Slide 1: 2017 Interim Results
2017 Interim Results 23 August 2017 Focused, Efficient and Delivering Growth
Slide 2: Disclaimer
Disclaimer The information contained in this presentation is intended solely for your personal reference and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person (whether within or outside your organisation/firm) or published, in whole or in part, for any pu
Slide 3: Overview
Overview Jerry Jiao, CEO 1H17 in review Ross Carroll, CFO Financial results Jerry Jiao, CEO Strategy and outlook Questions and Answers 3
Slide 4: 1H17 in review
1H17 in review Jerry Jiao Chief Executive Officer
Slide 5: First Half 2017 Highlights
First Half 2017 Highlights Safety Record half yearly safety performance NPAT US$113.7m Return to profit. Improvement of US$206.7m on 1H16 Debt reduction Strong cash generation. Net debt reduced by US$868m Efficiency Efficiency improvement programs across operations and corporate Growth Dug
Slide 6: Safety, Environment and Social Performance
Safety, Environment and Social Performance Safety performance Safety – our first value Record low half yearly TRIF for MMG of 1.14 per 4.1 million hours worked in the first six months of 2017 MMG’s TRIF benchmarks in the lowest quartile of 3.0 all International Council on Mining and Metals (IC
Slide 7: Operational Excellence
Operational Excellence 2017 production Las Bambas: 218kt Cu, guidance maintained C1 US$1.01 in 1H17. 560-615kt Copper World class ramp up. 65-72kt Zinc Large scale, low cost, long life Kinsevere – record Sepon – record production in July 2017 throughput in 1H17 Rosebery – Strong zinc Efficiency
Slide 8: Financial results
Financial results Ross Carroll Chief Financial Officer
Slide 9: Revenue, Earnings, NPAT and Cash Improve in H1
Revenue, Earnings, NPAT and Cash Improve in H1 US$ million 1H16 2H16 1H17 1H7 v 1H16 Revenue 586.1 1,902.7 1,942.4 231% Underlying EBITDA 134.3 814.9 855.0 537% Underlying Profit / (Loss) After Tax -93.0 -5.7 107.8 N/A Net Operating Cash Flow 57.7 664.6 1,116.0 1834% Net Debt 10,279.8 9,786.8 8,918.
Slide 10: Underlying earnings up over 500%, costs controlled
Underlying earnings up over 500%, costs controlled US$ million Discontinued 1000 Ops 8 Cash Prodn Stock Expenses Movements FX 800 Las (31) (29) Other (30) Bambas (22) 740 600 Price 400 114 1H17 Underlying EBITDA 855 200 Volume (29) 1H16 EBITDA 134 0 10
Slide 11: Strong Cash Generation
Strong Cash Generation US$1.1b of Net Operating Cash in Net operating cash flow (US$m) 1H17 1,500 US$1,354m US$1.8b of Net Operating Cash 1,200 US$1,116m generated since Las Bambas achieved commercial production 900 Spot commodity prices and FX US$665m would imply a ~US$477m 600 improvement in
Slide 12: Net debt down US$868m
Net debt down US$868m Net debt reduction of US$868m, Movements in Net Debt (US$m) driven by: 10,000 - Free Cash Flow1 of US$726m 9,800 9,787 726 9,600 - US$209m from asset sales 9,400 - Growth capital predominantly 9,200 relates to Dugald River 209 95 development (~US$200m 9,000 2 8,919 remaining)
Slide 13: Well managed debt maturity profile
Well managed debt maturity profile Gross debt reduced by >US$1b in 2017 YTD Average outstanding maturity profile now ~8 years Debt repayment schedule1 (US$m) 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 2017 2018 2019 - 2021 2022 - 2032 Las Bambas Acquisition Facility, 7 yrs, not
Slide 14: Earnings sensitivity
Earnings sensitivity Estimated impact on FY17 underlying EBIT from changes in commodity prices and currency Sensitivity EBIT Impact (US$m) Copper US$/lb $0.10/lb / ($0.10/lb) 135/(135) Zinc US$/lb $0.10/lb / ($0.10/lb) 10/(10) 1 Lead US$/lb $0.10/lb / ($0.10/lb) 4/(4) Gold US$/oz $100/oz / ($100/oz)
Slide 15: Ongoing efficiency programs
Ongoing efficiency programs Track record of C1 improvement at operations MMG weighted average Copper C1 costs (US$/lb) Mining industry costs likely to have seen bottom of cycle 1.70 1.60 Mature operations facing challenges - 1.50 working hard for incremental 1.40 improvement 1.30 Efficiency
Slide 16: MMG: Focused, Efficient and Delivering Growth
MMG: Focused, Efficient and Delivering Growth Jerry Jiao Chief Executive Officer
Slide 17: Positive outlook for copper and zinc
Positive outlook for copper and zinc Attractive fundamentals and insights from Mined copper supply gap and requirement for new capacity 26 major shareholder support commodity outlook Base Case production capability, including highly probable projects Supply risks growing – social, political, grade
Slide 18: World-class asset base – sustained production growth
World-class asset base – sustained production growth Top 10 miner of copper and zinc World’s top copper producers (2017)1 Kt Low cost position 1,600 Delivered 15% pa growth in Cu equivalent 1,400 1,200 production over 5 past years 1,000 800 600 2016-2018 Las Bambas (Cu) and 400 200 Dugald Ri
Slide 19: Las Bambas – world class delivery
Las Bambas – world class delivery 12 months of stable operation, 430kt copper production, C1 US$1.02 One of the lowest cost copper operations of this scale in the world Las Bambas efficiency review of external spend and productivity improvements. Full benefit expected in 2018. Initial 20+ ye
Slide 20: Dugald River – to deliver first production 2017
Dugald River – to deliver first production 2017 The Dugald River project ahead of 2019 forecast production capability1 schedule First production now expected in late 2017 Rampura-Agucha (previously first half 2018) Red Dog Total development capital expected around Mount Isa Pb/Zn US$600m (low en
Slide 21: Focused, Efficient and Delivering Growth
Focused, Efficient and Delivering Growth Growth Deliver Dugald River - Top 10 producer of copper and zinc. Operational Excellence Track record of continuous improvement. Shareholder 12 month total shareholder return of 124%. Strong cash value generation and near term focus on debt reduction 21
Slide 22: Appendix
Mprocress IWEIVIG
Slide 23: MMG operations
MMG operations We have a globally diversified portfolio of base metals operations and development projects HIGH LAKE IZOK LAKE SEPON 2017 production guidance: LAOS HONG KONG ~65,000 tonnes of copper VIENTIANE cathode SEPON 2017 C1 guidance: US$1.40 – US$1.50/lb LAS BAMBAS 2017 production guidance: D
Slide 24: Guidance for 2017
Guidance for 2017 Las Bambas Rosebery Copper – production 420,000 – 460,000 tonnes Zinc – production 65,000 – 72,000 tonnes Copper – C1 costs US$0.95 – 1.05 / lb Zinc – C1 costs US$0.15 – 0.25 / lb Lead – production 18,000 – 25,000 tonnes Kinsevere Sepon Copper – production 75,000 – 80,000 tonnes Co
Slide 25: MMG overview
MMG overview Overview Key metrics1 Founded in 2009, MMG is a diversified base metals company with four operating mines and one development project located across four HKEx/ASX tickers 1208.HK, MMG.ASX continents Headquartered in Melbourne (Australia), with a primary listing on the Shares Outstan
Slide 26: Las Bambas 1H17 overview – 12 months of stable production
Las Bambas 1H17 overview – 12 months of stable production Las Bambas has now demonstrated 12 months of stable operation since achieving commercial production on 1 July 2016. Financials Total production over the previous 12 months of 430kt at a C1 US$ million 1H17 1H161 % cost of US$1.02/lb. Prod
Slide 27: Kinsevere 1H17 overview – strong production continues
Kinsevere 1H17 overview – strong production continues Production down 2% on the prior period to 39,203 tonnes of copper cathode due to lower mill throughput. Revenue increased Financials by US$34.5 million (18%) as a result of higher copper prices US$ million 1H17 1H16 % Operating costs increase
Slide 28: Sepon 1H17 overview – record asset utilisation
Sepon 1H17 overview – record asset utilisation Sepon produced 32,456 tonnes of copper cathode in 1H17(-10%) Financials with continued transition to lower grade, more complex ores. US$ million 1H17 1H16 % The decline in grade was partially offset by record asset Revenue 192.7 176.3 9% utilisation
Slide 29: Australian Operations 1H17 overview
Australian Operations 1H17 overview Lower revenue due to sale of Golden Grove in February 2017 and Financials lower sales volumes at Rosebery due to declining grades. US$ million 1H17 1H16 % C1 zinc cost guidance reduction at Rosebery to US$0.15-0.25/lb Revenue 154.5 193.7 (20%) (was US$0.25-0.3
Slide 30: Financial dashboard
Financial dashboard Revenue by commodity Revenue by customer location 1% Australia 4% 4% 5% 6% 5% Zinc 10% China Copper Japan & Korea Gold 17% Other Asia Silver 47% Middle East Lead 16% 85% Other EBITDA by operating segment Operating expenses (sites) 8% 6% 7% 2% 7% 14% People 8% External Services Se
Slide 31: Consolidated financial performance: Statement of financial performance
Consolidated financial performance: Statement of financial performance Six Months Ended 30 June 2017 1H17 1H16 Var % US$ million Revenue 1,942.4 586.1 231% Underlying EBITDA 855.0 134.3 537% Depreciation and amortisation -425.7 -201.3 111% Underlying EBIT 429.3 -67.0 741% Net Interest -260.1 -47.1 4
Slide 32: Condensed consolidated balance sheet
Condensed consolidated balance sheet US$ million 30 June 2017 31 Dec 2016 Non-current assets 12,926.0 13,198.5 Current assets – cash and cash equivalents 914.3 552.7 Current assets – other 784.0 1,478.8 Total assets 14,624.3 15,230.0 Total equity 2,713.9 2,589.6 Non-current liabilities – other 1,496
Slide 33: Consolidated financial performance: Cash flow statement
Consolidated financial performance: Cash flow statement Six months ended 30 June 2017 2016 US$ million Receipts from customers 2,426.51 686.1 Payments to suppliers (561.0) (1,263.1) Payments for exploration expenditure (17.6) (18.8) Income tax paid (29.8) (48.6) Net cash generated from operating act
Slide 34: Executive team – global experience
Executive team – global experience Chief Executive Officer Chief Financial Officer EGM Business Support Mr Jerry Jiao Mr Ross Carroll Acting Chief Operating Officer 25+ years’ experience in metals 25+ years’ experience in the Natural Mr Greg Travers and mining Resources sectors Executive Gener
Slide 35: “Brouress EMEIVIG
AA “Brouress EMEIVIG