Slide 1: ASX cover letter: Half Year Conference Call Presentation
PALADIN ENERGY LTD ACN 061 681 098 Ref: 376750 12 February 2015 ASX Market Announcements By Electronic Lodgement Australian Securities Exchange 20 Bridge Street SYDNEY NSW 2000 Dear Sir/Madam 31 December 2014 Half Year Conference Call Presentation Attached please find the presentation in relation to
Slide 2: December 2014 Half Year and Quarter Results
December 2014 Half Year and Quarter Results Conference Call and Investor Update 13 February 2015 John Borshoff – Managing Director/CEO Craig Barnes– Chief Financial Officer Mark Chalmers – Executive General Manager, Production February 2015
Slide 3: Disclaimer and Notes for JORC and NI 43-101 Mineral Resources and Ore Reserves
Disclaimer and Notes for JORC and NI 43- 101 Mineral Resources and Ore Reserves This presentation includes certain statements that may be deemed “forward-looking statements”. All statements in this presentation, other than statements of historical facts, that address future production, reserve or re
Slide 4: Presentation Outline
Presentation Outline Key Achievements and Update Uranium Market Update Financial Review Project Update Positioning for the Future 2
Slide 5: Highlights
Highlights Strong safety record for 6 months to 31 December 2014 — 150 days without a lost time injury (LTI) due to new initiatives and improvements Langer Heinrich production back to design levels — 1.304Mlb U3O8 for December 2014 quarter, up 27% from the last quarter — sales of 3.161Mlb for 6 mont
Slide 6: Presentation Outline
Presentation Outline Key Achievements and Update Uranium Market Update Financial Review Project Update Positioning for the Future 4
Slide 7: 2015 Will Initiate Price Revival
2015 Will Initiate Price Revival 2014 2015 Excess supply affected price Excess supply largely depleting Utility long-term contracting at Utilities are vastly uncovered historical lows beyond 2017 — 10yr average 150Mlb pa — fuel cycle planning requires contracting — but 2013 only 20Mlb & 2014 only 82
Slide 8: Uranium Market Snapshot
Uranium Market Snapshot US$/lb U3O8 Spot Price US$38.25/lb • Dramatic uranium spot price increase 46 44 2nd half 2014 (~60%) with increased 42 40 volatility 38 36 • Spot market fundamentals improving 34 32 as supply tightens and demand rises 30 28 • 2014 term market contract volumes 31/08/2014 07/09
Slide 9: Uranium Macro-environment and Outlook
Uranium Macro-environment and Outlook Uranium price should normalise to pre-Fukushima level within 2 years A near/medium term supply shortage appears unavoidable post 2015. New primary supply will have to contribute ~70Mlb to meet demand requirements before 2020 Supply achievement 2004-2014 Supply a
Slide 10: Presentation Outline
Presentation Outline Key Achievements and Update Uranium Market Update Financial Review Project Update Positioning for the Future 8
Slide 11: Profit & Loss December 2014 Half Year
Profit & Loss December 2014 Half Year Revenue of US$109.7M, down 36% on 2013* primarily as a result of placing KM on care and maintenance — 3.161Mlb sold at average realised price of US$34.3/lb — sales of 1.911Mlb in December 2014 quarter Gross profit of US$3.9M (2013*: gross loss of US$29.3M) — ave
Slide 12: Balance Sheet December 2014 Half Year
Balance Sheet December 2014 Half Year Stronger balance sheet Cash and cash equivalents of US$333.9M, up US$245.1M — net proceeds from share placement and entitlement issue of US$166.9M — net proceeds received from LHM minority sale of US$167.0M — LHM project debt repayments of US$35.4M — interest pa
Slide 13: Cash Flow December 2014 Half Year
Cash Flow December 2014 Half Year Cash outflow from operating activities of US$40.5M — includes interest paid of US$15.5M, down 7% on 2013* — includes negative working capital movements of US$19.5M Cash outflow from investing activities of US$9.7M, down 44% on 2013* — US$7.4M capital expenditure, do
Slide 14: Cost Reductions for FY15
Cost Reductions for FY15 Corporate and exploration cost reductions — admin, marketing and non production costs for the half year down 23% — FY15 corporate costs cut by US$2.4M, down 17% over FY14 — FY15 exploration costs cut by US$1.0M, down 12% over FY14 — executive/senior management 10% pay reduct
Slide 15: Presentation Outline
Presentation Outline Key Achievements and Update Uranium Market Update Financial Review Project Update Positioning for the Future 13
Slide 16: Langer Heinrich Project Update
Langer Heinrich Project Update Step change production improvement from Actual Actual Actual last Sept qtr 6 Months Sept Dec — Dec qtr 1.3Mlb, up 27% from past qtr Dec’14 Qtr Qtr — recovery of 84.5% up from 80.7% from past qtr YTD — currently producing at or above design Ore processed 1.66Mt 0.745Mt
Slide 17: Kayelekera Project Strategically Positioned
Kayelekera Project Strategically Positioned Transition to C&M smoothly completed Water management plan approved — plant and equipment ready for controlled release of surplus run-off into local inland waters — discharged water to be at internationally recognised standards — stakeholder consultations
Slide 18: Key Pipeline Projects (being advanced)
Key Pipeline Projects (being advanced) Moving toward Field Leach Trial (FLT) Low-cost ISR project targeting 2Mlb pa U3O8 production – existing mining lease MANYINGEE – Paladin has the expertise to develop WA – advancing hydrogeological, metallurgical test work, etc 2018 development target (price dep
Slide 19: Presentation Outline
Presentation Outline Key Achievements and Update Uranium Market Update Financial Review Project Update Positioning for the Future 17
Slide 20: Funding Initiative Overview
Funding Initiative Overview Sources and uses Sources of capital US$M Uses of capital US$M Cash position as at 31 December 2014 334 Repayment/tender for 2015 CBs 300 New CB issue - Base amount 100 Transaction costs 3 - Additional (discretionary) 50 Cash to balance sheet 181 Total sources of capital $
Slide 21: 2015 CB Maturity Addressed
2015 CB Maturity Addressed Pro-forma debt maturity profile 2017 CBs LH Term Loan Existing 2015 CBs New 2020 CBs 350 300 250 200 Cash 150 300 tender 274 50 100 50 100 0 CY 2015 CY 2016 CY 2017 CY 2018 CY 2019 CY 2020 Total debt (US$mm) 9 9 283 19 19 100 – 150 Transaction rationale Eliminates all of t
Slide 22: Ongoing Discussions with Strategic Partners
Ongoing Discussions with Strategic Partners Paladin continues to strengthen strategic alliances — partnership with HOPU announced — discussions ongoing with major nuclear utilities — Paladin has established a clear and realistic roadmap for discussions — decision on preferred utility/strategic partn
Slide 23: Conclusions and Outlook
Conclusions and Outlook Guidance revised to 5.2-5.5Mlb U3O8 for FY2015 2015 priorities – focus on optimisation of operations and achieving production targets – continue cost rationalisation at operations and corporate level – remaining positioned to take advantage of the future uranium price resurge
Slide 24: Paladin Energy Ltd Contact Details
Paladin Energy Ltd Contact Details Head Office Level 4, 502 Hay Street Subiaco Western Australia 6008 PO Box 201, Subiaco Western Australia 6904 Telephone: +61 (0) 8 9381 4366 Facsimile: +61 (0) 8 9381 4978 Email: paladin@paladinenergy.com.au Website: www.paladinenergy.com.au Investor Relations Team