Hudbay Minerals Inc · TSX:HBM
Hudbay Minerals — Q4 2013 Earnings Presentation
18 slides from Hudbay Minerals's earnings presentation, Feb 20, 2014
Slide 1: Q4 2013 Presentation
Q4 2013 Presentation February 20, 2014 HBM
Slide 2: Forward-Looking Information
Forward-Looking Information This presentation contains “forward-looking statements” and “forward-looking information” (collectively, “forward-looking information”) within the meaning of applicable Canadian and United States securities legislation. All information contained in this presentation, othe
Slide 3: Forward-Looking Information (continued)
Forward-Looking Information (continued) Information Concerning Augusta Except as otherwise expressly indicated herein, the information concerning Augusta contained in this presentation has been taken from and is based solely upon Augusta's public disclosure on file with the relevant securities regul
Slide 4: Forward-Looking Information (continued)
Forward-Looking Information (continued) The scientific and technical information in respect of Hudbay contained in this presentation related to the Constancia project has been prepared by or under the supervision of Cashel Meagher, P.Geo., Hudbay’s Vice President, South America Business Unit. The sc
Slide 5: 2013: Year in Review
2013: Year in Review Key objectives achieved • Lalor shaft sinking completed on time and on budget • Initial Reed mine production started on time and on budget • Constancia construction advancing on schedule as 56% project completion achieved by year end • Zinc and precious metals production targets
Slide 6: 2014: Year of Growth and New Opportunities
2014: Year of Growth and New Opportunities On track to achieve our growth objectives in 2014 777 • Stable and steady low-cost production • Commercial production expected during Q2 Production Reed 2014 • Production rate to double in H2 2014 from main Lalor shaft and refurbished concentrator • Undergr
Slide 7: Proposed Acquisition of Augusta
Proposed Acquisition of Augusta Compelling value proposition for all shareholders • 0.315 of a Hudbay share per Augusta share, representing total consideration of C$2.96 per share1 Offer • Total enterprise value of approximately C$540 million2 Summary • 62% premium to Augusta’s 20-day volume weighte
Slide 8: Production, Reserve and Resource Growth
Production, Reserve and Resource Growth1 Significant production growth supported by large reserve base Copper Production Growth Copper Reserve and Resource Growth2 350 (mm tonnes Cu) 300 1.0 250 Copper Production (kt Cu) 1.6 200 +106% in P+P 150 0.6 Reserves +570% 1.0 100 4.1 50 2.0 0 2013A 2014E 20
Slide 9: Global Positioning on 2018E Cash Costs and Copper Production
Net Cash Costs (US$/lb Cu) Copper Production (bn lbs) $0.00 $1.00 $1.50 $2.50 $0.50 $2.00 0.0 4.0 1.0 2.0 3.0 Southern Cu Freeport Chinalco Source: Wood Mackenzie Codelco Russian Cu Glencore Hudbay (2018) BHP Hudbay (2018) PF First Quantum quartile costs Private Southern Cu MMG Rio Tinto Jiangxi Cu
Slide 10: Constancia Project Update
Constancia Project Update > Over US$1.3 billion of US$1.7 billion budget spent and PERU committed with 56% completion at end of Q4 2013 Lima > 100% of power transmission Constancia line rights of way secured; power line construction 61% Main sediment pond complete as at Jan. 31, 2014 > Pre-stripping
Slide 11: Constancia Progress Photos
Constancia Progress Photos Constancia bog dam Location of power substation for incoming electricity Constancia plant site overview Bottom shell of Constancia primary crusher installed Q4 2013 l 11
Slide 12: Constancia Progress Photos (continued)
Constancia Progress Photos (continued) Constancia flotation cells View of Constancia mill Hitachi shovels on site Mine fleet assembly Q4 2013 l 12
Slide 13: Lalor Mine Update
Lalor Mine Update MANITOBA > Overall $410 million of overall $441 million1 Lalor capital budget invested to Dec. 31, 2013 > Completed excavation of production shaft to Winnipeg final 985 metre level and steel guide installation to 516 metre level > Underground construction on ore and waste handling
Slide 14: Lalor Cross-Section
Lalor Cross-Section Underground exploration to begin in late 2014 Surface 0m Production shaft Vent raise 500m 750m 2014 Exploration platform 1000m 1500m Base Metal Resource Gold & Copper-Gold Resource Looking 0m 250m High Grade Intercepts N70oW Completed infrastructure and development Q4 2013 l 14
Slide 15: Reed Mine Update
Reed Mine Update MANITOBA > $67 million invested and committed of Reed overall capital budget to Dec. 31, 2013 > Project development has advanced Winnipeg 2,100 metres with additional 720 metres of pre-production development > On schedule and on budget with commercial production expected during Q2 2
Slide 16: Strong Financial Capacity
Strong Financial Capacity Well capitalized to complete construction at Constancia and advance Rosemont > Sufficient financial capacity to fund Hudbay Liquidity 1 remaining capital spending at Constancia, Lalor, and Reed Total Current Liquidity of $1.4 billion > Recently enhanced cash position with e
Slide 17: Near Term Milestones
Near Term Milestones Reed Lalor Constancia Commercial Production shaft Commercial production commissioning production 2014 2015 Q1 Q2 Q3 Q4 Q1 Q2 Rosemont Lalor Constancia Expiry of Completion of Initial Augusta Offer refurbished Snow production Lake Concentrator Note: All timelines are estimates Q4
Slide 18: Q4 2013 Presentation
Q4 2013 Presentation February 20, 2014 HBM