Igo Limited · ASX:IGO
Igo — Independence Group NL — Q2 FY2017 Earnings Presentation
20 slides from Igo's earnings presentation, Jan 25, 2017
Slide 1: December 2016 Quarter Results Presentation
INDEPENDENCE GROUP NL For personal use only December 2016 Quarter Results Presentation Peter Bradford, Managing Director and CEO 25 January 2017
Slide 2: Cautionary statements & disclaimer
Cautionary statements & disclaimer • This presentation has been prepared by Independence Group NL (“IGO”) (ABN 46 092 786 304). It should not be considered as an offer or invitation to subscribe for or purchase any securities in IGO or as an inducement to make an offer or invitation with respect to
Slide 3: 2Q17 highlights
2Q17 highlights Strong quarter with significant milestones achieved For personal use only • No lost time safety incidents in 2Q17 Continued improvement in safety performance • 12 month LTI frequency per million hours worked of 1.2 • Production and cash costs better than guidance range Tropicana deli
Slide 4: Unaudited financial results
Unaudited financial results Stronger cash generation plus debt retirement during 2Q17 For personal use only Unaudited Metrics Units 2Q17 1Q17 Revenue A$M 128.5 94.8 Underlying EBITDA(1) A$M 43.7 38.1 Net Profit After Tax A$M 10.2 10.1 Net Cash Flow From Operating Activities A$M 17.6 8.1 Underlying F
Slide 5: 2Q17 cash flow reconciliation
2Q17 cash flow reconciliation Improved operational free cash flow For personal use only A$M 350 7 300 38 47 6 7 26 250 58 200 17 4 2 150 71 249 100 50 109 - Tropicana Jaguar Long Nova Exploration Corporate Stamp Duty Windward Payments for Finance Debt FCF FCF FCF Development & BD costs & WC payments
Slide 6: Hedging
Hedging Copper and diesel hedging undertaken during 2Q17 For personal use only Current Hedging Units FY17 FY18 FY19 TOTAL Gold Hedging Gold Par Forwards oz 36,500 60,000 47,988 144,488 Gold Price A$/oz 1,664 1,796 1,859 1,784 Copper Hedging Copper Swaps – Nova t 6,450 6,450 A$/t 7,641 7,641 Copper S
Slide 7: Tropicana: 2Q17 operational scorecard and FY17 guidance
Tropicana 2Q17 operational scorecard and FY17 guidance For personal use only Metric Units FY17 Guidance Range 2Q17 YTD Gold produced (100% basis) oz 390,000 to 430,000 121,195 221,232 Gold Sold (IGO’s 30% share) oz 117,000 to 129,000 38,888 65,361 Cash cost A$/oz Au 850 to 950 753 821 All-in Sustain
Slide 8: Tropicana: Value enhancement studies
Tropicana Value enhancement studies For personal use only • To date studies have unlocked an additional 79% of value on a like for like basis with previous business plan • Opportunities identified to add further value include: • Plant expansion to 7.7-7.9Mtpa rate by end CY17 • Completion of Long Is
Slide 9: Tropicana: Mineral Resource and Ore Reserve Update
Tropicana Mineral Resource and Ore Reserve Update For personal use only Mineral Resources and Ore Reserves updated at 31 December 2016(1) • Updated Mineral Resource 148.1Mt at 1.68g/t Au for 8.02Moz • Updated Ore Reserve 60.1Mt at 1.97g/t Au for 3.80Moz Ongoing Technical Studies to be completed in 2
Slide 10: Tropicana outlook
Tropicana outlook Guidance modified to reflect delivery of value enhancement studies For personal use only FY17 Guidance (IGO 30%): Directional Production and AISC(1) • No change in AISC although likely to be at the higher end of koz A$/oz FY17 guidance of A$1,150/oz- 600 1,250 A$1,250/oz 1,200 • Ca
Slide 11: Long: 2Q17 operational scorecard and FY17 guidance
Long 2Q17 operational scorecard and FY17 guidance For personal use only Metric Units FY17 Guidance Range 2Q17 YTD Nickel (contained metal) t 7,400 to 8,200 2,063 4,229 Cash Cost (payable) A$/Ib Ni 3.50 to 3.90 3.19 3.21 Sustaining capex A$M 1 0.6 0.7 Development capex A$M N/A 0.2 0.2 Exploration exp
Slide 12: Jaguar: 2Q17 operational scorecard and FY17 guidance
Jaguar 2Q17 operational scorecard and FY17 guidance For personal use only Metric Units FY17 Guidance Range 2Q17 YTD Zinc in concentrate t 39,000 to 43,000 8,331 18,641 Copper in concentrate t 4,600 to 5,100 869 2,756 Cash cost (payable) A$/Ib Zn 0.70 to 0.80 1.08 0.77 Sustaining capex A$M 8 to 9 2.1
Slide 13: Nova Project: Significant milestones achieved
Nova Project Significant milestones achieved For personal use only Project remains on budget and ahead of schedule • Construction completed 10 October 2016 • Ore commissioning commenced 14 October 2016 • First nickel and copper concentrates production announced 26 October 2016 • First nickel concent
Slide 14: Nova Project: 10.2km of mine development completed
Nova Project 10.2km of mine development completed project to date For personal use only Nova Mining Schedule Nova Bollinger 14
Slide 15: Nova Project next steps
Nova Project next steps Ramp up to full production around mid CY17 For personal use only • Ramp up underground mine to full production of 1.5Mtpa around mid CY17 • Return Air Raise 1 to be commissioned 3Q17 • In mine exploration at C5 target adjacent to Bollinger decline • Seismic data collection to
Slide 16: Nova Project: In mine exploration at C5 target
Nova Project In mine exploration at C5 target For personal use only • In mine exploration commenced at C5 target adjacent to Bollinger decline • Under ground diamond drilling of 18 holes for 2,104m completed to date • Drilling will continue in 3Q17 testing the eastern portion of the C5 target • Prep
Slide 17: Fraser Range consolidation
Fraser Range consolidation Off market takeover of Windward Resources Limited For personal use only Increasing holdings of prospective tenure proximal to Nova Project • IGO acquired Windward Resources (1) during the quarter delivering 1,700km2 of under explored tenure • IGO entered into JV with Sheff
Slide 18: Nickel market
Nickel market Reversal of Indonesian export policy generating negative sentiment For personal use only What happened? • On the 12 January 2017 the Nickel Price government of Indonesia announced US$/t 12,000 the relaxation of a previously enforced raw materials export ban 11,000 • Removal of export b
Slide 19: Concluding comments
Concluding comments Diversified mining company delivering cash flow and growth For personal use only Continued improvement in safety performance Tropicana delivers record throughput of 7.6Mtpa Long production and cash costs better than guidance Jaguar payable copper and zinc lower Nova first concent
Slide 20: For personal use only
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Independence Group NL — Q2 FY2017 Earnings Presentation on 6ix