Mineral Resources Limited · ASX:MIN
Mineral Resources — Debt Investor Presentation (September 2020)
34 slides from Mineral Resources's debt investor presentation, Sep 21, 2020
Slide 1: ASX Announcement: Presentation to Bond Investors
ASX ANNOUNCEMENT 21 September 2020 Presentation to Bond Investors The following presentation will be made by Chris Ellison, Managing Director of Mineral Resources Ltd on Tuesday 22 September 2020 to bond investors. A copy of the presentation has been provided to the ASX in advance of this presentati
Slide 2: FY20 Results Presentation to bond investors
FY20 Results Presentation to bond investors 22 September 2020
Slide 3: Contents
01 Introduction to Mineral Resources 3 02 FY20 Highlights 4 03 FY20 Sustainability Performance 5 CONTENTS 04 Our Response to COVID-19 7 05 FY20 Operating Performance 9 06 FY20 Financial Performance 15 07 Future Direction FY21 and Beyond 22 08 Appendix 27 2
Slide 4: World's largest crushing contractor
World’s largest crushing contractor Leading pit-to-port mining services provider World’s top 5 lithium miner with joint ownership of the largest hard rock lithium deposit Australia’s 5th largest iron ore producer Major holder of exploration permits in Perth Basin’s highly prospective gas acreage 3
Slide 5: FY20 Highlights
FY20 Highlights Mining Services • Keeping our people safe and employed during • Production volume up 65%1 COVID-19 and our operations running • Revenue up 50%2 • Best full year result to date: • Full year EBITDA over $2.0bn, including Iron Ore $1.3bn capital gain • Koolyanobbing June run rate 12.7Mt
Slide 6: Sustainability Performance: Injury Frequency Rates
Sustainability Performance Injury Frequency Rates Per million hours worked 3.29 0.00 14.52 1.4 TRIFR1 LTI1 18% improvement 14 1.32 TRIFR LTIFR 3,100+ Lost Total Injury Frequency Rate (LTRIFR) Total Recordable Injury Frequency Rate (TRIF) 1.2 12 Employees & Contractors2 1 10 0.89 0.8 15.4% 8 7.15 5.9
Slide 7: Sustainability Performance: GHG Emissions and Community
Sustainability Performance Greenhouse Gas (GHG) Emissions1,2 20% lower 300 3.59 4.0 250 Emissions Intensity CO2 Equivalent (kt) 2.89 200 150 100 2.0 GHG Emissions Intensity2 50 0 0.0 FY19 FY20 Diesel Gas Electricity purchased Emissions Intensity $185m Community Contributions Royalties & Taxes • Doub
Slide 8: Our Response to COVID-19
Our Response to COVID-19 RESOURCES
Slide 9: COVID-19 Screening Process
COVID-19 Screening Process • April 2020 – first screening • WA’s largest private PCR screening facility • Two independent National Association of Testing Authorities (NATA) accredited pathology laboratories • 7 sites – 2 in Perth metropolitan area and 5 in regional areas • More than 40 nurses and co
Slide 10: FY20 Operating Performance
FY20 Operating Performance 9
Slide 11: FY20 Mining Services Performance
FY20 Mining Services Performance Mining Services Contracts • 2 new, 4 renewed, 1 completed • Volumes increased 65% yoy Crushing & Processing • 22 operating plants Contract Mining • 21 open pits Construction • Completed Wodgina • MRL crane fleet and crew at Kemerton • Built 15Mt NextGen crushing plan
Slide 12: Mining Services Performance FY16 to FY20
Mining Services Performance FY16 to FY20 Contract Volumes (Index)1 Revenue ($m) Mining Services less Construction EBITDA2 ($m) 250 231 1400 400 371 1200 350 200 1000 300 253 149 140 250 150 834 216 800 114 200 167 100 600 542 523 100 141 326 150 400 102 100 50 200 441 399 350 344 328 50 0 0 0 FY16 F
Slide 13: FY20 Commodities Performance
FY20 Commodities Performance Koolyanobbing • 7.4Mt shipped • Average revenue $116/t • Average cost $72/t CFR • Total material moved (TMM) 46.7Mt Iron Valley • 6.7Mt shipped • Average revenue $104/t • Average cost $81/t CFR • TMM 17.3Mt Mt Marion • 394Kdmt (411Kwmt) spodumene concentrate shipped1 • A
Slide 14: Iron Ore Performance FY16 to FY20
Iron Ore Performance FY16 to FY20 Exports (Mwmt) Revenue ($/wmt) CFR Cost1 ($/wmt) 16.0 120 80 76 14.1 110 70 14.0 70 64 12.1 12.3 100 90 12.0 60 56 57 10.6 80 75 10.0 9.3 50 65 67 8.0 60 40 6.0 30 40 4.0 20 20 2.0 10 0.0 0 0 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20
Slide 15: Spodumene Concentrate Performance FY16 to FY20
Spodumene Concentrate Performance FY16 to FY20 Exports1 (Kwmt) Revenue ($/wmt) CFR Cost2 ($/wmt) 450 411 1,200 700 658 1,044 621 400 382 378 576 600 1,000 520 350 879 783 500 300 800 250 597 400 600 200 300 150 116 400 200 100 200 100 50 0 0 0 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 FY16 F
Slide 16: FY20 Financial Performance
FY20 Financial Performance 15
Slide 17: FY20 Financial Performance Summary
FY20 Financial $2.1bn 49.6% Performance Revenue ROIC Summary ↑41% on FY19 After Tax $2.01bn $765m EBITDA EBITDA (statutory) (underlying) ↑420% on FY19 ↑77% on FY19 $1.5bn 100cps Cash Dividends ↑$1.3bn on FY19 ↑127% on FY19 16
Slide 18: Revenue and Earnings
Revenue and Earnings Revenue ($m) Underlying EBITDA ($m) Underlying NPAT ($m) 2,500 900 400 2,125 800 765 334 350 2,000 700 300 270 1,624 1,458 1,512 600 1,500 506 250 500 464 206 205 1,178 433 200 400 1,000 286 150 300 110 200 100 500 100 50 0 0 0 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 F
Slide 19: Underlying EBITDA FY19 to FY20
Underlying EBITDA FY19 to FY20 $ million Notes: 1. Mining Services Construction primarily reflects construction team overhead costs not capitalised to projects. 2. Commodities cost variance excludes the impact of changes in royalty costs which are included in the Commodities price variances. 18 3. C
Slide 20: Cash Generation
Cash Generation Cumulative Cash Flow Before Operating Cash Flow1 ($m) Capex ($m) Financing Activities2 ($m) 700 900 1,200 1,084 595 800 1,000 600 800 749 700 500 600 411 600 400 500 400 299 316 165 221 296 400 200 300 300 0 186 200 -200 200 100 100 -400 -355 0 -600 0 FY16 FY17 FY18 FY19 FY20 Adj FY1
Slide 21: Net Debt FY19 to FY20
Net Debt FY19 to FY20 $ million Capex Breakdown ($391m) Deferred Stripping 10 10 10 Wodgina 20 Yilgarn Fe Expansion 90 40 Other Mining Services 61 80 Pilbara Fe Expansion Iron Valley 70 Mt Marion Innovation Notes: 1. Net Debt at 30 June 2019 ($872m + $26m held for sale), less Hire Purchase (HP) liab
Slide 22: Balance Sheet
Balance Sheet Key Credit Metrics Units FY191,2 FY20 Debt Maturity Profile ($m)3 Cash and Equivalents $m 265 1,522 1,200 Total Assets $m 3,161 4,631 $1,020m 1,000 Debt $m (1,137) (1,291) Total Liabilities $m (1,781) (2,335) 800 Total Equity $m 1,380 2,296 600 Net Debt / (Cash) $m 872 (231) 400 $250m
Slide 23: Where are we going in FY21
Where are we going in FY21 • Operations FY21 outlook • Project pipeline 22
Slide 24: FY21 Mining Services Outlook
FY21 Mining Crushing Services Outlook • Volumes expected to increase: • Koolyanobbing 12 to 12.7Mt • Iron Valley 7.5 to 8.5Mt • NextGen II Crushing plant operational from 2Q21 Key Headlines Processing • Higher product volumes • Double the business over CY20-CY22 • Processing volumes remain stable du
Slide 25: FY21 Commodity Outlook
FY21 Commodity Iron Valley Outlook • Export: 7.5 to 8.5Mt at 40% Lump product • Volumes weighted to 2H • Year end run rate: 9Mtpa • FY21 TMM 31.2Mt Kemerton Key Headlines Koolyanobbing Construction and receipt of equipment ongoing • Developing mining operations Ramping up to 1000 people on site • Ex
Slide 26: Growth Projects
Growth Projects Pilbara • Working with Government and other parties to develop additional iron ore export capacity in the Port Hedland Harbour • Successful completion of projects would at least double our current iron ore exports • Targeting lower operating costs than current operations • Planning f
Slide 27: Thank you – Any questions
Thank you – Any questions 26
Slide 28: Appendix
Appendix Additional Information 27
Slide 29: Financial Performance Since Listing
Financial 30% 26.6% Performance Since EPS ROIC2 Listing in 2006 growth p.a.1 After Tax 27% 101% TSR growth Cash p.a.3 conversion4 $5.8bn $5.81 EBITDA Per share dividends5 Notes: 1. CAGR in diluted EPS from FY07 to FY20. 2. Average ROIC from FY07 to FY20. 3. CAGR in TSR since listing at $0.90/share i
Slide 30: Reconciliation of Non-IFRS Financial Information
Reconciliation of Non-IFRS Financial Information Reconciliation of Non-IFRS Financial Information ($ million) 1H19 2H19 FY19 1H20 2H20 FY20 Statutory Revenue 555 957 1,512 987 1,138 2,125 Statutory EBITDA 72 314 386 1,575 431 2,006 1 Less: gain on disposal of 60% interest in Wodgina - - - (1,290) (8
Slide 31: Mining Services Key Business Metrics
Mining Services Key Business Metrics Major external contract1 win / renewal metrics Metrics FY15 FY16 FY17 FY18 FY19 FY20 New contracts commenced - - 3 1 3 2 Ore bodies exhausted early, contracts ended due to end of life-of-mine or - (1) - (1) - (1) completion of scope Existing contracts renewed 7 1
Slide 32: Glossary
Glossary 1H, 2H, FY First half, second half, full year K Thousand $ Australian dollar M Million US$ United States dollar Net debt / (cash) Gross debt less cash and cash equivalents CAGR Compound annual growth rate NPAT Net profit after tax CFR Cost and freight rate PBT Profit before tax CFR Cost Ope
Slide 33: Disclaimer
Disclaimer This presentation has been prepared by Mineral Resources Limited (“MRL” or “the Company”). It should not be considered as an offer or invitation to subscribe for or purchase any securities in the Company or as an inducement to make an offer or invitation with respect to those securities.
Slide 34: Investor Relations
Investor Relations James Bruce Nigel Land Head of Investor Relations Treasurer T: +61 8 9329 3706 T: +61 8 9329 3609 E: james.bruce@mrl.com.au E: nigel.land@mrl.com.au OFFICE: 1 Sleat Road, Applecross, WA 6153 POSTAL: PO Locked Bag 3, Canning Bridge LPO, Applecross, WA 6153 P +61 8 9329 3600 F +61 8
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