Slide 1: 2018 Interim Results
2018 Interim Results 20 August 2018 Focused, Efficient and Delivering Growth
Slide 2: Disclaimer
Disclaimer The information contained in this presentation is intended solely for your personal reference and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person (whether within or outside your organisation/firm) or published, in whole or in part, for any pu
Slide 3: Overview
Overview Geoffrey Gao, CEO 2018 first half highlights Ross Carroll, CFO Financial results Geoffrey Gao, CEO Strategy and outlook Questions and Answers 3
Slide 4: 2018 first half in review
2018 first half in review Geoffrey Gao Chief Executive Officer
Slide 5: 2018 Interim Review
2018 Interim Review × Continued injury reduction, however fatal incident at our Sepon Safety mine in May NPAT attributable to equity holders* of US$124.2m, an increase Profit Growth of US$117.2m on H1 2017 Stronger Balance Net debt reduced by US$643m. Stronger balance sheet provides flexibility
Slide 6: Safety, Environment and Social Performance
Safety, Environment and Social Performance Safety performance Safety – our first value 4.7 4.5 4.5 4.3 Fatality at our Sepon mine. We continue to strive 4.1 3.9 towards an injury and incident free workplace 3.0 In 2017, MMG’s TRIF was the lowest of all International Council on Mining and Metal
Slide 7: Strategy and objectives
Strategy and objectives MMG’s objective is to be valued as one of the world’s top mid-tier miners by 2020 and, in the longer term, as one of the world’s top miners. To achieve this objective, we deliver value through four strategic drivers: We acquire, discover and develop mining assets that trans
Slide 8: Financial results
Financial results Ross Carroll Chief Financial Officer
Slide 9: Strong growth in profit to equity holders
Strong growth in profit to equity holders 2018 Key Financial Metrics (US$ million) 1H2018 1H2017 v 2017 Income Statement Revenue 1,898.8 1,749.8 9% Underlying EBITDA (excl 1H17 gain on divestments) 984.2 796.7 24% Profit After Tax (continuing ops) 188.8 102.4 84% Attributable to: Equity holders 124.
Slide 10: Underlying earnings growth driven by higher prices, costs controlled
Underlying earnings growth driven by higher prices, costs controlled External = $304 million Controllable = ($116) million USD Million 1400 1200 28.8 52.8 (171.2) 21.0 20.1 1000 (173.7) 251.0 800 (15.0) 600 984.2 970.4 400 200 0 1H 2017 Gain on Price Roylities , Selling Dugald River Volume Productio
Slide 11: Underlying profit to MMG equity holders
Underlying profit to MMG equity holders NPAT attributable to equity holders 1H18 1H17 2018 v MMG remains focused on driving (US$m) 2017 increased returns to shareholders Profit After Tax - Las Bambas 62.5% interest 107.4 158.9 (32%) via: Profit After Tax - Other operations 90.0 28.8 212% Accreti
Slide 12: Earnings sensitivity
Earnings sensitivity High earnings and cash flow leverage to copper and increasing leverage to zinc Estimated impact on FY18 underlying EBIT from changes in commodity prices and currency Sensitivity EBIT Impact (US$m) Copper US$/lb $0.10/lb / ($0.10/lb) 118/(118) Zinc US$/lb $0.10/lb / ($0.10/lb)
Slide 13: Net debt reduced by US$643 million in 1H18
Net debt reduced by US$643 million in 1H18 MMG has developed and commissioned the largest greenfield copper and zinc projects globally over the past 2 years Growth has been largely debt funded Operating mines are highly cash generative enabling rapid debt reduction Net debt reduced by US$2.1
Slide 14: Well managed debt maturity profile
Well managed debt maturity profile Gross debt reduced by >US$900m in H1 2018 Average outstanding maturity profile now ~6.5 years Debt repayment schedule1 (US$m) 3,500.0 3,000.0 2,500.0 2,000.0 1,500.0 1,000.0 500.0 0.0 2H 2018 2019 2020 2021 2022-25 2026-32 Las Bambas Acquisition Facility, 7 yrs
Slide 15: Business improvement
Business improvement Right sizing the base Business improvement is a group wide focus and one of our strategic drivers for value creation Delivering the right platform to support value creation at existing asset US$30m reduction in base and retain flexibility to grow overhead costs Portfolio o
Slide 16: Dugald River – ramp up ahead of schedule
Dugald River – ramp up ahead of schedule Commercial Production 1 May 2018. Total development capital ~US$550m1 Early commissioning has resulted in lower net capital expenditure in 2018 Mining and milling rates progressing strongly 2018 production guidance 120-140kt2 Steady state producti
Slide 17: Excellence in project delivery and ramp up
Excellence in project delivery and ramp up Ramp up profiles of greenfield copper concentrators1 Ramp up profiles of greenfield zinc concentrators1 120% 140% Mill throughput as % of installed Capacity Mill throughput as % of installed Capacity 100% 120% 100% 80% 80% 60% 60% 40% 40% Dugald River Mine
Slide 18: Las Bambas outlook
Las Bambas outlook Las Bambas has been established as one of the lowest cost copper operations of this scale in the world. 20+ year mine life based on current reserves with significant geological potential to support mine life extension/expansion. 1H18 production (187kt) was 15% below pcp, impac
Slide 19: Kinsevere and DRC Mining Code
DRC Contribution - MMG Kinsevere INVESTMENTS Mining Code $1.2bn $250m 2018 Additional capital Purchase of Anvil invested for mine Mining in 2012 Revised Mining Code development to 2017 enacted March 2018 WORKFORCE Increased royalties, fees, duties, State’s rights and super profits tax. >96% Reduced
Slide 20: MMG: Focused, Efficient and Delivering Growth
MMG: Focused, Efficient and Delivering Growth Geoffrey Gao Chief Executive Officer
Slide 21: World-class asset base delivering value
World-class asset base delivering value World class asset base with geographic diversity and track record of delivering operational commitments Top 10 miner of copper and zinc Low cost position – well placed to deal with commodity market volatility Free Cash Generation of US$2.1b over the pa
Slide 22: Positive outlook for copper and zinc despite recent volatility
Positive outlook for copper and zinc despite recent volatility Mined copper supply gap and requirement for new capacity Attractive fundamentals and insights from major shareholder support commodity outlook 26 Base case production capability Primary demand Supply risks growing – social, political,
Slide 23: Focused, Efficient and Delivering Growth
Focused, Efficient and Delivering Growth Growth Las Bambas then Dugald River - Top 10 producer of copper and zinc Operational Excellence Track record of continuous improvement Shareholder 12 month total shareholder return of 13% compared to -12% for value EMIX Global base metals index. Strong
Slide 24: Appendix
WERE IMIIVIG
Slide 25: MMG asset base
MMG asset base We have a globally diversified portfolio of base metals operations and development projects HIGH LAKE IZOK LAKE SEPON (90%)1 LAOS HONG KONG VIENTIANE SEPON LAS BAMBAS (62.5%) DUGALD RIVER (100%) 2018 production guidance: 2018 production guidance: 410,000 – 430,000 tonnes of DRC 120,00
Slide 26: Guidance for 2018
Guidance for 2018 Las Bambas Rosebery Copper – production 410,000 – 430,000 tonnes Zinc – production 70,000 – 80,000 tonnes Copper – C1 costs US$1.00 – 1.10 / lb Zinc – C1 costs US$0.00 – 0.15 / lb Kinsevere Dugald River Copper – production 80,000 tonnes Zinc – production 1 120,000 – 140,000 tonnes
Slide 27: Financial dashboard
Financial dashboard Revenue by commodity Revenue by customer location Copper China 7% 4%1% Japan&Korea 5% Zinc 2% 10% Asia 9% Lead Middle East Gold 11% 49% Australia Silver Others 3% Molybdenum 79% 20% EBITDA by operating segment Operating expenses (sites) 3% 12% 11% 17% People 6% External Services
Slide 28: Las Bambas 1H18 performance
Las Bambas 1H18 performance Key highlights: Financials Revenue of US$1,349.4 million 1% lower due to higher copper prices offsetting lower sales volumes US$ million 1H18 1H17 % Payable copper in product sold was 16% below pcp, reflecting Revenue 1,349.4 1,361.7 (1%) lower opening stocks and lowe
Slide 29: Kinsevere 1H18 performance
Kinsevere 1H18 performance Key highlights Financials Record first half production of 40,556 tonnes of copper US$ million 1H18 1H17 % cathode due to 10% higher mill throughput and improved recoveries to offset grade declines. Revenue 279.4 226.8 23% Revenue increased by US$52.6m (23%) and EBITDA
Slide 30: Rosebery 1H18 performance
Rosebery 1H18 performance Key highlights Financials Revenue increased by 48% to US$203.8 million due to US$ million 1H18 1H17 % higher prices and higher sales volumes across all Revenue 203.8 138.1 48% commodities. EBITDA 118.2 66.8 77% Total production expenses were US$1.9 million (3%) lower EB
Slide 31: Dugald River 1H18 performance
Dugald River 1H18 performance Key highlights Financials Achieved commercial production on 1 May 2018, with results US$ million 1H18 1H17 % taking into consideration sales revenue, operating expenses Revenue 69.2 - - and depreciation and amortisation from this date. EBITDA 28.8 - - Ramp up activi
Slide 32: Consolidated financial performance: Statement of financial performance
Consolidated financial performance: Statement of financial performance 2018 2017 6 months ended 30 June 2018 US$ million US$ million Revenue 1,898.8 1,749.8 Operating expenses (901.2) (829.5) Exploration expenses (14.2) (17.0) Administration expenses (22.8) (40.6) Other income / (expenses) 23.6 (66.
Slide 33: Condensed consolidated balance sheet
Condensed consolidated balance sheet US$ million 30 Jun 2018 31 Dec 2017 Non-current assets 12,170.4 13,093.5 Current assets – cash and cash equivalents 647.4 936.1 Current assets – other 648.4 760.0 Assets of disposal group classified as held for sale 583.3 - Total assets 14,049.5 14,789.6 Total eq
Slide 34: Consolidated financial performance: Cash flow statement
Consolidated financial performance: Cash flow statement Six months ended 30 June 1H2018 1H2017 US$ million Receipts from customers 2,216.8 2,426.5 Payments to suppliers and employees (1,262.6) (1,263.1) Payments for exploration expenditure (15.2) (17.6) Income tax refunded / (paid) 2.5 (29.8) Net ca
Slide 35: MMG overview
MMG overview Overview Founded in 2009, MMG is a diversified base metals company with five operating mines located across four continents Broker Coverage Headquartered in Melbourne (Australia), with a primary listing on the Broker Name HKEx (1208 HK) and a secondary listing on the ASX (MMG ASX) A
Slide 36: Mineral Resources
Mineral Resources Copper and zinc Mineral Resources of 14.4Mt and 11.8Mt respectively Mineral Resources – Contained Metal (100% asset basis) As at 30 June 2017 Project Copper Zinc Lead Silver Gold Molybdenum kt kt kt moz moz kt Las Bambas 11,625 182 2.7 341 Kinsevere 1,431 Sepon 531 1.3 Dugald River
Slide 37: Ore Reserves
Ore Reserves Copper and zinc Ore Reserves of 8.2Mt and 4.3Mt respectively Ore Reserves – Contained Metal (100% asset basis) As at 30 June 2017 Project Copper Zinc Lead Silver Gold Molybdenum kt kt kt moz moz kt Las Bambas 7,493 118 1.8 207 Kinsevere 486 Sepon 247 Dugald River 3,903 722 46 Rosebery 1
Slide 38: Executive team – global experience
Executive team – global experience Chief Executive Officer Chief Financial Officer EGM Business Support EGM Marketing & Risk Geoffrey Gao Ross Carroll Greg Travers Xu Jiqing Appointed as CEO of the 25+ years’ experience in the Executive General Manager 25+ years’ experience in Company in Aug
Slide 39: “prouress EVEIVIG
AA “prouress EVEIVIG