Slide 1: Third Quarter of the 2022 Fiscal Year
THIRD QUARTER OF THE 2022 FISCAL YEAR Webcast presentation - January 27, 2022 PREMIUM PRODUCT, TIER 1 JURISDICTION, HIGH QUALITY INFRASTRUCTURE
Slide 2: Disclaimer
DISCLAIMER TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF This presentation (the "Presentation") contains information about Champion Iron Limited ("Champion Iron Limited" or the "Company"), current as at the date hereof or as at such earlier date as may be specified herein. This Presentation does not constitute
Slide 3: Conference Call Participants
CONFERENCE CALL PARTICIPANTS TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF DAVID CATAFORD MICHAEL O’KEEFFE NATACHA GAROUTE ALEXANDRE BELLEAU MICHAEL MARCOTTE Chief Executive Officer Executive Chairman Chief Financial Officer Chief Operating Officer Senior Vice-President Corporate Development and Capital Market
Slide 4: FY2022 Third Quarter Highlights
FY2022 THIRD QUARTER HIGHLIGHTS TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF 2,013,200 WMT $59.5/DMT REVENUES $253.0M $543.4M TOTAL CASH ON HAND1,2 CONCENTRATE PRODUCED TOTAL CASH COST1 NET CASH FLOW OPS BEFORE WC & RESTRICTED CASH $105.6M EBITDA1 $122.1M 83.9% $321.5M SHORT-TERM AND $76.0/DMT NET INCOME $68.
Slide 5: Health & Safety and Environment
HEALTH & SAFETY AND ENVIRONMENT TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → Contributed to vaccination efforts in the Uashat Mak Mani-Utenam first nation community → Maintained the COVID-19 testing laboratory at the Bloom Lake mine with strict measures to adapt operations and conform to or exceed the Gover
Slide 6: Community & Sustainability
COMMUNITY & SUSTAINABILITY TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → In commemoration of our First Nation communities’ tragic and painful history, Champion declared that the National Day for Truth and Reconciliation will be treated as a statutory holiday for all its employees → In collaboration with our
Slide 7: Industry Overview
INDUSTRY OVERVIEW TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → Iron ore prices declined in the period as China enforced steel output reductions to curb emissions ahead of the February 2022 Winter Olympic Games, partially offset by increased steel production ex-China → Recovery in prices towards the end of t
Slide 8: Operational & Financial Results
OPERATIONAL & FINANCIAL RESULTS TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF 8
Slide 9: Operations Overview
OPERATIONS OVERVIEW TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → Record production for a quarter with scheduled maintenance, Iron Ore Concentrate Ore Mined and Hauled despite challenges imposed by the COVID-19 pandemic and ongoing Produced (M wmt) (M wmt) work programs in preparation of the Phase II expansi
Slide 10: Third Quarter Financial Highlights
THIRD QUARTER FINANCIAL HIGHLIGHTS TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → Robust cash operating margin of 45.0% and an EBITDA margin of 48.3% EBITDA* (C$M) → EPS of $0.13 negatively impacted by timing of sales and $7.2M incurred in pre- commercial start-up costs for the Phase II project $400 → Increas
Slide 11: Provisional Price Adjustment
PROVISIONAL PRICE ADJUSTMENT TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → 0.78M tonnes which were subject to provisional pricing at the end of Q2/FY22 realized final prices during the quarter → Q3/FY22 negative provisional pricing adjustment of US($6.0M), represents a negative impact of US($3.3/dmt) on the
Slide 12: Third Quarter Average Realized Selling Price
THIRD QUARTER AVERAGE REALIZED SELLING PRICE TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → Rising demand for high-grade iron ore enabled the Company to benefit from the premium pricing of its high-grade products → Average gross realized price of US$154.8/t, a 20% premium above the P65 index average for the p
Slide 13: Cash Change Details
CASH CHANGE DETAILS TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → Cash flows from operations* of $93.2M and working capital negatively impacted by timing of supplier payments related to Phase II project construction and customer receipts → Cash on hand* and restricted cash of $543.4M positively impacted from
Slide 14: Balance Sheet Positioned for Growth
BALANCE SHEET POSITIONED FOR GROWTH TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF $499.0M Cash & S-T investments $44.4M Restricted cash* -$111.2M Working capital Net cash* positive of $110.7M (including working capital) $321.5M Short-term & Long-term debt* $425.7M Available & undrawn loans* 29% 33% Q2/FY22 Q
Slide 15: Growth Focused / Continuing Capital Returns Strategy
GROWTH FOCUSED / CONTINUING CAPITAL RETURNS STRATEGY TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF Near completion of the Phase II expansion project and demonstrated ability to operate sustainably, creates the stability required to continue deploying a capital returns strategy, while focusing on growth opportu
Slide 16: Growth Projects
GROWTH PROJECTS TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF
Slide 17: Phase II – Project Near Completion
PHASE II – PROJECT NEAR COMPLETION TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → Deployed an additional $93.7M in capital expenditures and start-up costs and $2.4M in advanced payments in the quarter PHASE II - CAPEX (C$M) → Successfully advanced the project despite the pandemic-related challenges with cumul
Slide 18: Growth Opportunities Beyond Phase II
GROWTH OPPORTUNITIES BEYOND PHASE II TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → Ongoing study evaluating the reprocessing and infrastructure required to commercially produce a > 69% Fe Direct Reduction ("DR") pellet feed product → The study of this proposed project, scaled to convert approximately half of
Slide 19: COP26 → Positive Views for DR Iron Ore Demand
COP26 → POSITIVE VIEWS FOR DR IRON ORE DEMAND TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → Agora Energiewende (“Agora”), a recognized group which develops industrial transformation strategies, presented their views on what is required to decarbonize the steel industry at COP26 → Agora outlined the transitio
Slide 20: Steel → Critical for an Energy Transition
STEEL → CRITICAL FOR AN ENERGY TRANSITION TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF → A recent study published by McKinsey & Company RAWMATERIALS RAW MATERIALSCRITICAL CRITICALFOR FORTHE THETRANSITION TRANSITIONTO TOAALOW-CARBON LOW-CARBONECONOMY ECONOMY (BYTECHNOLOGY (BY TECHNOLOGYTYPE) TYPE) detailed the
Slide 21: Thank You to Our Staff
THANK YOU TO OUR STAFF TSX: CIA ⎪ ASX: CIA ⎪ OTCQX: CIAFF PRIDE INGENUITY RESPECT TRANSPARENCY Upholding our values for a sustainable future 21
Slide 22: Thank You!
THANK YOU! Contact us for more information: Michael Marcotte, Senior Vice-President – Corporate Development and Capital Markets mmarcotte@championiron.com 514-316-4858