfield Expansion grade satellite deposits for Constancia Potential high- Coppe
Slide 22: Pro Forma Positioning
PRO FORMA POSITIONING
Slide 23: Among Few Base Metal Producers >US$3BN EV
AMONG FEW BASE METAL PRODUCERS >US$3BN EV Enterprise Value (US$ Bn) $208 $252 $233 Qe NINN 4 2 i; o£ t OE 3 i Had . ze Ei 5S al og sr | or rt . eee SIEIOW eIsy [eed jaddog epenon, yejunoy seddog oyase, »y9019 uosdwoy jsnyued unsnon seddog 013 XNd eupenD) exXON Aeqpny euypueg Sui youu seounosey ny eu
Slide 24: Premier Positioning Amongst Peers
PREMIER POSITIONING AMONGST PEERS |2023E Cash Costs (US$/Ib Cu) $254 264 $2.08 185 sigo S158 156 138 31.05 sts 4 45 Lundin Capstone ProForma OZ —Sandfire_ Ero ProForma Sandfre OZ Ero Lundin Capstone NAV (x) P | 2023E CFPS (x) 12% 149% 1.0% 09x \ 94 x ad on 8x os 08x 07 58x | i = Sandfre oz Ero Lundi
Slide 25: On-Strategy Combination with Strong Industrial Logic
ON-STRATEGY COMBINATION WITH STRONG INDUSTRIAL LOGIC Commodity Efficiencies Diversification oe () Deleveraging Capital Allocation HIDBAY
Slide 26: Appendix
H' DBAY
Slide 27: Copper Mountain Exploration Potential
COPPER MOUNTAIN EXPLORATION POTENTIAL OREBODY REMAING OPEN BOTH LATERALLY AND AT DEPTH Copper Mountain is similar to Red Chris and the Cadia-Ridgeway deposits with the same style of high-grade, A-type quartz vein-hosted, copper gold mineralization MPARISON TO OTHER ALKALIC PORPHYRY DEPOSITS: Copper
Slide 28: Constancia Mine
CONSTANCIA MINE 16 YEARS Cu-Mo 86k tpd 110kt 87koz $1.18/Ib CONSTANCIA COPPER PRODUCTION PROFILE? $1.75 140 $154 $1.58 LONG LIFE, LOW-COST COPPER MINE IN PERU 100%-owned, production commenced in 2014 Developed constructive partnerships with local communities High-grade Pampacancha satellite pit comm
Slide 29: Constancia Exploration Potential
CONSTANCIA EXPLORATION POTENTIAL SEVERAL OPPORTUNITIES EXIST ON HUDBAY’S EXTENSIVE LAND PACKAGE IN PERU ‘Norte Maria Reyne ustrceo Pampacenche Geophysics indicate several nearby exploration targets within trucking distance of Constancia’s infrastructure - Maria Reyna and Caballo have large-scale pot
Slide 30: Snow Lake Operations
SNOW LAKE OPERATIONS LOW-COST GOLD OPERATION WITH MEANINGFUL BASE METAL PRODUCTION The 100%-owned Lalor mine in Snow Lake produces gold ore for the newly refurbished New Britannia mill and base metal ore for the Stall concentrator New Britannia mill commenced production in late 2021 resulting in Inc
Slide 31: Snow Lake Exploration Potential
SNOW LAKE EXPLORATION POTENTIAL LALOR IN-MINE EXTENSION POTENTIAL AND REGIONAL UPSIDE EXPLORATION OPPORTUNITIES @ Snow Lake deposits contain 1.7 million ounces of gold in inferred resources @ Lalor inferred resources estimated using stringent methodology constraining the resource within a stope opti
Slide 32: Copper World Project
1.2Bt $1.15/Ib 44 YEARS COPPER WORLD PROJECT om _ $1,296M / 18% : ia m COPPER WORLD ECONOMICS 3 HIGH-Q\ « => eee UALITY COPPER DEVELOPMENT PROJECT ‘Two-phase mine plan with standalone Phase I operation on private land requiring state-level permits and generating an after-tax NPV,o., of $741M and an
Slide 33: Mason Project
MASON PROJECT LARGE OPEN PIT COPPER PROJECT WITH SIGNIFICANT LAND PACKAGE Acquired in 2018, Mason is 100%-owned by Hudbay and is located in the prolific Yerington Copper District Excellent infrastructure is already in place including road access and nearby rail and power In 2019 and 2020, Hudbay con
Slide 34: Llaguen Project
LLAGUEN PROJECT ADDING A NEW PROJECT TO OUR COPPER GROWTH PIPELINE VERVIEW MINERAL RESOURCE ESTIMATE AS AT NOVEMBER 1, 2022 Category Metric Tonnes Cu(%) Mo (a!) Au(aM) Ag (ot) CuEq(%) Indicated Global (>= 0.14% Cu) 271,000,000 033 218 0033-20402 Including Indicated High-grade eer 113,000,000 043 261
Slide 35: Peru Mineral Reserves
PERU MINERAL RESERVES (as at sanuary 1, 2023) -ATEGORY ONNES Cu Ag (git) CONSTANCIA Proven 411,200,000 0.28 79 0.041 2.85 Probable 46,500,000 023 79 0.038 2.84 TOTAL PROVEN AND PROBABLE 457,700,000 0.28 79 0.040 2.85 PAMPACANCHA Proven 34,100,000 0.59 453 0.320 498 Probable 300,000 0.17 306 0.119 22
Slide 36: Peru Mineral Resources
PERU MINERAL RESOURCES (as at sanuary 1, 2023) \TEGORY CONSTANCIA, Measured Indicated Inferred — Open Pit, Inferred Underground PAMPACANCHA Measured Indicated Inferred TOTAL MEASURED AND INDICATED TOTAL INFERRED 118,400,000 140,700,000 56,700,000 6,500,000 9,100,000 300,000 900,000 268,500,000 64,10
Slide 37: Snow Lake Reserves & Resources - Lalor & 1901
SNOW LAKE RESERVES & RESOURCES - LALOR & 1901 (AS AT JANUARY 1, 2023) PROPERTY TONNES = Au( Zn (* Proven Lalor 977,000 25 57 2 Base Metal Zone 4901 4.278.000 22 an 020 aa Probable Lalor 522000 26 459 026 203 1901 245,000 os 407 020 232 Total Base Metal 8,022,000 25 oT 029 m5 Gold Zone Proven Lalor 3
Slide 38: Snow Lake Reserves & Resources - Other Gold
SNOW LAKE RESERVES & RESOURCES — OTHER GOLD (AS AT JANUARY 1, 2023) PROPERTY CATEGORY TONNES Au (git) Cu (%) Ag (git) wim Probable 2,450,000 0.25 16 1.63 63 Probable 660,000 = 42 3Zone TOTAL WIM + 3 ZONE PROBABLE (GOLD) 3,110,000 220 22 1.28 5.0 Inferred 570,000 = 44 Birch New Britannia Inferred 2,7
Slide 39: Snow Lake Reserves & Resources - Other Base Metals
SNOW LAKE RESERVES & RESOURCES — OTHER BASE METALS (AS AT JANUARY 1, 2023) PROPERTY cate TONNE: Zn¢ Ag (ait) PENI Indicated 470,000 3.89 03 049 68 Talbot! Indicated 2,190,000 179 24 233 36.0 TOTAL INDICATED (BASE METALS) 2,660,000 3.04 18 2.01 30.9 Watts River Inferred 3,150,000 258 10 234 31.0 PENI
Slide 40: Copper World Complex Mineral Resources
COPPER WORLD COMPLEX MINERAL RESOURCES (AS AT JANUARY 1, 2023) CuGrade Soluble Cu PROPERTY CATEGORY TONNES Ms Mo (ait) Ag (att) a 687,000,000 0.45 0.05 138 54 Indicated 287,000,000 0.36 0.06 134 36 Flotation Total Mal 973,000,000 0.42 0.05 37 az mnesen 210,000,000 0.36 0.05 19 39 eaeaes 405,000,000
Slide 41: Mason Mineral Resources
MASON MINERAL RESOURCES (AS AT JANUARY 1, 2023) PROPERTY -ATEGORY TONN cu Mo (ait) Au 9 - Measured 41,417,000,000 0.29 59 0.031 066 mas Indicated 801,000,000 0.30 80 0.025 osr TOTAL MASON MEASURED AND INDICATED 2,219,000,000 0.29 or 0.029 0.63 Mason inferred 237,000,000 0.28 7 0.033, 073
Slide 42: Llaguen Mineral Resources
LLAGUEN MINERAL RESOURCES (AS AT JANUARY 1, 2023) PROPERTY CATEGORY TON cu Mo (ait) Aug Agia) Indicated Global aun BREE 271,000,000 0.33 218 0.033, 2.04 Including indicated High-grade 0 0 2 come 113000.000 049 2a 04s 273 Inferred Global vtaguen AS 83,000,000 0.24 127 0.024 147 Including Inferred Hig
Slide 43: Copper Mountain Mineral Reserves
COPPER MOUNTAIN MINERAL RESERVES’ (AS AT DECEMBER 31, 2022) CATEGORY COPPER MOUNTAIN Proven Probable TOTAL PROVEN AND PROBABLE NEW INGERBELLE Proven Probable TOTAL PROVEN AND PROBABLE STOCKPILE TOTAL PROVEN AND PROBABLE TOTAL MINERAL RESERVES a BAY TONNES 21,636,000 145,493,000 373,189,000 183,003,0
Slide 44: NI 43-101 Matters: Additional Reserves & Resources
NI 43-101 MATTERS: ADDITIONAL RESERVES & RESOURCES INFORMATION; QUALIFIED PERSONS The reserve and resource estimates included in this presentation were prepared in accordance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") and the Canadian Institute of Mi