Kenmare Resources Plc · LSE:KMR
Kenmare Resources — H1 2015 Earnings Presentation
17 slides from Kenmare Resources's earnings presentation, Aug 28, 2015
Slide 1: H1 2015 Results
H1 2015 Results LISTED PREMIUM 1
Slide 2: Disclaimer
Disclaimer This Presentation (the “Presentation”) has information or opinions on which it is significant in the context of the been prepared and issued by Kenmare based, or any other written or oral statements, estimates and projections Resources plc (the “Company” or information made available in c
Slide 3: Overview
1 Overview 3
Slide 4: Kenmare Resources H1 2015 Overview
Kenmare Resources H1 2015 Overview HMC & finished product production impacted by unprecedented flooding, causing significant power interruptions in H1 2015; HMC and total products down 25% vs H1 2014 Power stability expected to improve significantly following the installation of new power infrastruc
Slide 5: Key Performance Indicators
Key Performance Indicators Production (Half-Yearly) 000t Revenue & EBITDA (Half-Yearly) US$m 500 50 150 Ilmenite (LHS) Revenue EBITDA Zircon (RHS) 125 400 40 100 Ilmenite Tonnes '000 Zircon Tonnes '000 300 30 75 US$m 200 20 50 25 100 10 0 0 0 -25 H1 2013 H2 2013 H1 2014 H2 2014 H1 2015 H1 2013 H2 20
Slide 6: Summary Results
2 Summary Results 6
Slide 7: H1 2015 Income Statement Review
H1 2015 Income Statement Review H1 ‘15 H1 ‘14 Comment US$m US$m Revenue 73.9 81.2 Revenue down 9%; sales volumes increased by 3% but prices declined Cost of Sales & Opex (101.1) (99.1) Including a product inventory write down of US$8.6m Operating loss (27.2) (17.9) Net finance costs (18.1) (16.2) Pr
Slide 8: H1 2015 Revenue Review
H1 2015 Revenue Review Volume/Mix Movement Pricing Movement 500,000 25,000 $200 $2,000 Ilmenite price per Tonne (US$) + 1% - 56% Zircon Price per tonne (US$) 400,000 20,000 $150 $1,500 Ilmenite Shipments (tonnes) -18% Zircon Shipments (tonnes) 300,000 15,000 + 63% $100 $1,000 -2% 200,000 10,000 $50
Slide 9: H1 2015 Cash Operating Costs Review
H1 2015 Cash Operating Costs Review H1 2015 H1 2015 H1 2014 H1 2014 US$m US$m US$m US$m Cost of sales 91.9 82.8 Other operating costs 9.1 101.0 16.2 99.0 Freight (CIF charged to customers) (1.5) (4.2) Total costs less freight 99.5 94.8 Non-cash costs Depreciation 16.6 20.1 Share-based payments (0.8)
Slide 10: Half Yearly 2013 – 2015 Cash Operating Costs
Half Yearly 2013 – 2015 Cash Operating Costs Cost/t for total finished products (ilmenite, zircon & rutile) is US$197/t in H1 2015 Cost/t increased due to reduced production, as a result of severe weather interruptions Significantly reduced unit costs expected in H2 2015 with increased production an
Slide 11: Cost Efficiency Initiatives
Cost Efficiency Initiatives Cost savings realised in the following areas: Labour: Reduction in employee numbers and amendment to shift allowances implemented in H1 2015 Reduction in short-term contracts, catering cost reductions and lower recruitment costs Engineering: Efficiencies in plant maintena
Slide 12: H1 2015 Cash Operating Costs
H1 2015 Cash Operating Costs Other Logistics & Travel 5% 9% Production Overheads Distribution Costs 12% 5% Other Logistics & 11% Travel 8% Distribution Costs Production 5% Overheads 10% Fuel 12% H1 H1 2015 Fuel 6% 2014 Labour payroll 33% Labour payroll Power 6% Power 32% 9% Repairs & Repairs & Maint
Slide 13: Balance Sheet Review at June 2015
Balance Sheet Review at 30 June 2015 30/6/2015 31/12/2014 Comment on 2015 & movement US$m US$m Property, plant & equipment 849.6 865.2 US$1.0m capital additions Inventories 46.8 62.5 Reduced product stock volumes and NRV adjustment Trade & other receivables 30.2 28.1 Function of sales prior to perio
Slide 14: Group Debt
Group Debt Group reported debt at 30 June 2015: US$329.9m (30 June 2014: US$349.6m), after project loan amendment fee adjustment of US$15.5 million (30 June 2014: US$9.5 million). Average project interest rate at June 2015 was 9.1%. Senior: US$79.2 million, floating @ LIBOR + 3.5% to 5.3%, fixed @ 5
Slide 15: Appendix
(a) Appendix 15
Slide 16: Group Lenders at June 2015
Group Lenders at 30 June 2015 Loan Balance Maturity under April 2015 US$m Loan amendment Senior Project Loans AFDB 21.2 2021 Absa (ECIC) 23.9 2018 EAIF 2.6 2021 EIB 8.6 2021 FMO 8.6 2019 KfW IPEX-Bank (Hermes) 6.6 2018 KfW IPEX-Bank (MIGA) 7.7 2021 79.2 Subordinated Project Loans EIB 143.6 2021 EAIF
Slide 17: Reserves & Resources
Reserves & Resources Reserves & resources table as at 31 December 2014 Zones Category Ore (Mt) % THM* % Ilmenite in THM % Ilmenite in ore % Rutile in ore % Zircon in ore % Slime THM (Mt) Ilmenite (Mt) Rutile (Mt) Zircon (Mt) Reserves Namalope Proved 246 4.1 82 3.3 0.077 0.24 8.05 10 8.2 0.19 0.58 Na