Mmg Ltd. · HKEX:1208
Mmg — Non-Deal Roadshow (May 2024)
49 slides from Mmg's roadshow presentation, May 2024
Slide 1: We mine for progress
We mine for progress i] MINING WITH PRINCIPLES
Slide 2: Disclaimer
Disclaimer The information in this investor presentation (this "Presentation") is prepared by MMG Limited (HKEx stock code: 1208) ("MMG", together with its subsidiaries, the "MMG Group"). The sole purpose of this Presentation is for informational purposes only to provide summary information about th
Slide 3: Overview
Overview New leadership team Strategy and outlook Key asset updates Debt portfolio update
Slide 4: New leadership team
New leadership team
Slide 5: Safety share
Safety share Driving an increased focus on enhancing the planning and execution of tasks SEEE-F1 TRIF2 TRIF MMG 3 4.7 TRIF ICMM 2019 1.86 4.5 4.5 4.3 3.9 2020 1.68 3.4 3.2 2.9 2.9 2.7 2.7 2021 0.99 2.4 2.3 2.1 2.0 1.9 2022 0.94 1.6 1.4 1.3 1.2 1.1 1.0 2023 1.14 2024 Q1 1.11 2013 2014 2015 2016 2017
Slide 6: Meet MMG’s new leadership team
Meet MMG’s new leadership team CEO and Executive Director Appointed EGM Finance EGM – Americas (Retained) Cao Liang appointed as CEO and Executive Executive accountability for finance and Jianxian Wei continues in this role and will Director with effect from 24 April 2024. managing the relationship
Slide 7: Strategy and outlook
Strategy and outlook
Slide 8: Strategic Pathways
Deliver on our strategy Our purpose Our mission Our vision Our ambition Strategy Grow and diversify our We mine to create resource, production We mine for wealth for our people, to create a leading and value, by leveraging host communities international mining company Chinese and international progr
Slide 9: MMG assets base & 2024 guidance
MMG assets base & 2024 guidance Kinsevere (100%) Location: DRC Las Bambas (62.5%) 2024 production guidance: 39,000 - 44,000 tonnes of copper Location: Peru cathode 2024 production guidance (100% basis): 2024 Copper C1 guidance: 280,000 - 320,000 tonnes of copper US$2.80 – US$3.15/lb in copper concen
Slide 10: Business update
Business update Now working alongside Stable operation at Las the community Bambas since companies on March 2023 development activities at Chalcobamba Khoemacau is a high Completion of quality asset with Khoemacau acquisition immediate growth in March 2024 opportunity 2023 operational cash flow Kins
Slide 11: Building a premier diversified copper producer
Building a premier diversified copper producer Proforma portfolio (Proforma) Las Bambas Dugald River 6% Significant Mineral Kinsevere 12% 31% 38% resource base resources by Izok Lake 11% 7.0Mt 22.8Mt Rosebery 15.8Mt added with asset Khoemacau 55% 4% >20 year life (kt CuEq)1 16% 8% 8% 11% Peru Austra
Slide 12: MMG growth opportunities
MMG growth opportunities Well progressed growth opportunities to expand exposure to copper and become a Top 10 listed copper producer Near Term Growth Mid Term Growth Further growth options being studied at all of our existing sites and at our Khoemacau Kinsevere Las Bambas Khoemacau Izok project Ac
Slide 13: Key asset updates
Key asset updates
Slide 14: Las Bambas: restoring stability and building community partnerships
Las Bambas: restoring stability and building community partnerships 1 2 3 4 5 Corazon Program Fuerabamba Stable Concentrate Huancuire Development at Implementation Community Transportation Community Progress Chalcobamba starts New social Collaboration Ensured consistent Five contracts with Working a
Slide 15: Khoemacau: attractive operating and financial metrics
Khoemacau: attractive operating and financial metrics Post-expansion, Khoemacau is expected to generate significant cash flows at a low cost and high margin Key operating and financial metrics (estimates shown either as a range or average) 2024 guidance (from 23 March onwards) Copper head grade rang
Slide 16: Khoemacau: Large-scale, high-grade resource
Khoemacau: Large-scale, high-grade resource Asset Highlights Geologically consistent PFS complete for High-grade Resource One of the largest Newly built, modern along strike, with all ~130ktpa expansion with 2.0% Cu grade at underground copper underground mine with deposits remaining open project, w
Slide 17: Khoemacau: Low capital intensity, brownfield expansion to ~130ktpa
Khoemacau: Low capital intensity, brownfield expansion to ~130ktpa Khoemacau expansion to leverage off existing infrastructure and proven mining and processing methods Khoemacau ramp-up profile by deposit Roadmap to ~130ktpa copper production 9.0 Low Capital • Low capital intensity brownfield expans
Slide 18: Khoemacau: 4,040km2 land holding across Kalahari Copper Belt
Khoemacau: 4,040km2 land holding across Kalahari Copper Belt Expansion potential Current exploration and development pipeline Exploration target Discoveries Resource and PEA2 PFS2 Production Full geological potential not yet Initial drilling has intersected High priority targets to feed unlocked int
Slide 19: Kinsevere Expansion Project
Photo: Sulphide concentrator in construction Kinsevere Expansion Project Sulphide processing system First Production of Cobalt ongoing Hydroxide Q4 2023 Construction on track Expanded production at full Full ramp up expected 2025 capacity of ~80kt of Cu & 4-6kt and mine life extended to of Co, drivi
Slide 20: Capital expenditure outlook
Capital expenditure outlook Capital Expenditure Capital Intensity of Copper Developments1 1,200 US$m Bubble size = Avg. CuEq production = Khoemacau Expansion = KEP 1,000 = Chalcobamba Expansion 800 600 400 200 0 2017 2018 2019 2020 2021 2022 2023 2024e 2024 capital expenditure guidance US$900 M – US
Slide 21: Debt portfolio update
Debt portfolio update
Slide 22: MMG’s commitment to debt reduction
MMG’s commitment to debt reduction MMG total borrowings (US$M)2 and gearing ratio as of 31 Dec 2023 MMG debt repayment schedule1 (US$M) 1,600 MLB 18 Yr Project Facility 8,000 74% 73% Total borrowings 80% CMN Shareholder Loan Gearing ratio 70% 56% DRM $450m 5 Yr Loan 55% 1,200 6,000 60% CDB $1.05bn A
Slide 23: Q&A
Q&A
Slide 24: Appendix
Appendix
Slide 25: Overview
Overview
Slide 26: MMG overview
MMG overview Overview Broker Coverage Broker Name Founded in 2009 Headquarters in Melbourne and Beijing Citi Jack Shang and Jimmy Feng HSBC Howard Lau A diversified metals company BOCI Research Lawrence Lau Four operating mines in Australia, Peru and DRC Goldman Sachs Joy Zhang MMG’s flagship asset
Slide 27: Products for a changing world
Products for a changing world The metals we mine are uniquely positioned with a portfolio of base metals assets that are critical to a low carbon future. Notes: 1. AET: Accelerated Energy Transition 2. Data source: Wood Mackenzie reports and MMG estimates 27
Slide 28: Net zero carbon emissions
Trend toward zero emissions Commitment Commitment to a goal of Net zero carbon emissions net zero carbon emissions by 2050. 2050 Scope 1 and Scope 2 We have set an interim, 2030 target of reducing greenhouse gas (GHG) emissions by 40%, from a 2020 baseline. Scope 3 Further focus on working with our
Slide 29: Las Bambas: Corazon Program Implementation
Las Bambas: Corazon Program Implementation Corazón Program Engagement Social Management Build Leadership Financial Approval Model Governance processes Capacities Social Challenges Processes and Alternatives of Social Investment Land Purchase and Logistics Transport Shared Value Model Agreements Mode
Slide 30: Further asset information
Further asset information
Slide 31: Historical production performance
Historical production performance Las Bambas – Copper in Copper Concentrate (kt) Dugald River – Zinc in Zinc Concentrate (kt) 190 178 180 173 175 454 170 320 152 385 383 147 330 311 290 302 280 255 2016 2017 2018 2019 2020 2021 2022 2023 2024 2018 2019 2020 2021 2022 2023 2024 Guidance Guidance Kins
Slide 32: Las Bambas
Las Bambas 2023 Copper Production One of the world’s largest copper mines with near term ↑19% organic growth optionality Year Ended 31 Dec Quarter Ended 31 Mar Record high annual mill 2023 2022 2024 2023 throughput Production metrics Ore mined kt 46,429 43,179 9,436 7,072 Ore milled kt 52,872 44,043
Slide 33: Kinsevere
Kinsevere Q1 2024 Copper Production Growing to be a ~100kt Copper Equivalent mine once ↓6% vs Q1 2023 expansion project fully ramped up Year Ended 31 Dec Quarter Ended 31 Mar Reducing reliance on 2023 2022 2024 2023 lower margin third- party ore in H2 Production metrics Ore mined kt 1,726 3,100 505
Slide 34: Dugald River
Dugald River Q1 2024 Zinc Production A world top 10 producing Zn mine with a >20yr mine life ↑ 114% vs Q1 2023 Year Ended 31 Dec Quarter Ended 31 Mar Q1 2023 operation 2023 2022 2024 2023 suspended 34 Days Production metrics Ore mined kt 1,651 1,873 458 226 Safe return to Ore milled kt 1,660 1,844 5
Slide 35: Rosebery
Rosebery Q1 2024 Zinc Production Rosebery continues to deliver after almost 90 years of ↑ 49% vs Q1 2023 operations Year Ended 31 Dec Quarter Ended 31 Mar Q1 2024 and Q4 2023 2023 2022 2024 2023 zinc recovery ↑ highest since 2017 Production metrics Ore mined kt 922 886 249 201 2023 Operating Ore mil
Slide 36: Khoemacau: exceptionally good strategic fit
Khoemacau: exceptionally good strategic fit C1 cost post-expansion1 Near-term expansion2 to US$1.55/lb ~130 ktpa Cu High-grade mine with attractive financial Delivered through increased processing metrics, bottom half of cost curve capacity and additional mining fronts Low-capital intensity3 Long-li
Slide 37: Financial update
Financial update
Slide 38: Financial performance
Financial performance Summary Income Statement 2023 2023 YEAR ENDED 31 DECEMBER (US$ M) vs. 2022 Revenue 4,346.5 34% EBITDA 1,461.9 (5%) Profit for the year 122.1 (50%) EBITDA margin 34% Net cash generated 1,849.9 122% from operating activities Basic earnings per share US 0.10 cents 38
Slide 39: EBITDA waterfall
EBITDA waterfall Notes: 1. Other variance includes FX, corporate costs, exploration costs, etc. 2. Operating Expenses including operating costs and stock movements. 3. Price variances include mark-to-market adjustments on open sales contracts and the impacts of commodity hedging. 39
Slide 40: NPAT waterfall
NPAT waterfall Notes: 1. Price variances include mark-to-market adjustments on open sales contracts and the impacts of commodity hedging. 40
Slide 41: Financial dashboard
Financial dashboard Revenue by Commodity Revenue by Customer Discharge Port EBITDA by Operating Segment (US$M) Operating Expenses (by Nature) 11% People Las Bambas 1396.7 28% 13% Energy Kinsevere (32.0) Consumables Dugald River 33.8 Royalities Rosebery 77.8 Selling Expenses Other (14.4) 18% External
Slide 42: Profit to MMG equity holders
Profit to MMG equity holders 2023 NPAT attributable to equity holders (US$M) 2023 2022 vs. Las Bambas NPAT up by 59%: 2022 More copper and molybdenum sales with stable logistics from March 2023 Profit after tax - Las Bambas 62.5% interest 188.6 118.4 59% Profit/(loss) after tax – Other continuing op
Slide 43: Profit & loss statement
Profit & loss statement YEAR ENDED 31 DECEMBER 2023 US$ M 2022 US$ M Change % Fav/(Unfav) Revenue 4,346.5 3,254.2 34% Operating expenses (2,814.1) (1,682.6) (67%) Exploration expenses (49.6) (30.8) (61%) Administration expenses (12.9) (16.0) 19% Net other (expense)/income (8.0) 10.6 (175%) EBITDA 1,
Slide 44: Balance sheet
Balance sheet US$ M AS AT 31 December 2023 US$ M AS AT 31 December 2022 US$ M Non-current assets 10,505.7 10,875.6 Current assets 1,395.1 1,659.9 Total assets 11,900.8 12,535.5 Total equity 4,312.0 4,228.5 Non-current liabilities – other 2,011.8 2,142.1 Non-current liabilities – borrowings 3,075.8 4
Slide 45: Statement of cash flow
Statement of cash flow YEAR ENDED 31 DECEMBER 2023 US$ M 2022 US$ M Receipts from customers 4,605.3 3,402.1 Payments to suppliers and employees (2,621.8) (2,319.9) Payments for exploration expenditure (4) (30.8) Income tax paid (79.1) (268.0) Net settlement of commodity hedges (4.9) 48.7 Net cash ge
Slide 46: Resources and reserves
Resources and reserves
Slide 47: Mineral resources
Mineral resources Copper and Zinc Mineral Resources of 9.7Mt and 10.5Mt Respectively Mineral Resources Contained Metal (100% Asset Basis) as at 30 June 2023 Project Copper (kt) Zinc (kt) Lead (kt) Silver (moz) Gold (moz) Molybdenum (kt) Cobalt (kt) Las Bambas 7,600 120 2 200 Kinsevere 1,100 36 Dugal
Slide 48: Ore reserves
Ore reserves Copper and Zinc Ore Reserves of 5.7Mt and 2.5Mt Respectively Ore Reserves Contained Metal (100% Asset Basis) as at 30 June 2023 Project Copper (kt) Zinc (kt) Lead (kt) Silver (moz) Gold (moz) Molybdenum (kt) Cobalt (kt) Las Bambas 4,900 76 1.0 130 Kinsevere 741 20 Dugald River 2,200 340
Slide 49: Thank you
Thank you