Paladin Energy Ltd · ASX:PDN
Paladin Energy — Q3 2014 Earnings Presentation
20 slides from Paladin Energy's earnings presentation, Nov 14, 2014
Slide 1: September Quarter Results Conference Call and Investor Update
September Quarter Results Conference Call and Investor Update 14 November 2014 John Borshoff – Managing Director/CEO Craig Barnes – Chief Financial Officer Mark Chalmers – Executive General Manager, Production
Slide 2: Disclaimer and Notes for JORC and NI 43-101 Mineral Resources and Ore Reserves
Disclaimer and Notes for JORC and NI 43- 101 Mineral Resources and Ore Reserves This presentation includes certain statements that may be deemed “forward-looking statements”. All statements in this presentation, other than statements of historical facts, that address future production, reserve or re
Slide 3: Presentation Outline
Presentation Outline Key Achievements and Update Uranium Market Update Financial Review Project Update Outlook 2
Slide 4: Paladin Update
Paladin Update Paladin has delivered on its strategic and operational objectives — EdF (US$200M) and CNNC (US$190M) — Kayelekera on C&M – preserving ore body, asset value and production optionality — Langer Heinrich (LHM) production and cost efficiencies continue being achieved Focus remains on dele
Slide 5: Operational Update
Operational Update Langer Heinrich production post quarter back on track — flagged 23% shortfall during quarter (ASX 16 Sept 2014) — production shortfall due to planned maintenance and dealing with unexpected pipe scaling — C1 costs increased to US$35.1/lb purely production volume related — reagent
Slide 6: Presentation Outline
Presentation Outline Key Achievements and Update Uranium Market Update Financial Review Project Update Outlook 5
Slide 7: Uranium Market Snapshot
Uranium Market Snapshot US$/lb U3O8 Spot Price US$42/lb • Dramatic uranium spot price increase 44 42 since May (~50%) 40 • Spot market fundamentals improving 38 36 as supply tightens and demand rises 34 32 • Term market contract volumes already 30 28 triple that of entire 2013; • Additional term con
Slide 8: Uranium Market Update
Uranium Market Update US Mid-Term elections expected to boost US nuclear power programme Japanese reactor restarts imminent — Japanese utilities have submitted applications for safety reviews for 20 reactors — Sendai 1 & 2 (Kyushu Electric) received restart approval from Prefecture Governor 7th Nove
Slide 9: Presentation Outline
Presentation Outline Key Achievements and Update Uranium Market Update Financial Review Project Update Outlook 8
Slide 10: Profit & Loss Quarter Ended 30 September 2014
Profit & Loss Quarter Ended 30 September 2014 Sales revenue of US$39.0M – down 44% on 2013* — 1.250Mlb sold at average realised price of US$31.16/lb — anticipated sales of approximately 1.9Mlb in the Dec quarter Gross profit from operations of US$1.4M (2013*: gross loss of US$14.9M) — average unit C
Slide 11: Cost Reductions for FY15
Cost Reductions for FY15 Corporate and exploration cost reductions — corporate costs cut by US$2.4M, reduction of 17% over FY14 — exploration costs cut by US$1.0M, reduction of 12% over FY14 — executive/senior management 10% pay reduction to be extended for another 12 months — corporate cost review
Slide 12: Cash Flow Quarter ended 30 September 2014
Cash Flow Quarter ended 30 September 2014 Cash and cash equivalents of US$209.5M — receipt of US$170M balance of proceeds from LHM minority sale in July — restructuring of LHM project finance facility, US$30.8M repayment (non-recurring) — net cash outflow from LHM of US$12.7M — corporate, exploratio
Slide 13: Presentation Outline
Presentation Outline Key Achievements and Update Uranium Market Update Financial Review Project Update Outlook 12
Slide 14: Langer Heinrich Project Update
Langer Heinrich Project Update Production down as reported Last Actual — production for quarter of 1.027Mlb U3O8 June Qtr Sept Qtr — down as a result of planned maintenance and unexpected scaling (now resolved) Ore processed 0.9081Mt 0.734Mt — recovery 82.7% (older resin and scaling) — well position
Slide 15: Kayelekera Project Strategically Placed
Kayelekera Project Strategically Placed Transition to C&M smoothly completed — manning/contractor levels reduced — C&M procedures well established C&M water management plan well advanced — involves controlled release of surplus run-off into local inland waters — treatment to internationally recognis
Slide 16: Key Pipeline Projects (being advanced)
Key Pipeline Projects (being advanced) Advancing toward Field Leach Trial (FLT) Low-cost ISR project targeting 2Mlb pa U3O8 production – existing mining lease – Paladin has the expertise to develop MANYINGEE WA 2018 development target (price dependent) – field leach testing planned for 2015/16 Signi
Slide 17: Presentation Outline
Presentation Outline Key Achievements and Update Uranium Market Update Financial Review Project Update Outlook 16
Slide 18: Strategic Partner Discussions
Strategic Partner Discussions Paladin Rationale — create strategic alliance with major utilities — Paladin holds unique global platform and achievements attracting high interest — provides opportunity for funding to deleverage the balance sheet — provides a partner to jointly fund new developments S
Slide 19: Conclusion
Conclusion Guidance for FY2015 remains 5.4Mlb to 5.8Mlb FY15 priorities — further cost rationalisation at operations and corporate level — strong operational performance through production optimisation — deleveraging the balance sheet — remaining positioned to take advantage of the future uranium pr
Slide 20: Paladin Energy Ltd – Contact Details
Paladin Energy Ltd – Contact Details Head Office Level 4, 502 Hay Street Subiaco Western Australia 6008 PO Box 201, Subiaco Western Australia 6904 Telephone: +61 (0) 8 9381 4366 Facsimile: +61 (0) 8 9381 4978 Email: paladin@paladinenergy.com.au Website: www.paladinenergy.com.au Investor Relations Te