Nickel Industries Limited · ASX:NIC
Nickel Industries — H1 2021 Earnings Presentation
20 slides from Nickel Industries's earnings presentation, 2021
Slide 1: A New Force in Global Nickel – 1H 2021 Results Presentation
A NEW FORCE IN GLOBAL NICKEL Results Presentation 1H 2021 Consistent operations deliver record 1H financial performance 0
Slide 2: Disclaimer
DISCLAIMER This presentation has been prepared by Nickel Mines Limited (ABN 44 127 510 589) (‘NIC’). The information contained in this presentation is for information purposes only and has been prepared for use in conjunction with a verbal presentation and should be read in that context. The informa
Slide 3: 1H 2021 Highlights
1H 1H2021 Review 2021 HIGHLIGHTS 2 ▪ Gross Profit of US$93.4M ▪ 20,210.3 tonnes Ni production ▪ Mine production of +1M wmt ▪ Acquired a 50% interest in Angel ▪ Operating Profit of US$88.9M ▪ Record attributable Ni production ▪ HM EBITDA US$11.5M on a Nickel ▪ Strong conversion of EBITDA to FCF of 16
Slide 4: Financial Snapshot - An Excellent 1H Across Both RKEF and Mine Operations
FINANCIAL SNAPSHOT - AN EXCELLENT 1H ACROSS BOTH RKEF AND MINE OPERATIONS All figures in US$M 1H 2021 1H 2020 ▪ Excellent 1H 2021 financial performance underpinned by: o Strong and consistent RKEF production. Sales Revenue $288.7 $227.8 27% o Higher realised NPI prices. Gross Profit $93.4 $56.4 66%
Slide 5: Balance Sheet - Growing with Significant Flexibility for the Future
BALANCE SHEET - GROWING WITH SIGNIFICANT FLEXIBILITY FOR THE FUTURE 30 June 31 December All figures in US$M 2021 2020 ▪ Strong operational performance has underpinned Current Assets $386.2 $538.6 the maintenance of a robust balance sheet. ▪ During 1H 2021 NIC repaid the remaining US$45M of the Range
Slide 6: RKEF Production - Industrial Style Consistency
RKEF PRODUCTION - INDUSTRIAL STYLE CONSISTENCY EBITDA figures in US$M EBITDA margins in US$/t 1H 2021 1H 2020 Hengjaya Nickel Production (Ni tonnes) 10,073.0 10,651.9 (5.4%) ▪ Consistent production from both Hengjaya Nickel and Ranger Nickel of > 10,000 tonnes. Ranger Nickel Production (Ni tonnes) 1
Slide 7: RKEF Operations - Another Period of Consistent Production Performance
RKEF OPERATIONS - ANOTHER PERIOD OF CONSISTENT PRODUCTION PERFORMANCE HENGJAYA NICKEL March 2021 Quarter June 2021 Quarter 1H 2021 RANGER NICKEL March 2021 Quarter June 2021 Quarter 1H 2021 NPI Production tonnes 36,811.4 36,927.8 73,739.2 NPI Production tonnes 35,127.9 37,558.7 72,686.6 NPI Grade %
Slide 8: RKEF Operations – Another Quarter of Strong EBITDA Margins
RKEF OPERATIONS – ANOTHER QUARTER OF STRONG EBITDA MARGINS Reliability and consistency are the hallmarks of NIC’s RKEF operations (1) (1) Pricing in the June quarter of 2020 was impacted by COVID-19. 7
Slide 9: NPI Contract Prices - Capturing the Current NPI Tailwinds
NPI CONTRACT PRICES - CAPTURING THE CURRENT NPI TAILWINDS ▪ For 1H 2021 o Average China NPI price(1) was ~US$15,300/t Ni representing approximately 88% of the average LME nickel price during the half. o NIC’s weighted average contract sales prices (pre-final assay) was 90.7% of the average China NPI
Slide 10: We Are a Low-Cost Producer of NPI, Generating Strong EBITDA Margins
WE ARE A LOW-COST PRODUCER OF NPI, GENERATING STRONG EBITDA MARGINS ▪ NIC is a low cost, bottom cost quartile producer of NPI. o Certain input costs did however increase in 1H 2021 Whilst the overall cost curve has increased – rising nickel ore, electricity and coking coal prices. since 2020 due to
Slide 11: Hengjaya Mine – A Tale of Two Halves
HENGJAYA MINE – A TALE OF TWO HALVES March Qtr June Qtr March Qtr June Qtr Production summary 1H2020 1H2021 2020 2020 2021 2021 Saprolite mined wmt 149,958 62,610 212,568 456,487 574,791 1,031,278 +385% Overburden mined BCM 179,524 150,817 330,341 262,270 549,213 811,483 Limonite mined BCM 75,254 18
Slide 12: Angel Nickel Overview - A Quick Refresher
ANGEL NICKEL OVERVIEW - A QUICK REFRESHER Nickel Mines is acquiring an 80% interest in Angel Nickel, with 50% already completed ▪ Nickel Mines has executed a binding definitive agreement with Shanghai The Acquisition will add significant scale to Nickel Mines’ attributable nickel Decent to acquire a
Slide 13: Angel Nickel - On Track for Commissioning in 2H 2022
ANGEL NICKEL - ON TRACK FOR COMMISSIONING IN 2H 2022 Engineering, procurement and construction activities at Angel Nickel are progressing well. All material earthworks and plant footings are largely completed, together with the fabrication of key long lead items including boilers, turbines and gener
Slide 14: ESG & Safety
ESG & SAFETY Community Environment Health & Safety ▪ Employee numbers are > 1,850 locals(1) at current ▪ Since early 2020 IMIP has cumulatively invested more ▪ Nickel Mines is committed to upholding high standards operations, with an additional ~2,000 expected to be than US$300 million in environmen
Slide 15: COVID-19 Pandemic Prevention and Control
COVID-19 PANDEMIC PREVENTION AND CONTROL ▪ There have been no COVID-19 related disruptions to production since the onset of the pandemic in early 2020. ▪ Continued strict enforcement of access controls into and out of the IMIP. ▪ Local government enforcement of a valid negative-PCR test prior to tra
Slide 16: 1H 2021 - Consistent, Steady-State Industrial Production and Strong EBITDA Margins
1H 2021 - CONSISTENT, STEADY-STATE INDUSTRIAL PRODUCTION AND STRONG EBITDA MARGINS Quarterly RKEF Ni Production and RKEF EBITDA margin per tonne US$/t 1H 2021: ▪ Consistent levels of production of ~10,000/t Ni per quarter. Nickel tonnes ▪ Improved EBITDA margins. ▪ Attractive stainless steel and nic
Slide 17: Thank You
THANK YOU For further inquiries please contact Justin Werner Cameron Peacock Managing Director Investor Relations & Business Development jwerner@nickelmines.com.au cpeacock@nickelmines.com.au +61 439 908 732 16
Slide 18: Appendix: Additional Information
APPENDIX: ADDITIONAL INFORMATION 17
Slide 19: Tsingshan Group Is the Best Partner in the Stainless Steel and Nickel Value Chain
TSINGSHAN GROUP IS THE BEST PARTNER IN THE STAINLESS STEEL AND NICKEL VALUE CHAIN #1 Stainless Steel Producer Globally Robust Growth of Stainless Steel Production Global Stainless Steel Market Share (2020) Global Stainless Steel Production Ranking (2) Tsingshan Stainless Steel Production(5) (2019) T
Slide 20: Stainless Steel Producer Benchmarking
STAINLESS STEEL PRODUCER BENCHMARKING Market Cap FY20 Stainless Steel Geographic Presence Product Mix FY20 Revenue (US$bn) FY20 EBITDA (US$m) (US$bn) Production Capacity (Mt) Indonesia, 21% 19% (1) (2) Private 10.8 42.4 NA China, No Rating 81% 79% 8% 24% (3) 46% 2.5 4.1 388 US$ 5.0bn 54% Rating With