Fortress Minerals Limited · SGX:OAJ
Fortress Minerals — FY2019 Earnings Presentation
26 slides from Fortress Minerals's earnings presentation, May 2019
Slide 1: Fortress Minerals Limited FY2019 Results Briefing
A LEADING MALAYSIAN HIGH-GRADE IRON ORE CONCENTRATE PRODUCER AND EXPORTER FORTRESS MINERALS LIMITED FY2019 RESULTS BRIEFING
Slide 2: Important Notice
IMPORTANT NOTICE: This presentation does not constitute, or form any part of any offer for sale or subscription of, or solicitation of any offer to buy or subscribe for, any securities in Fortress Minerals Limited (“Fortress Minerals” or the “Group”) in Singapore or any other jurisdiction nor shall
Slide 3: Business Introduction
7) " ‘i 19) 6 / vy BUSINESS INTRODUCTION
Slide 4: Company Profile
COMPANY PROFILE • We are an iron ore producer and exporter headquartered in Malaysia • Our principal business activities include exploration, mining, production and sale of iron ore concentrate • Currently producing high grade iron ore concentrate from East, Valley and West Deposits in Bukit Besi mi
Slide 5: Key Management
KEY MANAGEMENT Dato’ Sri Ivan Chee Ng Mun Fey Fionne Chua • Responsible for overall • Responsible for the overall • Responsible for all finance and management and operations of management and day-to-day accounting operations of the the Group, including operations of the Bukit Besi Group formulating,
Slide 6: Our Milestones
OUR MILESTONES Completed JORC drilling campaign on East, Valley & West Listed on the Catalist Board of SGX- Deposits ST in March 2019 Constructed mine infrastructure and processing plant with S$15.0 million gross proceeds raised a steady-state production of 40,000 wet metric tonnes First i
Slide 7: FY2019 Highlights
FY2019 HIGHLIGHTS Commenced Iron Ore Production Listed on the Catalist Board of SGX-ST April 2018 March 2019 Started commercial production of iron S$15.0 million in gross proceeds ore concentrate with TFe grade of at were raised to increase minerals least 65.0% resource and processing capabiliti
Slide 8: Bukit Besi Mine Overview
7) " ‘i 19) 6 / vy — @’ BUKIT BES! MINE OVERVIEW
Slide 9: Bukit Besi Mine - Overview
BUKIT BESI MINE - OVERVIEW Mine Infrastructure Magnetite-pyrite skarn Location: Terengganu, Malaysia Tenement Boundaries North Total Concession Area: 526.2ha open pit West East Nearby Airports: Airports in Kuantan and Kuala Valley Terengganu (approximately 1.5 hours drive); Kemaman Port (approximate
Slide 10: West/Valley/East Deposits – A Closer Look
WEST/VALLEY/EAST DEPOSITS – A CLOSER LOOK 10
Slide 11: Bukit Besi Mine – Overview
BUKIT BESI MINE – OVERVIEW PRE-IPO Net attributable to Area Category the Group LOCATION TERENGGANU, MALAYSIA Tonnes Grade Total concession Area 526.2ha (Mt) (% Fe) West, Valley and East West Deposit Indicated Resource 0.37 42.20 Explored areas Deposits West Deposit Inferred Resource 2.55 39.60 (<5%
Slide 12: Bukit Besi Mine – Production Process
BUKIT BESI MINE – PRODUCTION PROCESS Removal of blasted material Step 1 Step 2 Blasting of the Removal and identified stockpiling of location blasted materials Rock surface after blasting Step 3 Step 4 Crushing Concentrate processing process The crushing plant Magnetic separator Grinding ball mills
Slide 13: Financial Highlights
7) " ‘i 19) 6 / vy FINANCIAL HIGHLIGHTS
Slide 14: FY2019 Snapshot
FY2019 SNAPSHOT US$’M Revenue & Gross Profit Production Review 25.0 20.0 Average Selling Price US$84.21 15.0 14.1 COGS/WMT US$31.00 10.0 9.1 Gross Profit/WMT US$53.21 5.0 6.6 3.9 0.0 Revenue Gross Profit 1H2019 2H2019 US$’M Net Profit & Net Profit Margin WMT 250,000 Resource Summary Mt 7.00 3.5 35.0
Slide 15: Combined Statements of Comprehensive Income
COMBINED STATEMENTS OF COMPREHENSIVE INCOME Unaudited US$'000 1H2019 2H2019 FY2019 Revenue 6,572 14,057 20,629 Gross profit 3,916 9,118 13,034 Gross profit Margin 59.6% 64.9% 63.2% Other operating income 2,069 (67) 2,002 Operating expenses (3244) (4,984) (8,227)1 Net profit after tax(NPAT) 2,007 2,8
Slide 16: Unaudited Pro Forma Combined Statements of Financial Position
UNAUDITED PRO FORMA COMBINED STATEMENTS OF FINANCIAL POSITION US$’000 FY2018 FY2019 ASSETS Non-current assets Exploration & evaluation assets - 403 Mining properties 7,009 6,973 Plant and equipment 7,301 11,365 Total Non-current Assets 14,310 18,741 Current assets Inventories 223 439 Trade receivabl
Slide 17: Unaudited Pro Forma Combined Statements of Financial Position
UNAUDITED PRO FORMA COMBINED STATEMENTS OF FINANCIAL POSITION US$’000 FY2018 FY2019 EQUITY AND LIABILITIES Equity Share capital 268 268 Other reserves 607 518 Retained earnings 668 5,564 Total equity 1,543 6,350 Non-current liabilities Borrowings 16 - Deferred tax liability 55 503 Amount owing to sh
Slide 18: Unaudited Pro Forma Combined Statement of Cash Flows
UNAUDITED PRO FORMA COMBINED STATEMENT OF CASH FLOWS FY2018 FY2019 Net cash flow (used in)/generated from operations (456,964) 6,931,284 Net cash flow used in investing activities (10,800,699) (6,400,845) Net cash flow generated from financing activities 11,248,034 1,553,233 Net change in cash and c
Slide 19: Dividends
DIVIDENDS First interim dividends for FY2020: Directors intend to recommend not less than 15% of the Group’s NPAT for FY2020 Not less than 0.16 Singapore Cent1 20% of NPAT S$800,000 or 12.1% of FY2019 NPAT paid as Interim for FY2020 FY2020 FY2021 FY2019 1 As disclosed in page 68 of the Company’s Off
Slide 20: Future Plans and Use of Proceeds
FUTURE PLANS AND USE OF PROCEEDS Aggregate amounts in SGD’000 Balance as at 2 May 2019 • Further development of our Bukit Besi Mine • Future exploration and geology work 01 S$7.0 million • Expansion of iron ore processing capacities • Acquisition/JV 02 S$2.0 million of new mines • General working ca
Slide 21: Industry Overview
7) " ‘i 19) 6 / vy INDUSTRY OVERVIEW
Slide 22: Market Update on Iron Ore
INDUSTRY OVERVIEW Market Update on Iron Ore Current iron ore prices have hit multi- year highs due to supply disruptions Cyclones strikes Australia such as the dam disaster in Brazil and cyclones at the main iron ore shipping Vale dam disaster ports in Australia Industry leaders such as Rio Tint
Slide 23: PRC's Demand for High-Grade Iron Ore Likely to Remain Strong
INDUSTRY OVERVIEW PRC’s Demand for High-Grade CRUDE STEEL PRODUCTION Iron Ore Likely to Remain Strong Our primary market, the PRC, is the world’s largest steelmaker and consumer of iron ore PRC’s iron ore imports are expected to remain at a high level of 1,000 Mt annually Source: World Steel Ass
Slide 24: Competitive Advantage
COMPETITIVE ADVANTAGE Iron ore concentrate with TFe Key contributing factors to our content of at least 65% competitiveness Low levels of impurities which Strategic Location, Favourable geological conditions would command premium prices High Grade Iron Good Infrastructure, and cost advantage
Slide 25: Share Statistics
SHARE STATISTICS Bloomberg Code SGX: OAJ Share Price S$0.245 Market Capitalization S$122.5 million Free Float 75.0 million P/E ratio 18.5x Dividend Yield 6.53% NAV Per Share 1.27 US Cents = 1.71 Singapore Cents Total Issued Shares 500 million Substantial Shareholders Insiders 50.25% Selangor Dredgin
Slide 26: Thank You!
THANK YOU! Registered Office: 8 Robinson Road #03-00 ASO Building Singapore 048544 Principal Place of Business: 9-1 Jalan PJS 8/18 Dataran Mentari 46150 Petaling Jaya Selangor, Malaysia Tele: +60 (3) 56301993 Email: corporate@fortress.sg Website: www.fortress.sg