Paladin Energy Ltd · ASX:PDN
Paladin Energy — H1 FY2016 Earnings Presentation
22 slides from Paladin Energy's earnings presentation, Feb 17, 2016
Slide 1: 31 December 2015 Half Year Conference Call Presentation (ASX cover letter)
PALADIN ENERGY LTD ACN 061 681 098 Ref: 405843 16 February 2016 ASX Market Announcements By Electronic Lodgement Australian Securities Exchange 20 Bridge Street SYDNEY NSW 2000 Dear Sir/Madam 31 December 2015 Half Year Conference Call Presentation Attached please find the presentation in relation to
Slide 2: December 2015 Half Year and Quarter Results Conference Call and Investor Update
December 2015 Half Year and Quarter Results Conference Call and Investor Update 17 February 2016 Alexander Molyneux – Chief Executive Officer Craig Barnes – Chief Financial Officer Darryl Butcher – EGM Technical and Project Development Andrew Mirco – GM Corporate Development and Investor Relations
Slide 3: Disclaimer and Notes for JORC and NI 43-101
Disclaimer and Notes for JORC and NI 43-101 Mineral Resources and Ore Reserves This presentation includes certain statements that may be deemed “forward-looking statements”. All statements in this presentation, other than statements of historical facts, that address future production, reserve or res
Slide 4: Paladin…
Paladin…. A GLOBAL URANIUM LEADER OWNS LANGER HEINRICH, A STRATEGIC TIER ONE MINE HAS OPTIMISATION AS A CORE COMPETENCY PROVIDES BEST SENIOR LEVERAGE TO URANIUM UPSIDE Paladin Energy Ltd 2
Slide 5: Global Uranium Leader
Global Uranium Leader Paladin is the world’s leading independent pure play uranium miner 27.4 Annual Capacity KazAtomProm 24.5 Mlb Areva 23.5 Cameco 23.5 ARMZ/Uranium One 21.4 Rio Tinto 11.8 BHP Billiton 8.8 Paladin 8.0 Navoi 6.2 Government owned Divisions of diversified companies Integrated with no
Slide 6: Langer Heinrich A Strategic Tier One Mine
Langer Heinrich A Strategic Tier One Mine First Quartile C1 Cash Cost1 Top 10 Uranium Mine by 2 Production 4th largest open-pit +20 Year Mine Life3 33.8Mlb Cumulative production 1 Source – UxC Uranium Production Cost Study – August 2015 2 Source – TradeTech Uranium Market Study – 2015: Issue 3 (base
Slide 7: Quarter to 31 December 2015 Highlights
Quarter to 31 December 2015 Highlights Production 1.259Mlb LTIFR 2.10 Compared to 1.39 last quarter and Drummed Production 1.264Mlb 4.14 for quarter ended 31 December 2014 US$37.90/lb ASP C1 Cash Cost US$25.38/lb 5% above average spot US$40.54/lb YTD vs December quarter guidance US$25/lb to US$27/lb
Slide 8: Quarter to 31 December 2015 Highlights
Quarter to 31 December 2015 Highlights References below to 2015 and 2014 are to the equivalent three months ended 31 December 2015 and 2014 respectively. Sales revenue US$64.4M Gross Profit 1.699Mlb sold at average US$12.4M realised price of US$37.90/lb Increase from 2014 Gross Profit of US$2.5M Dow
Slide 9: Quarter to December 2015 Cash Flow
Quarter to 31 December 2015 Cash Flow Quarter to 31 December 2015 change in cash and cash equivalents 200.0 62.7 (2.5) (1.6) (0.7) 150.0 (9.2) (4.6) (15.4) (0.3) 136.8 US$M 100.0 108.4 50.0 0.0 Paladin Energy Ltd 7
Slide 10: EBITDA Variance Analysis
EBITDA Variance Analysis Quarter to 31 December 2015 vs. Quarter to 30 September 2015 Quarter to 31 December 2015 vs. Quarter to 31 December 2014 15.0 40 Revenue variance COS variance 2.8 0.5 35 34.1 0.1 10.0 COS variance 10.6 0.4 30 11.8 5.0 25 20 US$M 0.0 US$M Revenue variance 15 0.8 2.8 4.0 0.3 0
Slide 11: All-in Cash Spending (Breakeven Price)
All-in Cash Spending (Breakeven Price) Defined to include all spending Quarter to 31 December 2015 vs. Quarter to 31 December 2014 (incl. principal amortisation on LHM project financing) Q2 FY2015 Actual all-in cash costs 48.91 Ahead on plans to reduce Currency (3.39) expenditure in line with lo
Slide 12: Capital Management
Capital Management Debt reduction1 ― US$471.1M since June 2012 ― US$22M during Dec Quarter • US$17M reduction in 2017 CB • US$5M reduction in LHM project financing Breakdown of Key Debt Instruments 1 US$M LHM Syndicated Facility Agreement 56 Next maturity is April 2017 Convertible Bonds due Apri
Slide 13: Optimisation a Core Competency
Optimisation a Core Competency Reagent Cost Optimisation US$/lb 14 5% Full Option 4 13 Reduction Impact Paladin maintains a world class 47% Reduction 12 13.04 Initial BRP technical services team focused on 11 13.77 12.57 Impact cash flow optimisation 10 9 12.33 8 9.20 BRP Enhancement 4 now opera
Slide 14: Optimisation a Core Competency
Optimisation a Core Competency Updated FY2016 optimisation – lower ‘all in’ cost guidance All-in cash costs variance analysis (FY2016 current guidance vs. FY2015 actual)1 FY2015 All-in cash expenditure 50.75 Currency (2.72) Assumed USD/NAD of 14.98 vs 11.48 for FY2015 Volume and grade 0.37 9.0% redu
Slide 15: Best Leverage to Uranium Upside
Best Leverage to Uranium Upside Uranium is not affected by recent commodity rout Oil Bloomberg Commodity Index Uranium 140 120 Rebased to 100% 100 80 60 40 20 Feb-14 Apr-14 Jun-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Feb-16 Source: Bloomberg as at 12 February 2016 Paladin Energy L
Slide 16: Best Leverage to Uranium Upside
Best Leverage to Uranium Upside Uranium market liquidity improving and outlook remains robust Mlb Long Term Contracting Volumes 1 300 Increased market activity in 2015 ― LTC volumes increased to 81Mlb (43 250 deals) 249 200 ― Market replacement volumes need to 193 150 trend to 180M to 200Mlb ― 201
Slide 17: Strategy
Strategy 1. Maximise LHM operating cash flows through optimisation initiatives whilst preserving the integrity of the long-term life of mine plan 2. Maintain KM and exploration on a “minimal expenditure, care and maintenance basis” 3. Minimise corporate and administrative costs 4. Progress strategic
Slide 18: Revised FY2016 Guidance
Revised FY2016 Guidance 5.0-5.2M lb FY 2016 US$4/lb Production Full-year average ASP Premium to spot vs 5.0-5.4M lb previously (no change) US$19M corporate costs, KM care and maintenance LHM C1 US$24-26/lb vs US$25-27/lb previously and exploration US$14M lower than FY2015 (no change) Cash flow neutr
Slide 19: Appendix
Appendix Paladin Energy Ltd 17
Slide 20: Langer Heinrich Project Update
Langer Heinrich Project Update Actuals Dec Quarter Dec Half Production December Quarter ― 1.259 Mlb (drummed 1.264Mlb) FY2015 FY2016 FY2015 FY2016 ― recovery 88.5% (improvement sustained) Ore treated (Mt) 0.917 0.903 1.651 1.750 Ore grade (ppm) 773 714 779 710 C1 Cost US$25.38/lb, on track to ac
Slide 21: Pipeline Projects
Pipeline Projects Kayelekera Mine ― now stable in C&M ― restart feasibility study completed and under Board review ― site stable in terms of water and other environmental issues for the long term Michelin Deposit Canada ― minimum expenditure planned for FY2016 Manyingee WA ― Minimum activity p
Slide 22: Paladin Energy Ltd – Contact Details
Paladin Energy Ltd – Contact Details Head Office Level 4, 502 Hay Street Subiaco Western Australia 6008 PO Box 201, Subiaco Western Australia 6904 Telephone: +61 (0) 8 9381 4366 Facsimile: +61 (0) 8 9381 4978 Email: paladin@paladinenergy.com.au Website: www.paladinenergy.com.au Investor Relations An