Sherritt International Corporation · TSX:S
Sherritt International — Q4 2020 Earnings Presentation
21 slides from Sherritt International's earnings presentation, Feb 11, 2021
Slide 1: Q4 Earnings Call: Review of Financial and Operational Results
Q4 Earnings Call Review of Financial and Operational Results February 11, 2021
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains certain forward-looking statements. Forward-looking statements on key personnel and skilled workers; the possibility of equipment and other failures; risks The Corporation may, from time to time, make oral forward-looking statements. The can gene
Slide 3: Q4 Highlights
Q4 Highlights 1. Ended year with strengthened balance sheet 2. Strong production results driven by operational excellence and measures to mitigate COVID-19 3. Year-end results largely in line with guidance 4. US$20M of re-directed distributions reduced overdue receivables 5. Recovery of nickel and c
Slide 4: Review of operating results
Review of operating results 4
Slide 5: Impact of COVID-19
Impact of COVID-19 • Limited impact on production to date • Physical distancing and intensified hygiene measures implemented • Costs for added health and safety measures have been marginal • Contributed to rescheduling of annual maintenance shutdown • Added health and safety measures to remain in ef
Slide 6: Moa JV highlights
Moa JV highlights Q4 Production(1) (tonnes) Full Year Production(1) (tonnes) Finished Nickel Finished Cobalt Finished Nickel Finished Cobalt 16,554 4,049 4,020 15,753 1,688 1,685 451 411 Q4 2019 Q4 2020 Q4 2019 Q4 2020 FY2019 FY2020 FY2019 FY2020 • Q4 2020 impacted by unplanned autoclave repairs at
Slide 7: Moa JV highlights – Costs
Moa JV highlights – Costs (1) Mining, Processing and Refining Costs (US$/lb) Net Direct Cash Cost(1) (US$/lb) $5.46 $5.31 $4.93 $4.73 $4.47 $4.14 $4.20 $3.75 Q4 2019 Q4 2020 FY2019 FY2020 Q4 2019 Q4 2020 FY2019 FY2020 • MPR costs declined by 11% in Q42020 • NDCC in Q4 2020 impacted by lower fertiliz
Slide 8: Oil and Gas highlights
Oil and Gas highlights Oil Production (Cuba GWI, bopd)(1) Unit operating costs (Cuba GWI, $/bbl(2)) $27.17 $24.23 4,175 $23.13 3,785 $21.60 2,599 2,947 Q4 2019 Q4 2020 FY2019 FY2020 Q4 2019 Q4 2020 FY2019 FY 2020 • Production impacted by natural reservoir declines • FY2020 cost increase largely due
Slide 9: Power highlights
Power highlights Electricity production (33⅓% GWh(1)) Unit operating costs ($/MWh(2)) 736 186 $26.73 602 144 $22.15 $18.22 $17.38 Q4 2019 Q4 2020 FY2019 FY2020 Q4 2019 Q4 2020 FY2019 FY2020 • Q4 2020 production impacted by reduced natural gas • Q4 2020 and FY2020 unit costs impacted by timing of ava
Slide 10: Financial Highlights
Financial Highlights sherritt
Slide 11: Liquidity
Liquidity Energas 79.8 Energas 75.0 Sherritt ended 2020 with an increase in consolidated cash and more cash in Canada 1. Net of Energas consolidation adjustment 2. Excluding interest paid on notes, Moa JV dividend distributions and redirections from GNC 11
Slide 12: Status of Cuban energy receivables
Status of Cuban energy receivables Received on Q3 2020 Expected/ receivables Q4 2020 US$M overdue due Received agreement overdue Oil & Gas - Trade receivables $ 23.1 $ 2.0 $ – $ – $ 25.1 Power Trade receivables/other $ 4.5 $ 0.9 $ (2.4)(1) $ (0.4) $ 2.6 Energas CSA $131.5 $14.0 $ – $ (27.3) $118.2 T
Slide 13: Unification of Cuban currencies
Unification of Cuban currencies Key highlights Impacts to Sherritt 1. Cuba’s dual currency system ended Dec. 31 1. All payments made in $US 2. Convertible currency (CUC) unified with domestic 2. No effect on distributions from Moa JV currency (CUP) on Jan. 1 3. Cash held at Energas unaffected 3. CUP
Slide 14: Outlook
Outlook 14
Slide 15: 2021 Outlook
2021 Outlook Moa JV • Production guidance at Moa JV consistent Finish nickel 32,000 – 34,000 tonnes with historical production Finished cobalt 3,300 – 3,600 tonnes • Production guidance reflects ongoing Net direct cash cost: US$4.25 - $4.75/lb commitment to Operational Excellence Capital Spending: U
Slide 16: Outlook for OGP
Outlook for OGP 1. PSC at Puerto Escondido/Yumuri set to expire March 19, 2021 2. Efforts to secure earn-in partner for drilling and exploration activities on Blocks 10 and 6A are ongoing 3. Power forecasts for 2021 impacted by re-scheduling of maintenance activities deferred in 2020 4. Power agreem
Slide 17: Nickel and cobalt prices since July 2020
Nickel and cobalt prices since July 2020 60% US$22.18 Cobalt +55% 50% US$8.38 Nickel +45% 40% 30% 20% 10% US$5.80 0% US$14.33 (10%) 6-Oct 13-Oct 20-Oct 27-Oct 3-Nov 10-Nov 17-Nov 24-Nov 1-Dec 8-Dec 15-Dec 22-Dec 29-Dec 5-Jan 2-Feb 9-Feb 30-Jun 7-Jul 14-Jul 21-Jul 28-Jul 4-Aug 1-Sep 8-Sep 12-Jan 19-J
Slide 18: Outlook for nickel and cobalt
Outlook for nickel and cobalt • Recent price momentum driven by economic recovery and renewed interest in electric vehicles • New government policies and automotive industry investments paving the way • Nickel remains the metal of choice for battery chemistries • Price volatility expected in the nea
Slide 19: Summary
Summary • Strongest balance sheet since financial crisis • Results for 2020 were largely in line with guidance for the year • 2021 guidance based on a number conservative forecasts • Overdue payments will be lumpy in 2021 • Long-term outlook for nickel and cobalt prices is favourable Sherritt is wel
Slide 20: Q&A Discussion
Q&A Discussion sherritt
Slide 21: Sherritt International Corporation contact details
Sherritt International Corporation 22 Adelaide West, 42nd Floor Toronto, Ontario, Canada M5H 4E3 Joe Racanelli, Director, Investor Relations Telephone: (416) 935 -2457 I Toll -Free: 1 (800) 704 -6698 Email: joe.racanelli@sherritt.com I Website: www.sherritt.com
Sherritt International — Q4 2020 Earnings Presentation on 6ix