Centerra Gold Inc. · TSX:CG
Centerra Gold — Investor Presentation (June 2020)
45 slides from Centerra Gold's investor presentation, June 2020
Slide 1: Built For Success
Kumtor BUILT FOR SUCCESS Mount Milligan Investor Presentation June 2020 TSX: CG Öksüt www.centerragold.com
Slide 2: Caution Regarding Forward-Looking Information
Caution Regarding Forward-Looking Information Information contained in this document which are not statements of historical facts, and the documents incorporated by reference herein, may be “forward-looking information” for the purposes of Canadian securities laws. Such forward-looking information i
Slide 3: Centerra: Built For Success
Centerra: Built For Success Corporate Highlights Profitably Growing Gold Production 20201 estimated gold production up to 820koz, copper production up to 90Mlbs, AISC2 of $820 to $870 per ounce Öksüt Mine first gold pour January 31, 2020, Delivered on time and under budget 1,000 Ounces (000’s) Q1 20
Slide 4: Q1 2020 ESG Operations Update
Centerra: Q1 2020 ESG Operations Update Continued focus on safety leadership training/awareness Maintained and strengthened our “Social Licence to Operate” at all operations with no interruptions for ~81 months. No reportable environmental incidents. Continued towards our commitment of creating a di
Slide 5: Committed to Responsible Gold Mining
Centerra: Committed to Responsible Gold Mining • Centerra is implementing the World Gold Council’s Responsible Gold Mining Principles (RGMP) across our operations • RGMP was designed to provide confidence to our investors and supply chain participants that our gold has been produced responsibly • In
Slide 6: Operational Results vs Guidance 2013-2019
Centerra: Operational Results vs Guidance 2013-2019 Centerra has a strong track record of beating both production and AISC2 on a by-product basis guidance Operating Statistics vs. Guidance (mid-point) (koz Au) 850 900 878 863 851 800 850 795 852 785 783 750 805 818 748 800 814 730 700 691 744 685
Slide 7: Q1 - 2020 Corporate Highlights
Centerra: Q1 - 2020 Corporate Highlights Safety – Öksüt recently achieved one year without a lost time injury COVID-19 Implement Proactive Measures, Temporary Workforce Reductions, Increase Hygiene Protocols, Social Distancing, Extend Mine Site Rotations, Separate Work Crews on Site Öksüt Firs
Slide 8: Q1 - 2020 Corporate Update
Centerra: Q1 - 2020 Corporate Update Q1 - 2020 Cash Flow (US$MM’s) Cash Flow From Operations (US$MM’s) 5 300 180 1,403 1,487 1,600 1,374 160 1,237 1,400 250 82 20 29 140 121 1,200 200 194 120 95 1,000 118 100 91 92 800 150 80 600 60 100 40 400 50 43 20 200 0 0 0 2 Q2-2019 Q3-2019 5 Q4-2019 Q1-2020 2
Slide 9: Industry Leading Free Cash Flow Yield
Centerra: Industry Leading Free Cash Flow Yield Q1 2020 FCF Yield1 (%) 2020E FCF Yield3 (%) 2021E FCF Yield3 (%) Centamin 14% Alacer 11% Centerra 15% Centerra 11% Centamin 10% Alacer 12% Alacer 11% Centerra 8% New Gold 12% Endeavour 2 8% Endeavour 2 8% Endeavour 2 11% B2Gold 7% B2Gold 8% Centamin 11
Slide 10: Compelling Valuation
Centerra: Compelling Valuation P / NAVPS (x) P / 2020E CFPS (x) P / 2020E EPS (x) B2Gold 1.39x Alamos 9.3x OceanaGold 60.6x Yamana 1.25x SSR Mining 8.8x Yamana 25.5x Kirkland Lake 1.22x Kirkland Lake 8.0x Alamos 21.0x Endeavour 1.21x Yamana 7.7x IAMGOLD 15.8x Centamin 1.16x B2Gold 6.6x Centamin 12.9
Slide 11: AISC Comparison
Centerra: AISC1 Comparison 2019 AISC1 (US$/oz) YoY Change in AISC1 (%) Kirkland Lake $564 Kirkland Lake (18%) Alacer $713 Alamos (4%) Centerra $737 Centerra (2%) Endeavour $818 SSR Mining (0%) B2Gold $862 Yamana 0% Centamin $943 Alacer 1% Alamos $951 Kinross 2% Kinross $983 Eldorado 4% Yamana $999 I
Slide 12: Low-Cost Asset Base
Centerra: Low-Cost Asset Base 20201 estimated gold production up to 820koz, copper production up to 90Mlbs, AISC2 of $820 to $870 per ounce Au Positioned to generate meaningful cash flow through the price cycles AISC2 Industry Curve (By-P roduct Basis) $2,500 25% 50% 75% 100% $2,250 $2,000 Cente
Slide 13: Kumtor: World Class Open Pit Gold Mine
Kumtor: World Class Open Pit Gold Mine 2017 2018 2019 2020E Gold Production (koz) 563 535 600 520-560 All-In Sustaining Costs ($/oz) (1) $698 $694 $598 $750-$800 Sustaining Capital ($MM) $61 $44 $39 $49 Growth Capital ($MM) $18 $17 $16 $18 Reserves(2) (Moz) 3.2 Au Grade (g/t) 2.31 Resources M&I(2) (
Slide 14: Kumtor: Exploration
Kumtor: Exploration 2019 drilling focused on the Hockey Stick Zone and continued to confirm gold mineralization outside the ultimate open pit Hockey Stick Zone Boris Kotlyar, a Member with the American Institute of Professional Geologists, is Centerra’s qualified person for the purpose of National I
Slide 15: Kumtor: Mineral Resources
Kumtor: Mineral Resources1 Exclusive of Reserves (Year-over-Year Change) Kumtor Open Pit Tonnes Ounces Kumtor Open Pit Tonnes Ounces Au (g/t) Au (g/t) 2018 Reserves (kt) (koz) 2019 Reserves (kt) (koz) Proven & Probable – Reserves 51,631 2.42 4,018 Proven & Probable – Reserves 43,295 2.31 3,214 Kumto
Slide 16: Mount Milligan: Low Cost Gold Copper Mine
Mount Milligan: Low Cost Gold Copper Mine 2017 2018 2019 2020E Gold Production (koz) 223 195 183 140-160 Copper Production (Mlbs) 54 47 71 80-90 All-In Sustaining Costs $505 $764 $828 $885-$935 (US$/oz)(1) Sustaining Capital ($MM) $30 $43 $36 $55 Gold Copper 35% @ 18.75% @ 15% of Royal Gold Stream U
Slide 17: Mount Milligan: Life-of-Mine Plan
Mount Milligan: Life-of-Mine Plan Cash Flow Summary1 1. Effective date December 31, 2019, see NI 43-101 Technical Report on the Mount Milligan Mine dated March 26, 2020 and filed on SEDAR. June 2020 17
Slide 18: Öksüt: Funded High Margin Gold Production
Öksüt: Funded High Margin Gold Production Project Highlights Mine Type Open Pit, Heap Leach Heap Leach Stacking Rate 11,000 tpd Life of Mine Strip Ratio (w:o) 2:1 Avg. LOM Annual Production 110koz Au 2020e Gold Production (koz) 80-100 Öksüt Gold 2020e All-in Sustaining Costs ($/oz)(1) $650-$700 Proj
Slide 19: Öksüt: Site Photos
Öksüt: Site Photos Admin Offices and Crushing Area Open Pit Mining Open Pit Mining Heap Leach Pads Stacked Ore on Heap Leach Pad Irrigating Stacked Ore June 2020 19
Slide 20: Kemess: C$1Billion of Infrastructure
Kemess: C$1Billion of Infrastructure Fly-in, Fly-out Work Camp Permitted Open Pit Tailings Storage Facility Metallurgical Facility Kemess Proximity to Mount Milligan Kwadacha Kemess Project (Fort Ware) Kemess Omineca Resource Project Tsay Keh Access Road Forest Service Road 0 100 200 Kilometres Daws
Slide 21: Kemess: Large, Low-Cost Production
Kemess: Large, Low-Cost Production Kemess Underground – 2016 Feasibility Highlights(1) Kemess East– 2017 PEA Highlights(1) Mine Type Underground Block Cave Mine Type Underground Panel Cave Avg. LOM Gold Production (koz) 106 Avg. LOM Gold Production (koz) 80 Avg. LOM By-Product AISC (US$/oz)(2) $244
Slide 22: Greenstone: One of Canada's Largest Undeveloped Open Pit Gold Mines
Greenstone: One of Canada’s Largest Undeveloped Open Pit Gold Mines Cornerstone Canadian Development Project Ontario: Top Tier Mining Jurisdiction 50:50 development partnership with Premier Gold Greenstone Development Project Open pit reserves(1) 4.7Moz Au @ 1.02 g/t (100%) Location: Ontario, Canada
Slide 23: Potential Upside Optionality - Molybdenum
Centerra: Potential Upside Optionality - Molybdenum Molybdenum Price Movement Thompson Creek Mine ● Located in Idaho, is the world’s fourth largest open-pit primary molybdenum mine ● Operations began in 1983, using conventional open-pit mining and a on- site 25,500 tpd mill ● In December 2014 placed
Slide 24: Centerra: Built For Success
Centerra: Built For Success Corporate Highlights Q1 - 2020 Cash Flow (US$MM’s) 300 20201 estimated gold production up to 820koz, copper 82 20 250 29 production up to 90Mlbs, AISC2 of $820 to $870 per ounce 200 194 118 150 Öksüt Mine first gold pour January 31, 2020 100 50 43 Q1 2020 gold production
Slide 25: Appendix
Kumtor BUILT FOR SUCCESS Mount Milligan Appendix TSX: CG Öksüt www.centerragold.com
Slide 26: COVID-19 Update
Centerra: COVID-19 Update • Priority is the health and safety and well-being of employees, contractors, communities and other stakeholders, and to minimize spread of virus • Working remotely where possible • Restrict access to mine sites • Increased cleaning and hygiene protocols at all sites, inclu
Slide 27: Leading Capital Efficiency and Profitability
Centerra: Leading Capital Efficiency and Profitability L3Y Return on Invested Capital (%) L3Y Return on Capital (%) L3Y Return on Equity (%) Kirkland Lake 21% Kirkland Lake 24% Kirkland Lake 17% Centamin 13% Alacer 9% Centerra 8% Alacer 10% Centerra 8% OceanaGold 8% Centerra 8% Centamin 8% Alacer 8%
Slide 28: Q1 - 2020 Corporate Update
Centerra: Q1 - 2020 Corporate Update Q1 2020 Cash Flow (US$MM’s) Liquidity Profile March 31, 2020 (US$MM’s) 300 250 82 20 29 194 364 200 118 150 US$558MM 100 194 50 43 0 1 2019 YE Cash Kumtor + MTM Debt Drawdown Oksut Spend Dev Projects, 2020 Q1 Cash 2 3 FCF 5 G&A & Other Cash Reserves Corporate Cre
Slide 29: Q1-2020 Financial Highlights
Centerra: Q1-2020 Financial Highlights1 Quarter Ended Quarter Ended (in thousands, except ounces, per share amounts, and average realized price3) March 31, 2020 March 31, 2019 Revenue $374,045 $334,040 Total gold ounces sold(2) 203,258 196,451 Total copper pounds sold (000’s) 20,423 12,522 Cash prov
Slide 30: Q1-2020 Operating Highlights
Centerra: Q1-2020 Operating Highlights Thompson Creek Mine achieved 5 full years without a lost time injury and April 19th Öksüt achieved one year without a lost time injury Q1 2020 gold production - Kumtor 152,307 oz, Mount Milligan 33,681 oz, Öksüt 4,486 oz Q1 2020 copper production - Mount Millig
Slide 31: 2020 Operations Key Focus
Centerra: 2020 Operations Key Focus Improve Safety Performance Company-wide Ramp up Öksüt to Commercial Production Spring Melt Commenced; Adequate Water Expected at Mount Milligan to Run at Full Capacity for the Year Focus on Consistent and Improved Production at the Mount Milligan Mine Co
Slide 32: 2020 Guidance
Centerra: 2020 Guidance6 Mount 2020 Production Guidance Units Kumtor Öksüt Centerra Milligan(1) Gold Total Gold Payable Production(2) (Koz) 520-560 140-160 80-100 740-820 Copper Total Copper Payable Production(2) (Mlb) - 80-90 - 80-90 2020 All-in Sustaining Unit Costs Units Kumtor Mount Milligan(1)
Slide 33: 2020 Guidance Sensitivities and Assumptions
Centerra: 2020 Guidance5 Sensitivities and Assumptions Impact on Impact on ($ per ounce ($ millions) sold) Production Costs Net Earnings AISC(2)(3) on Capital Costs Financing Costs Revenues Cash flows & Taxes (after tax) by-product basis Gold price $50/oz 5.1 - 5.6 - 1.5 - 1.6 34.5 - 38.2 27.9 - 31.
Slide 34: Mineral Reserves - Proven & Probable
Centerra: Mineral Reserves - Proven & Probable1 Gold Mineral Reserves Proven Probable Total Proven and Probable Property Tonnes Grade Contained Tonnes Grade Contained Tonnes Grade Contained (kt) (g/t) Gold (koz) (kt) (g/t) Gold (koz) (kt) (g/t) Gold (koz) Mount Milligan 114,753 0.41 1,525 76,275 0.3
Slide 35: 2019 Corporate Highlights
Centerra: 2019 Corporate Highlights Safety – 2019 performance overshadowed by two tragic safety incidents at Kumtor in December 2019 and February 2020 Completed KR Strategic Agreement August 26, 2019 Construction of Öksüt Project Approximately 89% Complete Exceeded 2019 Gold Production Guidanc
Slide 36: 2019 Corporate Update
Centerra: 2019 Corporate Update 2019 Cash Flow (US$MM’s) Liquidity Profile (US$MM’s) 600 500 329 111 500 400 63 87 US$615MM 300 177 200 152 43 72 100 43 0 1 1 2 3 3 2018 YE Cash Kumtor + 5 Debt KR Settlement Oksut Spend Dev Projects, 2019 YE Cash Cash Reserves Corporate Credit Facility Oksut Credit
Slide 37: 2020 Exploration - Map of Projects
Centerra: 2020 Exploration - Map of Projects 2016A 2017A 2018A 2019A 2020E Exploration spending ($MM) $11 $13 $21 $28 $50 37 June 2020
Slide 38: Mount Milligan: 2019 Exploration
Mount Milligan: 2019 Exploration North NPI (Resource) • 69 drill holes completed (25,961 m) • 6 zones (South Boundary, Southern Star, Saddle, GEF, MBX/WBX, Oliver) Brownfield • 26 drill holes completed (12,137 m) • 5 zones (North Slope, Goldmark, Goldmark- Oliver, Saddle West, South Boundary) Greenf
Slide 39: Öksüt: Exploration Targets
Öksüt: Exploration Targets Western Asia, Europe and West Africa Keltepe NW-Keltepe N Oxide Au & Supergene Cu Target Boztepe & Boztepe West Porphyry Cu/Au Target Keltepe Pit Büyüktepe Oxide Au Target Keltepe & Güneytepe Oxide Au Resource & Supergene Cu Target Güneytepe Pit Yelibelen Oxide Au Target M
Slide 40: Mount Milligan: Short & Medium-term Water Sources
Mount Milligan: Short & Medium-term Water Sources June 2020 40
Slide 41: Kemess: Overview
Kemess: Overview Kemess Underground (Feasibility – 2016)(1) • Reserves of 1.9Moz Au and 0.6Blbs Cu(2) • LOM of 12 years at 106koz Au/p.a. and 47Mlbs/p.a. at AISC(3) of $244/oz on a by-product basis • Environmental approvals and IBA received • Received Mines Act Permit (construction permit) • Receive
Slide 42: Kemess: De-Risked Brownfield Project
Kemess: De-Risked Brownfield Project(1) • Established mining jurisdiction Kwadacha Kemess Project • (Fort Ware) Advanced-stage Kemess Omineca Resource Project Tsay Keh Access Road − EA Approved, IBA in hand, Amended Mines Act Forest Service Road Permit (construction permit) received, Effluent 0 100
Slide 43: Investor Relations Highlights
Centerra: Investor Relations Highlights Research Coverage Top Ten (10) Institutional Shareholders Brokerage Firms Rating Target Institution/Firm Mar. 31-2020 1. BofA Merrill Lynch Buy C$16.00 1. Van Eck Associates 9.42% 2. Canaccord Genuity Buy C$17.50 3. CIBC World Markets Outperform C$17.00 2. Bla
Slide 44: Directors
Centerra: Directors Board of Directors Background MICHAEL S. PARRETT Chairman Appointed Director of Centerra’s Board, May 2014 BRUCE V. WALTER Vice Chair Appointed Director of Centerra’s Board, May 2008 SCOTT G. PERRY Director Appointed Director of Centerra’s Board, January 2016 RICHARD W. CONNOR Di
Slide 45: Built For Success
Kumtor BUILT FOR SUCCESS Mount Milligan Investor Presentation June 2020 TSX: CG Öksüt www.centerragold.com