Igo Limited · ASX:IGO
Igo — Independence Group NL — Investor Presentation (November 2015)
37 slides from Igo's investor presentation, Nov 3, 2015
Slide 1: November 2015 Investor Presentation
INDEPENDENCE GROUP NL For personal use only Peter Bradford, Managing Director and CEO November 2015 Investor Presentation 1 November 2015
Slide 2: Cautionary statements & disclaimer
Cautionary statements & disclaimer For personal use only • This presentation has been prepared by Independence Group NL (“IGO”) (ABN 46 092 786 304). It should not be considered as an offer or invitation to subscribe for or purchase any securities in IGO or as an inducement to make an offer or invit
Slide 3: IGO introduction
IGO introduction Leading Australian diversified mining company For personal use only Listed on the ASX (IGO) • Based in Perth, Western Australia Portfolio of high margin assets • All proximally located in West Australia • Nickel, Gold, Zinc, Copper, Cobalt Consistent track record and future • Strong
Slide 4: Sustainability
Sustainability Continued strengthening and improvement across the business For personal use only Safety 14 42 • Two lost time injuries recorded in the quarter 12 36 Sustainability reporting 10 30 • First sustainability report released 8 24 • Available in soft copy from the IGO website (www.igo.com.a
Slide 5: September 2015 Quarter Highlights
September 2015 Quarter Highlights Strong quarter absorbing transaction costs For personal use only Financial and Corporate • Completed acquisition of Sirius on 22 September 2015 • Cash and bullion of $131.8M and debt of $200.0M at quarter end for net debt of $68.2M • $33.0M of operating cash flow fo
Slide 6: Unaudited financial highlights
Unaudited financial highlights Balance sheet remains strong For personal use only Unaudited ($’million) Q1 FY16 Q4 FY15 Revenue 124.2 118.7 Underlying EBITDA(1) 40.3 38.0 Underlying NPAT(1) 12.5 7.5 Profit after tax (49.9) 7.5 Net Cash Flow From Operating Activities 33.0 47.3 Underlying Free Cash Fl
Slide 7: Financial Notes
Financial Notes Adjustments for Sirius transaction and updated gold hedging position For personal use only Finalising Sirius Acquisition • Underlying EBITDA of $40.3M (June 2015 $38.0M) • Unaudited profit after tax of $12.5M (June 2015 $7.5M) • Unaudited loss after tax of $49.9M included tax unadjus
Slide 8: IGO asset portfolio
IGO asset portfolio Portfolio of gold and base metals assets For personal use only Mining Construction Permitting Exploration Au Ni Zn/Cu Ni/Cu Cu/Zn TROPICANA LONG JAGUAR NOVA STOCKMAN VARIOUS 30% JV Interest 100% owned 100% owned 100% owned 100% owned 70-100% West Australia West Australia West Aus
Slide 9: Tropicana overview
Tropicana overview One of Australia’s lowest cost, open pit gold mines of scale For personal use only 30% IGO and 70% AngloGold Ashanti • Located 370km East NE of Kalgoorlie Low cost and long mine life • 3 Moz Ore Reserves(1) • Contained within 7 Moz Resources(1) • Open Pit mining with remaining LOM
Slide 10: Tropicana September quarter
Tropicana September quarter Production and cash costs within or better than annualised guidance For personal use only Gold production and costs meet/beat guidance • 35,461oz gold produced and 36,341oz sold (IGO share) • Cash costs of $624/oz produced and AISC of $798/oz sold Mining • Higher producti
Slide 11: Tropicana pits
Tropicana pits Four contiguous pits extending over a five kilometre strike For personal use only 11
Slide 12: Tropicana upside
Tropicana upside Significant potential to extend mine life beyond initial 10 years For personal use only Process plant debottlenecking ongoing • Throughput rates of up to 6.6 Mtpa achieved on a monthly basis • Work underway to debottleneck to +7.0 Mtpa at Life of Mine grade of ~2 g/t Au Resource ext
Slide 13: Jaguar overview
Jaguar overview High grade Zn-Cu VMS camp For personal use only High grade underground Zn-Cu-Ag-Au VMS deposit • Located 300km north of Kalgoorlie via sealed road • Fly in – fly out from Perth Significant improvement in operation over last 1-2 years • Acquired by IGO in 2011 • Owner operated undergr
Slide 14: Jaguar September quarter
Jaguar September quarter Zinc production beats guidance but cash costs impacted by lower Copper by-product credits than guidance For personal use only Production and costs • 11,407t Zn and 1,429t Cu produced in concentrates • Cash cost of $0.65/lb payable zinc net of by-product credits and royalties
Slide 15: Jaguar in-mine resource extension
Jaguar in-mine resource extension Currently drilling out inferred resource at Flying Spur For personal use only 15
Slide 16: Long overview
Long overview History of consistent production and reserve replacement For personal use only High grade underground nickel • Located in Kambalda, 60km south of Kalgoorlie 35 year operating history • Acquired by IGO in 2002 • Average grade project to date of 3.8% Ni • Owner operated underground minin
Slide 17: Long September quarter
Long September quarter Quarter of transition to scaled back production rate For personal use only Production and costs • 2,262t contained nickel produced • Cash costs of $4.24/lb payable Ni net of by-product credits and royalties Underground mining • 66,315t mined at an average grade of 3.41% Ni • M
Slide 18: Long resource extension
Long resource extension Targeting extensions within lava channel to south For personal use only Moran South • Identified 320m x 60m wide mineralised zone • Best intersection 5.4m @ 12.4% Ni • Infill drilling underway to establish an inferred resource • Pushing drill drive further south to be able to
Slide 19: Nova overview
Nova overview World class, low cost magmatic nickel-copper project For personal use only Fully funded underground nickel- copper project in construction • Located in highly prospective Fraser Range • Located 350 km SE of Kalgoorlie, WA • 350km from port of Esperance, WA • Acquired by IGO in 2015(1)
Slide 20: Nova: a world class project
Nova: a world class project Orebody shape, grade and mineralogy underpin low cost profile For personal use only High Grade • Resource: 14.3Mt @ 2.3% Ni and 0.9% Cu • Reserve: 13.1Mt @ 2.0% Ni and 0.8% Cu Flat lying, thick orebody shape • High nickel tonnes per vertical metre • Translates to lower un
Slide 21: Nova Project design
Nova Project design Tried and tested underground mining and processing methods For personal use only Underground mining • Contract mining, initial 3-year term, with Barminco • Conventional longhole stoping with decline haulage Processing plant • 1.5Mtpa • Conventional flowsheet of crushing, grinding
Slide 22: Nova construction on schedule
Nova construction on schedule Work progressing on time and on budget with critical path items currently ahead of schedule For personal use only 2015 2016 2017 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Underground Boxcut excava
Slide 23: Nova Project progress
Nova Project progress Fully financed, in construction, on schedule and on budget For personal use only Overall • Significant progress made during quarter and project now physically 44% complete • $120M capex expended to date in line with project “S” curve • Project remains on track for commissioning
Slide 24: Nova Project photos
Nova Project photos Project currently on time and on budget For personal use only Accommodation village, airstrip and access road Flotation circuit foundations Portal Decline SAG mill pedestals 24
Slide 25: Optimisation study
Optimisation study Focus on accelerating ramp-up and bringing value forward For personal use only Optimisation study currently underway • Scheduled to be completed in December 2015 • Designed to optimise the project on a Present Value & project return basis Key value drivers being captured by the op
Slide 26: Greenfields exploration
Greenfields exploration Long term commitment to delivering organic growth For personal use only Andrew Young Intrusive Focus on belt scale opportunities Complex – Lake Mackay • Utilising science to drive area selection • Targeting provinces that can deliver multiple gold and base metals projects Fra
Slide 27: Fraser Range – Tropicana belt
Fraser Range – Tropicana belt A highly fertile – under explored province For personal use only 27
Slide 28: Greenfields exploration
Greenfields exploration Long term commitment to delivering organic growth For personal use only Lake Mackay • AC program of 3,216m completed over six gold and multi-element surface anomalies • Bumblebee discovery • 2m @ 1.3g/t Au, 34.6g/t Ag, 7.4% Cu, 1.6% Zn, 1.3% Pb and 0.09% Co from 29m (oxide) •
Slide 29: FY16 guidance
FY16 guidance Long guidance modified in September following restructuring For personal use only Tropicana (IGO share) • 129,000 to 141,000oz at average cash cost of $640 to $710/oz Au • AISC of $820 to $910/oz Au sold • Sustaining capex of $8 to $10M and Exploration of $9 to $11M Jaguar • 35,000 to
Slide 30: Concluding comments
Concluding comments Diversified mining company delivering cash flow and growth For personal use only Solid quarter of operating results • All mines delivering broadly in line with guidance range • Restructuring implemented at Long in September to reset cost structure Nova acquisition completed: focu
Slide 31: Follow us as we go from strength to strength
i FOLLOW US AS WE GO FROM STRENGTH TO STRENGTH igo.com.au
Slide 32: Mineral resource & ore reserve: Competent Persons Statements
Mineral resource & ore reserve Competent Persons Statements For personal use only Exploration Results • The information in this report that relates to Exploration Results is a compilation of previously published data for which Competent Persons consents were obtained. Their consents remain in place
Slide 33: Mineral resource & ore reserve: Tropicana Operation
Mineral resource & ore reserve Tropicana Operation Mineral Resource 30 June 2015 Ore Reserve 30 June 2015 For personal use only 100% Project 100% Project Classification Tonnes Mt Au g/t Contained Au Moz Classification Tonnes Mt Au g/t Contained Au Moz OPEN PIT Measured 12.8 2.09 0.86 OPEN PIT Proved
Slide 34: Mineral resource & ore reserve: Long Operation
Mineral resource & ore reserve Long Operation Mineral Resource 30 June 2015 Ore Reserve 30 June 2015 For personal use only Classification Tonnes Ni% Ni Tonnes Classification Tonnes Ni% Ni Tonnes LONG Measured 65,000 5.4 3,500 LONG Proved 28,000 3.6 1,000 Indicated 287,000 5.1 14,600 Probable 94,000
Slide 35: Mineral resource & ore reserve: Jaguar Operation
Mineral resource & ore reserve Jaguar Operation For personal use only Mineral Resource 30 June 2015 Ore Reserve 30 June 2015 Classification Tonnes Cu% Zn% Ag g/t Au g/t Classification Tonnes Cu% Zn% Ag g/t Au g/t BENTLEY Measured 529,000 2.1 11.5 159 0.8 BENTLEY Proved 323,000 2.0 10.8 155 0.8 Indic
Slide 36: Mineral resource & ore reserve: Nova Project
Mineral resource & ore reserve Nova Project For personal use only Mineral Resource 30 June 2015 Ore Reserve 30 June 2015 Classification Tonnes (Mt) Ni% Cu% Co% Ni Kt Cu Kt Co Kt Classification Tonnes (Mt) Ni% Cu% Co% Ni Kt Cu Kt Co Kt NOVA Measured - - - - - - - NOVA Proved - - - - - - - Indicated 9
Slide 37: Mineral resource & ore reserve: Stockman Project
Mineral resource & ore reserve Stockman Project Mineral Resource 30 June 2015 Ore Reserve 30 June 2015 For personal use only Classification Tonnes Mt Cu% Zn% Ag g/t Au g/t Classification Tonnes Mt Cu% Zn% Ag g/t Au g/t CURRAWONG Measured - - - - - CURRAWONG Proved - - - - - Indicated 9.5 2.0 4.2 42
Independence Group NL — Investor Presentation (November 2015) on 6ix