Igo Limited · ASX:IGO
Igo — Independence Group NL — Diggers and Dealers Mining Forum 2019
29 slides from Igo's conference presentation, Aug 5, 2019
Slide 1: Diggers and Dealers Mining Forum 2019
INDEPENDENCE GROUP Diggers and Dealers Mining Forum 2019 For personal use only Peter Bradford, Managing Director and CEO 5 August 2019 ASX:IGO / ADR:IIDDY
Slide 2: Agenda
Agenda For personal use only Where have we come Where are we today Where do we go next from and what have we and what is our and what does success done well? purpose? look like? 2
Slide 3: Where have we come from?
Where have we come from? For personal use only EBITDA Profile(1) ✓ Improved ESG & safety record 600 A$M ✓ Tropicana value enhancement 500 400 ✓ Streamlined portfolio 300 ✓ Nova operational delivery 200 100 ✓ Positioned IGO as a leading explorer 0 FY12 FY14 FY16 FY18 FY20e FY22e FY24e ✓ Built a great
Slide 4: We have built a great team & culture
We have built a great team & culture For personal use only Strong sense of purpose ▲37% An empowered team who Lower want to make a difference Turnover Rate ▲25% YoY Female Employees Focus on doing what is right ▲15% and 3% – because we care YoY Employee Indigenous Engagement Score Fostering the next
Slide 5: We have improved our ESG & Safety
We have improved our ESG & Safety For personal use only Key Lag Injury Metrics(1) 5 ▲470% 4 Leadership Interaction 3 Rate(2) 2 ▲53% Lower Lost Time Injury ▲56% 1 Lower High Rate(2) Potential 0 Incident Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 MTIFR 12 MMA LTIFR 12 MMA Rate(2) 1) 12 month mov
Slide 6: We have supported the next generation
We have supported the next generation For personal use only Recognise that graduates will be the Training and mentoring are at the core of future leaders of our company our program Committed to supporting new entrants Program has more than doubled since into the mining industry 2018 with graduates i
Slide 7: We delivered improved financial performance in FY19
We delivered improved financial performance in FY19 For personal use only NPAT Underlying FCF FCF Yield Net Cash A$M 300 A$348M Cash A$76M A$278M 11% 250 A$86M Debt ▲43% YoY ▲100% YoY FY19 (unaudited) 200 150 100 Net Cash from Operating Activities EPS Growth 50 0 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3
Slide 8: We outperformed at Nova in FY19
We outperformed at Nova in FY19 For personal use only Improvements in production and costs A$/lb Strong second year of commercial Tonnes 9,000 $4.50 production 8,000 $4.00 7,000 $3.50 Nickel Production of 30,708t 6,000 $3.00 5,000 $2.50 4,000 $2.00 3,000 $1.50 2,000 $1.00 Cash Costs of A$2.07/lb (pa
Slide 9: Tropicana delivered consistently in FY19
Tropicana delivered consistently in FY19 For personal use only Consistent production (100%) and cost profile oz A$/oz Track record of consistent delivery 160,000 $1,400 140,000 $1,200 120,000 100,000 $1,000 Gold produced (100%) of 518,172oz $800 80,000 $600 60,000 40,000 $400 AISC of A$951/oz 20,000
Slide 10: We progressed multiple growth projects
We progressed multiple growth projects For personal use only Commenced Boston Multiple business Commissioned second Shaker underground improvement initiatives ball mill at Tropicana development at to improve safety & Tropicana productivity Delivered step change Progressed Nickel Continued to underst
Slide 11: Where are we today and what is our purpose?
Where are we today and what is our purpose? For personal use only Market Capitalisation(1) Shares on Issue(1) A$3.2 billion 590 million Cash(2) Debt(2) A$348 million A$86 million Shareholders(2) Institutional vs Retail Institutional holders by Geography 28% 34% 66% 72% Insitutional Retail Domestic I
Slide 12: Strategically focused on metals critical to clean energy
Strategically focused on metals critical to clean energy For personal use only Globally High-quality Relevant Products Vertically Proactively Integrated Green People 12 12 12
Slide 13: Why focus on metals critical to clean energy?
Why focus on metals critical to clean energy? For personal use only Renewable energy and Grid scale energy Drives increased electric vehicles to storage to stabilise demand for nickel and reduce emissions grids copper 13
Slide 14: Let's look at electric vehicles (EVs)
Let’s look at electric vehicles (EVs) For personal use only Outlook for passenger electrification(1,2) (% of sales) Number of EVs sold and forecast is 70% 600 increasing Profile of installed solar 60% PV cells from 1998 - 2016 500 50% Higher energy density and improved safety 400 driving new applica
Slide 15: Lower battery costs to help EV demand
Lower battery costs to help EV demand For personal use only EV Battery Cost Outlook(1) EV Sales US$/kWh Subsidies, regulation and penalties (Millions) and g/km 50 250 45 40 200 Increased recharge infrastructure 35 30 150 25 Improved quality and battery life 20 100 15 10 50 Lower cost 5 0 0 2017 2020
Slide 16: Battery chemistry trending in nickel's favour
Battery chemistry trending in nickel’s favour For personal use only EV batteries becoming more nickel intensive(1) NMC (811) or NCA in 80% of EVs by 2025(2) +50kg of nickel in a Tesla S 30.2% 36.2% 71.9% 82.3% 73.1% NMC (111) NMC (433) NMC (811) NCA NCA+ Aluminium Cobalt Nickel Manganese Lithium 1)
Slide 17: Nickel market forecast to continue in deficit
Nickel market forecast to continue in deficit For personal use only Nickel Stockpiles vs Price(1) Nickel Market Supply Balance(2) Nickel Stocks Nickel Price kt (kt) (US$/t) 300 500 Thousands 19,000 200 450 400 17,000 100 350 0 15,000 300 -100 13,000 250 -200 200 11,000 -300 150 9,000 -400 100 7,000
Slide 18: The path forward….
The path forward…. For personal use only Operational Perspective • Nova and Tropicana value enhancement & optimisation Growth Perspective • Mine life extension through brownfields exploration • Downstream opportunities to unlock value • M&A to fill the development pipeline (Cu & Ni focus) • Explorat
Slide 19: Significant underground upside at Tropicana
Significant underground upside at Tropicana For personal use only 100% basis 19
Slide 20: Higher recovery through continuous improvement
Higher recovery through continuous improvement For personal use only Recoveries trending higher Average nickel recoveries improving 90 95 Metal recoveries (%) 88 86 90 Nickel Recovery (%) 84 82 85 80 78 80 76 Process control Regrind Mill 74 75 Avg. 86.1% Avg. 88.0% Avg. 89.5% 72 1Q18 2Q18 3Q18 4Q18
Slide 21: Downstream processing
Downstream processing For personal use only High metal extraction Lower cost (1) Lower emissions(1) Lower waste(1) 1) Compared to existing alternative processes to convert nickel concentrate to nickel sulphate 21
Slide 22: Technical viability of IGO Process confirmed
Technical viability of IGO Process confirmed For personal use only Current Work Underway Site selection Strong results from test work at bench and pilot scale: Complete ✓ High metal extraction (+97%) Flow sheet optimisation PFS ✓ Battery grade product 2Q20 ✓ Strong environmental credentials Maximisi
Slide 23: Nova search space much larger than first thought
Nova search space much larger than first thought For personal use only 3D Modelling of Magmatic Intrusives on Nova Mine Lease Much larger system than previously apparent Accelerated drill program planned for FY20 23
Slide 24: Enduring commitment to greenfields exploration
Enduring commitment to greenfields exploration For personal use only FY20 Exploration Budget A$6M A$3M A$3M A$4M A$26M A$66M A$24M Tropicana Nova Fraser Range West Kimberley Lake Mackay Other Greenfields & Generative 24
Slide 25: Enduring commitment to greenfields exploration
Enduring commitment to greenfields exploration For personal use only 25
Slide 26: Concluding Comments
Concluding Comments For personal use only Well positioned with strong balance Exploration to extend mine life and sheet and strong free cash flow discover the mines of the future Tropicana and Nova consistently Unlock additional value through delivering high margins downstream processing study Under
Slide 27: For personal use only
For personal use only 27
Slide 28: 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 29: Competent Person's Statements
Competent Person’s Statements For personal use only • 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 dated 20 February 2019 (Annual Statement) and lodged with the ASX f
Independence Group NL — Diggers and Dealers Mining Forum 2019 on 6ix