Igo Limited · ASX:IGO
Igo — Macquarie WA Forum (December 2020)
40 slides from Igo's conference presentation, Dec 3, 2020
Slide 1: IGO Limited Macquarie WA Forum
For personal use only IGO Limited Macquarie WA Forum 3 December 2020
Slide 2: Cautionary Statements & Disclaimer
Cautionary Statements & Disclaimer • This presentation has been prepared by IGO Limited (“IGO”) (ABN 46 092 786 304). It should not be considered as an offer or invitation to subscribe for, purchase or sell any securities in IGO or as an inducement to make an offer or invitation with respect to thos
Slide 3: Competent Person's Statements
Competent Person’s Statements • Any references to IGO Mineral Resource and Ore Reserve estimates should be read in conjunction with IGO’s Annual Update of Exploration Results, Mineral Resources and Ore Reserves For personal use only dated 30 January 2020 (Annual Statement) and lodged with the ASX fo
Slide 4: ESG and Sustainability
For personal use only ESG and Sustainability 4
Slide 5: Safety
Safety We continued to focus on improving safety and wellbeing For personal use only Total Reportable Injury Frequency (TRepIF)1 and Serious Potential Incident Frequency (SPIF) 2 20 7 19 6 18 17 5 16 15 4 14 13 3 12 2 11 10 1 9 8 0 TRepIFR (lhs) SPIFR (rhs) 1) 12 month moving average TRepIF – Total
Slide 6: Sustainability Reporting
Sustainability Reporting We released our 6th Sustainability Report in September For personal use only Key Achievements in FY20 Nova Solar Farm TCFD alignment Climate Change Policy Dow Jones Sustainability Index Australia Continued commitment to creating shared value 6
Slide 7: Proactively Green
Proactively Green We are walking the talk on our commitment to ‘clean mining’ For personal use only Carbon Intensity of Nickel Operations1 PT Aneka Tambang PT Vale Indonesia Glencore (global nickel assets) Cleanteq Sunrise BHP Nickel West Eagle mine Vale Canada* IGO Limited - Nova Nickel 0 10 20 30
Slide 8: Our Culture
Our Culture We continued to build on our strong culture For personal use only High levels of alignment to our values Consistently strong employee engagement across the business Our team’s response to COVID-19 was enhanced by the strength of our culture 8
Slide 9: Operating & Financial Performance
For personal use only Operating & Financial Performance 9
Slide 10: Key Achievements
Key Achievements FY20 was a highly successful year and 1Q21 continued trend For personal use only Effectively operated throughout a Operational performance met and challenging period exceeded our expectations Delivered outstanding financial Matured our exploration portfolio performance toward discov
Slide 11: Nova
For personal use only Nova 11
Slide 12: Nova Overview
Nova Overview Excellent operational performance delivered above-guidance metal production For personal use only Nickel Production Cash Costs 30,436t A$2.41/lb Ni (payable) Copper Production Free Cash Flow Margin 13,772t 54% Cobalt Production EBITDA Margin 1,142t 59% 12
Slide 13: Nova Performance
Nova Performance Excellent operational performance generated record financial results For personal use only FY20 Quarterly Production & Cash Costs Nova Financial Results Tonnes A$/lb 600 9,000 $3.00 593 $2.59 8,000 $2.70 $2.42 8,019 500 7,724 $2.50 504 7,000 7,513 7,181 7276 2.25 6,000 $2.00 400 $1.
Slide 14: Nova Track Record
Nova Track Record Established track record of high margins and strong free cash generation For personal use only Nova historic margin and cumulative free cash flow Margin Cumulative Free Cash Flow (A$M) 110% 800 A$756M 103% 700 90% 600 70% 70% 70% 500 67% 67% 61% 59% 60% 59% 56% 57% 50% 54% 53% 53%
Slide 15: Nova
Nova Operationally de-risked – mine is fully developed and grade control drilled For personal use only 1) Refer: Annual Update of Exploration Results, Mineral Resources and Ore Reserves released to ASX on 30 January 2020 15
Slide 16: Nova
Nova Forward production profile reflects planned lower mined grades For personal use only FY21 Guidance Directional Guidance kt A$/lb Metric Units FY21 Guidance 35.0 3.50 Nickel in concentrate t 27,000 to 29,000 30.0 3.00 Copper in concentrate t 11,000 to 12,500 25.0 2.50 Cobalt in concentrate t 850
Slide 17: Tropicana
For personal use only Tropicana 17
Slide 18: Tropicana Overview
Tropicana Overview FY20 production and costs were within guidance range For personal use only Gold Sold (IGO 30%) AISC EBITDA Margin 141,169 oz A$1,171 /oz 60% Boston Shaker Underground Mine completed on time and on budget 18
Slide 19: Tropicana Performance
Tropicana Performance Record financial results across most metrics For personal use only Tropicana Production (100% ) and AISC Tropicana Financial Results oz A$/oz 300 160,000 $1,800 290 279 140,000 $1,600 250 $1,440 $1,527 133,932 $1,400 240 $1,303 120,000 123,320 200 $1,200 100,000 103,858 107,060
Slide 20: Tropicana
Tropicana Lower YoY production in FY21 investment year before recovery in FY22 For personal use only FY21 Guidance Directional Guidance (100% basis) koz AISC/oz Metric Units FY21 Guidance 500 2,000 Gold produced (100%) koz 380 to 430 1,800 400 1,600 Gold Sold (IGO 30%) koz 114 to 129 1,400 Cash cost
Slide 21: Tropicana Growth
Tropicana Growth Commercial production declared from Boston Shaker Underground For personal use only Development completed on time and on budget Ramp up to nameplate 1.1 Mtpa production rate expected by March 2021 Depth extensions to be tested with upcoming drilling 1) Refer to ASX release dated 28
Slide 22: Tropicana Strategic Review
Tropicana Strategic Review Strategic Review underway focused on delivering value for all shareholders For personal use only Motivated by conviction that Tropicana is not fully valued in IGO portfolio Initial phase focused on technical review to inform strategy and decision making 22
Slide 23: Financial Results
For personal use only Financial Results 23
Slide 24: Financial Results Summary
Financial Results Summary Sustained improvement across key financial measures For personal use only Revenue1 (A$M) Net Profit After Tax (A$M) 1000 200 892 155 781 793 150 800 100 76 600 53 422 50 417 17 400 0 200 -50 -59 0 -100 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 Underlying Free Cash F
Slide 25: Financial Results
Financial Results Solid financial results underpinned by quality, high margin assets For personal use only Units 4Q20 1Q21 QoQ Revenue and Other Income A$M 230.6 226.6 (2%) ▼ Underlying EBITDA(1) A$M 113.1 121.3 7% ▲ Profit After Tax A$M 39.8 45.4 14% ▲ Net Cash from Operating Activities A$M 84.9 10
Slide 26: FY20 Dividend
FY20 Dividend Enduring commitment to making cash returns to shareholders For personal use only Dividend History (cents per share) Dividend (cents Free Cash Flow Final Dividend per share) (A$M) 14 350 5c per share (unfranked) 12 289 282 300 10 250 5 Total FY20 dividend payout 8 172 200 A$65M (▲10% yo
Slide 27: Capital Management
Capital Management Balanced approach to funding growth and returns to shareholders For personal use only Group Free Cash Flow 15% - 25% 50% - 70% 15% - 25% Exploration Returns to Capital to grow Balance Sheet Shareholders the business Capital to sustain (Dividends or organically via the business and
Slide 28: Strategy & Growth
For personal use only Strategy & Growth 28
Slide 29: Our Strategic Focus
Our Strategic Focus Focused on high quality, high margin assets aligned to clean energy metals For personal use only Globally Relevant Quality Products Vertically Integrated Proactively Green 29
Slide 30: Why Focus Clean Energy Metals?
Why Focus Clean Energy Metals? EV demand has significant implications for nickel demand (and other metals) For personal use only Tesla’s focus on nickel is clear Class 1 Nickel Supply and Demand Outlook2 kt “Technically, our cells should be called nickel- 2,500 graphite, because the primary constitu
Slide 31: Growth Strategy
Growth Strategy Parallel focus on organic and inorganic growth For personal use only Commodity focus: metals critical to enabling green energy Organic Opportunities Inorganic Opportunities Exploration to unlock the mines of the Disciplined M&A targeting development future and deliver transformative
Slide 32: Exploration Overview
Exploration Overview Organic growth through exploration is a key pillar of our growth strategy For personal use only Focus on discovering deposits with scale and high value ore Terranes and JV’s selected due to potential to host multiple Tier-1 discoveries Energised team, prospective portfolio and f
Slide 33: FY21 Exploration Guidance
FY21 Exploration Guidance Financial commitment to exploration maintained at A$65M for FY21 For personal use only FY21 Exploration Budget Substantial work program underway across A$1M A$5.0M the portfolio A$2M A$2M A$3M Work programs include significant drilling of A$65M A$11M A$38M targets in close
Slide 34: Fraser Range Project
Fraser Range Project Significant opportunity to unlock value through discovery For personal use only 34
Slide 35: Kimberley and Raptor Projects
Kimberley and Raptor Projects Pipeline of projects which are prospective for Nova-like nickel sulphide discoveries For personal use only Kimberley Project (WA) Raptor Project (NT) 35
Slide 36: Paterson Project
Paterson Project Recently consolidated land position prospective for Tier-1 sedimentary copper discoveries For personal use only New belt-scale opportunity for IGO Highly prospective for copper-gold discovery IGO holds second largest land package in the region 36
Slide 37: Lake Mackay
Lake Mackay Multiple mineralisation styles discovered For personal use only Grimlock Lateritic nickel-cobalt-manganese prospect Arcee Gold prospect Phreaker Copper-gold-silver + cobalt prospect 37
Slide 38: What to watch for in FY21
For personal use only What to watch for in FY21 38
Slide 39: Our focus for FY21
Our focus for FY21 Enduring commitment to drive value for all our stakeholders For personal use only Our People Accelerating Growth Operational Excellence Maintaining and building Continued focus on Active Exploration our unique culture being better Progressing Technology driven Disciplined M&A Safe
Slide 40: Making a Difference
For personal use only We believe in a world where people power makes amazing things happen. Where technology opens up new horizons and clean energy makes the planet a better place for every generation to come. We are bold, passionate, fearless and fun - a smarter, kinder, more innovative company. Ou