China Gold International Resources Corp. Ltd. · HKEX:2099
China Gold International Resources — Investor Presentation (November 2019)
31 slides from China Gold International Resources's investor presentation, November 2019
Slide 1: Proven Organic Growth & Acquisition Potential
Proven Organic Growth & Acquisition Potential TSX: CGG | HKEX: 2099 November 2019
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains “forward looking statements” within the meaning of the United States private securities litigation reform act of 1995 and “forward looking information” within the meaning of applicable Canadian securities legislation. Such forward-looking stateme
Slide 3: Why Invest in China Gold International
Why Invest in China Gold 1 SOLID STRATEGIC INVESTOR BACKING Strong financial support from substantial shareholder: China National Gold Group PROVEN STRATEGY FOR LONG-TERM VALUE CREATION International 2 11th year of increased production Series II of Jiama mine phase II expansion achieved commercial p
Slide 4: Capital Structure and Key Information
Capital Structure and Key Information MAJOR SHAREHOLDERS1 LISTINGS (fungible) OUTSTANDING SHARES2 TSX: CGG 396.41 MM 39.3% China National Gold Group HKEX: 2099 3.98% Van Eck Associates Corp. 2.40% Dimensional Fund Advisors 0.58% Blackrock 0.40% CATAM Asset MARKET CAP1 53.34% Other Shareholders CDN$4
Slide 5: Nine months ended September 30, 2019 Performance Highlights
Nine months ended September 30, 2019 Gold Performance Highlights Gold production increased by 7% to 162,640 ounces (4.61 tonnes) from the same period in 2018. Copper Copper production of 108.7 million pounds (49,306 tonnes), an increase of 32% from same period in 2018. Revenue Revenue increased by 2
Slide 6: Excellent Track Record on Production
Excellent Track Record on Production 5.32% COMBINED GOLD PRODUCTION (K oz) Compound Annual Growth Rate Au Production (K oz) 234 229 211 215 210 Budget (K oz) 181 142 153 148 2011 2012 2013 2014 2015 2016 2017 2018 2019E 23.75% Compound Annual COPPER PRODUCTION (MM lbs) Growth Rate 132 121 79 Cu Prod
Slide 7: Substantial Revenue Growth Leader
Substantial Revenue CGG REVENUES FROM 2008-2018 (US$MM) 571 Growth Leader 412 332 340 339 311 303 278 31.12% Compound Annual 133 81 Growth Rate 29 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 CGG REVENUES FOR THE PAST 6 QUARTERS (US$MM) 186.4 158.8 163.0 163.2 142.1 145.6 2018 Q2 2018 Q3 2
Slide 8: Strong Operation Cash Flow Generation
Strong Operation Cash Flow Generation Cumulative net cash flow from operating activities (MM US$) $127.91 $ 828.55 Million Cumulative operation $154.94 cash flow of $828.55 $98.55 million since 2011 $77.13 $66.87 $93.79 $2.97 $90.79 $115.60 2011 2012 2013 2014 2015 2016 2017 2018 2019 First 3Qt Tota
Slide 9: Comparison with Peers
Comparison with Peers Good timing to buy Price/Book Value Enterprise Value/Sales 3.26 3.22 2.04 2.73 2.84 1.68 2.27 1.55 1.28 1.85 1.17 1.51 0.78 0.96 0.38 0.24 Price to Cash Flow (Actual) Sales Growth Year over Year 18.77 69.6% 9.07 36.9% 8.02 6.36 5.96 5.16 21.5% 15.8% 18.9% 2.67 2.16 8.9% 5.0% 3.
Slide 10: About China National Gold Group (CNG)
US$14 billion credit facility About China National Gold Group (CNG) BBB Credit Rating by S&P A strong national platform in China’s gold industry Accounts for 20% total gold production in China /controls more than 20 gold production bases 30% of domestic reserves/Chair Member of China Gold Associatio
Slide 11: Investment Grade Rating
Investment Grade Rating China Gold International’s China National Gold Group’s Rating Rating BBB- BBB • Company with a rating of BBB- or better are considered “investment-grade.” • Only 9 gold companies in the world have BBB- or better ratings, in which 5 gold companies have BBB rating. 11
Slide 12: Superior Financing Capability
Superior Financing Capability US$500 million July 2017 - US$500 MM Bond Issue Date July 6, 2017 Credit Rating BBB- • Second time CGG has successfully Price 99.663% managed a bond offering in the Coupon 3.25% per annum international capital markets Maturity July 6, 2020 • Financing costs were signifi
Slide 13: Corporate Strategy
2019 Corporate Strategy Increase production • Projected copper production of 132 million pounds • Projected gold production of 210,000 ounces Increase ore grade and recovery rate from Jiama Increase investment on exploration program at Jiama Continue exploring the potential mineral resource
Slide 14: Future Potential
Future Potential CSH Mine The Company continues to assess underground development plans for the mineralization extending below and around the ultimate pit limit at the CSH Mine. Jiama Mine Significant potential for more ore supply from underground mine, bring up ore grade. M&A Ready to take on suita
Slide 15: Proven strategy for long-term value creation
Proven strategy for long-term value creation 2008-2009 2010-2011 2012-2013 • CNG acquired • Acquired Jiama mine • Completed pre-feasibility Jinshan(changed name to • Completed dual-primary study on Jiama (53.7% IRR) CGG) listing on HK exchange • CSH Mine completed its new • Financed US$38.10 million
Slide 16: Jiama Polymetallic Mine
Company Assets and Prospect Jiama Polymetallic Mine One of China’s largest Polymetallic Mines COMMODITIES Copper, Gold, Silver, Zinc, JIAMA RESOURCES Lead and Molybdenum Grade Contained Metal LOCATION Resources Ore Cu Mo Au Ag Pb Zn Cu Mo Au Ag Pb Zn (Mt) (%) (%) (g/t) (g/t) (%) (%) (kt) (kt) (Moz)
Slide 17: Company Assets and Prospect (cont'd)
Company Assets and Prospect (cont’d) 2020E 2019 2018 Delivers solid 2017 performance 2014 Increasing ore Drilling continue to expand the during years 2012 Commercial Commercial production on supply from underground high grade production on Series II of mine mineralization Phase II Feasibility study
Slide 18: Jiama Operational Status
Company Assets and Prospect (cont’d) Jiama Operational Status 2019 Q3 Jiama Mine Production data Average copper ore grade 0.58% Copper recovery rate 80% Ore mined from open pit 33,000 Tonnes/Day Ore mined from underground (Phase 1&Phase 2) 17,000 Tonnes/Day Ore processed 44,000 Tonnes/Day 18
Slide 19: 2019 Drilling Program Progress
Company Assets and Prospect (cont’d) 2019 Drilling Program Progress – looking for higher grade ores • The project includes surface drill of 33,390 +/-m, 25 drills, 500 +/- m of 1 hydrogeological drill and 800 +/- m of 2 engineering geological drills. • During 2019 Q3, surface drill of 18,215.63 +/-m
Slide 20: CSH Gold Mine
Company Assets and Prospect (cont’d) CSH Gold Mine one of China’s largest gold mines • Well-established infrastructure with excellent access COMMODITIES to roads and sufficient supplies of power, water and Gold dore with local labor silver by-product • Long time running gold mine that is still in pr
Slide 21: Company Assets and Prospect (cont'd)
Company Assets and Prospect (cont’d) 2020E 2019 2018 To identify 2014 updated mine additional Exceptional 2011 Conducted plan and life of mine resources New additional that may Operation 2009 processing remediation plan for the production schedule, further Processing system Execution capacity commen
Slide 22: CSH Operational status
Company Assets and Prospect (cont’d) CSH Operational status 2019 Q3 CSH Mine Production data Average ore grade 0.58 gram/Tonnes Ore mined and placed on pad 4,031,723 Tonnes Overall accumulative project-to-date gold recovery rate 54.28% Cash production cost US$820/Ounce AISC US$1,119/Ounce Based on t
Slide 23: CSH updates production schedule
Company Assets and Prospect (cont’d) CSH updates production schedule • The new recommended final pit slopes of the north-east pit is 36.5 degrees (from 42 degrees) for the south wall and 38 degrees (from 44 degrees) for the north wall* • The mine life is extended to 7 years Note: Based on a slope st
Slide 24: High Standard of CSR and HSE
High Standard of CSR and HSE Total investment of Total safety investment environmental protection (in thousand US$) (in thousand US$) 10,940 2,470 5,220 1,371 873 2,410 2016 2017 2018 2016 2017 2018 ■ US$18.57 million was invested in environmental protection and US$4.71 million was invested into wor
Slide 25: 2018 Sustainability Performance Highlights
2018 Sustainability Performance Highlights Both mines are proud to be recognized as an industry leader, great employer and corporate citizen • National High-tech Enterprise - CSH Gold mine 2018 • National Green Mines & Golden Digital mine - Jiama mine 2018 As of 2018, the Company recorded zero o
Slide 26: Accretive Acquisition Strategy
Accretive Acquisition Strategy TARGET PROJECT • Mines at operating stage with ramp-up plan or near production PHASE • High quality mine assets under development stage • Established mining jurisdictions GEOGRAPHY • Stable political environment • Gold and Copper focus METAL • Polymetallic mineral reso
Slide 27: Appendix
Appendix 27
Slide 28: 2019 Q3 & First 9 months Production Overview
2019 Q3 & First 9 months Production Overview Gold Production Gold Production 2018 First 9 months VS 2019 Q3 2018 VS Q3 2019 First 9 months 65 24% 160 7% 60 150 Increase Increase 55 140 50 130 In line with the budget In line with the budget 45 120 2018Q3 2019Q3 2018 2019 Copper Production Copper Prod
Slide 29: 2019 Q3 & First 9 months Financial Overview
2019 Q3 & First 9 months Financial Overview Total mining cost per tonne Total mining cost per tonne 2018 First 9 months VS 2019 Q3 2018 VS Q3 2019 First 9 months 6 7 5.5 21.5% 38.8% 6 5 Decrease Decrease 4.5 5 4 3.5 In line with the budget 4 In line with the budget 3 3 2018Q3 2019Q3 2018 2019 Revenu
Slide 30: 2019 Q3 Financial Overview
2019 Q3 Financial Overview Q3 Ended Q3 Ended Year Ended Sept 30, 2019 Sept 30, 2018 Dec 31, 2018 • Revenue increased to US$186.4 million, representing an increase of 17% Revenues (MM USD$) $186.4 $158.8 $570.6 compared to the same period in 2018 Mine operating earning • Net operating cash flow from
Slide 31: Contact Information
Contact Information China Gold International Resources Corp. Ltd. TSX: CGG | HKEX: 2099 Contact Us: info@chinagoldintl.com | chinagoldintl.com 31
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