Iamgold Corporation · TSX:IMG
Iamgold — Shareholder Meeting (May 2019)
42 slides from Iamgold's shareholder meeting presentation, May 7, 2019
Slide 1: 2019 Annual General Meeting
2019 Annual General Meeting May 7, 2019 TSX: IMG l NYSE: IAG
Slide 2: Cautionary Statement
Cautionary Statement All information included in this presentation whether in narrative or chart form, including any information as to the Company’s future financial or operating performance, and other statements that express management’s expectations or estimates of future performance, other than s
Slide 3: President's Awards
HARM ZERV = PRESIDENT’S AWARDS HEALTH & SAFETY | SUSTAINABILITY
Slide 4: 2018 President's Award for Health & Safety
2018 PRESIDENT’S AWARD FOR HEALTH & SAFETY ESSAKANE MINE in Burkina Faso 4
Slide 5: 2018 President's Award for Sustainability
2018 PRESIDENT’S AWARD FOR SUSTAINABILITY ESSAKANE MINE in Burkina Faso 5
Slide 6: 2018 President's Award for Exploration
2018 PRESIDENT’S AWARD FOR EXPLORATION Peru Exploration Team 6
Slide 7: CSR & ESG at IAMGOLD
CSR & ESG at IAMGOLD TSX: IMG l NYSE: IAG
Slide 8: Corporate Social Responsibility (CSR)
Corporate Social Responsibility (CSR) • Suriname › Updated Makamboa Protocol stabilized SSM operations in East Roma - significant breakthrough › Steve Letwin's civilian award granted, in part, as a reflection of our commitment to community investment, including the Makamboa Protocol › Committed with
Slide 9: Environmental, Social and Governance (ESG)
Environmental, Social and Governance (ESG) IAMGOLD CULTURE AND VALUES ALIGNED • What is ESG? › The consideration of environmental, social and governance factors alongside financial factors in the investment decision-making process • Why does it matter? › From IAMGOLD’s perspective, high ESG practice
Slide 10: Clean Water, Sanitation & Infrastructure Development
Clean Water, Sanitation & Infrastructure Development Sahel Water Project (Essakane) 10
Slide 11: Clean Water, Sanitation & Infrastructure Development
Clean Water, Sanitation & Infrastructure Development TRIANGE D’EAU / SAHEL WATER PROJECT (ESSAKANE) • The 4-year, C$14 million project aims to: › Increase drinking water supplies, › Improve water sanitation, › Enhance governance of water management services, › Promote economic development, and › Con
Slide 12: Public Health
Public Health Healthcare investment in Suriname 12
Slide 13: Public Health
Public Health • Healthcare investment in Suriname (Rosebel): › Over $1.35 million invested in upgrading healthcare equipment in Suriname since 2018. • Suriname National Basketball Team Training Camp (Rosebel): › Hosted training camp at Rosebel • Support for Gorom orphanage (Essakane) › 1) Provide ch
Slide 14: Clean Energy
Clean Energy Essakane Solar 14
Slide 15: Clean Energy
Clean Energy • Essakane Solar › Over the full 15-year PPA, the Project is expected to bring 86 million litres of heavy fuel displacement (representing a total savings of US$80.9 million in fuel savings) and avoid 274,110 tonnes of CO2 emissions. › Local employment and training of local workforce to
Slide 16: Quality Education
Quality Education IAMGOLD Student Engineering Junction at Laurentian University 16
Slide 17: Quality Education
Quality Education • Laurentian University Investment (Côté): › 5 year $2 million investment, to build a “collaboration space” for engineering students in Laurentian’s Cliff Fielding Research, Innovation and Engineering building. › In addition, the funds will be used for engineering lab refurbishment
Slide 18: Decent Work and Economic Growth
Decent Work and Economic Growth Fonds Fer project (Essakane) Winner of the 2018 TSM award for community excellence 18
Slide 19: Decent Work and Economic Growth
Decent Work and Economic Growth • Small Scale Mining: › Training of 40 young small scale miners at the Agence Nationale de la promotion de l’Emploi et de la Formation Professionalle a Dori (ANPE) (ESS): Training of 20 young small-scale miners in metalworking for 60 days Training of 20 young peop
Slide 20: Reduced Inequality
Reduced Inequality Fondation Émergence Aging Gayfully program 20
Slide 21: Reduced Inequality
Reduced Inequality • Support for Human Rights (Essakane) › Organization of the National Civic Week (SENAC) under the theme “Preservation of Burkinabe social values: Roles and responsibilities of private and public actors to reinforce peace and social cohesion” › Organized a march in 3 communes › Sch
Slide 22: Market Overview
Market Overview tf [IAMGOLD 22
Slide 23: The World wants a Self Funding Model
The World wants a Self Funding Model Fast Safe Payback Jurisdictions Minimal Debt Free Cash Flow Low Capex Dividends No Hedges Minimal Share Dilution Share Buy Backs High IRR 23
Slide 24: Investor Fatigue
Investor Fatigue Gold has averaged $1,250/oz since June 2013 Today’s investor want low capital intensive, cash producing assets Short Cycle Investments 24
Slide 25: Mining Capital Raises on the Decline
Mining Capital Raises on the Decline • Amount of equity capital raised by mining companies on the TSX and TSX.V Exchange declined in 2018 for second straight year • Miners raised $6.47bn in equity capital in 2018, 23.47% less than the $8.4bn raised in 2017 25
Slide 26: Passive Investors Pervasive in Modern Gold Space
Passive Investors Pervasive in Modern Gold Space Source: Bloomberg, Morningstar Direct Many traditional active funds abandoned sector once gold bottomed out post-2011 (e.g., in 2018 Vanguard slashed exposure to precious metals from 80% to 25%) Gold stocks are now largely bought and sold by passive i
Slide 27: Total Exploration Spending Grew 19% in 2018...
Total Exploration Spending Grew 19% in 2018… • Exploration budgets still well below historic highs – but rising since 2016 • Gold leading the way: ~50% of global budget allocated to gold exploration last year 27
Slide 28: ...but Grassroots Exploration at Historic Lows
…but Grassroots Exploration at Historic Lows 35% 39% 26% • Spending is increasingly allocated to advanced projects and mines • Grassroots exploration budget share hit all-time low of 26% in 2018 • Majors allocated record low of 0.4% of their revenue to grassroots in 2017 • Industry is short of criti
Slide 29: Gold Miners Remain Risk Averse
Gold Miners Remain Risk Averse • Exploration spending highly concentrated in “safe” jurisdictions • Most new gold deposits discovered in Canada, Australia, U.S. in 2018 • 29% of total 2018 global exploration budgets allocated to Canada and Australia 29 29
Slide 30: Jurisdictional Trends
Jurisdictional Trends Canada is the only major gold-producing country to continue significant increases in 5 years 30
Slide 31: Peak Gold...?
Peak Gold…? • 2019 Gold output to hit new record high of 109.6 Moz • 15% of gold production by 2024 will be coming from mines that are not yet producing • Attributable gold reserves have declined 50% industry-wide in the past five years • Lower grades mean production costs have risen significantly:
Slide 32: Peak Gold...?
Peak Gold…? As gold production starts to fall, growing share of production will come from base metal mines 32
Slide 33: Riding the Consolidation Wave
Riding the Consolidation Wave + 20.91 + 11.60 + 6.50 • Bigger is looking better in the wake of Barrick/Randgold & Newmont/Goldcorp deals • From date of merger announcement to YTD, Barrick’s stock appreciated over 20% • Investors appear receptive to mergers and even willing to forgo a premium with an
Slide 34: More M&A Activity to Come
More M&A Activity to Come • Gold industry is small (~$100B) but highly fragmented • Consolidation is inevitable: smaller companies operating in a public market that is a much larger entity run the risk of becoming irrelevant • Creating new benefits: stronger stock prices, asset optionality, risk div
Slide 35: Gold: A U.S. Dollar Story
Gold: A U.S. Dollar Story • Negative correlation between gold and the U.S. dollar continues to be the most significant factor affecting prices • Gold currently hamstrung by relatively little risk aversion in the world marketplace and a strong Dollar index • BUT: Decelerating U.S. economy and dovish
Slide 36: Central Banks "De-Dollarizing"
Central Banks “De-Dollarizing” • Global economy trending towards less U.S. and U.S. dollar centric • Countries increasingly selling U.S. treasuries and returning to gold for wealth preservation • Central bank net purchases up ~75% over the past year - Russia leading the way • Central banks acquired
Slide 37: China Continues to Add Reserves
China Continues to Add Reserves China ‘Official’ Gold Reserves as of 3/1/2019 • China’s ‘official’ gold reserves stood at 60.62M oz as of April – adding 1.38M oz to its reserves since November 2018 • PRC reducing U.S. Treasury exposure as its looks for a safe haven hedge • Before December, last time
Slide 38: Weaker U.S. & China Will Fuel Global Uncertainty
Weaker U.S. & China Will Fuel Global Uncertainty Gloomy outlook for global economy in 2019 and beyond China grows 6.6% in 2018, lowest pace in 28 years Eurozone continues to underperform: Germany cuts 2019 growth forecast to just 0.5% Italy’s public debt sits at US$2.7 trillion, 131% of GDP South Ko
Slide 39: Corporate Overview
Corporate Overview tf [IAMGOLD 39
Slide 40: IAMGOLD: Building a Cash Flow Pipeline
IAMGOLD: Building a Cash Flow Pipeline Our vision is to be the global leader in generating superior value for our stakeholders through accountable mining. 1 2 3 4 CREATING DIVERSIFYING MAINTAINING ENSURING superior our portfolio a strong a robust shareholder balance sheet pipeline value • Operationa
Slide 41: Near Term Catalysts
Near Term Catalysts H1 2019 $170 Million Gold Prepay Agreement Diahka-Siribaya Updated Resource Essakane CIL Feasibility Study H2 2019 Saramacca Production Expect delivery of Boto Mining Permit Nelligan Maiden Resource Westwood Plan Update 2020 Saramacca Full Production Essakane Debottleneck (13.5Mt
Slide 42: Contact
Indi Gopinathan Martin Dumont Investor Relations Lead Senior Analyst, Investor Relations T: 416-360-4743 T: 416-933-5783 TSX: IMG l NYSE: IAG42