Florida Canyon Gold — Argonaut Gold — Q4 2019 Earnings Presentation
24 slides from Florida Canyon Gold's earnings presentation, Feb 24, 2020
Slide 1: Corporate Presentation: Fourth Quarter and Year Ended December 31, 2019
Gold producer with advanced exploration projects in the Americas CORPORATE PRESENTATION Fourth Quarter and Year Ended December 31, 2019 Conference Call TSX:AR February 24, 2020
Slide 2: Forward Looking Information
FORWARD LOOKING INFORMATION This presentation contains certain “forward-looking statements” and “forward-looking information” under applicable Canadian securities laws concerning the proposed transaction and the business, operations and financial performance and condition of Argonaut Gold Inc. (“Arg
Slide 3: Q4 2019 Impairments
Q4 2019 Impairments Write down of long term PAD Write down of book value for inventory: San Antonio project: $111.0M El Castillo Complex: $20.1M La Colorada mine: $12.1M Impact of Impairments 3 months ended Dec. 31/19 Year ended Dec. 31/19 With Without With Without Impairments Impaitments1 Impairmen
Slide 4: 2019 Highlights
2019 Highlights Financial Performance 186,615 Production GEOs2 • Increased net cash1 by over $26M • Record annual production • Increased production by 53% over the past 3 years Short-Term Initiatives Long-Term Growth Initiatives • San Agustin: • Magino • Completed Federal & Provincial Environmental
Slide 5: Recent CSR Highlights
Recent CSR Highlights Argonaut continues to create sustainable value through innovation and collaboration within the communities in which we operate. Some recent highlights include: MEXICO CANADA Sonora Cultural Event at Delivery of food basket Visit from Governor of Completed Michipicoten La Colora
Slide 6: Financial Performance
Financial Performance Fourth Quarter Year Ended December 31 2019 2018 2019 2018 Production (GEO)1 47,521 51,658 186,615 165,117 Sales (GEO)1 48,843 42,328 194,269 155,480 Revenue ($M) $72.1 $51.6 $268.9 $196.1 Net loss ($M) ($107.5) ($17.5) ($93.1) ($7.6) Loss per share ($0.60) ($0.10) ($0.52) ($0.0
Slide 7: Operations Overview
Operations Overview Fourth Quarter Year Ended December 31 Production (GEO)1 2019 2018 2019 2018 El Castillo 13,896 18,984 66,509 48,311 San Agustin 21,003 18,993 64,768 68,815 La Colorada 12,622 13,681 55,338 47,991 TOTAL 47,521 51,658 186,615 165,117 Adjusted Cash Cost2 El Castillo $1,264 $1,007 $1
Slide 8: 2019 Production Guidance vs. Actual 2019 Production
2019 Production Guidance vs. Actual 2019 Production 2019 PRODUCTION ACTUAL 2019 GUIDANCE (GEOs)1 PRODUCTION (GEOs)1 Consolidated 190K – 200K 186,615 Q4 PRODUCTION CHALLENGES ACTIONS TAKEN: Run-of-mine and no longer Lower productivity crushing • Wet, sticky ore – El Castillo • Small working faces – a
Slide 9: Managing Pit De-Watering & Recent Improvements
Managing Pit De-Watering & Recent Improvements LA COLORADA EL CASTILLO Q4 2019 Q4 2019 Q1 2020 Q1 2020 Improvements in reduction of water in pits De-watering old underground Investment in pumping equipment mine workings encountered to manage water table TSX:AR Fourth Quarter and Year End December 31
Slide 10: Q4 2019 Capital Spending And Cash Flow ($M)
Q4 2019 Capital Spending And Cash Flow ($M) Investing in the future Cash Flow Reconciliation Capital Spend Opening balance cash 35.6 Cash flow from ops excl. working capital 27.2 Sustaining Expansion Stripping Changes in working capital (9.5) El Castillo 2.8 - 1.5 Cash before investment & financing
Slide 11: 2020 GEO Production and Cost Guidance
2020 GEO1 Production and Cost Guidance El Castillo La Colorada Consolidated Complex GEO Production1 In 000s 115 - 120 60 - 65 175 - 185 $ per Cash costs 2,3 ounce Au $900 - 1,000 $900 - 1,000 $900 - 1,000 $ per AISC 2,3 ounce Au - - $1,150 - 1,250 1 GEOs are based on a conversion ratio of 80:1 for s
Slide 12: 2020 Capital Estimate
2020 Capital Estimate 2020 Capital Capital Estimate by Project ($M)1 Estimate by Project ($M)1 EL CASTILLO El Castillo / COMPLEX San Agustin 12 - 16 12 - 16 LA La Colorada 17 - 20 MAGINO & COLORADA CDG 11 - 14 17 - 20 Magino & Cerro del Gallo 11 - 14 Total 40 - 50 Exploration at Magino is $4M 2019 A
Slide 13: Transformation Strategy - Next Tier Producer
Transformation Strategy - Next Tier Producer CURRENT OPERATIONS DEVELOPMENT ASSETS 2019 2019 2019 Adjusted Adjusted Production Cash Cost2 AISC2 Capital Production LOM Cash Cost2 AISC2 (GEOs/year) (per oz) (per oz.) ($M) (GEOs/year) (years) (per oz) (per oz.) Cerro del Current 187k $134 80k 15.5 $597
Slide 14: 2020 Plans
2020 Plans EL CASTILLO COMPLEX LA COLORADA § Focus on reducing unit costs § ~12% of ore in 2020 will require two- § Processing run-of-mine vs. stage crushing and ~78% of ore will crushed ore at El Castillo, require three-stage crushing optimizing overburden haul § Anticipate crushing throughput of d
Slide 15: Magino – Expanding on Goudreau Deformation District
Magino – Expanding on Goudreau Deformation District ALAMOS MAGINO WESDOME Other mines and projects in the district are showing a grade increase at depth TSX:AR Fourth Quarter and Year End December 31, 2019 Conference Call – FEBRUARY 24, 2020 | ARGONAUT GOLD 15
Slide 16: Wawa Gold Project Gold Camp Comparison
WAWA Potential toWAWA GOLD GOLD Add Mineral PROJECT PROJECT Resources and Reserves - Magino GOLD GOLD CAMP CAMP COMPARISON COMPARISON ALAMOS GOLD WESDOME MAGINO Multiple Multiple near-surface near-surface deposits deposits ISLAND that that GOLD remain remain openopen alongalong EAGLE strike strike a
Slide 17: Potential to Add Mineral Resources and Reserves - Magino
Potential to Add Mineral Resources and Reserves - Magino MAGINO PROPERTY ALAMOS GOLD’S Lower ISLAND GOLD MINE grade at surface INCREASING GRADE Higher grade at depth Current program testing down to 1,000 m TSX:AR Fourth Quarter and Year End December 31, 2019 Conference Call – FEBRUARY 24, 2020 | ARG
Slide 18: Potential to Add Mineral Resources and Reserves - Magino Long Section
Potential to Add Mineral Resources and Reserves - Magino Long Section TSX:AR Fourth Quarter and Year End December 31, 2019 Conference Call – FEBRUARY 24, 2020 | ARGONAUT GOLD 18
Slide 19: Building A Sustainable Business
Building A Sustainable Business Market Cash Operations Valuation Balance1 175-185k GEOs $215M + + = $39M $40-50M $760M Development FCF Projects2 @ $1,500 Gold @ $1,500 Gold 1 At December 31, 2019. 2 Based on the assumptions and parameters as set out in the Magino Feasibility Study dated December 21,
Slide 20: Our Focus
Our Focus MAXIMIZE cost efficiencies and profitability BUILD balance sheet DE-RISK development projects TRANSFORMATION strategy TSX:AR Fourth Quarter and Year End December 31, 2019 Conference Call – FEBRUARY 24, 2020 | ARGONAUT GOLD 20
Slide 21: Additional Information
TSX:AR ADDITIONAL INFORMATION /ArgonautGoldInc @Argonaut_Gold Dan Symons Vice President, Investor Relations @ArgonautGoldInc Argonaut Gold Inc. company/Argonaut-Gold-Inc First Canadian Place 100 King St. West, Suite 5700 Toronto, ON M5X 1C7 T: 416-915-3107 Argonaut Gold Inc. Email: dan.symons@argona
Slide 22: Mineral Resource Notes and Disclosures
Mineral Resource Notes and Disclosures All Mineral Resources have been estimated in accordance with Canadian Institute of Mining Standards. Mineral Resources are not known with the same degree of certainty as Mineral Reserves and do not have demonstrated economic viability. In addition, the quantity
Slide 23: Notes and Disclosures
Notes and Disclosures Argonaut Gold is a Canadian gold company engaged in exploration, mine development and production activities. Its primary assets are the production stage El Castillo mine and San Agustin mine, which together form the El Castillo Complex in Durango, Mexico and the production stag
Slide 24: Consolidated Mineral Resources & Mineral Reserves
Consolidated Mineral Resources & Mineral Reserves(1) Au Contained Au Ag Contained Ag Cu Tonnes Project Category Grade Ounces Grade Ounces Cu % tonnes (millions) (g/t) (000s) (g/t) (000s) (000s) El Castillo Proven 2.9 0.58 54 El Castillo Probable 25.3 0.39 314 San Agustin Probable 57.9 0.33 614 10.2