St. Barbara Ltd. · ASX:SBM
St. Barbara — H1 FY2017 Earnings Presentation
35 slides from St. Barbara's earnings presentation, Feb 21, 2017
Slide 1: Presentation on the December 2016 Half Year Report and webcast
ASX Release / 21 February 2017 For personal use only Presentation on the December 2016 Half Year Report and webcast Bob Vassie, Managing Director & CEO, will brief analysts and institutional investors on the December 2016 Half Year Report at 12:00 pm Australian Eastern Daylight Time (UTC + 11 hours)
Slide 2: December 2016 Half Year Presentation
BOB VASSIE, MANAGING DIRECTOR & CEO For personal use only GARTH CAMPBELL-COWAN, CHIEF FINANCIAL OFFICER / 21 February 2017 December 2016 Half Year Presentation
Slide 3: Disclaimer
Disclaimer For personal use only This presentation has been prepared by St Barbara Limited (“Company”). The material contained in this presentation is for information purposes only. This presentation is not an offer or invitation for subscription or purchase of, or a recommendation in relation to, s
Slide 4: Contents
Contents For personal use only • Highlights • Operations • Financial results • Value proposition • Conclusion • Appendices Sky over Gwalia processing plant, April 2016 DDH1 Drilling at Gwalia, November 2016 3/ December 2016 Half Year Presentation
Slide 5: First half FY17 Highlights: Record cash flow
For personal use only First half FY17 Highlights: Record cash flow 139 • Record cash flow & 123 120 Underlying NPAT1 92 • Net-cash1 from Nov 81 83 77 67 2016, debt free2 60 from March 2017 • Positioned for growth 1H FY16 2H FY16 1H FY17 NPAT NPAT Cash flow (underlying) (statutory) from op'ns A$M 1.
Slide 6: Net cash at Dec 2016, debt free in March 2017
For personal use only Net cash at 31 Dec 2016, debt free1 in March 2017 A$M Net Debt / Net Cash2 • Gross debt reduced by 100 A$M $31 million A$173 million during half 50 Net Cash 0 • Debt free1 once US Notes -50 -15 repaid in full on 15 -92 March 2017 -100 -134 -150 • Net cash position to -200 -199
Slide 7: Start safe, stay safe
Start safe, stay safe For personal use only Total Recordable Injury Frequency Rate2 Safety performance 9.0 • Record low TRIFR1 of 1.8 continued to 31 December 2016 • Gwalia Emergency Response 6.0 Team overall winners for the 5.0 second year running in CMEWA 4.1 Underground Mine Emergency Response Co
Slide 8: Consolidated Gold Production
Consolidated Gold Production For personal use only AISC (Consolidated) (A$/oz) 1,166 1H FY17 Production Highlights 922 954 905 Consolidated 882 • 192 koz @ AISC1 A$905/oz 211 203 • 376 koz CY16 192 167 50 58 184 Gwalia 52 53 30 27 9 • 138 koz record @ A$774/oz 23 • 269 koz CY16 134 136 131 138 114 S
Slide 9: Financial Performance
Financial Performance Garth Campbell-Cowan, CFO For personal use only 700% 600% 500% 400% SBM 379% 300% 200% 100% XGD 94% 0% AU$ Gold 5% US$ Gold 5% -100% 1 Jul 15 1 Oct 15 1 Jan 16 1 Apr 16 1 Jul 16 1 Oct 16 1 Jan 17 8/ December 2016 Half Year Presentation
Slide 10: Underlying Profit & EBITDA
Underlying Profit & EBITDA1,2 • EBITDA margin2 for group: 51% (2015: 46%) • Underlying earnings per share2 increased 34% to 16.22 cents per share (2015: 12.12 cps) For personal use only Underlying NPAT2 movement Underlying NPAT2 & EBITDA2 1H FY16 to 1H FY17 6 -7 5 -1 -2 21 -1 81 164 144 142 60 81 67
Slide 11: Significant Items – Net $2 million after tax
Significant Items1 – Net $2 million after tax Significant Items in NPAT For personal use only 27 -7 -22 83 81 Σ =$2 M Dec 16 Impairment Foreign exchange Income tax Dec 16 NPAT Underlying A$ Million NPAT[1] Simberi Impairment: Tax credits: • A$27 million non cash impairment of • $8 million tax credit
Slide 12: 1H FY17 Cash flow results
1H FY17 Cash flow results • Cash flow from operations less $16 million sustaining capex = $123 million1 • Debt repayments totalled $173 million For personal use only Cash flow from operations Cash movement 139 25 -173 132 123 120 137 -15 -9 -10 87 1H 2H 1H Cash Jun Leonora Simberi Ops Debt Interest
Slide 13: Segment results
Segment results • EBITDA margin3 at Gwalia: 66% For personal use only Underlying profit from Cash contribution from operations1 operations1, 2 150 140 143 140 129 25 21 15 16 117 115 128 18 125 119 124 21 13 111 83 102 96 15 68 FY15 FY16 FY16 FY17 FY15 FY16 FY16 FY17 2H 1H 2H 1H 2H 1H 2H 1H Leonora
Slide 14: Capital expenditure
Capital expenditure Capex For personal use only 24.6 A$M 25 Other 1.3 22.5 21.5 1.5 3.2 Simberi P&E 20 6.3 3.1 2.5 Gwalia studies 15 4.1 3.9 4.9 1.8 1.8 Gwalia drilling 2.0 10 Gwalia P&E 11.1 11.1 5 10.0 Gwalia U/G 0 Total 1H FY16 2H FY16 1H FY17 13 / December 2016 Half Year Presentation
Slide 15: FY17 and beyond
FY17 and beyond Bob Vassie, MD&CEO Operations performing well For personal use only • On track to deliver FY17 Guidance Organic growth • Gwalia extension project • Exploration of existing tenements • Gwalia & WA • Simberi & PNG • Option and farm in with Newcrest Inorganic growth 14 / December 2016 H
Slide 16: Organic Growth – Gwalia Extension Project
Organic Growth – Gwalia Extension Project • Feasibility studies and A$6 million For personal use only Devel - GEP early works approved • Investment decision due March 2017 Gwalia Extension Project Capex A$85 to $95 million in total Construction period 2 to 2.5 years Works Objective Ventilation shaft
Slide 17: Exploration
Exploration Exploration guidance For personal use only FY17: A$18 to A$22 M • Gwalia, WA A$10- A$12 M • Pinjin, WA A$2- A$3 M • PNG A$6- A$7 M • St Barbara own oxide and sulphide gold exploration seeking to extend Simberi LOM • copper- gold porphyry exploration with Newcrest 16 / December 2016 Half
Slide 18: Positioned for growth
Positioned for growth Business performing well For personal use only • Production, costs, safety Strong balance sheet • Debt free1, accumulating cash Pursuing organic growth options • Exploration – Greater Gwalia, Pinjin, Back Creek, Simberi & Tabar Islands • Option and farm in with Newcrest • Gwali
Slide 19: St Barbara vs Comparators FCF Yield & EV/Reserves
St Barbara vs Comparators FCF Yield & EV/Reserves EV/Reserve oz (A$/oz) For personal use only A$0 St Barbara A$200 Resolute Oceana Gold A$400 A$600 Saracen A$800 Regis Evolution A$1,000 Bubble size = estimated production rate Northern Star A$1,200 (koz p.a.) A$1,400 0% 5% 10% 15% 20% 25% 30% 35% FCF
Slide 20: St Barbara vs Comparators AISC Margin & EV/Production
St Barbara vs Comparators AISC Margin & EV/Production EV/Production (A$/oz) For personal use only $2,000 St Barbara $3,000 Resolute $4,000 Northern Star $5,000 Regis Evolution $6,000 Bubble size = $7,000 estimated Oceana Gold production rate (koz p.a.) $8,000 500 550 600 650 700 750 800 850 AISC Mar
Slide 21: Exciting future from a sustainable, profitable base
Exciting future from a sustainable, profitable base • Record and reliable cash generation For personal use only • A$139 million this half, building on A$120 and A$123 million in prior halves • Company will be effectively debt free from March 20171 • Dividends under review, taking into account perfor
Slide 22: Appendices
Appendices For personal use only 21 / December 2016 Half Year Presentation Schoolhouse, Gwalia village, photo: Stuart Smith
Slide 23: Consolidated Production, Costs, Guidance Summary
Consolidated Production, Costs, Guidance Summary Production Summary Q4 Jun Year Q1 Sep Q2 Dec Guidance Consolidated FY16 FY16 FY17 FY17 FY173 For personal use only Production Gwalia oz 65,098 267,166 67,118 70,925 255 to 265 koz (previously 245 to 265 koz1) King of the Hills4 oz - 9,112 - - - Simber
Slide 24: St Barbara share price vs US$ gold and XGD
St Barbara share price vs US$ gold and XGD - % change 700% For personal use only Gwalia A600% rich history Topwith a bright performing future stock in the ASX 200 in FY20162 Joined ASX 200 500% Top performing stock in the 400% ASX 300 in CY20151 Joined ASX 300 SBM 379% 300% 200% 100% XGD 94% A$ gold
Slide 25: 1H FY17 Financial Results Summary
1H FY17 Financial Results Summary1 1H 2H 1H For personal use only FY17 FY16 FY16 Gold price Average gold price realised A$/oz 1,687 1,664 1,564 All-In Sustaining Cost2 A$/oz 905 954 922 Result ˃ Statutory profit after tax A$M 83 92 77 ˃ Underlying net profit/(loss) after tax 2 A$M 81 67 60 ˃ EBITDA
Slide 26: Debt and hedging today
Debt and hedging today For personal use only Debt ˃ Final US Notes repayment of US$20 million due on 15 March 2017 Hedging FY17 ˃ 26,000 ounces of gold forward contracts remaining to be delivered in monthly instalments between April and June 2017 @ US$1,338/oz Credit Rating ˃ Moody’s B2 with stable
Slide 27: Gwalia: Record production driven by productivity gains
Gwalia: Record production driven by productivity gains 8% year on year improvement, Mined Grade 9.3 3 key innovations (g/t Au) 8.8 8.9 For personal use only 8.2 8.4 6.9 Reserve Grade 6.3 8.3 g/t Au June 2016 5.7 Ore passes Allows bogger to work constantly, independent of ore trucks, 267 265 removes
Slide 28: Simberi FY14 to FY16 – improvements in all metrics
Simberi FY14 to FY16 – improvements in all metrics All-in sustaining cost (A$/oz) For personal use only 2,300 1,464 1,293 1,410 25 Guidance mid-point Mining Consecutive years of >50% improvement 9,898 Processing 3.3 Mt processed in FY16, 29% improvement Y on Y Mining (kt) 6,293 110 100 Guidance 4,15
Slide 29: Ore Reserves Summary as at June 2016
Ore Reserves Summary as at 30 June 2016 For personal use only Proved Probable Total Project Tonnes Au koz Tonnes Au koz Tonnes Au koz (k) g/t (k) g/t (k) g/t Gwalia (WA) 2,286 9.6 702 4,510 7.6 1,105 6,795 8.3 1,808 Tower Hill (WA) - - - 2,572 3.7 306 2,572 3.7 306 Simberi Oxide (PNG) 4,687 1.3 194
Slide 30: Mineral Resources Summary as at June 2016
Mineral Resources Summary as at 30 June 2016 For personal use only Measured Indicated Inferred Total Project Tonnes Au koz Tonnes Au koz Tonnes Au koz Tonnes (k) Au koz (k) g/t (k) g/t (k) g/t g/t Gwalia (WA) 4,951 7.7 1,232 11,773 6.8 2,584 570 4.4 80 17,294 7.0 3,896 Tower Hill (WA) - - - 4,604 3.
Slide 31: Strong institutional share register
Strong institutional share register Shareholding Structure For personal use only Gwalia A rich history with a bright future Institutional holdings by location Not analysed Institutional 10% 84% USA 36% Non Institutional 6% Australia 25% UK 13% Other 10% Analysis and geographic spread of shareholders
Slide 32: Significant Shareholders & wide broker coverage
Significant Shareholders & wide broker coverage For personal use only Significant Shareholders 1 Research Coverage Van Eck Associates 17% Argonaut James Wilson M&G Investment Mgt 8% Canaccord Reg Spencer Vinva Investment Mgt 5% Credit Suisse Mike Slifirski Deutsche Bank Matt Hocking Institutional Sh
Slide 33: Competent Persons Statement
Competent Persons Statement For personal use only Exploration Results The information in this presentation that relates to Exploration Results for Simberi and Pinjin is based on information compiled by Dr Roger Mustard, who is a Member of The Australasian Institute of Mining and Metallurgy. Dr Musta
Slide 34: Non-IFRS Measures
Non-IFRS Measures For personal use only We supplement our financial information reporting determined under International Financial Reporting Standards (IFRS) with certain non-IFRS financial measures, including cash operating costs. We believe that these measures provide meaningful information to ass
Slide 35: Investor Relations Enquiries
Investor Relations Enquiries For personal use only Rowan Cole Company Secretary Garth Campbell-Cowan Chief Financial Officer T: +61 3 8660 1900 E: info@stbarbara.com.au 34 / December 2016 Half Year Presentation