Lundin Mining Corporation · TSX:LUN
Lundin Mining — Q1 2018 Earnings Presentation
25 slides from Lundin Mining's earnings presentation, Apr 26, 2018
Slide 1: First Quarter 2018 Results
TSX: LUN Nasdaq Stockholm: LUMI First Quarter 2018 Results April 26, 2018 1 Candelaria, Atacama Region, Chile
Slide 2: Cautionary Statements
Cautionary Statements Caution Regarding Forward-Looking Information and Non-GAAP Performance Measures All statements, other than statements of historical fact, made and information contained or incorporated by reference in or made in giving this presentation and responses to questions is "forward-lo
Slide 3: Participants
Participants President & Paul Conibear Chief Executive Officer Senior Vice President & Marie Inkster Chief Financial Officer Vice President Peter Richardson Chief Operating Officer 3
Slide 4: Q1 2018 Highlights
Q1 2018 Highlights Strong Operational Excellent Project Disciplined Capital Performance Execution Management – continued excellent safety – Los Diques commissioning – continued focus on low- performance ahead of schedule risk, high-return brownfield projects – on target to achieve – Candelaria under
Slide 5: Q1 2018 Summary Results
Q1 2018 Summary Results Attributable Production – 41,187 t of copper – 36,880 t of zinc – 5,141 t of nickel – 8,780 t of lead $470M in Sales – 59% copper – 18% zinc – 12% nickel – 6% gold and silver 5
Slide 6: Financial Highlights
Financial Highlights Realized Metal Prices1 Q1 2018 Q1 2017 Δ Copper $2.93/lb $2.80/lb 5% Nickel $6.04/lb $4.63/lb 30% Zinc $1.51/lb $1.32/lb 14% Summarized Financial Results2 Q1 2018 Q1 2017 Δ Revenue $470M $488M -4% Gross Profit $150M $164M -9% Attributable Net Earnings from Continuing Operations
Slide 7: Capital Allocation Priorities
Capital Allocation Priorities Liquidity Position (March 31, 2018) Invest in low-risk, high-return brownfield expansion projects and exploration 18% Cash and Equivalents Maintain regular dividend $2.0B Undrawn Credit Facility Prudent and accretive management of debt and 82% cash positions Flexible ba
Slide 8: Candelaria
Candelaria 8 Candelaria Mill – Copper / Gold / Silver – Atacama Region, Chile
Slide 9: Candelaria
Candelaria On Track to Achieve Full Year Guidance – copper production of 31.8 kt (100% basis) Copper Production & Cash Cost Outlook – mill throughput impacted by downtime for maintenance (100% basis; kt & $/lb Cu, net of by-product credits) – waste stripping accelerating with contractor support Unde
Slide 10: Candelaria Underground Expansion
Candelaria Underground Expansion Candelaria North Sector Owner-Operated Loading and Haulage Fleet Candelaria Open Pit Candelaria South Sector Future Portal 10
Slide 11: Los Diques Tailings Storage Facility
Los Diques Tailings Storage Facility First Phase Construction Complete – commissioning with continuous tailings placement commenced ahead of schedule, under budget 11 – operating permit applications submitted
Slide 12: Neves-Corvo
Neves-Corvo 12 Copper / Zinc / Lead – Portugal
Slide 13: Neves-Corvo
Neves-Corvo Excellent Mine and Mill Performance – production of 10.8 kt copper and 17.8 kt zinc – record lead production of 1.8 kt Copper, Zinc Production & Cash Cost Outlook – noticeable improvement in mining execution resulting in (kt & $/lb Cu, net of by-product credits) improved mine productivit
Slide 14: Eagle
Eagle Humboldt Mill – Nickel / Copper / PGMs – Michigan, U.S.A. 14
Slide 15: Eagle
Eagle Continued Excellent Performance – production of 5.1 kt nickel and 4.8 kt copper – on track to meet production guidance Nickel, Copper Production & Cash Cost Outlook – improved full-year cash cost guidance (kt & $/lb Ni, net of by-product credits) Eagle East Advancing Ahead of Schedule 14-17 15
Slide 16: Eagle East
Eagle East Existing Access Ramp Current Advance Eagle Mine Eagle East Dual Declines Ore Body 1,000 m 16
Slide 17: Zinkgruvan
Zinkgruvan 17 Zinc / Lead / Copper – Sweden
Slide 18: Zinkgruvan
Zinkgruvan On Track to Achieve Full Year Guidance – production of 19.0 kt zinc and 7.0 kt lead Zinc Production & Cash Cost Outlook – good zinc recoveries on lower than planned zinc (kt & $/lb Zn, net of by-product credits) headgrade; forecast to improve – first quarter throughput impacted by schedul
Slide 19: Zinkgruvan – Exploration Focus
Zinkgruvan – Exploration Focus Exploration areas 19
Slide 20: 2018 Capital Expenditure & Exploration Guidance
2018 Capital Expenditure & Exploration Guidance Capital Expenditures1 (US$M) Total Capitalized Stripping2 200 Overall Capex Guidance Unchanged Los Diques Facility 60 – minor offsetting changes to forecast sustaining New Mine Fleet Investment 75 capex at Eagle and Neves-Corvo Mill Optimization Invest
Slide 21: 2018 Production and Cash Cost Guidance
2018 Production and Cash Cost Guidance Attributable Production1 and C1 Cash Cost2 (t and $/lb, net of by-products) Copper Candelaria (80%) 104,000 – 109,000 $1.70/lb Eagle 15,000 – 18,000 Neves-Corvo 39,000 – 44,000 $1.30/lb Zinkgruvan 1,000 – 2,000 Total Attributable 159,000 – 173,000 Nickel Eagle
Slide 22: Three-Year Production Outlook
Three-Year Production Outlook1 (kt attributable) Copper Zinc Nickel Increasing primarily on improved ~60% increase primarily on Neves-Corvo Eagle East on-line in 2020 Candelaria mine plan Zinc Expansion Project 244 17 201 16 234 183 187 13 173 14 13 169 176 159 10 154 166 144 2018 2019 2020 2018 201
Slide 23: Lundin Mining
Lundin Mining High Quality Meaningful Scale Financial Strength Competitive Mines Growth Oriented – strong margins at all – exploration upside and – proven track record for operations high value expansion rigorous investment projects underway approach, focused on – demonstrated operational value crea
Slide 24: NI 43-101 Compliance
NI 43-101 Compliance Unless otherwise indicated, Lundin Mining Corporation (the “Company”) has prepared the technical information in this presentation including Mineral Reserve and Mineral Resource estimates (“Technical Information”) based on information contained in the technical reports and news r
Slide 25: TSX: LUN Nasdaq Stockholm: LUMI
TSX: LUN Nasdaq Stockholm: LUMI 25