First Majestic Silver Corp. · TSX:AG
First Majestic Silver — Investor Presentation (February 2017)
33 slides from First Majestic Silver's investor presentation, February 2017
Slide 1: First Majestic Silver Corp.
FIRST MAJESTIC SILVER CORP. TSX: FR | NYSE: AG | FWB: FMV | BMV:AG
Slide 2: Forward-looking statements
2 Certain statements contained herein regarding First Majestic Silver Corp. (the “Company”) and its operations constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. All statemen
Slide 3: Pure silver producer in Mexico
3 Pure Silver Producer ~70% of revenue from Silver (18% Au, 10% Pb, 2% Zn) One Country: Mexico World’s largest silver producing country Multi-Asset Producer Six producing silver mines; 100% owned Future Growth Two advanced stage silver projects Goal Achieve annual production of 20M+ Ag oz
Slide 4: Market capitalization and shares outstanding
4 Market Capitalization: US$1.7B Shares Outstanding: 164.7M (FD 176.3M) Avg. Daily Volume: 7.9M shares ~ US$65M in daily liquidity (NYSE & TSX) Cash & Cash Equiv1: US$129.0M 1) As of Dec 31, 2016
Slide 5: Broad depth of people
5 BROAD DEPTH OF PEOPLE • ~ 3,900 direct employees • Internally design, develop and construct 100% of our silver projects • Awarded ‘Socially Responsible Company’ for eight consecutive years, 2008 to 2015, from the Centro Mexicano para la Filantropia (CEMEFI)
Slide 6: Q4 and full year 2016 results
6 Q/Q Y/Y Full Year (All shown in $USD) Q4 2016 Q3 2016 Q4 2015 2016 Revenue 66.2M 79.3M 66.0M 278.1M Mine Operating Earnings 9.9M 20.0M 3.9M 49.2M Net Earnings after taxes 1.8M 13.4M (103.0M) 8.6M Earnings per share - Adjusted1 (0.01) 0.07 (0.66) 0.12 Operating Cash Flows, before movements in WC 23
Slide 7: Mines and projects in Mexico
7 IN PRODUCTION 1 La Encantada 2 La Parrilla 6 3 San Martin 1 4 La Guitarra 5 Del Toro 9 6 Santa Elena 2 7 5 8 PROJECTS 3 7 Plomosas 4 8 La Luz EXPLORATION 9 La Joya
Slide 8: Silver ounces produced
8 Silver Ounces (M) Silver Price Avg. Ag Grade 223 163 166 174 167 161 (g/t): Also produced 55.5M oz of silver over this period
Slide 9: Strong production growth
NYSE: AG FWB: FMV. BMV: AG STRONG PRODUCTION GROWTH = Silver Eqv. Ounces (M) @ La Luz* ™@ Plomosas @ Santa Elena ! | La Guitarra "Del Toro _ = wn oa r=) i—J Ss °o = a 2 77) La Encantada @ La Parrilla @ San Martin *Pending permits jm FIRST MAJESTIC SILVER CORP, 2006 2007 2008 2009 2010 2011 2012 2013
Slide 10: 2017 production and cost guidance
10 Mine Silver Oz (M) Silver Eqv Oz (M) Cash Costs ($) AISC ($) Santa Elena 2.6 – 2.9 5.4 – 6.0 0.90 – 1.46 6.22 – 7.24 La Encantada 2.6 – 2.9 2.6 – 2.9 9.83 – 10.17 12.35 – 12.90 La Parrilla 1.9 – 2.1 2.9 – 3.2 6.45 – 6.84 10.79 – 11.55 Del Toro 1.3 – 1.4 2.3 – 2.6 4.90 – 5.35 10.38 – 11.30 San Mar
Slide 11: Q4 2016 production and costs
11 Mine Silver Oz (M) Silver Eqv Oz (M) Cash Costs ($) AISC ($) Santa Elena 0.7 1.5 (1.43) 1.64 La Encantada 0.6 0.6 13.87 16.53 La Parrilla 0.5 0.7 10.22 15.34 Del Toro 0.3 0.7 2.80 8.43 San Martin 0.5 0.6 6.94 10.01 La Guitarra 0.2 0.4 7.74 15.99 Totals: 2.8 4.4 6.49 12.90 Metal price assumptions
Slide 12: 2017E AISC excluding non-cash items
12 Excluding non-cash items: 2017E AISC $11.36 - $12.21 1) AISC is a non-GAAP measure and was calculated based on guidance provided by the World Gold Council (“WGC”)
Slide 13: 2017E capex
13 $78M Expansionary $46M Sustaining $53M - U/G Development 2017E CAPEX include: $27M - Exploration $33M - PP&E $11M - Corporate Projects
Slide 14: First Majestic
14 FIRST MAJESTIC
Slide 15: Santa Elena
15 Plant Operations Mill Throughput: 2,750 tpd 2017E Production: 2.6M – 2.9M Ag oz (5.4M – 6.0M AgEq oz) 2017E AISC: $6.22 - $7.24 Reserves & Resources Proven & Probable: 13.5M Ag + 210K Au oz Measured & Indicated: 14.3M Ag + 226K Au oz Inferred: 0.8M Ag + 13K Au oz *M&I Resources are inclusive of R
Slide 16: La Encantada
16 Plant Operations Mill Throughput: 3,000 tpd 2017E Production: 2.6M – 2.9M Ag oz 2017E AISC: $12.35 – $12.90 Reserves & Resources Proven & Probable: 30.6M Ag oz Measured & Indicated: 31.4M Ag oz Inferred: 7.2M Ag oz *M&I Resources are inclusive of Reserves • Recently installed natural gas Quarter
Slide 17: La Parrilla
17 Plant Operations Mill Throughput: 1,500 tpd 2017E Production: 1.9M – 2.1M Ag oz (2.9M – 3.2M AgEq oz) 2017E AISC: $10.79 – $11.55 Reserves & Resources Proven & Probable: 16.2M Ag oz Measured & Indicated: 18.6M Ag oz Inferred: 52.5M Ag oz *M&I Resources are inclusive of Reserves • Connecting the m
Slide 18: Del Toro
18 Plant Operations Mill Throughput: 1,000 tpd 2017E Production: 1.3M – 1.4M Ag oz (2.3M – 2.6M AgEq oz) 2017E AISC: $10.38 - $11.30 Reserves & Resources Proven & Probable: 17.4M Ag oz Measured & Indicated: 20.9M Ag oz Inferred: 29.9M Ag oz *M&I Resources are inclusive of Reserves Quarter End • Curr
Slide 19: San Martin
19 Plant Operations Mill Throughput: 1,000 tpd 2017E Production: 1.8M – 2.0M Ag oz (2.0M – 2.2M AgEq oz) 2017E AISC: $11.77 - $12.41 Reserves & Resources Proven & Probable: 14.8M Ag oz Measured & Indicated: 20.2M Ag oz Inferred: 35.5M Ag oz *M&I Resources are inclusive of Reserves Quarter End Full Y
Slide 20: La Guitarra
20 Plant Operations Mill Throughput: 400 tpd 2017E Production: 0.9M – 1.0M Ag oz (1.4M – 1.5M AgEq oz) 2017E AISC: $14.37 - $15.45 Reserves & Resources Proven & Probable: 8.0M Ag oz Measured & Indicated: 9.8M Ag oz Inferred: 7.4M Ag oz *M&I Resources are inclusive of Reserves Quarter End Full Year Q
Slide 21: Revenue forecasts
21 1) Revenue forecasts calculated using metal price assumptions of $16.50/oz silver, $1,200/oz gold, $2.50/lb copper, $1.00/lb lead and $1.20/lb zinc. 2) Source: BMO
Slide 22: MXN peso and margins
22 • ~75% of our USD/MXN operating costs are in MXN Peso’s • Increasing profit margins – higher silver price & lower costs • Weakness of MXN Peso expected to continue in 2017 due to threat of Trump tariffs Source: Bloomberg
Slide 23: Silver and gold price performance
23 AG +36% AG +182% AG +407% AG ? AU -24% AU +69% AU +105% AU ?
Slide 24: Share performance vs peers
24 1 Year 5 Year 10 Year Source: Bloomberg (as of Feb 20, 2017) *10 year excludes Fresnillo due to IPO on May 2008
Slide 25: 2017 catalysts
25 Installation of roasting circuit at La Encantada - expected to add 1.5 million Ag ounces to annual production La Guitarra expansion to 1,000 tpd – doubling production and reducing AISC Updating NI 43-101’s for San Martin, Del Toro and La Parrilla Installation of LNG plant at Santa Elena t
Slide 26: Our Strategy
26 Our Strategy… One Metal One Country Continue to Acquire the Best Talent in Mexico Build through Development and Acquisitions Become a 20+ Million Ounce Producer
Slide 27: Reliance on silver and technology
S S en tes ne Sy & Thess ua > et Ea b H “AS WE BECOME MORE RELIANT ON TECHNOLOGY... WE BECOME MORE RELIANT ON SILVER’
Slide 28: Appendix
NYSE: AG FWB: FMV. BMV: AG APPENDIX jm FIRST MAJESTIC SILVER CORP,
Slide 29: Research coverage and institutional holders
29 Research Coverage Institution % S/O Bank of Montreal - Andrew Kaip Van Eck 6.2% Cormark - Graeme Jennings Resolute Funds 3.4% Desjardins - Mike Parkin M&G Investment 2.7% Echelon Wealth Partners - Matt O'Keefe Vanguard 1.9% National Bank Financial - Greg Doyle Connor Clark & Lunn 1.7% Raymond Jam
Slide 30: Proven and probable mineral reserves
30 PROVEN AND PROBABLE MINERAL RESERVES WITH AN EFFECTIVE DATE OF DECEMBER 31, 2015 Mine Category Mineral Type k tonnes Ag (g/t) Au (g/t) Pb (%) Zn (%) Ag-Eq (g/t) Ag (k Oz) Ag-Eq (k Oz) Proven (UG) Oxides 251 247 - - - 247 1,991 1,991 Probable (UG) Oxides 1,473 214 - - - 214 10,120 10,120 LA ENCANT
Slide 31: Measured and indicated mineral resources
31 Measured and Indicated Mineral Resources are reported inclusive of Mineral Reserves) Mine / Project Category Mineral Type k tonnes Ag (g/t) Au (g/t) Pb (%) Zn (%) Cu (%) Ag-Eq (g/t) Ag (k Oz) Ag-Eq (k Oz) Measured (UG) Oxides 283 267 - - - - 267 2,433 2,433 Indicated (UG) Oxides 854 299 - - - - 2
Slide 32: Inferred mineral resources
32 Mine / Project Category Mineral Type k tonnes Ag (g/t) Au (g/t) Pb (%) Zn (%) Cu (%) Ag-Eq (g/t) Ag (k Oz) Ag-Eq (k Oz) Inferred Total (UG) Oxides 905 246 - 0.03 - - 246 7,154 7,169 LA ENCANTADA Inferred (UG) Sulphides Inferred Total (UG) Oxides + Sulphides 905 246 - 0.03 - - 246 7,154 7,169 Infe
Slide 33: Plomosas and La Luz historical estimates
33 Plomosas Historical Estimates (1) Plomosas historical resources figures are taken from Grupo Mexico’s estimates prepared in 2001 (2) Tonnage is expressed in thousands of tonnes, metal content is expressed in thousands of ounces. (3) A qualified person has not done sufficient work to classify the
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