Kingsgate Consolidated Limited · ASX:KCN
Kingsgate Consolidated — Shareholder Meeting (November 2015)
32 slides from Kingsgate Consolidated's shareholder meeting presentation, November 2015
Slide 1: Annual General Meeting Presentation November 2015
Annual General Meeting Presentation November 2015
Slide 2: Disclaimer
Disclaimer These materials include forward looking statements. Forward looking statements inherently involve subjective judgment & analysis & are subject to significant uncertainties, risks & contingencies, many of which are outside of the control of, & may be unknown to, the company. Actual results
Slide 3: Kingsgate Today
Kingsgate Today ASX Listed: Market Cap ~A$150 M Net debt ~ A$83 M* Enterprise Value A$233 M* Portfolio: Chatree Gold Mine (Thailand) ave 130,000 Koz per annum Challenger Gold Mine (Australia) ave 80,000 Koz per annum till Feb 2016 Nueva Esperanza Project (Chile) 1.9 Moz AuEq^ resource Bowdens Projec
Slide 4: Snapshot
Snapshot Total Shareholder Composition 2% 2% 1% Institutional 5% Corporate Information – as at 26 Nov 2015 Unanalysed Retail 15% ASX Listed (ASX 300) KCN Corporate Share Price A$0.63 Related Party 50% Issued Shares 223,585M Broker Market Cap A$150M Custodian Cash Balance (available) A$35M* Unallocat
Slide 5: Board of Directors
Board of Directors Ross Smyth-Kirk Sharon Skeggs Executive Chairman Non-Executive Director Investment Management Marketing and Change Management • 40+ years experience in investment management • 35+ years experience in marketing and change and mining management in Australia the UK and Asia. • Former
Slide 6: Senior Management
Senior Management Greg Foulis Ronald James Chief Executive Officer GM – Exploration & Resource Development Mining and Financial Markets Gold Exploration • 30+ years experience in mining and financial markets • 31+ years experience in gold exploration & mining • Previously SVP Business Development fo
Slide 7: Macro backdrop
Macro backdrop Kingsgate is an international precious metals explorer, developer and producer The macro environment with respect to commodities and financing has been difficult for the past 3 to 5 years. Gold and silver prices are at multi year lows and related equity indices are also at lows eg The
Slide 8: Kingsgate FY15 – a performance re-cap
Kingsgate FY15 – a performance re-cap Kingsgate Scorecard 2013 2014 2015 Comments Chatree (Koz) 133.7 134.5 125.1 Ops Challenger (Koz) 66.2 75.0 80.2 KCN Production (Koz) 199.9 209.5 205.2 Steady production Gold Price - Ave Deliv (US$/oz) 1,588 1,291 1,208 Declining gold price Cash Costs (US$/oz) 87
Slide 9: Kingsgate FY16
Kingsgate FY16 Renewal and re-focus New CEO – Greg Foulis Back to basics approach Success and capability is epithermal gold in the Pacific Rim Chatree and Nueva Esperanza are big epithermal systems The plan is to grow from these two beachheads Core capabilities are explore, develop and produce Strat
Slide 10: Australia – Challenger Gold Mine
Australia – Challenger Gold Mine 1. Kingsgate made an informed decision to stop incurring costs on this capital intensive operation. The decision to place the mine onto Care and Maintenance was an informed decision based on technical, economic and risk factors. Kingsgate expects to make a cash surpl
Slide 11: Australia – Bowdens Silver Project
Australia – Bowdens Silver Project Bowdens is a significant silver resource of 134 Moz , with economics and valuation leverage to silver prices. Kingsgate has phased work on the Environmental Impact Statement (EIS) and Feasibility Study to reduce costs and mitigate silver price volatility. EIS well
Slide 12: Chatree Gold Mine, Thailand
Chatree Gold Mine, Thailand Proven track record Discovered, developed, expanded Highly efficient mining of low grade epithermal gold Chatree Produced over 1.8 Moz gold Outstanding safety and environmental record Operating Cashflow Bangkok FY15 production: 125 Koz, EBITDA A$71M Thai FY16 budget: 125-
Slide 13: Chatree FY16
Chatree FY16 Chatree production is skewed towards a strong second half given the cutback of Pit A. Key operating initiatives for FY16 include: Mining fleet roster changes to be implemented in the December Quarter to achieve higher daily operating hours per machine. Milling initiatives to achieve hig
Slide 14: Chatree Gold Mine – Pit A Cutback
Chatree Gold Mine – Pit A Cutback A major cutback of Pit A is progressing with better grades being accessed in the second half FY16. 14
Slide 15: Thai Regulatory Environment
Thai Regulatory Environment The Thai Department of Industry and Mines is developing a new Gold Policy for Thailand. The new Gold Policy is designed to implement a more progressive regulatory framework for gold mining. The next stage of the Gold Policy requires public consultation. A new Minister of
Slide 16: Chatree – Health and Environment
Chatree – Health and Environment Akara is a highly compliant and accredited international operation. Akara was one of the first signatories to the International Code for Cyanide Management. Akara has the following international certifications: q OHSAS18001 (Health & Safety); q ISO14001 (Environment)
Slide 17: Chatree – Health and Environment
Chatree – Health and Environment Chatree operations were suspended for a total of 44 days in January/February this year due to the temporary suspension order issued by the Department of Primary Industries and Mines (DPIM). The order related to the issue of slightly elevated arsenic and manganese lev
Slide 18: Chatree - Corporate Social Responsibility
Chatree - Corporate Social Responsibility Since startup, the Chatree Operation has a created a proud business that makes a meaningful economic contribution to Thailand and is supported by a highly skilled and competent workforce of around 1,000 people. Fund Contributions Local Business startup initi
Slide 19: Chatree - Corporate Social Responsibility
Chatree - Corporate Social Responsibility Health Thai Culture • Chatree continues to monitor • Donations to local groups the health and well being of the local communities and similarly its employees. Land Support Thai Religion • With the support of local • Donations to local groups village heads, l
Slide 20: Chatree – Progressive Policies
Chatree – Progressive Policies Gender Equality – The Chatree Operation employs more than 1000 people of which 340 people are directly employed by Akara Resources. We are a leader in gender equality and have a number of policies in place to promote and bolster female employment opportunities. Women c
Slide 21: Nueva Esperanza – A Flagship Project
Nueva Esperanza – A Flagship Project History Historic bonanza silver production pre-Kingsgate Consolidation of tenements and resources by Kingsgate in 2011 Extensive feasibility work completed 2012-14 Several process routes considered Nueva Esperanza Breakthroughs Teterita Gold discovery at Chimbero
Slide 22: Chile & The Maricunga Belt
Chile & The Maricunga Belt Chile Favoured mining investment destination Ranked 13 in Fraser Institute survey Worlds largest copper producer Ranked 14 in global gold production Maricunga Belt Defined total gold resources of ~100 Moz Low grade porphyry styles in the south Higher grade epithermal style
Slide 23: Nueva Esperanza Fly-through video presentation
Nueva Esperanza Fly-through video presentation 23
Slide 24: Nueva Esperanza – FY15 Achievements
Nueva Esperanza – FY15 Achievements Discovery of Chimberos Gold Nueva Esperanza Mineral Resources increased 21% to 34.6 Mt at 1.7 g/t AuEq60 for 1.9 Moz gold equivalent* Identified high-potential gold targets for follow-up Teterita 0.3Moz AuEq Chimberos 0.64Moz AuEq Total Resources 0.53 Moz gold Arq
Slide 25: Nueva Esperanza – What we have
Nueva Esperanza – What we have ü 100% ownership Grid Power ü Favourable mining investment jurisdiction Options ü Skills to explore, build, operate ü Inventory of 1.9 Moz AuEq* ü Significant feasibility level work completed ü Initial permitting in place ü Water rights secured Nueva ü Power options av
Slide 26: Nueva Esperanza – Optimisation Study
Nueva Esperanza – Optimisation Study The aim of the study is to confirm that lower capital and operating costs are achievable so that the project can deliver: : 2 Mtpa ~100,000oz US$175-200M US$15.50 – <US$700/oz processing per annum Capital US$19.50/t cash costs capacity AuEq1 Cost processing costs
Slide 27: Nueva Esperanza – Currency Upside
Nueva Esperanza – Currency Upside Chile is not a USD economy. Chilean Peso devaluation has been similar to AUD. We anticipate devaluation cost benefits similar to Australia. 27
Slide 28: Nueva Esperanza – FY16 Forward Plan
Nueva Esperanza – FY16 Forward Plan Optimisation Study -> Significant Improvement Complete economic optimisations Update Ore Reserves Complete technical, environmental & CSR studies to modify existing permits Permitting -> derisking Submit permit amendments Exploration -> value add Complete systemat
Slide 29: Kingsgate – Investment Opportunity
Kingsgate – Investment Opportunity Flagship project in Nueva Esperanza – 1.9 Moz AuEq+ De-risk, add value and advance towards development World class mine at Chatree +6.0 Moz gold mineralised system (produced and in-situ) Core capabilities in-house Explore, develop, build and operate Manage assets a
Slide 30: Thank you
< Kingsgate Consolidated Limited Thank you
Slide 31: Appendix
Appendix Competent Persons Statement – Nueva Esperanza The information in this report that relates to exploration results and data quality is based on and fairly represents information compiled by Mr Ron James who is a member of the Australasian Institute of Mining and Metallurgy and a full time emp
Slide 32: Mineral Resource and Ore Reserve Statement as at 30 June 2015
Mineral Resource and Ore Reserve Statement as at 30 June 2015 32
Kingsgate Consolidated — Shareholder Meeting (November 2015) on 6ix