China Gold International Resources Corp. Ltd. · HKEX:2099
China Gold International Resources — Investor Presentation (May 2016)
24 slides from China Gold International Resources's investor presentation, May 20, 2016
Slide 1: Sustainable Profitability and Growth
TSX: CGG | HKSE: 2099 May 2016 Sustainable Profitability and Growth
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS This presentation contains “forward looking statements” within the meaning of the United States private securities litigation reform act of 1995 and “forward looking information” within the meaning of applicable Canadian securities legislation. Such forward-looking stateme
Slide 3: Agenda
AGENDA v Company Overview v Financial Highlights v CSH Gold Mine Overview and Expansion Update v Jiama Polymetallic Mine Overview and Expansion Update v Growth Plan (Organic Growth and M&A) v Social Responsibility China Gold International Resources Corp. Ltd | TSX: CGG – HKSE: 2099 3
Slide 4: Why Invest in China Gold International
WHY INVEST IN CHINA GOLD INTERNATIONAL Rapid Growth Consistent Profitability 8th year of growing 8 years of consistent production capacity CSR Model Enterprise operational profitability Jiama awarded CSR Model Enterprise by CASS in 2015 Unique Corporate Model Global Vision, Effective Cost Internatio
Slide 5: About China Gold International
ABOUT CHINA GOLD INTERNATIONAL Inner v Dual listed, profitable and growing gold and Mongolia copper producer v Two producing mines in China: CSH Gold Mine Baotou • CSH Gold Mine - Inner Mongolia Tibet Region • Jiama Copper-Polymetallic Mine - Tibet Region Lhasa v The ONLY overseas listing vehicle
Slide 6: About China National Gold Group (CNG)
ABOUT CHINA NATIONAL GOLD GROUP (CNG) CHINA NATIONAL GOLD GROUP OWNS 39.33% OF CHINA GOLD INTERNATIONAL u Largest gold producer in China u Major Shareholder in both International u Employment: 50,800 people and Domestic Listings – TSX and HK Stock Exchanges: u BBB credit rating by S&P China Gold
Slide 7: Our Unique Corporate Model
OUR UNIQUE CORPORATE MODEL In China Internationally Viewed as a local Full TSX and HK listing Chinese miner allows access to global capital markets Full support of China National Gold Group – Building international our 39% shareholder corporate and Global Vision, government Access to
Slide 8: Experienced Board and Management Team
EXPERIENCED BOARD AND MANAGEMENT TEAM Top management of China Gold International Xin Song Bing Liu Lianzhong Sun Liangyou Jiang Chairman and Executive CEO and Executive Non-Executive Director Senior Executive Vice Director Director President and Executive Director ~30 years ~30 years Over 30 years ~
Slide 9: Resources/Reserves, Production
RESOURCES/RESERVES, PRODUCTION Combined Gold Reserve / Resource Copper Reserve / Resource Contained Gold Contained Copper CSH and Jiama Gold (Billion Pounds / (M oz) Jiama’s Copper Thousand Tonnes) Proven / Probable Reserve 5.5 Proven / Probable Reserve 5.9 / 2,673 Measured / Indicated Resource (1)
Slide 10: Financial Highlights: Maintaining profitability despite lower commodity prices
FINANCIAL HIGHLIGHTS Maintaining profitability despite lower commodity prices Realized average gold price Realized average copper price 1,700 1,611 (US$ per ounce) 2.82 2.75 (US$ per pound) 1,600 2.7 2.51 1,500 2.4 1,362 1,400 2.1 1.99 1,300 1.8 1,209 1,200 1.5 1,117 1,100 1.2 1,000 0.9 2012 2013 20
Slide 11: 2015 and Q1 2016 Financial Highlights
2015 and Q1 2016 FINANCIAL HIGHLIGHTS Q1 ended March 31, Year ended Dec. 31, Year ended Dec. 31, Item 2016 2015 2014 Revenues (MM USD) 65.6 340 278 Net Profit (MM USD) -3.5 -7 * 42 Net Operating Cash 6 67 3 Flow (MM USD) Earning per share (US -0.91 -2.07 10.02 cents) Cash Costs – CSH 800 $/oz 702 $/
Slide 12: Cost Reduction Measures
COST REDUCTION MEASURES The company has been engaged in the following cost savings measures: v renegotiated with contractors, decreasing procurement cost v rely on progress of science and technology, optimize “five rates” and reduce “five fees” v optimization of mining plan and improvement of hea
Slide 13: Investment Grade Rating
INVESTMENT GRADE RATING China Gold International China National Gold Group’s Ratings by S&P Ratings by S&P v “BBB-“ long-term corporate rating by v “BBB” long-term corporate credit rating Standard Poor’s Rating Services (“S&P”). and a “cnA-” long-term Greater China S&P expects that CGG “will obtai
Slide 14: Superior Financing Capability
SUPERIOR FINANCING CAPABILITY Amount RMB 3.98 Billion ($US 627 Million) November 2015 – RMB 3.98 Billion (US$ Date November 3, 2015 627 MM Loan Facility) 2.83% per annum (at time of issue) Rate of People's Bank of China Lhasa Center Branch’s Interest v Low Cost Financing interest rate LESS 0.07% v
Slide 15: CSH Gold Mine – Overview
CSH GOLD MINE – OVERVIEW One of China’s largest gold mines v Located in Inner Mongolia of China, CSH Mine Resources ~ 210km northwest of the city of Baotou Tonnage Grade Gold Content v Principal product: Gold dore bars with silver as a Resources (mt) (g/t) (Moz) by-product v Well-established basi
Slide 16: CSH Gold Mine – Expansion Completed
CSH GOLD MINE – EXPANSION COMPLETED v H2, 2014 - Expansion finished, commercial production begins. Processing capacity increased from 30,000 tpd to 60,000 tpd v 2015 gold production is 204,471 oz v 2016 gold production is expected to be 219,000 oz Newly completed crushing system CSH gold producti
Slide 17: Jiama Polymetallic Mine – Overview
JIAMA POLYMETALLIC MINE – OVERVIEW One of China’s largest Cu-Au polymetallic mines v Located 68 kilometers northeast of Lhasa, Tibet v Commercial production began in September 2010 v Phase I Operation successfully completed and included: – open-pit and underground mining operation – processing pl
Slide 18: Jiama Polymetallic Mine – Expansion Progress
JIAMA POLYMETALLIC MINE – EXPANSION PROGRESS v Processing capacity will increase from 6,000 tpd to 50,000 tpd when completed v Stage I of the plant started the loaded test run in October 2015. Defects elimination work is now undergoing. v Two source pits ready to provide ore feed v Stage II of t
Slide 19: Jiama Polymetallic Mine – Geology
JIAMA POLYMETALLIC MINE – GEOLOGY Current Reserves and Resources Jiama Resources Grade Contained Metal Ore Cu Mo Au Ag Pb Zn Cu Mo Au Ag Pb Zn Category (mt) (%) (%) (g/t) (g/t) (%) (%) (kt) (kt) (M oz) (M oz) (kt) (kt) Measured 96.8 0.40 0.04 0.10 6.53 0.04 0.02 385.5 35 0.27 17.86 43 23 Indicated 1
Slide 20: Growth Vision: Organic Expansion + M&A
5 YEAR GROWTH VISION: CHINA GOLD INTERNATIONAL: ORGANIC EXPANSION + M&A Accretive Acquisition AU 500,000 oz/year CU 330 MM lbs/year PRODUCER Organic Growth 2012 2013 2014 2015 2016 CSH Expansion construction Producing at Producing at full capacity. Gold Production 30,000 tpd to 60,000 tpd about 80%
Slide 21: Growth Plan – Accretive Acquisition Strategy
GROWTH PLAN – ACCRETIVE ACQUISITION STRATEGY Property Acquisition Criteria Valuation Transaction Structure Accretive to current Significant Stake in shareholders Selective the Project and acquisition strategy Resources/Reserves Target traded at a deep discount to Financed through: internal
Slide 22: Awards
AWARDS “CSR (Corporate Social Responsibility) Model Enterprise” by the Corporate Jiama Social Responsibility Research Center of Chinese Academy of Social Sciences “3 second grade awards and 1 third grade awards for Technology Innovation 2015 Jiama Achievements” by China Gold Association “1 Grand Awa
Slide 23: Social Responsibility, Harmonic Development, Highest HSE Standards
SOCIAL RESPONSIBILITY, HARMONIC DEVELOPMENT, HIGHEST HSE STANDARDS v Jiama and CSH mine spent 120mm and 35mm RMB respectively funding local roads, drinking water systems, irrigation systems, education, helping the poor, landscaping… v Proportion of local staff: 35% Jiama and 13% CSH v 21% of the
Slide 24: Share Information
SHARE INFORMATION TSX: CGG – HKSE: 2099 Capital Structure and Share Info Top 10 Institutional Holders (# shares) (As of May 20, 2016) (As of May 20, 2016) Issued and VAN ECK ASSOCIATES 396.4 million CORP Outstanding 20.42MM DIMENSIONAL FUND 3.71MM Fully Diluted 396.4 million ADVISORS LP Cash US$116
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