Kingsgate Consolidated Limited · ASX:KCN
Kingsgate Consolidated — 2011 Macquarie Australia Conference
36 slides from Kingsgate Consolidated's conference presentation, May 4, 2011
Slide 1: ASX cover letter: 2011 Macquarie Australia Conference
ABN 42 000 837 472 4 May 2011 Via ASX Online (36 pages including cover) The Manager Company Announcements Office Australian Securities Exchange Dear Sir/Madam, 2011 Macquarie Australia Conference Please find attached a 35 page presentation and update about Kingsgate, provided to investors at the Mac
Slide 2: Kingsgate Consolidated Limited: Premier ASX mid-tier gold producer
Kingsgate Consolidated Limited Premier ASX mid-tier Gold producer May 2011
Slide 3: Disclaimer
Disclaimer Forward Looking Statements: These materials include forward looking statements. Forward looking statements inherently involve subjective judgment & analysis & are subject to significant uncertainties, risks & contingencies, many of which are outside of the control of, & may be unknown to,
Slide 4: Premier ASX Mid-Tier Gold Miner
Premier ASX Mid-Tier Gold Miner Production Growth Diversified Production Resource Growth Strong Cashflow Growth Opportunities
Slide 5: Kingsgate Growth Strategy
Kingsgate Growth Strategy 2010 - One Mine One Country Chatree
Slide 6: Chatree – Thai Gold Belt
Chatree – Thai Gold Belt Chatree Thailand World Class Gold Bangkok Province Thai Gold Belt Phitsanulok Province First Mover Advantage Granted Phetchabun Province 70 km Chatree Phichit 1,300 km2 Tenement Province Package Pending Multiple Targets Nakhonsawan Province
Slide 7: Chatree - World Class Deposit
Chatree - World Class Deposit World Class Gold Deposits are +5 Moz Western Australia’s Kalgoorlie Chatree ~6Moz Super Pit to date & growing (same scale) Section5 km including mined to date 1.9 Moz Reserve 4.3 Moz Resource* (*As at 30 June 2010) 1 km
Slide 8: Expansion on Time and Budget
Expansion on Time and Budget Chatree processing plant capacity increase from 2.3 to +5 Mtpa Completion expected in September Quarter 2011 Increase production rate up to 200,000 ounces per year Total project capex US$125M; EPCM contract US$100M Expensed ~US$75M; Remaining ~US$50M Tax incentives grant
Slide 9: Chatree Expansion
Chatree Expansion
Slide 10: Organic Growth - Expanding Pits
Organic Growth - Expanding Pits Chatree Grade/Tonnage Variance Versus Gold Price* Gold Price Gold Grade Tonnes Contained Gold (US$) (g/t) (Millions) (Moz) 1050 0.98 71 2.2 1150 0.96 78 2.4 1250 0.85 100 2.7
Slide 11: Underground Potential
Highway diversion and underpass 6T8Q0OME Potential Underground Mineralised Structures Z Mineralised vein AF Deep potential mineralisation LH Fault, interpreted Site BENE 25 Te Satine ‘ime rion Soe] \ Major 4 Feeder \ 7 \ Structure \ (NNW strike) USS95¢/oz /, Om| -100m| Paleo andesitic volcanic hasin
Slide 12: Kingsgate Diversifies
Kingsgate Diversifies 2011 Two Mines Two Countries Chatree Challenger
Slide 13: Australian Assets
Australian Assets Completed the acquisition of Dominion Mining in February 2011 Challenger underground gold mine in South Australia Prospective portfolio of regional exploration tenements and applications in Western Australia, South Australia and Laos Challenger Gold Mine
Slide 14: Challenger Gold Mine
Challenger Gold Mine Discovered May 1995 – development commenced Mar 02 Historical open pit Underground from July 05 Reserves of 421,650 ounces (as at June 30, 2010) Resources of 950,220 ounces (as at June 30, 2010) Strong reserve increase since commencement and further reserve growth an
Slide 15: Challenger Long Section
Challenger Long Section NE SW Ventilation Shaft Challenger RL(m) 1000 M1 800 Level M2 Exploration Drive 800 M3 Identified 600 Structures 400 280 Level Exploration Drive Open Upside 200 Down 0 Dip -200 Open -400 Down Dip
Slide 16: Challenger Oblique Section
Challenger Oblique Section E W Ventilation Shaft Challenger Challenger RL(m) West 1000 800 Level Exploration Drive 800 Upside 600 400 280 Level Exploration Drive Open 200 Down Open Dip Down Dip 0 Open -200 Down Upside Dip
Slide 17: Challenger Area Exploration
Challenger Area Exploration
Slide 18: Advanced Exploration WA
Advanced Exploration WA Challenger Gold Mine Calingiri Advanced Exploration Projects Cundeelee – Gold prospect in Tropicana Belt (Host to the+5Moz Tropicana Deposit) Calingiri – Copper/gold in SW Yilgarn
Slide 19: Kingsgate Grows
Kingsgate Grows 2013 Three Mines Three Countries Chatree Challenger Arqueros
Slide 20: Arqueros Project Well Located
Arqueros Project Well Located Acquired 70% of Laguna in Feb 2011 Arqueros project located in the world- class Maricunga Gold-Silver Belt Maricunga Belt Host to over 70Moz gold resources Produced over 10Moz gold Currently producing ~500Kozpa Available infrastructure with access to power
Slide 21: Fast Track to Production
Fast Track to Production 1.1 Million ounces gold equivalent (JORC Indicated + Inferred) Arqueros Average grade of 1.5g/t gold equivalent (cut-off: 0.7 g/t g/e) Target production of 100,000oz pa gold equivalent by open cut mine Definition drilling re-commenced Plan to fast-track Arqueros th
Slide 22: Kingsgate Grows: Gold Production Growth
Kingsgate Grows 2013 Three Mines Three Countries 400 Gold Production Growth ‘000oz Gold 300 200 Chatree 100 0 2008 2009 2010 2011F 2012F 2013F Chatree Challenger Arqueros (100%) Challenger Arqueros
Slide 23: March Quarter Summary
March Quarter Summary • Group Gold Production 32,973oz (Chatree 16,784oz, Challenger 16,189oz) • Total Cash Costs, Chatree US$425/oz, Challenger US$814/oz • Chatree Expansion on Schedule & Budget • Dividend of 10 cps declared on 22 February and paid on 17 March 2011 • FY2011 Group Production 125Koz
Slide 24: March Quarter Detail
March Quarter Detail Mining restricted to low grade areas Chatree Costs benefit from high silver price Higher grade in December half Unseasonal rain cuts supply lines Challenger Reflected in production and costs Exploration development advances Exploration camp re-established Arqueros Definition dri
Slide 25: Proven Value Creator
Proven Value Creator 3rd best ASX 200 return (last 10 yrs) Superior Returns Average annual ROI ~38% Return on Equity ~23% Interim dividend A$0.10/share Dividend Paid A$1.39/share over past 8 years Differential High yielding gold stock (+3%) Fully exposed to strong gold price Strong Future Low cash c
Slide 26: Premier Mid Tier Gold Producer
Premier Mid Tier Gold Producer Production • Plant expansion on time and budget Growth • Challenger and Arqueros Resource • In-pit and u/g potential at Chatree Growth • Prospective u/g zones at Challenger Thailand - Chatree Gold Mine Diversified Australia - Challenger Gold Mine Production Chile - Arq
Slide 27: Kingsgate Consolidated Limited
Kingsgate Consolidated Limited Shares: 134 Million Market Cap: ~A$1.1Bn ASX: KCN OTC: KSKGY www.kingsgate.com.au
Slide 28: Appendix: General Disclaimer
Appendix General Disclaimer: The information contained in this presentation is for informational purposes only and does not constitute an offer to issue, or arrange to issue securities or other financial products. The information contained in this presentation is not investment or financial product
Slide 29: Income Statement (A$M)
Income Statement (A$M) A$ Million : Dec 10 HY Dec 09 HY Underlying Business Profit Total Revenue 66.2 88.5 Direct Costs (36.8) (42.8) Employee Benefits (6.8) (5.7) D&A (5.4) (7.6) Finance Costs (0.6) (1.1) Exploration Expenses 0 (0.1) Forex (9.3) (8.0) Inventory 13.1 14.2 Other (9.8) (4.9) Profit be
Slide 30: Corporate Structure
Corporate Structure KINGSGATE 100% 100% 70% Dominion Laguna KCN Capital Gold Operations Resources 49% 49% 49%** Phar Mai 51%* Issara Akara 51%* Sinphum Challenger Arqueros Exploration Mining Mining Co. Ltd. Gold Mine Project Limited Limited Limited 100% 100% Gold Chatree 51%* Exploration * Held via
Slide 31: Thai Progressive Royalty Rate
Thai Progressive Royalty Rate 20% 15% 10% US$1250/oz 5% 0% Baht/gm 0 400 600 1000 1500 2000 US$/oz 0 385 580 965 1445 1930 US$1.00=Baht 30, Jan 2011.
Slide 32: Working in Thailand
Working in Thailand Asian Competitive Advantage Cost Comparisons – Thailand vs Australia Established Infrastructure Grid Power Open Pit Mining (US$): Sealed roads Waste: $1.70/t vs $2.50/t Lower cost support Ore: $3.40/t vs $4.00/t Skilled manufacturing “Buy Thai” sourced supplies Po
Slide 33: Corporate Social Responsibility
Corporate Social Responsibility World Safest Gold Mine Over 8 years – No incidents Zero Environmental Incidents ISO Standards on all activities Only mining company granted Thailand National Zero Accident Award 2010.jpg Occupational Social Accountability SA8000 Safety & Health Award 2010 T
Slide 34: Chatree
Chatree Chatree Ore Reserves as at 30 June 2010 (>0.4g/t gold cut-off grade) Source Category Tonnes Gold Grade Silver Grade Gold Contained Silver Contained (millions) (g/t) (g/t) (million ounces) (million ounces) From Pits Proved 37.4 1.00 9.5 1.20 11.42 Probable 18.7 0.98 8.4 0.59 5.02 Stockpiles 5
Slide 35: Challenger
Challenger Challenger Ore Reserves as at 30 June 2010 Source Category Tonnes Gold Grade Gold Contained (thousands) (g/t) (thousand ounces) From Mine Proved 318 5.8 59 Probable 1,834 6.0 352 Stockpiles 157 2.1 9 Challenger Total Total 2,310 5.7 420 Challenger Mineral Resources as at 30 June 2010 Sour
Slide 36: Arqueros
Arqueros JORC Sep.2010 Million Grades, g/t Ounces, thousands Category Tonnes Gold Silver AuEQ60 Gold Silver AuEQ60 Cut-off grade 0.5 g/t Au EQ60 Indicated 7.0 0.35 83 1.73 78 18,596 387 Inferred 24.6 0.32 47 1.11 253 37,506 870 Total 31.6 0.33 55 1.24 332 56,103 1,258 Cut-off grade 0.7 g/t Au EQ60 I
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