Grange Resources Limited · ASX:GRR
Grange Resources — Shareholder Meeting (May 2018)
30 slides from Grange Resources's shareholder meeting presentation, May 30, 2018
Slide 1: Australia's most experienced magnetite producer
Australia’s most experienced magnetite producer AGM Presentation May 2018
Slide 2: Company Highlights
Company Highlights ✓ Most EXPERIENCED magnetite producer Over 50 years of operational experience at Savage River ✓ STRONG Safety Culture Achieved over 1 year LTI free after the end of March 2018 ✓ Shipped ~1.9m tonnes of Iron Ore Products 1.9 million tonnes of pellets and chips sold through the port
Slide 3: Iron units in = Iron units out
Iron units in = Iron units out Blast Furnace May 2018 Slide 3
Slide 4: Iron Ore Quality
Iron Ore Higher Developing Iron Ore Pellet Fluxed Pellet ~65% Fe Magnetite Concentrate ~65%-67% Fe QUALITY Direct Shipping Lump ~63% Fe Direct Shipping Fines Lower ~57% - ~ 61% Fe Lower Price Higher May 2018 Slide 4
Slide 5: Magnetite
Magnetite Magnetite is a naturally occurring mineral, commonly refined into an iron ore concentrate and used for steel production. Smelting magnetite to iron involves agglomeration or ‘clumping together’ of the magnetite concentrate, and thermal treatment to produce spherical shaped balls – pellets.
Slide 6: The Benefit of Pellets
The Benefit of Pellets Pellets are often preferred over iron ore fines, sinter and lump due to their favourable physical and chemical properties supporting increased Blast Furnace productivity and efficiency. Pellets are an enriched form of iron ore and provide significant benefits for the steel mak
Slide 7: Pellet Premium
Pellet Premium Pellet Premium Received (FOB USD) 120 120 100 100 80 80 USD 60 60 40 40 20 20 62% Index FOB Calculated Price Grange Price 65% Index FOB Calculated Price 0 0 Jan-2017 Feb-2017 Mar-2017 Apr-2017 May-2017 Jun-2017 Jul-2017 Aug-2017 Sep-2017 Oct-2017 Nov-2017 Dec-2017 May 2018 Slide 7
Slide 8: Company Overview
Company Overview May 2018 Slide 8
Slide 9: Grange Strategy
Grange Strategy Stronger Iron Ore Business Seek Strategic Partner(s) for Optimise Capital Southdown Project Allocation Plan Focus on Tasmania Operations • Improve productivity Further progress sales process Generate, conserve and actively • Sustain access to high grade with our JV partners and advis
Slide 10: Company Assets
Company Assets Australia’s Most Experienced Magnetite Producer Savage River (100%) Southdown Project (70%) Focusing on the Searching for an fundamentals equity partner Quality assets in Tasmania and Western Australia. May 2018 Slide 10
Slide 11: Company Snapshot
Company Snapshot Capital Structure (A$) Share Price and Volume Ordinary Shares on issue 31 Mar 2018 1,157m Share Price 31 Mar 2018 $0.17 Market Capitalization 31 Mar 2018 $197m Cash and Term Deposits 31 Mar 2018 $185m Loan 31 Mar 2018 $3m Ownership Structure as at 31 Mar 2018 Jiangsu Shagang 43% Pac
Slide 12: Tasmanian Operations Performance & Focus
Tasmanian Operations Performance & Focus May 2018 Slide 12
Slide 13: Dec 2017 Financial Position - Consolidated
Dec 2017 Financial Position - Consolidated 2017 2016 Difference Indicator Variance% Comments AUD’000 AUD’000 AUD’000 ↑ Cash, ↓ Shipping receivables, Current Assets 261,339 232,806 28,533 12% ↑ Inventories ↑ PP&E ↑ Mine Properties & Dev Non-current Assets 228,622 196,150 32,472 17% ↓ Deferred Tax Ass
Slide 14: 2017 Performance – Indicators
2017 Performance – Indicators Variance Indicator Unit 2017 Actual 2016 Actual Difference Comments % ↓ Mining delays with restricted access to Concentrate Tonnes ‘000 1,960 2,397 (437) (18%) ore has impacted full year production. ↓ Pellet production line balanced with Pellet Tonnes ‘000 1,895 2,378 (
Slide 15: 2018 Quarter 1 Performance – Indicators
2018 Quarter 1 Performance – Indicators Q1 2018 Q4 2017 Indicator Unit Difference Variance% Comments Actual Actual Tonnes ↓ Q4 2017 record daily and weekly Concentrate 647 696 (49) (7%) production rates achieved ‘000 Tonnes ↓ Pellet production line balanced with Pellet 623 674 (51) (8%) concentrate
Slide 16: Highlights for 2017 — Tasmania
Highlights for 2017 — Tasmania ✓ Restored ore production from Main Ore Zone Mining resumed on the east wall with redesigns post the incident in March. While we continue to remediate upper parts of the east wall, delivery from the main ore zone is progressing well. ✓ Second Autogenous Mill Shell repl
Slide 17: LOM Strategies — Leveraging Resources
LOM Strategies — Leveraging Resources North Pit South Deposit ▪ High quality, long life resources ▪ ~18MT @ 41%DTR ▪ ~125MT @ 58%DTR ▪ Supporting LOM tailings infrastructure ▪ Supporting long life operations construction Centre Pit Long Plains ▪ Modelling in progress to further develop ore ▪ Develop
Slide 18: North Pit Development
North Pit Development North Pit Mine Development ▪ West wall cut-back continues North Pit East Wall Remediation ▪ Supporting continued ore production Ore Supply ▪ Main Ore Zone production May 2018 Slide 18
Slide 19: LOM Strategies— Optimising Mining Operations
LOM Strategies— Optimising Mining Operations North Pit Underground ▪ Exploration program in progress to define ore at depth ▪ Studies proceeding for potential block caving North Pit Mine Development ▪ West wall cut-back continues Centre Pit ▪ Exploration program in progress ▪ Feasibility study focus
Slide 20: Southdown Project Achievements & Strategies
Southdown Project Achievements & Strategies May 2018 Slide 20
Slide 21: 2017 Project Overview – Southdown
2017 Project Overview – Southdown ✓ The Project continues on reduced expenditure while Grange seeks an equity partner for a strategic share in the Project ✓ Existing tenure and approvals have been maintained . ✓ Project security has been enhanced by continuing to build land tenure and access, includ
Slide 22: Southdown Project Strategies 2018
Southdown Project Strategies 2018 The on-going strategy is to maintain the currency and good standing of all tenements, permits and project assets, and to: ▪ Formulate valid alternate development models and seek to secure equity ▪ Continue to monitor all ongoing project requirements to ensure that t
Slide 23: Grange ROC Property
Grange ROC Property Joint Venture Established May 2018 Slide 23
Slide 24: Grange ROC Property – Joint Venture with ROC Built
Grange ROC Property ▪ Joint Venture with ROC Built ▪ Grange ROC Property (GRP) established in early 2018 ▪ Part of strategy to provide diversify risk and return on capital ▪ Ownership 51% Grange Resources; 49% ROC Built ▪ Investment in smaller scale, high-end residential property development in Melb
Slide 25: Grange ROC Property Projects
Grange ROC Property ▪ Project 1 – Lumley Court, Prahran ▪ Development site purchased and settled March 2018. ▪ Plans for development of 5 large luxury apartments. ▪ Expected completion end of 2019. ▪ Project 2 – Brookville Road, Toorak ▪ Agreed terms to acquire site, currently 3 houses for $9.3m. Se
Slide 26: Grange — LOM Strategies Recapped
Grange — LOM Strategies Recapped ▪ Improve productivity and sustain access to high grade ore ▪ Provide high quality ore from North Pit ▪ Continue investment in mine development - progress next phase of North Pit development on the west wall ▪ Continue to invest in process infrastructure ▪ Completed
Slide 27: Focusing on the fundamentals
Focusing on the fundamentals ▪ Our fundamentals remain firm ▪ Experienced magnetite producer with a long life project close to the Asian market ▪ Producer of a high quality iron ore product (65%+ Fe) that receives a premium price ▪ Strong balance sheet ▪ Stable work force with minimal turnover ▪ Our
Slide 28: Ongoing Strategies
Ongoing Strategies We continue to: ▪ Develop and optimise LOM ▪ Develop Long Plain resources and project ▪ Seek feasible investments within the strategy undertaken by the Board ▪ Optimise capital allocation plan ▪ Diversify the sales markets outside of China ▪ Improve communications/relations with a
Slide 29: Primary Contact
Primary Contact Primary Contact: Honglin Zhao Managing Director +61 3 6430 0222 ManagingDirector@grangeresources.com.au Notes: - A lower cut-off grade of 15% DTR was used in the calculation of both the Mineral Resources and Ore Reserves - For details of Resources and Reserves, refer ASX announcement
Slide 30: Disclaimer
Disclaimer The material in this presentation (“material”) is not and does not constitute an offer, invitation or recommendation to subscribe for, or purchase, any security in Grange Resources Limited (“GRR”) nor does it form the basis of any contract or commitment. GRR makes no representation or war