Igo Limited · ASX:IGO
Igo — Independence Group NL — Macquarie Australia Conference 2018
43 slides from Igo's conference presentation, May 2, 2018
Slide 1: Macquarie Australia Conference 2018
INDEPENDENCE GROUP NL For personal use only Macquarie Australia Conference 2018 Peter Bradford, CEO & Managing Director ASX:IGO / ADR:IIDY 3 May 2018
Slide 2: Cautionary statements & disclaimer
Cautionary statements & disclaimer For personal use only • This presentation has been prepared by Independence Group NL (“IGO”) (ABN 46 092 786 304). It should not be considered as an offer or invitation to subscribe for or purchase any securities in IGO or as an inducement to make an offer or invit
Slide 3: Presentation Focus
Presentation Focus • Corporate overview For personal use only • Committed to people, ESG and exploration • Solid 3Q18 result • Tropicana • Nova • Nova and Fraser Range Exploration • EV mega trend • Jaguar, Long and Lake Mackay 3
Slide 4: Robust balance sheet as focus shifts from construction to delivery and discovery
Robust balance sheet as focus shifts from For personal use only Share Ownership construction to delivery Substantial Holders(1) Institutional Ownership(3) Mark Creasy 16% Australia 66% and discovery FIL 9% USA 21% T Rowe Price 8% UK & Europe 10% CBA 6% ROW 3% ASX IGO Ausbil 5% Base Perth, WA Share P
Slide 5: A Focus on Projects that Create a Solid Foundation
A Focus on Projects that Create a Solid Foundation For personal use only IGO EBITDA Profile (A$M)(1) 600 500 400 300 200 100 - FY12 FY13 FY14 FY15 FY16 FY17 FY18e FY19e FY20e Long (A$M) Jaguar (A$M) Tropicana (A$M) Nova (A$M) 1) Macquarie Research – 31 Jan 2018 5
Slide 6: Embedded ESG performance & reporting in the business
Embedded ESG Key Lag Safety Metrics(1,2,3) For personal use only performance & reporting 9.0 8.0 in the business 7.0 LTIFR 12 MMA MTIFR 12 MMA 6.0 5.0 ACSI Rating of ASX200 Sustainability Reporting(5) 4.0 3.0 Leading 2.0 1.0 Detailed - Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 S
Slide 7: Right people in the right place at the right time
For personal use only Right people in the right place at the right time • Shaping the right culture • Nurturing the IGO Way • Developing the next generation of industry leaders 7
Slide 8: A$50M Commitment to Discovery in FY18
A$50M Commitment to For personal use only Discovery in FY18 Fraser Range A$10M Nova A$1.5M A$21M Tropicana A$4M Jaguar A$4.5M A$9M Long Other Greenfields 8
Slide 9: 3Q18 Highlights
3Q18 Highlights Strong free cash flow significantly reduces net debt to A$73M For personal use only • Nova delivers nameplate 1.5Mtpa mining rate for 3Q18 and an increase in nickel grade to 1.85% ─ Production from three stopes at Bollinger • Tropicana and Long metal production in line with expectati
Slide 10: Strengthening Financial Results
Strengthening Financial Results EBITDA up 14%, strong free cash flow of A$57M and net debt reduced to A$73M For personal use only Units 2Q18 3Q18 YTD QoQ Revenue and Other Income A$M 207.3 182.7 537.5 (12%) Underlying EBITDA(1) A$M 64.5 73.7 207.1 14% Profit (Loss) After Tax A$M (1.5) 9.2 12.4 n.a N
Slide 11: 3Q18 Cash Flow Reconciliation
3Q18 Cash Flow Reconciliation Total free cash flow from Operations was A$71M For personal use only A$M 140 120 1 5 9 3 16 0 3 100 29 80 52 6 2 60 40 70 51 20 - Cash at 31 Nova FCF Tropicana Jaguar FCF Long FCF Exploration & Corporate & Proceeds Payments for Debt Dividends Net Finance/ Cash at 31 Dec
Slide 12: Tropicana Gold Mine
For personal use only Tropicana Gold Mine 12 12
Slide 13: Tropicana
Tropicana • 330km NE of Kalgoorlie For personal use only • 465,000oz gold production (100%) at $1,115/oz AISC(1) • 10 year mine life remaining • Upside potential Tropicana Production (100%) & AISC koz A$/oz 160 1,400 1,286 140 1,167 1,200 1,093 120 939 1,000 100 800 80 600 60 400 40 20 200 - - 4Q17
Slide 14: Tropicana value drivers
Tropicana value drivers For personal use only Directional Production and AISC(1) • Grade streaming drives FY18 to koz A$/oz 800 1,500 1,162 FY20 gold production and costs 700 1,000 • Long Island underpins mine life 600 max 500 max • Additional ball mill delivers lift 500 max min - in scale and gold
Slide 15: Tropicana – 5km strike of mineralisation
Tropicana – 5km strike of mineralisation For personal use only 1) Refer to ASX release dated 7 Dec 2017: Tropicana JV Commits to Long Island and Increased Milling Capacity 15
Slide 16: Boston Shaker Underground Drilling
Boston Shaker Underground Drilling (1) For personal use only Reserve extension opportunities • Boston Shaker underground study during CY18 • Future underground assessment at Havana and Havana South • Regional exploration along 160km of strike on 3,660km2 1) Refer to ASX release dated 7 Dec 2017: Tro
Slide 17: Nova
For personal use only Nova 17
Slide 18: Nova
Nova • Delivers scale, low cost, long For personal use only mine life and exploration upside • Commercial production since 1 July 2017 ─ Five years from discovery Nova Production (tonnes) 7,000 5,961 6,000 5,000 4,500 4,454 4,000 3,000 2,477 2,472 1,832 2,011 2,000 1,329 1,000 - 4Q17 1Q18 2Q18 3Q18
Slide 19: Successful first three quarters of commercial production
Successful first three quarters of commercial For personal use only production • Achieved nameplate capacity of 1.5Mtpa • Transitioned to smaller number of larger stopes at Nova and Bollinger • Metallurgical recoveries performing in line with or better than design recoveries • Nickel grade consisten
Slide 20: Resource model being de-risked with grade control drilling
For personal use only Red traces = Remaining Diamond drilling Resource model being de-risked with grade control drilling at Nova and 20,000 Nova/Bollinger diamond drilling progress Bollinger to be 18,000 16,000 completed by end- FY18 14,000 Bollinger: Metres drilled (m) 12,000 Indicated to Measured
Slide 21: Nova near mine exploration search space is wide open
Nova near mine exploration search space is wide open with focus to date on Nova/Bollinger resource envelope For personal use only 21
Slide 22: Understanding the potential extensions of the Nova intrusive
Understanding the For personal use only potential extensions of the Nova intrusive • 58km2 3D seismic survey over mining lease completed • Drilling 3D seismic targets in FY19 • Continued drilling of extension to intrusive to the NW of Nova Goal is to expand Nova! 22
Slide 23: Why explore the Fraser Range?
September 2015 Why explore the Fraser Range? For personal use only • Multiple magmatic intrusions • Ni/Cu anomalism reported by multiple explorers along belt • Disseminated and blebby sulphides Empirical evidence demonstrates belt is fertile 1) Classic Minerals ASX Releases: 29 Aug 2013, 12 Dec 2013
Slide 24: Systematic exploration over 14,300km2 of consolidated tenure
February 2018 March 2018 For personal use only Systematic exploration over 14,300km2 of consolidated tenure • Multiple EM platforms • Bedrock geochem using Aircore • Gravity survey & mapping • Follow up RC/DDH Goal is to discover the next Nova! 24
Slide 25: LME Nickel Versus Nickel Sulphate
LME Nickel Versus Nickel Sulphate (US$/t)(1,2) US$/t Downstream processing For personal use only 20,000 potential 18,000 • Produce nickel and cobalt 16,000 NiSO4 Price sulphates for EV batteries Premium 14,000 • Metallurgical testwork commenced in 3Q18 12,000 • Targeting PFS completion 10,000 around
Slide 26: Evolving EV battery chemistry
Evolving EV battery For personal use only chemistry designed to • Improve battery performance • Reduce overall cost • Cathode component ~18% of battery cost(1) • Enhance EV penetration 1) Source data: Citi EV’s putting the pedal to the metal 31 October 2017 26
Slide 27: Nickel to be a big winner from EV demand
For personal use only Nickel Mine Supply by Product (kt)(1) Nickel to be a big winner Ni ktpa 2018E supply Ni ktpa from EV demand 3,500 deficit of 3,500 3,000 167kt(2) 3,000 disruption 2,500 2,500 2,000 2,000 • Market in deficit in 2016 & 2017 1,500 1,000 1,500 1,000 • Synchronous growth in USA, 500
Slide 28: Jaguar, Long & Lake Mackay
For personal use only Jaguar, Long & Lake Mackay 28
Slide 29: Jaguar
Jaguar • Improving performance For personal use only • Depth extensions at Bentley • New deposit at Triumph • Regional exploration Jaguar Production (tonnes) 9,000 8,105 8,000 7,399 6,885 7,000 6,000 4,935 5,000 4,000 3,000 2,000 1,121 1,000 530 591 244 - 4Q17 1Q18 2Q18 3Q18 Zinc in concentrate Copp
Slide 30: Jaguar – Bentayga intercepts
Jaguar Promising intercepts at Bentayga substantially increase the size of the modelled lens For personal use only 3,370m of underground drilling returned significant intercepts(1) • 4.10m @ 8.81% Zn, 6.34% Cu, 1.40g/t Au and 492g/t Ag • 4.15m @ 8.85% Zn, 3.92% Cu, 0.96g/t Au and 199g/t Ag • 2.12m @
Slide 31: Long
Long For personal use only • Solid and consistent performer • Greenfields exploration continuing • Care and maintenance planning • Final mining 31 May 2018 Long Life of Mine Production & Grade Ni t Ni% Metal (Ni t) Grade (Ni%) 16,000 5.00% 14,000 4.50% 4.00% 12,000 3.50% 10,000 3.00% 8,000 2.50% 6,0
Slide 32: Lake Mackay exploration
For personal use only Lake Mackay exploration • 12,900km2 belt scale greenfields project • Soil sampling completed with pervasive gold and base metal anomalism(1) • Diamond drilling at Grapple(2) • Multiple narrow sulphide intervals in all holes 1) Refer to ASX release date 13 Feb 2018: Lake Mackay
Slide 33: Concluding Comments
Concluding Comments For personal use only • Strong 3Q18 with A$57M free cash flow and net debt reduced to A$73M • Nova continues to deliver nameplate 1.5Mtpa throughput • Transitioned to bigger stopes at Nova and Bollinger • Tropicana and Long within guidance • Focused on delivery and discovery 33
Slide 34: Appendix
For personal use only Appendix 34
Slide 35: Tropicana
Tropicana JV – IGO 30% with AngloGold Ashanti 70% For personal use only Overview 7.8Mtpa open pit and processing plant Resource(1) 7.5Moz (100%) 2.2Moz (30%) Reserve(1) 4.1Moz (100%) 1.2Moz (30%) Production Guidance (100%) (30%) FY18 440 – 490koz 132 – 147koz Operating cost Guidance Cash cost AISC F
Slide 36: Tropicana
Tropicana Tropicana pours its two millionth ounce of gold in January 2018 For personal use only Metric Units 2Q18 3Q18 YTD Guidance(2) koz Tropicana Production (100%) and AISC A$/oz 160 1,400 Gold produced (100%) koz 135.2 103.6 352.9 330 – 368 1,286 140 1,167 1,200 Gold Sold (IGO 30%) koz 41.4 31.1
Slide 37: Nova
Nova Low cost Ni – Cu – Co mine For personal use only 1.5Mtpa underground mine and Overview processing plant Resource(1) 271,000t Ni, 113,000t Cu, 9,000t Co Reserve(1) 274,000t Ni, 110,000t Cu, 9,000t Co Production Guidance FY18 23,000 – 27,000t Ni (contained metal in 10,000 – 12,000t Cu concentrate
Slide 38: Nova
Nova Mining for 3Q18 was in line with the 1.5Mtpa nameplate production rate For personal use only Tonnes Metric Units 2Q18 3Q18 YTD Guidance(1) Nova Production 7,000 Nickel in concentrate t 4,454 5,961 14,914 17,250 – 20,250 6,000 5,961 Copper in concentrate t 2,011 2,472 6,315 7,500 – 9,000 5,000 4
Slide 39: Jaguar
Jaguar 100% owned underground Cu – Zn VMS For personal use only Overview High grade Underground Cu – Zn VMS Resource(1) 55kt Cu, 364kt Zn & 18Moz Ag, 90koz Au Reserve(1) 16kt Cu, 161kt Zn, 8Moz Ag, 36koz Au Production Guidance FY18 29,000 – 33,000t Zn (contained metal in 2,600 – 3,000t Cu concentrat
Slide 40: Jaguar
Jaguar A challenging 3Q18 but expect to achieve end of year zinc metal production guidance For personal use only Metric Units 2Q18 3Q18 YTD Guidance(1) Tonnes Jaguar Production 9,000 Zinc in concentrate t 6,885 4,935 19,925 21,750 – 24,750 8,105 8,000 7,399 6,885 Copper in concentrate t 591 244 1,36
Slide 41: Long
Long 100% owned high-margin underground nickel mine For personal use only Average grade project to date of 3.8% Ni Overview Consistent low cost producer Resource(1) Mining to cease 31 May 2018 Reserve(1) Production Guidance FY18 (contained metal in 5,400 – 6,000t Ni concentrate) Operating cost Guida
Slide 42: Long
Long Long production guidance met YTD For personal use only Metric Units 2Q18 3Q18 YTD Guidance(1) Tonnes Long Production 2,500 Contained nickel produced t 1,374 1,381 4,327 4,050 – 4,500 2,069 2,000 Cash cost (payable) A$/lb Ni 5.47 5.13 5.11 4.40 – 4.90 1,572 1,374 1,381 Sustaining capex A$M 0.1 0
Slide 43: For personal use only
a el a “FOLLOW US ~ UAS WE GO FROM STRENGTH TO STRENGTH igo.com.au
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