Florida Canyon Gold — Argonaut Gold — Q1 2020 Earnings Presentation
22 slides from Florida Canyon Gold's earnings presentation, May 13, 2020
Slide 1: Corporate Presentation – First Quarter Ended March 31, 2020
Gold producer with advanced exploration projects in the Americas CORPORATE PRESENTATION First Quarter Ended March 31, 2020 Conference Call TSX:AR May 13, 2020
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: Why an At Market Merger Makes Sense
Why an At Market Merger Makes Sense ARGONAUT ALIO § EXTENDS CORPORATE MINE LIFE § GAINS OPERATIONAL DIVERSIFICATION § Florida Canyon adds immediate growth § Three additional operating mines. No longer then replaces El Castillo, scheduled to a single mine company. close in 2022 § SIGNIFICANTLY IMPROV
Slide 4: COVID-19 Update
COVID-19 UPDATE April 1, 2020 • Mexican federal government decree to cease all non-essential businesses, including mining, until April 30, 2020 • Orderly shut down of mining, crushing and stacking operations • Orderly shut down of construction activities • Leaching and metal sales continued April 23
Slide 5: Recent CSR Highlights
Recent CSR Highlights Argonaut continues to create sustainable value through innovation and collaboration within the communities in which we operate. Some recent highlights include: MEXICO CANADA Preventative COVID-19 Donation of masks, infrared Organized a community Signing Ceremony with campaign f
Slide 6: Q1 2020 Highlights
Q1 2020 Highlights Financial Performance 41,536 Production GEOs2 • Strong Cash Flow • Reduced accounts payable and accrued liabilities • El Castillo production of 14,729 GEOs balance by $10M • San Agustin production of 13,779 GEOs • Reduced debt by $3M • La Colorada production of 13,028 GEOs • Inves
Slide 7: Financial Performance
Financial Performance First Quarter Ended March 31 2020 2019 % Change Production (GEO)1 41,536 54,169 -23% Sales (GEO)1 42,204 56,674 -26% Revenue ($M) $66.6 $73.9 -10% Net income (loss) ($M) $(9.5) $4.1 -332% Earnings (loss) per share - basic $(0.05) $0.02 -350% Adjusted net income2 ($M) $8.4 $2.4
Slide 8: Operations Overview
Operations Overview First Quarter Ended March 31 Production (GEO)1 2020 2019 % Change El Castillo 14,729 23,263 -37% San Agustin 13,779 14,804 -7% La Colorada 13,028 16,102 -19% TOTAL 41,536 54,169 -23% Cash Cost (per Au oz.)2 El Castillo $1,099 $918 20% San Agustin $782 $794 -2% La Colorada $1,021
Slide 9: Operations Update
Operations Update El Castillo San Agustin La Colorada § Q1 production in-line with plan § Lowered unit cost per tonne § Lowered unit cost per tonne processed by 14% vs. Q1 processed by 15% vs. Q1 2019 § Experienced difficulty achieving 2019 planned mining rates during Q1, § Achieved nearly 30ktpd pr
Slide 10: Q1 2020 Capital Spending And Cash Flow ($M)
Q1 2020 Capital Spending And Cash Flow ($M) Investing in the future Cash Flow Reconciliation Capital Spend Opening balance cash 38.8 Cash flow from ops excl. working capital 14.8 Sustaining Expansion Stripping Change in accounts payable and accrued El Castillo 2.5 - 2.6 liabilities (9.9) La Colorada
Slide 11: Leach Pad Construction Ahead of Schedule
Leach Pad Construction Ahead of Schedule El Castillo La Colorada NE Leach Pad East Crusher Leach Pad Pad 4b Percentage Complete: 90% Percentage Complete: 40% Percentage Complete: 80% Will have the ability to place ore close to plastic to offset some of the production loss during COVID-19 restriction
Slide 12: Magino Gold Project – Gold Camp Comparison
WAWA Potential toWAWA GOLD GOLD Add Mineral PROJECT PROJECT Resources and Reserves - Magino GOLD GOLD CAMP CAMP COMPARISON COMPARISON ALAMOS GOLD WESDOME MAGINO Multiple Multiple near-surface near-surface deposits deposits ISLAND that that GOLD remain remain openopen alongalong EAGLE strike strike a
Slide 13: Potential to Add Mineral Resources and Reserves - Magino
Potential to Add Mineral Resources and Reserves - Magino MAGINO PROPERTY ALAMOS GOLD’S Lower ISLAND GOLD MINE grade at surface INCREASING GRADE Higher Current program testing down to 1,000m grade at depth TSX:AR First Quarter Ended March 31, 2020 Conference Call – MAY 13, 2020 | ARGONAUT GOLD 13
Slide 14: Magino Long Section
Potential to add Mineral Resources and Reserves - Magino Long Section TSX:AR First Quarter Ended March 31, 2020 Conference Call – MAY 13, 2020 | ARGONAUT GOLD 14
Slide 15: Magino Exploration Targets
Potential to add Mineral Resources and Reserves - Magino Exploration Targets TSX:AR First Quarter Ended March 31, 2020 Conference Call – MAY 13, 2020 | ARGONAUT GOLD 15
Slide 16: Transformation Strategy – Next Tier Producer
Transformation Strategy – Next Tier Producer THE DEVELOPMENT PIPELINE Magino4 Cerro del Gallo3 STRATEGY: Generating cash from operations to fund development Ontario, Canada Guanajuato, Mexico and upgrade our production and M+I 144.0 Mt @ 0.91 g/t, 4.2M oz Au5 M+I 47.9 Mt @ 0.60 g/t, 0.9M oz Au5 cost
Slide 17: Upcoming Milestones
Upcoming Milestones Q2 Q3 Q4 Focus on reduction of unit costs at CONTINUOUS operations Close Alio merger Restart mining, crushing and stacking operations Resume leach pad construction Magino drill results CONTINUOUS Magino Schedule 2 permit Cerro del Gallo permit submittal Cerro del Gallo permit dec
Slide 18: Our Focus
Our Focus MAXIMIZE cost efficiencies and profitability BUILD balance sheet DE-RISK development projects TRANSFORMATION strategy TSX:AR First Quarter Ended March 31, 2020 Conference Call – MAY 13, 2020 | ARGONAUT GOLD 18
Slide 19: 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 20: 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
Slide 21: 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 22: Consolidated Mineral Resources & Mineral Reserves
Consolidated Mineral Resources & Mineral Reserves(1) Contained Au Contained Ag Contained Tonnes Au Grade Ag Grade Cu Grade Project Category Ounces Ounces Tonnes Cu (Millions) (g/t) (g/t) (% Cu) (000s) (000s) (000s) RESERVES PROVEN & PROBABLE El Castillo Proven 1.1 0.60 21 El Castillo Probable 18.4 0