Barrick Mining Corporation · TSX:ABX
Barrick Mining — Investor Day (November 2022)
23 slides from Barrick Mining's investor day presentation, November 2022
Slide 1: Finance, Supply Chain & Digital Transformation
Graham FINANCE, SUPPLY CHAIN & Shuttleworth DIGITAL TRANSFORMATION Senior Executive Vice President & CFO NYSE : GOLD TSX : ABX World Class Mines, World Class People Investor Day, November 2022
Slide 2: Cumulative free cash flow from operating mines (2023-2027)
Cumulative free cash flow1 from operating mines (2023-2027) $20 bn. $15 bn. Free Cash Flow1 $10 bn. $5 bn. $0 bn. $1,300/oz $1,400/oz $1,500/oz $1,600/oz $1,700/oz $1,800/oz $1,900/oz $2,000/oz $3.00/lb $3.25/lb $3.50/lb $3.75/lb $4.00/lb $4.25/lb $4.50/lb $4.75/lb Gold and Copper Price Assumption T
Slide 3: Five-year gold outlook ($1,650/oz gold price)
Five-year gold outlook ($1,650/oz gold price) GROUP GOLD Gold Production (Attributable), koz Cost of Sales3, Total Cash Costs4 and Total Gold Capital Expenditures5 (Attributable), $ mln AISC4, $/oz Total production, GEOi Porgera Africa and Middle East LATAM and AP North America Cost of Sales3 Total
Slide 4: Five-year copper outlook ($3.50/lb copper price)
Five-year copper outlook ($3.50/lb copper price) GROUP COPPER Copper Production (Attributable), Mlbs Cost of Sales3, C1 Cash Costs6 and Total Copper Capital Expenditures5 (Attributable), $ mln AISC6, $/lb Jabal Sayid Zaldivar Lumwana Cost of Sales3 C1 Cash Costs6 AISC6 Total Capital5 600 3.50 550 3.
Slide 5: Cost dynamics have changed, driven by higher energy costs
Cost dynamics have changed, driven by higher energy costs Total Cash Costs4 by Category ($/oz) 300 i 2020 2021 2022 250 200 150 100 50 - Labour & Benefits Energy & Fuels Consumables & Spares Contracted Services Royalties Other United States 3% Labour & Benefits 9% 9% Mali Contracted Services 7% 23%
Slide 6: Taking a deeper cost dive – NGM consumables and fuel & energy
Taking a deeper cost dive – NGM consumables and fuel & energy Approximately half of our cost base is represented by consumables (33%) and fuel & energy (16%) At an operational level, we can drill into the components that make up that spend (using NGM as an example below) Diesel makes up the largest
Slide 7: Price trends
Price trends Lower index values signal a slowdown in shipping activity with lower demand driving down freight pricing Freight (measured by the Baltic Dry Index) had a +70% decrease since a peak in 2021 China Containerized Freight showing downward trend in 2022 Brent crude oil peaked in mid-2022 with
Slide 8: Supply chain approach and global impact
Supply chain approach and global impact Barrick Supply Chain is decentralised to the Operations with a centralised Strategic Sourcing Group Focus on collaborative Empower people with Integrated systems Working with supply Integrated logistics Drive ESG initiatives demand planning to supply chain and
Slide 9: Mine operating supplies - Inventory management
Mine operating supplies - Inventory management Maintaining security of supply while optimizing working capital Main drivers contributing to an optimized inventory base Evolution of Inventory ($ millions) Empowered our people to take full responsibility and 1,200 accountability of inventory. This is
Slide 10: Supply chain cost reduction
Supply chain cost reduction Our procurement strategy includes leveraging our buying power to structure long term agreements with our key business partners Supplier collaboration and building key relationships are key not only from a supply and pricing perspective, but also to drive joint efficiencie
Slide 11: Local supplier spend and development
Local supplier spend and development Key Initiatives 2021/2022 Tanzania local content plans approved by the government Establishing local fuel and lube suppliers in the AME and LATAM & AP regions Establishing local construction and mining partners in the AME and LATAM & AP regions Roll-out supplier
Slide 12: Managing GHG in supply chain – Scope 3 emissions
Managing GHG in supply chain – Scope 3 emissions Scope 3 Emissions During 2021, we worked to quantify our emissions produced throughout our value chain We have identified Category One - Goods and Services, as the most material and impactful Scope 3 emissions category to address Our Scope 3 reduction
Slide 13: Simplifying our core business systems
Simplifying our core business systems Before After Financial Reporting Planning ERPi SAP Analytics OneStream Cloud Global and Local Reporting Global Data Platform 3 regional systems 8 applications and 7 local systems SAP single global instances single single global (Finance, SC, Maintenance, C
Slide 14: Switching from foundation to innovation
Switching from foundation to innovation Global Data Platform (GDP) Established New project examples Data analytics projects in AME, NGM/NA & LATAM now More insightful data and analytics combining multiple have a single, modern data platform for their initiatives data sources, benchmark reporting and
Slide 15: Sandvik Remote Monitoring
Sandvik Remote Monitoring Opportunity We have roughly 200 Sandvik assets in operation across the Group Each one has a wealth of sensors with data constantly being generated Currently we do not have the capability to make use of all of that data – one would need to ingest it and then “mine” it using
Slide 16: Business simplicity
Business simplicity We continue to simplify our intercompany equity and loans to provide a transparent ownership structure: Once final government approval is received, we will simplify the legacy structures in Tanzania, eliminating 26 companies. This will also improve efficiency as there will be no
Slide 17: Maintaining our drive to lower G&A costs versus our peer group
Maintaining our drive to lower G&A costs versus our peer group7 2022 Q3 YTD G&A as % of Consolidated Revenue 2022 Q3 YTD G&A as % of Consolidated OCF 2022 Q3 YTD G&A as $ per attributable GEO +139% +133% 36% 50 40 30 3.2% 9.5% 45 20 29 1.3% 4.1% 10 0 Barrick Peer group average Barrick Peer group ave
Slide 18: Recent engagement and developments in fiscal regimes
Recent engagement and developments in fiscal regimes Egypt We are negotiating a new fiscal regime with Republic of Mali the federal government The Barrick mines in to develop the mining Mali operate under the industry in Egypt. Pakistan stability clauses of their We have agreed Mining Conventions, u
Slide 19: Dividends, share buybacks and balance sheet management
Dividends, share buybacks and balance sheet management Performance dividend policy established to enhance returns to shareholders when liquidity is strong8 $1 billion share buyback program established for opportunistic repurchases Combination of share buybacks and dividends paid in 2022 expected to
Slide 20: Barrick
BARRICK
Slide 21: Endnotes
Endnotes 1. Free cash flow” is a non-GAAP financial performance measure which deducts capital expenditures from net cash provided by operating activities. Management believes this to be a useful indicator of our ability to operate without reliance on additional borrowing or usage of existing cash. F
Slide 22: Endnotes
Endnotes 6. “C1 cash costs” per pound and “All-in sustaining costs” per pound are non-GAAP financial performance measures. “C1 cash costs” per pound is based on cost of sales but excludes the impact of depreciation and royalties and production taxes and includes treatment and refinement charges. “Al
Slide 23: Appendix A – Outlook
Appendix A – Outlook 2022 Key assumptions 2023 2024 2025+ Guidance Gold Price ($/oz) 1,700 1,650 1,300 1,300 Copper Price ($/lb) 4.00 3.50 3.00 3.00 Oil Price (WTI) ($/barrel) 65 90 70 70 AUD Exchange Rate (AUD:USD) 0.75 0.75 0.75 0.75 ARS Exchange Rate (USD:ARS) 100.00 120.00 120.00 120.00 CAD Exch