Slide 1: 2022 Results Presentation
RESPONSIBLY MEETING GLOBAL DEMAND FOR QUALITY-OF-LIFE MINERALS 2022 Results Presentation 22 March 2023
Slide 2: Disclaimer
Disclaimer This Presentation (the “Presentation”) has been This Presentation does not constitute or form part attainable or will be realised. In particular, certain prepared and issued by Kenmare Resources plc of, and should not be construed as, an offer, statements in this Presentation relating to
Slide 3: Agenda
Agenda Introduction Michael Carvill, Managing Director Financial review Tom Hickey, Finance Director Operational review Ben Baxter, Chief Operations Officer Market update Michael Carvill, Managing Director Outlook Michael Carvill, Managing Director Questions? Kenmare Resources – 2022 Results Present
Slide 4: Creating sustainable competitive advantage
Creating sustainable competitive advantage Strategic priorities OPERATE • 12 million hours worked with no LTIs 0.09 • 6% reduction in Scope 1 CO2 LOST TIME INJURY RESPONSIBLY emissions FREQUENCY RATE • 1st quartile industry position for DELIVER LONG LIFE, LOW COST 2021 confirmed by TZMI • >100 years
Slide 5: Record revenues, profits, and shareholder returns
Record revenues, profits, and shareholder returns Operational and financial highlights Other highlights Projects Sales price (FOB) ($/t) 463 Mineral Product 2022 Dividends RUPS1 Revenue ($m) 498 327 421 229 248 272 Up 66% Complete 246 256 232 2022: USc54.3/sh Providing steady 2021: USc32.7/sh power
Slide 6: Financial review
Financial review Tom Hickey, Finance Director Mineral Separation Plant
Slide 7: Record $206m profit after tax, up 60% on 2021
Record $206m profit after tax, up 60% on 2021 2022 Income Statement review 2022 2021* Revenue by product (%) – 2022 vs 2021 $ million $ million Concentrates Rutile Concentrates Rutile Revenue 526.0 455.9 8% 4% 5% 1% Freight costs (27.6) (35.4) Primary zircon Primary zircon Mineral product revenue 49
Slide 8: Stronger prices received for all products in 2022
Stronger prices received for all products in 2022 2022 product price and shipping review Commodity price movements ($/t, FOB)1 Strong pricing in 2022 $500/t $2,000/t Zircon price ($/t) Ilmenite & average 42% increase in average sales price (FOB)1 to $463/t in $400/t $1,600/t 2022 (2021: $327/t). S
Slide 9: 37% reduction in ilmenite unit cost of production
37% reduction in ilmenite unit cost of production 2022 cash operating cost calculations Unit 2022 2021* Cost of sales (excl freight & FX) $m 241.1 244.9 Administration expenses $m 22.8 22.6 Cost of sales down slightly on lower shipment volumes offset by product mix Total costs (excl freight & FX)
Slide 10: Increased cash flow from improved pricing
Increased cash flow from improved pricing Movement in net cash/(debt) • RUPS • Studies • Sustaining • Receivables $47m • Payables $2m • Dividends • Interest • Inventory $24m • Odd lot offer • Leases • FX Strong operating cash flow of $290m in 2022 (2021: $211m) due to improved pricing, offset by i
Slide 11: Strong and flexible balance sheet
Strong and flexible balance sheet Balance sheet review 31-Dec-2022 31-Dec-2021 $ million $ million PPE additions of $59.9m, in line with 2021 additions of Property, plant and equipment 932.4 956.7 $60.3m Inventory 84.2 60.2 Inventory increased by $24.0m Trade and other receivables 124.0 74.7 I
Slide 12: Continued dividend growth
Continued dividend growth Shareholder returns Dividends 2022 Shareholder returns profile $60m Dividends per Full year 2022 $40m share dividend +66% USc54.3/sh $20m $0m 2019 2020 2021 2022 Dividend policy delivery Interim Dividend Final Dividend Dividend policy of minimum 20% profit after tax Pro
Slide 13: Balancing capital returns & investment plans
Balancing capital returns & investment plans Capital allocation priorities • Sustaining capital Capital requirements • Non-discretionary capital (i.e. WCP A transition) CORE • Debt facilities of $150m originally – reducing with repayments Debt repayment / servicing • Strong balance sheet / low debt
Slide 14: Operational review
Operational review Ben Baxter, Chief Operations Officer Bronagh J
Slide 15: Sustainability is core
Sustainability is core Sustainability strategic pillars Safe and engaged workforce Thriving communities • 50% LTIFR improvement against • $3 million invested by KMAD in a 3-year average (2020-2022) community projects • 14.5% female representation at • 17% improvement in numeracy the Moma Mine (2021:
Slide 16: 11.8 million hours LTI free record achieved
11.8 million hours LTI free record achieved Striving to improve Health and Safety outcomes Safety performance 8 0.3 0.27 7 0.25 Redoubling efforts on workforce safety 0.3 19 months and 11.8 million hours worked without a Lost 6 Time Injury from 2021 to 2022 0.2 5 Hours Worked Improved performanc
Slide 17: 6% reduction in Scope 1 emissions in 2022
6% reduction in Scope 1 emissions in 2022 Improvements achieved in both RUPS and MSP dryers RUPS1 improves power reliability to the Mineral Separation Plant RUPS RUPS (MSP) NPV Positive project costing $21m, commissioned Q2 2022 Diesel generators now only utilised when there is power instability
Slide 18: Consistent production in 2022 despite higher slimes
Consistent production in 2022 despite higher slimes Greater efficiencies offset some impacts of slimes and lower feed quality HMC production Ilmenite HMC: Steady production Record excavated ore volumes and HMC production 1,586,200t 1,088,300t Slimes levels impacted mining rates and recoveries at
Slide 19: Maintaining production in 2023
Maintaining production in 2023 2023 production guidance Production 2023 Guidance1 2022 Actual Ilmenite tonnes 1,050,000 - 1,150,000 1,088,300 Primary zircon tonnes 51,000 - 57,000 58,400 Rutile tonnes 8,000 - 9,000 8,900 Concentrates2 tonnes 37,000 - 41,000 45,200 Costs Total cash operating costs $m
Slide 20: Strategy for Nataka developed and tested
Strategy for Nataka developed and tested Full update to be provided at the Capital Markets Day Definitive Feasibility Studies (DFS) to be completed in 2023 ? Nataka is the largest ore zone for Moma, representing 75% of Kenmare’s mineral resources Different resource characteristics to Namalope; h
Slide 21: Market update
Market update Michael Carvill, Managing Director Zircon product warehouse
Slide 22: Record prices achieved
Record prices achieved A strong year for all products 800 600 700 500 429 Shipment Volumes 600 $ per tonne (FOB) 366 486 (000’s tonnes) 500 400 283 400 236 239 257 300 223 300 269 274 200 200 100 100 - - H1 2018 H2 2018 H1 2019 H2 2019 H1 2020 H2 2020 H1 2021 H2 2021 H1 2022 H2 2022 Shipment Volumes
Slide 23: Market leading ilmenite supplier
Market leading ilmenite supplier Kenmare’s scale, quality and consistency of supply supports demand for its ilmenite Largest supplier of ilmenite globally Kenmare share of non-Chinese ilmenite supply*1 Constraints from other producers have resulted in customers 25% valuing security and stability o
Slide 24: Robust demand maintained
Robust demand maintained Received prices expected to be moderately lower for 2023 Titanium feedstocks A weaker pigment market in H2 2022 put pressure on ilmenite prices in late 2022 and early 2023 Western pigment demand has improved in early 2023 but remains subdued Chinese pigment market reco
Slide 25: Outlook
Outlook Michael Carvill, Managing Director WCP A control room
Slide 26: First quartile margin position attained in 2021
First quartile margin position attained in 2021 Mineral sands industry revenue to cash cost curves 8 7 6 5 4 3 2 1 2021 2018 2013 1st Q 2nd Q 4th Q 0 0% 25% 50% 75% 100% 2013 2018 2021 The latest TZMI industry cost analysis puts Kenmare in the 1st quartile for 2021 Maintaining the best possible
Slide 27: Delivering on our strategy
Delivering on our strategy Strategic performance and targets 2022 performance 2023 targets • Focus on safety • RUPS commissioning OPERATE RESPONSIBLY • Reducing CO2 emissions & • Broad range of ESG targets set increasing biodiversity • Maintain cost control in an • Steady forecast production in DELI
Slide 28: Appendices
Appendices Transshipment vessel loading
Slide 29: Mineral sands: essential to modern life
Mineral sands: essential to modern life Two core product streams: titanium feedstocks and zircon World GDP vs TiO2 pigment consumption1 Titanium feedstocks (ilmenite and rutile) 6 450 TiO2 pigment imparts whiteness and opacity in the Global GDP Index Million tonnes manufacture of paints, plastics
Slide 30: A globally significant titanium minerals deposit
A globally significant titanium minerals deposit Moma Titanium Minerals Mine overview Tier one orebody Operational process outline >100 year life of mine at targeted production rate of 1.2 Mtpa ilmenite Wet Heavy mineral Dredge + dry mining concentrator concentrate Moma is comprised of multiple
Slide 31: Ilmenite unit costs benefitting from co-products
Ilmenite unit costs benefitting from co-products Production and cash operating cost per tonne profile 1,600kt $200/t 1,400kt $175/t 1,200kt $150/t Cost per tonne ($/t) Production (kt) 1,000kt $125/t 800kt $100/t 600kt $75/t 400kt $50/t 200kt $25/t 0kt $0/t 2015 2016 2017 2018 2019 2020 2021 2022 202
Slide 32: Higher cash costs as a result of inflation
Higher cash costs as a result of inflation Total cash operating costs breakdown Logistics & Travel Other Labour 6% 13% payroll 25% Production 2022: $217m Overheads 17% Repairs & Maintenance Fuel 20% 10% Power 9% Increase in cash operating costs due to Power and fuel: Higher fuel (+64% compared to
Slide 33: Follow Kenmare on social media
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Slide 34: Contact Us
Progressive land rehabilitation Contact Us Jeremy Dibb / Michael Starke +353 1 671 0411 ir@kenmareresources.com Follow us