Lundin Mining Corporation · TSX:LUN
Lundin Mining — Shareholder Meeting (May 2017)
25 slides from Lundin Mining's shareholder meeting presentation, May 12, 2017
Slide 1: Annual General Meeting
TSX: LUN OMX: LUMI Annual General Meeting May 12, 2017 Neves-Corvo, Portugal 1
Slide 2: Cautionary Statements
Cautionary Statements Caution Regarding Forward-Looking Information and Non-GAAP Performance Measures All statements, other than statements of historical fact, made and information contained or incorporated by reference in or made in giving this presentation and responses to questions is "forward-lo
Slide 3: Lundin Mining – Excellent Asset Base & Growth Oriented
Lundin Mining – Excellent Asset Base & Growth Oriented High Quality Meaningful Scale Financial Strength Competitive Mines Growth Oriented - strong margins at all - high value expansion - proven track record for operations projects and exploration rigorous investment - demonstrated operational upside
Slide 4: 2016 in Review
2016 in Review - all of our mines had positive operating margins at the bottom of the market Strong Margins and Meaningful Scale1 (operating margin, %) - we improved our balance sheet with 70% positive cash flow from each mine 60% - exploration and expansionary projects advanced despite low commodit
Slide 5: Responsible Mining
Responsible Mining Safety Performance Environmental Performance TRIF per 200,000 person hours worked - excellent track record and improving performance each year 5.6 - increased reporting and disclosure practices International Green Apple Award for Environmental Best Practice for Galmoy 3.5 Wetlands
Slide 6: 2016 Operating Highlights
2016 Operating Highlights 2016 was a volatile year for the base metals with metal prices bottoming out in H1/16 Copper was up 17%, Zinc 61% and Nickel 13% year-over-year in 2016 Base Metals outlook is very good. Zinc strong. Copper improving. Nickel will take time Candelaria copper production exceed
Slide 7: 2016 Revenue Breakdown
2016 Revenue Breakdown Total sales of $1.55B Other Lead 4% 3% Gold 6% Zinkgruvan 11% Nickel 8% Eagle 16% Candelaria Zinc 55% 13% Copper 66% Neves-Corvo 18% By Operation By Metal 7
Slide 8: 2017 Production Outlook
2017 Production Outlook1 Copper Zinc Nickel (Attributable kt) (kt) (kt) 162 233 216 34 205 202 152 148 145 145 24 20 17 89 125 13 66 8 2013A 2014A 2015A 2016A 2017 2013A 2014A 2015A 2016A 2017 2013A 2014A 2015A 2016A 2017 Guidance Guidance Guidance 1. Production guidance is based on certain estimate
Slide 9: Share Price Performance
Share Price Performance Lundin Mining’s share price has consistently outperformed over the last five years compared to TSX, copper price and peer groups 1.8x 1.6x 1.4x 1.2x 1.0x 0.8x 0.6x 0.4x 0.2x 0.0x 2011 Nov VWAP 2012 Nov VWAP 2013 Nov VWAP 2014 Nov VWAP 2015 Nov VWAP 2016 Nov VWAP LMC Share Pri
Slide 10: 2017 Outlook
2017 Outlook Copper / Gold / Silver – Region III, Chile 10
Slide 11: 2017 Priorities
2017 Priorities Stable operations and disciplined growth Operate safely and responsibly, with strong community support Advance internal high value-add growth projects - Zinkgruvan mill throughput expansion - Zinc Expansion Project at Neves-Corvo - Eagle East ramp development - Candelaria Consolidati
Slide 12: Balance Sheet Strength and Flexibility
Balance Sheet Strength and Flexibility Cash balance at April 26, 2017 of approximately $2.1B and net cash of approximately $1.1B $350M revolving credit facility undrawn Initiated regular dividend Cash and Cash Equivalents (End of Quarter) Liquidity Position (April 26, 2017) 14% $929M $2.4B $561M $35
Slide 13: Capital Allocation Strategy
Capital Allocation Strategy Focus on Disciplined Growth Invest in high-return brownfield expansion projects and exploration Service regular dividend Prudent and accretive management of bond debt and cash positions Keep flexible balance sheet to move quickly on compelling growth opportunities Conside
Slide 14: Internal Growth and Expansions – At All Locations
Internal Growth and Expansions – At All Locations Copper / Zinc – Portugal 14
Slide 15: Neves-Corvo, Portugal
Neves-Corvo, Portugal Zinc Plant Expansion New Conveyor Ramp 15
Slide 16: Neves-Corvo with ZEP, and Base Case (BC) without ZEP
Neves-Corvo with ZEP, and Base Case (BC) without ZEP1 1. Refer to the May 11, 2017 new release entitled “Lundin Mining Announces Neves-Corvo Zinc Expansion Project Feasibility Study Results” on the Company’s website (www.lundinmining.com). 16
Slide 17: Eagle and Eagle East, Michigan
Eagle and Eagle East, Michigan Existing access ramp Eagle Mine Eagle East Deposit 1,000 m 17
Slide 18: Eagle East – Meaningful Addition to Production Profile
Eagle East – Meaningful Addition to Production Profile Eagle East advancing on schedule and on budget - initial ramp development progressing well - mine permit amendment application submitted in March 25 Copper Production Profile1 25 Nickel Production Profile1 (kt) (kt) 20 20 15 15 10 10 5 5 0 0 201
Slide 19: Candelaria, Chile
Candelaria, Chile SW NE Candelaria Pit Candelaria Norte Alcaparrosa Surface Topography 3rd Party Property Section Location Drillhole Trace Alcaparrosa Interpreted Prospective Horizons Santos Candelaria > 0.4 % Cu Drillhole Samples 1,000 m 19 19 Property limits
Slide 20: Candelaria LOM Production Profile
Candelaria LOM Production Profile Copper Production Profile1 (100% basis, kt Cu) 188 171 167 165 165 160 162 129 122 114 111 110 109 99 102 101 93 94 64 38 2016A 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 January 2017 Technical Report At Purchase (
Slide 21: Zinkgruvan, Sweden
Zinkgruvan, Sweden 1350 Zinc Expansion Project - final stages of commissioning - targeted to increase overall mill capacity by ~10% Exploration program rejuvenated targeting two deposits currently not in mine plan - initial drilling in the Mellanby and Dalby areas have been successful 21
Slide 22: Tenke Fungurume, DRC
Tenke Fungurume, DRC Copper / Cobalt – DRC Lundin involvement spanned 20 years, from 1996 to 2017 Closed sale of interest in TF Holdings Limited in April 2017, receiving gross proceeds of $1.136B 22
Slide 23: Lundin Mining
Lundin Mining High Quality Competitive Mines - strong margins at all operations Meaningful Production Scale & Growth - internal growth projects and exploration upside at all operations Financial Strength - from profitable assets run with disciplined capital allocation 23
Slide 24: NI 43-101 Compliance
NI 43-101 Compliance Unless otherwise indicated, Lundin Mining Corporation (the “Company”) has prepared the technical information in this presentation including Mineral Reserve and Mineral Resource estimates (“Technical Information”) based on information contained in the technical reports and news r
Slide 25: TSX: LUN OMX: LUMI
TSX: LUN OMX: LUMI 25