Kenmare Resources Plc · LSE:KMR
Kenmare Resources — TP ICAP Midcap Conference, Paris 2023
33 slides from Kenmare Resources's conference presentation, May 2023
Slide 1: TP ICAP Midcap Conference, Paris
RESPONSIBLY MEETING GLOBAL DEMAND FOR QUALITY-OF-LIFE MINERALS TP ICAP Midcap Conference, Paris May 2023
Slide 2: Disclaimer
Disclaimer This Presentation (the “Presentation”) has been This Presentation does not constitute or form part statements in this Presentation relating to future prepared and issued by Kenmare Resources plc of, and should not be construed as, an offer, financials, results, plans and expectations (the
Slide 3: Moma is a Tier 1 mine
Moma is a Tier 1 mine 60% EBITDA margin generated in 2022 Mineral sands are essential to modern life Used in the production of paints, paper, inks and plastics Imparts brightness and opacity to products Historical demand has shown a strong correlation with World GDP Long-life, lost cost produc
Slide 4: A globally significant titanium minerals mine
A globally significant titanium minerals mine Operating schematic Low cost, bulk mining operation Low environmental impact Mature operation – in production since 2007 Primarily hydro-generated electricity (>90% of electrical Three Wet Concentrator Plants (WCPs) in operation requirements and 50
Slide 5: Significant resources provides optionality
Significant resources provides optionality Kenmare’s concessions cover three mineralised areas in north eastern Mozambique Kenmare Resources – TP ICAP Midcap Conference, Paris (May 2023) 5
Slide 6: Mineral sands: essential to modern life
Mineral sands: essential to modern life Demand for Kenmare’s products is driven by global GDP growth and urbanisation in emerging markets Titanium feedstocks (ilmenite and rutile) TiO2 pigment imparts whiteness and opacity in the manufacture World GDP vs TiO2 pigment consumption1 of paints, plasti
Slide 7: 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, 2021 confirmed by TZMI • >100 years of Miner
Slide 8: 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 9: Dividend policy revised to provide stability
Dividend policy revised to provide stability Evolving the policy to target a 20-40% profit after tax payout range Revised dividend policy Based on current plans and forecasts, Kenmare expects that dividends should be sustainable at or around the current absolute level for the medium term Full year
Slide 10: Operational review
Operational review Higino Jamisse, General Manager
Slide 11: 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 12: 11.8 million hours LTI free record achieved
11.8 million hours LTI free record achieved Striving to improve Health and Safety outcomes Redoubling efforts on workforce safety Safety performance 19 months and 11.8 million hours worked without a Lost Time Injury from 2021 to 2022 8 0.3 0.27 Improved performance related to hazard identificati
Slide 13: 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 14: 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 15: 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 16: Transition to Nataka
Transition to Nataka Mining at WCP A
Slide 17: Strategy for Nataka developed and tested
Strategy for Nataka developed and tested Nataka Pre-feasibility Study completed 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; higher slimes
Slide 18: Phased capital expenditure profile
Phased capital expenditure profile Early implementation mitigates pre-Nataka slimes challenges Capex $247m over three years 2023-2025, and a tail of c. $23m Capital breakdown & implementation dates over 2026/27 Strongly equipment focused for optimal Nataka production Contingency, $37m Nataka C
Slide 19: Upgraded equipment maintains low costs
Upgraded equipment maintains low costs 1st quartile industry position maintained Cash operating costs per tonne1 Operating cost composition $200/t 100% $150/t 80% $100/t 60% $50/t 40% $0/t 20% 2022 2024 2026 2028 2030 2032 2034 2036 2038 2040 2042 2044 2046 2048 2050 0% 2023 2027 Unit operating co
Slide 20: WCP B upgrade to 3,400tph
WCP B upgrade to 3,400tph Closes ilmenite gap and brings long term HMC delivery at 1.2Mt ilmenite per annum equivalent 1,000tph additional capacity optimal expansion size WCP B spirals plant to be upgraded by 1,000tph Mining Moving to a dual dredge operation Utilises original WCP A dredge Proces
Slide 21: Resilient delivery of 1.2Mt pa ilmenite equivalent
Resilient delivery of 1.2Mt pa ilmenite equivalent Mining eliminated as a bottleneck 2,500kt 2,000kt 1,500kt 1,000kt 500kt 0kt 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 Total HMC - Production HMC E
Slide 22: Market update
Market update Titanium feedstocks
Slide 23: 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) 400 500 283 400 236 239 257 300 223 300 269 274 200 200 100 100 - - H1 2018 H2 2018 H1 2019 H2 2019 H1 2020 H2 2020 H1 2021 H2 2021 H1 2022 H2 2022 Shipment Volumes
Slide 24: 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 25: 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 26: Outlook
Outlook Mining at WCP A
Slide 27: 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 28: Moving forward with confidence
Moving forward with confidence Investing in future production to maintain first quartile industry position Resilient long-term production profile Maintaining first quartile industry position WCP A capabilities will be transformed with new Dredge and hydromining combination in Nataka is the desli
Slide 29: Appendices
Appendices Rosalina Moma, owner of a KMAD-supported vegetable business
Slide 30: 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 31: 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 32: Follow Kenmare on social media
Follow Kenmare on social media Facebook, Twitter and LinkedIn Kenmare has profiles on Facebook, Twitter and LinkedIn, which feature regular updates on our corporate social responsibility initiatives, operational and development milestones, news flow and more Click the name of the social network
Slide 33: Contact Us
Contact Us Jeremy Dibb / Michael Starke +353 1 671 0411 ir@kenmareresources.com Jetty at sunset Follow Us
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