Iamgold Corporation · TSX:IMG
Iamgold — 23rd Annual Deutsche Bank Leveraged Finance Conference 2015
40 slides from Iamgold's conference presentation, September 2015
Slide 1: 23rd Annual Deutsche Bank Leveraged Finance Conference
23rd Annual Deutsche Bank Leveraged Finance Conference September 2015 Alberto Nunez – Treasurer TSX: IMG NYSE: IAG
Slide 2: Cautionary Statement on Forward-Looking Information
Cautionary Statement on Forward-Looking Information All information included in this presentation, including any information as to the Company’s future financial or operating performance, and other statements that express management’s expectations or estimates of future performance, other than state
Slide 3: Geographically Diversified Asset Base
Geographically Diversified Asset Base Four Operating Gold Mines 3
Slide 4: Strong Financial Position
Strong Financial Position $836M cash, cash equivalents and gold bullion $678M $500M $645M long-term debt due 2020 1 $1,336M As at June 30, 2015 In discussions to renew and extend credit facility 2 $158M Cash & Cash Equivalents Gold Bullion at Market Unused Credit Facility 1 $644.6 million senior uns
Slide 5: Capitalization
Capitalization Position (as at June 30, 2015) M$ Cash and cash equivalents 678 Bullion (at market) 158 LTD - senior unsecured notes 645 Shareholder’s Equity (incl. non-controlling interests) 2,707 Total Capitalization 3,352 Net Cash 191 Credit Metrics EBITDA (TTM) $260M Net Debt/EBITDA (TTM)1 0x Tot
Slide 6: Few Gold Producers in a Net Cash Position
Few Gold Producers in a Net Cash Position Net Cash (Net Debt) – 2015E 1,000 0 Barrick Goldcorp Agnico Alamos Torex Kinross Primero Newmont Alacer Yamana B2Gold New Gold Centerra IAMGOLD (1,000) (2,000) $US Millions (3,000) (4,000) (5,000) (6,000) (7,000) (8,000) (9,000) Source: BoA Merrill Lynch Glo
Slide 7: Disciplined Capital Spending
Disciplined Capital Spending 800 54% of the decrease from 2014 to 2015 due to 700 $669M reduced spending on gold assets; balance due to sale 600 of Niobec. 500 $ Millions Development / 400 Expansion $325M 300 Sustaining $230M 1 200 100 0 2013 2014 2015 Guidance 1 Plus or minus 10% 7
Slide 8: 2015 Capital Expenditure Outlook
2015 Capital Expenditure Outlook Development/ ($ millions) Sustaining1 Expansion Total (Non-sustaining) Rosebel 70 10 80 Essakane 55 5 60 Westwood 30 50 80 Total gold segments 155 65 220 Côté Gold - 5 5 Total consolidated 155 70 225 Joint ventures 5 - 5 Total (±10%) 160 70 230 1 Includes capitalized
Slide 9: Key Strengths
Key Strengths Balance Sheet Reduced Costs Mine Optimization - More than $830M in - Down $175M since 2013 - A continuous process Cash, Cash Equiv. & Bullion 9
Slide 10: IAMGOLD’s Plan
IAMGOLD’s Plan Revisit LOMs at lower gold prices Reduce operating costs and sustaining capital Review all capital programs, including future development projects Continue to optimize performance at Essakane and Rosebel Determine optimal development plan for Westwood Preserve financial st
Slide 11: Debt covenant requirements
Debt covenant requirements: Exclusively or in combination: 1) Repay existing secured debt (i.e. capital leases), debt associated with Designated Senior Debt (i.e. LC’s or derivatives) or other Indebtedness (provided an equal amount is used to buy back bonds through open market purchases) 2) Re-inves
Slide 12: Definitions
Definitions: For IMG purposes the following definitions are established to assess investments that qualify for debt covenant: Planned Spending: Year-To-Date (YTD)1 actual spend as reported on the MD&A plus forecasted spending Actual Capital Spending1: As reported on the MD&A on a quarterly basis Com
Slide 13: Operations Review
Operations Review £IAMGOLD
Slide 14: 2015 Production and Cost Guidance
2015 Production and Cost Guidance1 Rosebel (000s oz.) 290 - 300 Essakane (000s oz.) 360 - 370 Westwood (000s oz.) 60 - 75 Total owner-operated production (000s oz.) 710 - 745 Joint ventures (000s oz.) 70 Total attributable production (000s oz.) 780 - 815 Total cash costs2,3 – owner-operator ($/oz.)
Slide 15: All-In Sustaining Costs
All-In Sustaining Costs1,2 1,400 All figures in $/oz. sold 1,288 1,272 1,201 1,221 1,194 1,200 1,136 1,124 1,1133 1,0763 1,000 1,028 800 600 400 200 ` 0 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Total Cash Costs 1,2 Average Realized Gold Price 1 1 This is a non-GAAP measure. Refer to the non-GAAP perf
Slide 16: Rosebel – Suriname
Rosebel – Suriname Multiple open-pit mine Produced ~4 million ounces in first 11 years Hard rock comprises ~32% of ore mix and will increase to 80% by 2018 Joint venture with Government of Suriname to target higher-grade, softer rock › >$0.11/kWh power rate › 5-year option agreement with Sar
Slide 17: Rosebel – Suriname
Rosebel – Suriname 100 1250 New power rate agreement in 2013 reduced power costs 80 1000 by ~30% 83 94 76 60 68 71 750 Power costs benefitting from lower oil prices (000s oz.) Optimization of mill feed benefitting recoveries and ($/oz.) 40 500 20 250 reducing power draw and reagent consumption
Slide 18: Suriname – Political Environment
Suriname – Political Environment Bouterse government re-elected in historic majority in recent election Government highly supportive of mining industry We are strongly engaged with new cabinet. We were at the inauguration, visited Suriname recently and will be returning soon. 18
Slide 19: Essakane – Burkina Faso
Essakane – Burkina Faso 100 1250 Open-pit mine in 5th year of production; 80 1000 10 years remaining 92 89 89 89 60 83 750 April 2015 – updated resource estimate at 40 500 Falagountou increased indicated resources by 84% to (000s oz.) ($/oz.) 613,000 oz. and grade by 10% to 1.5 g/t Au 20 250 › E
Slide 20: Burkina Faso – Political Environment
Burkina Faso – Political Environment Following democratic uprising in 2014 that ousted former President Compoare, Transitional Authority has been working towards elections on October 11, 2015 Elections may be pushed back by a coup by a branch of the military (the Presidential Guard) opposed to the e
Slide 21: Sadiola – Mali
Sadiola – Mali 30 25 1200 1000 Open-pit mine has produced 7M ozs. over 20 years 20 24 21 800 Expansion to accommodate hard rock would extend (000s oz.) 15 20 19 17 600 mine life for ~10 more years ($/oz.) 10 5 400 200 Continuing to look for additional oxide reserves 0 0 Q2'14 Q3'14 Q4'14 Q1'15
Slide 22: Mali – Political Environment
Mali – Political Environment Operating in Mali for > 20 years without any operational disruption from any political unrest or conflict. Located more than 2,400 km by road from the centre of conflict in the north Government working with regional partners to identify lasting political solution to conf
Slide 23: Westwood – Canada
Westwood – Canada 40 1600 Commercial production July 1, 2014 30 1200 Production and unit costs impacted by localized 20 800 ground fall following seismic event on May 26, 2015 (000s oz.) 35 10 35 22 23 400 Affected area under temporary halt 0 Q3'14 Q4'14 Q1'15 Q2'15 0 Mining in unaffected ar
Slide 24: Exploration Review
Exploration Review # IAMGOLD
Slide 25: Boto Gold Project (Senegal)
Boto Gold Project (Senegal) • Estimated indicated resource of 1.2 Moz at 1.7 g/t Au; and inferred resource of 635,000 oz at 1.8 g/t Au • Infill drilling at Malikoundi deposit completed • Final 2014 assay results include: › 40 m at 3.24 g/t Au (including 11 m at 8.15 g/t Au) Deposit › 9 m at 10.5 g/t
Slide 26: Siribaya (Mali) – JV with Merrex Gold
Siribaya (Mali) – JV with Merrex Gold Focused on Diakha prospect - extension Fekola -B2Gold of trend hosting Boto Gold deposit 4.3Moz @ 2.16 g/t Au* • Highlights from 2014 final assay Boto-Malikoundi results include1: Mali 1.2Moz @ 1.7 g/t Au** Guinea › 6 m at 10.53 g/t Au › 3 m at 15.01 g/t Au • Hi
Slide 27: Pitangui Project (Brazil)
Pitangui Project (Brazil) • Focused on upgrading resources at the São Sebastião deposit • April 2014 – maiden inferred resource estimate of 0.64 M oz at 4.88 g/t Au > 40M oz. historical • Infill drilling program completed in Q2/15 production in Brazil’s Iron Quadrangle • Assay results highlights rep
Slide 28: Eastern Borosi (Nicaragua) – JV with Calibre Mining
Eastern Borosi (Nicaragua) – JV with Calibre Mining • 176km2 land package with 2 gold and silver deposits and series of exploration targets • Drilling program in 2015 focused on further testing discoveries from 2014 as well as exploring additional vein systems Bonanza • May 6, 2015 – Blag vein syste
Slide 29: Monster Lake (Quebec) – JV with TomaGold
Monster Lake (Quebec) – JV with TomaGold • Located in prolific Abitibi Greenstone belt • High-grade intervals (25 to 30+ g/t Au) from Monster Lake previous drilling • Highlights from 2014 final drilling results include: › 9.18 m at 46.33 g/t Au › 3.42 m at 18.68 g/t Au › 7.1 m at 6.74 g/t Au Westwoo
Slide 30: Investment Highlights
Investment Highlights Strong balance sheet allowing for financial flexibility Operations diversified across three continents Focused on cost reduction, mine plan optimization, capital discipline and cash preservation Excellent CSR reputation Promising exploration pipeline Highly levered to
Slide 31: Appendices
Appendices CORPORATION
Slide 32: ERM – Risk Assessment Process
ERM – Risk Assessment Process Step 1: For each risk, Executive Leadership Team assessed risk impact Step 2: Reviewed mitigating measures and monitoring actions in place Step 3: Assessed likelihood of occurrence to determine residual risk Step 4: Established risk owners, identified improvement opport
Slide 33: ERM – Risk Universe
ERM – Risk Universe Organization Strategic Compliance Leadership Cost containment / reduction Reserves and resources Talent / succession Capital allocation Legal Compensation Pipeline shrinkage Title Governance Exploration Fraud and corruption Merger & Acquisition / Divesti
Slide 34: ERM – Site Risks Corporate Oversight
ERM – Site Risks Corporate Oversight 2014 Key site risks Corporate level mitigations Cost containment / Sustainability of costs reduction initiatives, Number of agreements in place with key suppliers, realized margin. Expansion of savings initiatives to reduction include Diagnostics and Engagements
Slide 35: The Gold Price: An Industry Challenge
The Gold Price: An Industry Challenge Spot Gold Price ($US/OZ) 1350 1300 1250 1200 1150 1100 1050 1000 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Source: London Bullion Market Association – London PM Fix 35
Slide 36: Taxes & Royalties
Taxes & Royalties Africa Americas Burkina Faso Mali Canada Suriname 36% includes 17.50% Quebec mining duty taxes which Corp. Tax Rate 30% 36% are deductible for mining tax Statutory corporate income tax rate of 27.5% purposes less 10% per Mining Agreement 6.5% (Au price 3%- Au price <$1000/oz >$425/
Slide 37: Summary of Outstanding Derivative Contracts
Summary of Outstanding Derivative (Hedge) Contracts1 Contracts 2015 2016 2017 2018 Foreign currency Canadian dollar contracts (M of C$) 60.0 90.0 – – Contract rate range (C$/$) 1.12 – 1.17 1.12 – 1.29 – – Hedge ratio2 46% 30% – – Euro contracts (M of €) 48.0 18.0 – – Contract rate range ($/€) 1.21 –
Slide 38: Capital Structure
Capital Structure Equity Debt IMG CDN Equity (as at Sep 21, 2015) Price: $2.26 IAMGOLD 6 ¾ callable bonds October 1, 2020 Market Cap: $935 M Rating: B2 (Moody’s), and B (S&P) as of September 2015 52 Wk High/Low: $4.09/$1.50 Rank: Sr Unsecured YTD: (28%) Issue price: $100 Last trade: $72.02 (09/16/20
Slide 39: 2014 Reserves and Resources
2014 Reserves and Resources 1 As of December 31, 2014 2014 Gold (000s attributable oz. contained) Total proven and probable mineral reserves 8,608 Total measured and indicated mineral resources 2,3 21,412 Total inferred resources 7,018 • Gold reserves have been estimated at our owned and operated mi
Slide 40: Investor Relations Contacts
Bob Tait VP, Investor Relations T: 416-360-4743 Laura Young Director, Investor Relations T: 416-933-4952 Investor Relations info@iamgold.com TSX: IMG NYSE: IAG
IAMGOLD — 23rd Annual Deutsche Bank Leveraged Finance Conference 2015 on 6ix