Newcrest Mining — Citi Gold Corporate Day 2019
30 slides from Newcrest Mining's conference presentation, September 2019
Slide 1: Delivering on our Vision
CITI GOLD CORPORATE DAY Delivering on our Vision Gerard Bond Finance Director and Chief Financial Officer
Slide 2: Disclaimer - Forward Looking Statements
Disclaimer Forward Looking Statements This presentation includes forward looking statements. Forward looking statements can generally be identified by the use of words such as “may”, “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “continue”, “outlook” and “guidance”, or other similar
Slide 3: Disclaimer - Competent Person's Statement
Disclaimer Competent Person’s Statement The information in this presentation that relates to Mineral Resources or Ore Reserves (other than Red Chris and Havieron) has been extracted from the release titled “Annual Mineral Resources and Ore Reserves Statement –31 December 2018” dated 14 February 2019
Slide 4: Newcrest Mining Limited
Newcrest _ Mining Limited
Slide 5: Our Vision, Safety & Sustainability
Our Vision Safety & Sustainability Our Assets Financials Growth & portfolio Summary optimisation
Slide 6: Our Vision: To be the Miner of Choice
Our Vision: To be the Miner of Choice Our Pillars: SAFETY & PEOPLE OPERATING TECHNOLOGY PROFITABLE SUSTAINABILITY PERFORMANCE & INNOVATION GROWTH ASPIRATIONS Zero fatalities First quartile First quartile 5 breakthrough Exposure to five tier one and industry- organisational Group AISC successes by or
Slide 7: Safety & Sustainability
Our Vision Safety & Sustainability Our Assets Financials Growth & portfolio Summary optimisation
Slide 8: Improving Safety Performance
Improving Safety Performance Continued TRIFR1 (per million hours worked) safety improvement 3.7 3.3 38% 2.4 2.3 FY16 FY17 FY18 FY19 Zero Fatalities Safety Transformation Remaining vigilant with • A strong safety culture another year free of fatalities • Critical controls for every high-risk task and
Slide 9: Sustainability commitments
Greenhouse gas (GHG) intensity target Sustainability A 30% reduction in GHG emissions per tonne of ore treated by 2030 against the 2018 commitments baseline Shadow carbon price Acquisitions and key capital investment decisions will include carbon price scenarios between $25 and $50 a tonne of CO2-e
Slide 10: Our Assets & portfolio optimisation
Our Vision Safety & Sustainability Our Assets Financials Growth & portfolio Summary optimisation
Slide 11: Long-life, low cost portfolio
Cadia (100%) Lihir (100%) Telfer (100%) Long-life, FY19 Production: 913koz Au, 91kt Cu FY19 Production: 933koz Au FY19 Production: 452koz Au, 15kt Cu low cost FY19 AISC: Ore Reserves: $132/oz 22moz Au & 4.3mt Cu FY19 AISC: Ore Reserves: $887/oz 24moz Au FY19 AISC: Ore Reserves: $1,253/oz 2.0moz Au &
Slide 12: Large orebodies are rare
Large Resource & Reserve base of global majors’ operating assets (moz) orebodies are rare 60 Solid bars = ore reserve Transparent bars = mineral resource Only Cadia 50 and Lihir have an ore reserve 40 base in excess of 15 moz 30 20 1. Based on producing assets held by Barrick, Newmont 10 Goldcorp an
Slide 13: Lowest cost major gold producer
Lowest cost AISC/oz for the most recently reported quarter1 ($/oz) major gold producer 1,016 996 953 910 869 720 1 AISC/oz from company reports for 3 months ended 30 June 2019. Based on data available as at 5:00pm AEST, 15 August 2019. For comparative purposes, reported AISC for the 3 months ended 3
Slide 14: A unique suite of technical capabilities
A unique Lihir, Telfer Telfer Gosowong Telfer Cadia suite of technical capabilities OPEN PIT SELECTIVE Reef Narrow Vein UNDERGROUND BULK Sublevel Caving Block/Panel UNDERGROUND Caving Large scale comminution Pressure oxidation PROCESSING Copper-gold flotation Cyanide & carbon in leach
Slide 15: Financials
Our Vision Safety & Sustainability Our Assets Financials Growth & portfolio Summary optimisation
Slide 16: Strong FY19 Results
Gold Production Copper Production AISC Strong FY19 (koz) (kt) ($/oz) Results1,2 6% 2,488 106 850 800 835 12% 2,346 36% 750 738 700 78 650 600 550 500 FY18 FY19 FY18 FY19 FY18 FY19 Free Cash Flow EBITDA Adjusted EPS ($m) ($m) ($/share) 1,670 0.73 804 6% 22% 34% 1,565 0.60 601 1 Please see Newcrest’s
Slide 17: Strong free cash flow generation
Strong free Cumulative free cash flow of $4.2bn since January 2014 ($m) cash flow1 $4.2 Billion generation H1 Free Cash Flow H2 Free Cash Flow 1 Free cash flow is calculated as cash flow from operating activities less cash flow related to investing activities.
Slide 18: Strong financial position
Leverage Ratio (Net Debt / EBITDA) Gearing Ratio Target less Strong Target less than 2.0x (for trailing 12 months) than 25% financial 16% 1.2x position 12% 12% 0.7x 0.6x 5% 0.2x 31 Dec 2017 30 Jun 2018 31 Dec 2018 30 Jun 2019 31 Dec 2017 30 Jun 2018 31 Dec 2018 30 Jun 2019 Coverage ($b) Investment G
Slide 19: Increasing returns to shareholders
Increasing Dividends (Full Year US$/share) Increasing returns to 0.22 19% shareholders 0.185 0.15 0.075 FY16 FY17 FY18 FY19 • Third consecutive year of dividend increases • Targeting a total dividend payment of at least 10-30% of free cash flow • With the dividend being no less than US15 cents per s
Slide 20: Growth
Our Vision Safety & Sustainability Our Assets Financials Growth & portfolio Summary optimisation
Slide 21: Our approach to profitable growth
Our approach to profitable growth 1. Organic 2. Greenfield 3. Early entry 4. M&A growth exploration partnerships
Slide 22: Meaningful organic growth options
Cadia Expansion ▪ Expansion Feasibility Study expected to be completed before the end of 2019 ▪ Molybdenum plant gated to execution with first production expected CY21 Meaningful organic Lihir ▪ Annualised sustainable milling rate of 15mtpa achieved in June 2019 Quarter growth ▪ Now focused on susta
Slide 23: Undercut-less Caving
Next generation of caving ▪ Telfer testing 4 undercut-less drawbells in first half FY20 Undercut-less Caving ▪ Cadia to construct ~6 undercut-less drawbells in second half FY20 Potential to be ▪ Aim to reduce construction cost and faster, safer and establishment time of macro blocks by lower cost ~3
Slide 24: Large portfolio of early entry partnerships
Australia-Pacific Americas Large portfolio of early entry partnerships Australia Canada Mexico • Second Junction Reefs (JV) • Red Chris (JV 70%) • Azucar (EI-19.9%) • Encounter Alliance & JVs • Prodigy Gold NL (FI) USA Chile • Isa North 100% • Jarbidge (O) • Altazor (O&FI) Key: • Cloncurry (O&FI) •
Slide 25: Early entry partnership - Havieron
Havieron +27 Moz Au* regional endowment Winu Telfer Magnum Early entry partnership - Havieron Leveraging existing Havieron infrastructure at Telfer Telfer O’Callaghans Niffy Yeneena ▪ Located 45km east of Telfer Maroochydore ▪ kilometres Potential high grade mill feed zone for Telfer 0 10 20 ▪ Miner
Slide 26: M&A when we can unlock value
Red Chris +220 Moz Au* regional endowment 0 25 50 kilometres M&A when we can Red Chris JV unlock value Schaft Creek Galore Creek Eskay Creek Leveraging our KSM Brucejack technical capabilities at ▪ Large metal endowment 20Moz Au Red Chris and 13Blbs Cu ▪ Presence of high grade mineralisation The inf
Slide 27: Red Chris exhibits Cadia like porphyry geology
Red Chris exhibits Cadia like porphyry geology
Slide 28: Summary
Our Vision Safety & Sustainability Our Assets Financials Growth & portfolio Summary optimisation
Slide 29: What makes Newcrest different
What makes Newcrest Long Low cost different reserve life production Organic growth Do what options we say (at Cadia, Lihir, Wafi Golpu and Red Chris) Strong exploration & technical Financially robust capabilities
Slide 30: Find out more
Find out more: www.newcrest.com.au Engage with us +613 9522 5717 +1 (647) 255 3139