Evolution Mining Limited · ASX:EVN
Evolution Mining — Investor Day (June 2023)
31 slides from Evolution Mining's investor day presentation, Jun 5, 2023
Slide 1: ASX Announcement: 2023 Investor Day Session 1 Presentation
ABN 74 084 669 036 Sydney Office P +61 2 9696 2900 F +61 2 9696 2901 Level 24 ASX Announcement 175 Liverpool Street Sydney NSW 2022 5 JUNE 2023 www.evolutionmining.com.au 2023 INVESTOR DAY SESSION 1 PRESENTATION Evolution Mining Limited (ASX: EVN) is today hosting an Investor Day. The entire event w
Slide 2: Inspired people creating a premier global gold company
Inspired people creating a premier global gold company CLICK TO EDIT MASTER INVESTOR DAY TITLE STYLE 5 June 2023 1
Slide 3: Forward Looking Statement
FORWARD LOOKING STATEMENT These materials prepared by Evolution Mining Limited (“Evolution” or “the Company”) include forward looking statements. Often, but not always, forward looking statements can generally be identified by the use of forward looking words such as “may”, “will”, “expect”, “intend
Slide 4: Production Target
PRODUCTION TARGET Mungari Production Target and relevant proportions of Mineral Resources and Ore Reserves underpinning the Production Target The Mungari Production Target of 1.9Moz to 2.7Moz between FY24 and FY38 comprises 3% Proved Ore Reserves, 49% Probable Ore Reserves, 19% Indicated Mineral Res
Slide 5: Investor Day Agenda
INVESTOR DAY AGENDA 8.45am – 10.15am AEST Session one Peter O’Connor Jake Klein Lawrie Conway Barrie van der Fiona Murfitt General Manager - Executive Chair Chief Executive Merwe VP Sustainability Investor Relations Officer and Managing Chief Financial Director Officer Welcome Introduction Strategy
Slide 6: Acknowledgement of Country
Acknowledgement of Country " Evolution would like to acknowledge the Traditional Custodians of the land on which we operate and on which we meet today, and pay our respects to Elders past, present, and emerging, for they hold the memories, the traditions, the culture and the hopes for Aboriginal peo
Slide 7: Introduction
INTRODUCTION 6
Slide 8: Today's Highlights
TODAY’S HIGHLIGHTS Mungari Expansion Red Lake 18% reduction in AISC to $1,750/oz 15 year mine life IRR of 19% at A$2,400/oz and 28% at spot price Ernest Henry mine life extended to 2040 Copper and Gold Ore Reserves more than doubled Ernest Henry 17 year mine life IRR of 28% at A$2,40
Slide 9: Gold and Copper – Investment Drivers
GOLD AND COPPER – INVESTMENT DRIVERS ¥ Decarbonisation Dedollarisation Destabilisation Debt defaults Debt ceiling Financial stress Geopolitical issues 8
Slide 10: Years of Evolution
12 Cowal – cornerstone asset acquisition: Evolution acquired Cowal from Barrick, reduced group AISC by A$100/oz and extended portfolio YEARS OF EVOLUTION Successful track record of portfolio optimisation through disciplined approach to M&A Mungari – cornerstone asset acquisition (i): Reducing Group
Slide 11: Strategy and Business Outlook
STRATEGY AND BUSINESS OUTLOOK 10
Slide 12: Clear and Consistent Strategy
CLEAR AND CONSISTENT STRATEGY A business that prospers through the cycle Create sustainable value for stakeholders in an environmentally and socially responsible way High performing culture with values and reputation as non-negotiables Willing to take appropriate geological, operational and financia
Slide 13: Delivering Returns and Deleveraging
DELIVERING RETURNS AND DELEVERAGING Margin over ounces priority Production (koz) and AISC FY24 vs FY23 revenue ($/oz) - Gold price opportunity ($M) FY24 production guidance 770koz +/-5% 1390 1370 FY25-26 targeting around 800kozpa Cost discipline to optimise margin & manage inflation 770 310
Slide 14: Portfolio Structure and Journey
Percentage repaid At acquisition PORTFOLIO STRUCTURE AND JOURNEY Current – up to 25% Current – 26-50% Current – 90-99% Long life, high return assets Current – 100% 400 Return on investment 350 20%+ ROI Annual production – gold equivalent1 (koz) 300 Ernest Henry6 250 Cowal Cowal 15-20% ROI Renewable
Slide 15: Mungari on Path to Cornerstone Asset
MUNGARI ON PATH TO CORNERSTONE ASSET Feasibility study outcomes Expansion Capital investment of $250M Construction of 30 months to March 2026 Increase throughput to 4.2Mtpa from 2Mtpa ~200koz Planned annual production 155koz (LOM) & 200koz (FY27-32) ~120-130koz ~155koz Mine life of 15 year
Slide 16: Ernest Henry Extends to 2040
ERNEST HENRY EXTENDS TO 2040 Completed mining Pre-feasibility study outcomes Pre-feasibility study design Available December 2022 Mineral BERT Resource Significant initial Ore Reserve upgrade Increased to 77.4Mt, 589kt Cu and 1,109koz Au10 Future Gold up 124% and Copper up 103% study opportuni
Slide 17: Projects Appropriately Timed
PROJECTS APPROPRIATELY TIMED Project FY23 FY24 FY25 FY26 FY27 FY28 FY29 Cowal Building to Commissioning Execution underground 320,000+ oz and ramp up Red Lake Pathway to Commissioning Execution (Upper Campbell) 200,000+ oz and ramp up 15 year mine life at Commissioning and Mungari expansion Feasibil
Slide 18: Key Takeaways
KEY TAKEAWAYS Focus on safe and reliable operational delivery – margin over ounces Organic growth options to deliver long term returns Capital discipline – investing when needed and justified Cash generation benefit – upside at spot prices 17
Slide 19: Footnotes
FOOTNOTES 1. Cash benefit is before tax in comparison to FY23 and against the old debt profile 2. Gold price assumptions are A$2,650/oz (plan and consensus) and A$2,965/oz (spot) 3. Emissions reduction target measured against FY20 baseline 4. From FY22 Stakeholder Perception Survey 5. Ernest Henry p
Slide 20: Financial Position and Outlook
FINANCIAL POSITION AND OUTLOOK PR O SPER T H R O U GH T H E C YC L E
Slide 21: FY24 Guidance: Production
Production (koz) FY24 GUIDANCE: PRODUCTION 770 (+/-5%) Production to increase 17% to 770,000oz Mungari in line with current production levels 660 Ernest Henry back to normal production Cowal production to increase 16% to ~320,000oz FY23 Estimate FY24 Guidance Continued access to higher gra
Slide 22: Cost Drivers and Sensitivities
FY23 Expense Elements (%) COST DRIVERS AND SENSITIVITIES Other, 10% Reagents, Employees, 27% 5% Top six expenses account for ~77% of total costs Royalties, 4% Labour represents ~46% of operating costs Diesel, 5% Tight labour market remains Selling, Refining & Expected to increase by 5-6% in
Slide 23: FY24 Guidance: AISC
All In Sustaining Cost1 ($/oz) FY24 GUIDANCE: AISC 1,390 Cowal 1,370 Benefitting from higher grade Stage H Underground ramp-up commencing Commercial production expected from H2 FY24 FY23 Estimate22 Red Lake lower as it benefits from higher proportion of FY24 Guidance Upper Campbell ore in
Slide 24: Capital Trending Lower
Approved Capital Expenditure ($M) CAPITAL TRENDING FY24-26 Average vs FY23 LOWER No new capital projects compared to last year 420 Capital intensity decreasing over next few years 290 Average total capital ~$150M lower per year Delivers on commitment to de-lever 130 110 Sustaining capital
Slide 25: Balance Sheet Flexibility
BALANCE SHEET Debt Maturity Profile (A$M) FLEXIBILITY Long term debt 82% of total (6-12 year tenor) 477 Alignment of maturity profile to assets’ longer mine lives and cash flows Near term debt 18% of total Additional liquidity of $445M next three years 273 273 Improved flexibility from balance
Slide 26: Capital Discipline
CAPITAL DISCIPLINE B AL AN C E S H E E T S U P P O R T S S T R AT E G Y T O P R O S P E R T H R O U G H T H E C Y C L E Gearing target of ~15% CAPITAL Debt tenor aligned with mine life STRUCTURE Investment grade (BBB-) credit rating LIQUIDITY AND Deleveraging a priority FLEXIBILITY Minimum
Slide 27: Sustainability
SUSTAINABILITY IN T EG R AT ED IN TO EVERYT H IN G W E D O “Evolution’s commitment to sustainability is core to our business and drives our thinking about who we are and how we will be relevant in the decades to come” Fiona Murfitt, VP Sustainability ‘Enviro’ category improved from 6 to 1 and ‘Socia
Slide 28: Sustainability
SUSTAINABILITY I N T E G R AT E D I N TO E V E RY T H I N G W E D O Shared stories strengthen reputation. Unlock potential through leadership to Resilient to change with improved develop protective behaviours Disclosure and Advocacy Storytelling & Health, Safety ESG Reporting and Wellbeing Risk Gove
Slide 29: Achieving Our Net Zero Future
ACHIEVING OUR NET ZERO FUTURE 0% +10% -10% FY30 ~ -35%2 +30% -30% Absolute emissions performance against FY20 baseline 1. FY22 Performance is relative to the FY20 baseline 2. Scope 1 & 2 emissions are based on estimates from current operations 28 against FY20 baseline excluding future growth project
Slide 30: Our Stories: Positive Partnerships
FIRST NATION PARTNERSHIPS OUR STORIES Gadarjil – Murra Wolka Project Galari Agricultural Project – Traineeship programs Authentic and Culturally Appropriate Building Capability & Capacity COMMUNITIES POSITIVE PARTNERSHIPS University of Queensland – Use of Hope Project – Supporting Women gold in Canc
Slide 31: Evolution Mining
Evolution MINING