Endeavour Silver Corp. · TSX:EDR
Endeavour Silver — Investor Presentation (November 2011)
36 slides from Endeavour Silver's investor presentation, November 2011
Slide 1: Rising Sales, Falling Costs: Corporate Presentation November 2011
RISING SALES, FALLING COSTS = RECORD CASH-FLOWS, RECORD EARNINGS Corporate Presentation-November1 2011
Slide 2: Cautionary Note: Forward Looking Statements
Cautionary Note: Forward Looking Statements This presentation contains “forward-looking statements” within the meaning of the United States private securities litigation reform act of 1995 and “forward-looking information” within the meaning of applicable Canadian securities legislation. Such forwar
Slide 3: Why Silver?
Why Silver? • Silver is an Industrial Metal- unlike gold, Photography 2001 silver is consumed 2010 & the number of industrial uses is Coins & Silverware multiplying • Silver is a Precious Metal- like gold, Jewelry silver was historically used as money & its role as Implied Net Investment hedge again
Slide 4: Silver vs. Gold: The Current Cycle
Silver vs. Gold: The Current Cycle Silver typically lags gold, then plays catch-up, resulting in highly leveraged investment opportunities. Silver: gold ratio 50:1 4
Slide 5: Introduction
Introduction • One of North America’s fastest growing silver mining Endeavour Silver Corp: companies • Two high grade silver-gold operations in Mexico; Producing Assets: Guanacevi Mines in Durango, Guanajuato Mines in Guanajuato • Cash-flow and earnings growth amongst the best in Growing Margins: th
Slide 6: Investor Highlights
Investor Highlights Proven Track Compelling Additional Acquisition Record: Organic Growth: Growth: 842% production 60% expansion at Looking to find or buy growth in last 7 years Guanajuato in 2011 operation #3 Experienced Quality Assets: Management: Large districts, big 175 years in mining veins, hi
Slide 7: Share Capital
Share Capital • EXK: NYSE EDR: TSX EJD: Frankfurt • 87.3 Million • 5.8 Million (adds $23 Million) • 93.1 Million • US$ 10.84 • US$ 947 Million • 3.8 Million Shares (TSX & NYSE) • Fresnillo PLC 4% 7
Slide 8: Record Performance YTD, 2011
Record Performance YTD, 2011 Record Financial Performance YTD: • Sales Revenues: US$110.5 million, Up 90% • Mine Op. Cash Flow: US$75.3 million, Up 171% • Operating Cash Flow: US$50.2 million, Up 367% • Adjusted Net Earnings: US$33.9 million (US$0.40 per share) • Production Cash Cost: US$5.53 per oz
Slide 9: Core Assets
Core Assets Business Model: • Acquire under-explored mines in historic silver districts that are built, permitted and about to close • Invest the capital and expertise needed to discover new ore- bodies and re-open then mines • Consolidate district land-holdings and expand silver resources, reserves
Slide 10: Guanacevi Mines
ENDEAVOUR 10 FOCUSED ON GROWTH
Slide 11: Guanacevi: A Top Mexican Silver District
Guanacevi: A Top 5 Mexican Silver District District Highlights: • Located in the Sierra Madre Occidental gold-silver belt • Produced over 450 million oz silver historically • Multiple silver veins span 10 km x 5 km area • Classic epithermal ore-bodies in Lower Tertiary andesites • Excellent infrastr
Slide 12: Guanacevi: Four Underground Mines
Guanacevi: Four Underground Mines 2010 Reserves/Resources: P+P: 12.0 million oz Ag M+I: 17.2 million oz Ag Inf: 14.5 million oz Ag Q3 2011 Production: 647,397 oz Ag 1,933 oz Au Throughput: 952 tpd Grades: 305 gpt Ag 0.83 gpt Au Recoveries: 75.3% Ag 82.6% Au Mines: Porvenir Norte Porvenir Dos Porveni
Slide 13: Guanacevi: Upgrading the Mines & Plant
Guanacevi: Upgrading the Mines & Plant 2011 Capital Projects: 90% Total: $18.1 million 85% Plant: Dry Stack Tailings 90% Mine: Underground development 9630m 95% Surface: New 115 Kv power line Mine: Underground equipment Plant Currently Operating at 1000 tonnes per day; Additional Expansions Subject
Slide 14: Guanacevi: Reserves and Resources
Guanacevi: Reserves and Resources Endeavour Discovered Five New Silver Deposits In Five Years 14
Slide 15: Guanajuato Mines
nee = ENDEAVOUR 15 FOCUSED ON GROWTH
Slide 16: Guanajuato: 2nd Largest Mexico Silver District
Guanajuato: 2nd Largest Mexico Silver District District Highlights: • Located in the Sierra Madre silver-gold belt • Produced over 1.2 billion oz silver historically and 5 million oz gold • Three main vein systems span 20 km x 20 km area • Classic epithermal ore-bodies in Lower Tertiary andesites •
Slide 17: Guanajuato: Three Underground Mines
Guanajuato: Three Underground Mines 2010 Reserves/Resources: P+P: 1.4 Million Oz Ag M+I: 7.6 Million Oz Ag Inf: 7.3 Million Oz Ag Q3 2011 Production: 211,341 Oz Ag 2,993 Oz Au Throughput: 554 tpd Grades: 190 gpt Ag 2.57 gpt Au Recoveries: 68% Ag 71% Au Mines: Bolanitos/Lucero/ View of New Lucero Sou
Slide 18: Guanajuato: Expanding the Mines & Plant
Guanajuato: Expanding the Mines & Plant 2011 Capital Projects: 85% Total: $14.7 million Plant: Added new crusher, conveyors, ball mill, cyclones, float cells 85% Mine: Underground development 8460 m Mine: Underground equipment Surface: Buildings & miscellaneous Plant currently operating at 1000 tpd;
Slide 19: Guanajuato: New Discoveries At Bolanitos
Guanajuato: New Discoveries At Bolanitos Old Mines Recent Drill Results • 250 gpt Ag, 5.35 gpt Au / 9.35 m • 404 gpt Ag, 6.50 gpt Au / 7.35 m • 448 gpt Ag, 14.0 gpt Au / 4.61 m Lucero Mine (producing) Lucero Mine • 170 gpt Ag, 7.73 gpt Au / 7.14 m (producing) Lucero South Mine (under development) Lu
Slide 20: Guanajuato: Lucero Vein Long. Section
Guanajuato: Lucero Vein Long. Section Lucero Discovery is 800 m long x 150 m vertical x 3-5 m thick 20
Slide 21: Guanajuato: Karina Vein Long. Section
Guanajuato: Karina Vein Long. Section Karina Discovery is 500 m long x 150m vertical x 2-4 m thick 21
Slide 22: Guanajuato: Daniela Vein Long. Section
Guanajuato: Daniela Vein Long. Section Latest Drill Results OPEN OPEN Daniela Discovery is now 400 m long x 150m vertical x 2-6 m thick 22
Slide 23: San Sebastian: Historic High Grade Silver Vein District
San Sebastian: Historic High Grade Silver Vein District Property Highlights • Discovered in 1542, mined for centuries, largely un-explored • Four large silver-gold vein systems each 3 km long • Covers +50 small historic mines on +20 separate veins • Classic epithermal ore-bodies in Lower Tertiary an
Slide 24: Parral: Historic Silver District, Significant New Resource
Parral: Historic Silver District, Significant New Resource Property Highlights • Located adjacent to city of Hidalgo de Parral in Chihuahua State • Discovered in 1631, district produced over 250 million oz Ag • Esmeralda vein 5 km long, Esmeralda Mine 2 km to south • Esmeralda mine produced 4 millio
Slide 25: La Brisa: Multiple New Veins Near Guanacevi
La Brisa: Multiple New Veins Near Guanacevi Property Highlights • 2,662 hectare La Brisa property located 10 km south of Guanacevi plant • Five main quartz veins with anomalous Ag-As-Sb-Hg up to 3 meters wide over 4 km long trend • Hosted by Tertiary rhyolites outcropping well above the target “bona
Slide 26: Lomas Bayas: New Bulk Tonnage Target in Historic Silver District
Lomas Bayas: New Bulk Tonnage Target in Historic Silver District Property Highlights • 407 hectare Lomas Bayas property has bulk tonnage LOMAS open pit silver-gold potential BAYAS • Small scale mining historically by several shafts to 330 m depth; • Multiple veins/stock-works over a 300 m width and
Slide 27: Reserves/Resources: Continue to Grow
Reserves/Resources: Continue to Grow Silver Equivalent Reserves and Resources (million oz’s) 100 100 90 GJTO 90 80 76 70 GCVI 62 60 53 50 46 40 30 20 16 10 0 2004 2005 2006 2007 2008 2009 2010 2011 Target Note: 2010 Silver equivalents based on 50:1 silver: gold ratio, base metals are not included 27
Slide 28: Silver Production: 842% Growth Last Years
Silver Production: 842% Growth Last 6 Years Annual Silver Production (million oz’s) 5 3.7 4.5 GJTO 4 3.5 3.30 GCVI 3 2.60 2.5 2.35 2.15 2 1.5 1.35 0.95 1 0.5 0.35 0 2004 2005 2006 2007 2008 2009 2010 2011 Target 28
Slide 29: Revenues & Cash Flows: Up for 5th Consecutive Year
Revenues & Cash Flows: Up for 5th Consecutive Year $160 $150.0 Operating Cash Flow $140 Revenues $120 $100 $86.5 Millions $80 $80.0 $60 $50.8 $40 $39.3 $32.3 $32.7 $20 $15.6 $12.2 $1.8 $-2.4 $-4.6 $0 2006 2007 2008 2009 2010 2011 -$20 Projected 29
Slide 30: Gross Margin: Up for 4th Consecutive Year
Gross Margin: Up for 4th Consecutive Year $42.50 Cash Costs Gross Margin Realized Silver Price $37.00 $37.50 $32.50 $27.50 $/oz $22.50 $19.62 $31.47 $17.50 $15.49 $13.38 $14.51 $11.55 $12.50 $5.48 $13.91 $2.17 $9.48 $6.83 $7.50 $9.38 $9.03 $6.55 $6.04 $5.71 $5.53 $2.50 2006 2007 2008 2009 2010 2011
Slide 31: Experienced Management Team
Experienced Management Team Bradford Cooke Godfrey Walton Dan Dickson M.Sc., P.Geo. M.Sc., P.Geo. CA, Chairman & CEO President & COO CFO David Howe Barry Devlin Hugh Clarke Miguel Ordaz M.Sc. M.Sc., P.Geo. VP, Corporate Ing.-Mexico Projects VP, Operations VP, Exploration Communications Director 31
Slide 32: Board of Directors
Board of Directors Len Harris Geoff Handley B.Sc. Rex McLennan P. Eng. Retired Lead Independent B.Sc., M.B.A Director CFO Viterra Mario Szotlender Ricardo Campoy Bradford Cooke Godfrey Walton B.IR B.Sc. Man. Director M.Sc., P.Geo. M.Sc., P.Geo. Businessman Headwaters MB Chairman & CEO President & CO
Slide 33: Institutional Investors, Analysts Coverage
Institutional Investors, Analysts Coverage • Royce & Associates • Ash Guglani, Salman Partners • Van Eck Associates • Brian Quast, CIBC • Global X Management • Chris Thompson, Haywood • Fidelity Management • Andrew Kaip, BMO • BlackRock Investment Mgmt. • AGF Investments • Sprott Asset Management •
Slide 34: Social Responsibility
Social Responsibility • Endeavour Silver strives to improve the quality of life for every employee & each community in which it works by operating in the most socially responsible manner • Placed 2nd out of 20 teams in First Aid & 3rd out of 27 teams in Mine Rescue at recent Mexico National Mine Saf
Slide 35: Near Term Catalysts For Growth
Near Term Catalysts For Growth • Adj. Earnings growth: +600% for 2011 based on Q3 • Cash-Flow growth: +120% for 2011 based on Q3 • Production growth: +33% target over next 2 years • Reserve/resource growth: +33% target over next 2 years • Discovery growth: Aggressive US$13.3 million, 70,000 meter, 2
Slide 36: Contact Us
Contact Us Endeavour Silver Corp. Suite 301-700 West Pender Street Vancouver, BC, V6C 1G8 Canada hugh@edrsilver.com lmccray@edrsilver.com www.edrsilver.com Phone: 1-604-685-9775 Fax: 1-604-685-9744 Canada and US Toll-Free: 1-877-685-9775 36
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