Kenmare Resources Plc · LSE:KMR
Kenmare Resources — Shareholder Meeting (May 2014)
21 slides from Kenmare Resources's shareholder meeting presentation, May 28, 2014
Slide 1: Kenmare Resources plc Annual General Meeting
Kenmare Resources plc Annual General Meeting | 28 May 2014 Michael Carvill – Managing Director
Slide 2: Disclaimer
Disclaimer This Presentation (the “Presentation”) has been prepared and issued by Kenmare Resources plc (the “Company” or “Kenmare”). While this Presentation has been prepared in good faith, the Company and its respective officers, employees, agents and representatives expressly disclaim any and all
Slide 3: Kenmare Resources – 2013/2014
Kenmare Resources – 2013/2014 Phase II Expansion Completed Operations ➢ Mine production increasing ➢ Cost savings programme underway ➢ Solutions in place to address power transmission capacity and power stability to Moma Mine Unprecedented challenging market conditions Restructured project financing
Slide 4: Kenmare Resources – Long Life, Low cost
Kenmare Resources – Long Life, Low cost ➢ World leading titanium minerals producer ➢ Dredge mineable, direct export, low cost mine ➢ Life of mine over 100+ years ➢ 50% expansion completed and in production ➢ 8% of global titanium feedstock supply ➢ Projected above trendline pigment demand growth ➢ 2
Slide 5: Future Pigment Demand Expected to Grow at Above Historical Growth Rate
Future Pigment Demand Expected to Grow at Above Historical Growth Rate Global Pigment Demand 1990-2020 ('000 tonnes) 8,000 BASE DOWN UPSIDE ACTUAL 3.0% trend 7,000 6,000 5,000 Growth 2011 to 2020 4,000 UPSIDE CASE 3.4% CAGR BASE CASE 3.1% CAGR 3,000 DOWNSIDE CASE 2.8% CAGR Historical 3.0% CAGR from
Slide 6: Pricing Movement
Pricing Movement $300 $2,000 $1,800 Zircon price /t (US$) $250 $1,600 Ilmenite price /t (US$) - 21% $1,400 $200 - 44% $1,200 $150 $1,000 $800 $100 - 55% $600 Ilmenite Price $400 $50 Primary Zircon Price $200 Secondary Zircon Price $0 $0 2012 2013 Kenmare has increased cost focus in response to prici
Slide 7: Total Product Revenue/t -v- Kenmare Share Price
Total Product Revenue/t -v- Kenmare Share Price 500 70 450 60 400 S 350 t 50 U g 300 40 S $ 250 p / 200 e 30 t n 150 c 20 Revenue per Tonne 100 e KMR Closing Share Price 10 50 0 0 01/10 04/10 07/10 10/10 01/11 04/11 07/11 10/11 01/12 04/12 07/12 10/12 01/13 04/13 07/13 10/13 01/14 Q2-11 Q1-10 Q2-10
Slide 8: Pigment Demand Growth Drivers
Pigment Demand Growth Drivers Pigment Consumption Intensity of TiO2 in 20121 60 Canada ➢ Demand growth drivers in developing USA 50 Japan W. Europe economies: ➢ Pigment intensity of use at early stage of GDP US$ '000 per capita 40 growth curve ➢ Increasing per capita GDP 30 ➢ Urbanisation trends Tai
Slide 9: Operational Developments
Operational Developments Phase II Expansion complete ➢3rd Dredge operational ➢WCP B operational ➢Upgraded processing plant operational ➢Extended product storage facility complete Phase II Q1 2014 ➢Ilmenite production: 210.8kt (Q1 2013: 137.5kt) ➢Zircon production ➢Primary zircon: 7.7kt (Q1 2013: 5.7
Slide 10: Expanded Processing Complete
Expanded Processing Complete Extended Storage New Storage New Whims New Aux Ilmenite Existing MSP New Belt filter 10
Slide 11: Production
Production 450,000 Ilmenite Zircon 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 0 H1 2012 H2 2012 H1 2013 H2 2013 ➢ Expansion ramp up started H2 2013, with HMC up 47% and total final products up 21% in 2013 on 2012 production Latest Production update from IMS 24th Apr 2014: ➢ Q1 20
Slide 12: 2011 – 2013 Cash Operating Costs
2011 – 2013 Cash Operating Costs $250.0 800 Final Product Production (Kt) - Right Axis Ongoing Cash Operating Cost per Tonne (US$/t) - Left Axis 700 $200.0 600 500 $150.0 400 $100.0 300 200 $50.0 100 $- 0 2011 2012 2013 ➢ Cost per tonne peak in 2013, expected to drop in 2014 due to: ➢ Increasing pro
Slide 13: Power Reliability
Power Reliability Solutions by Kenmare and Electricidade de Moçambique (EdM) to address transmission capacity and power stability to Moma Mine : Horizon Solution Responsibility Power Status Current ➢ Rent diesel-electric generating plant for Kenmare 7.5MW Contracted for MSP Delivery in Q3 ➢ Load man
Slide 14: KMAD - Community Relations
KMAD - Community Relations 2013 – 2015 Strategic Plan Agreed Current Projects ➢ Health post started operating in March 2013 & ambulance allocated for community service ➢ Nataka school completed & 2 new schools under construction ➢ Water supply to the Natuco vegetable project finalised ➢ 2 new commun
Slide 15: Kenmare Resources – Long Life, Low Cost
Kenmare Resources – Long Life, Low Cost Moma – A low cost, long life asset ➢ World leading producer of titanium minerals ➢ 8% of global titanium feedstock supply ➢ Life of mine over 100+ years ➢ Low cost dredge-mineable mine with port facilities on site Established producer ➢ US$1bn+ invested into M
Slide 16: Kenmare Resources plc contact details
Kenmare Resources plc Kenmare Chatham House │ ChathamResources plc 2 │ Ireland Street │ Dublin Chatham House │ Chatham Street │ Dublin 2 │ Ireland www.kenmareresources.com www.kenmareresources.com
Slide 17: Appendix
Appendix 17
Slide 18: Mozambique Overview
Mozambique Overview Quick facts (2012) Capital Maputo Government type Presidential Democratic Republic S&P (B+ / Stable) Moma Ratings Fitch (B+ / Positive) Mine Nominal GDP US$14.6bn Total Debt / GDP (2011) 32.1% Net FDIs / GDP 10.0% GDP Growth 7.4% Population 25 million International natural resour
Slide 19: Kenmare Resources at a Glance
Kenmare Resources at a Glance Kenmare quick facts Location of mine Moma Mine, North-east Coast Mozambique Products (market share)(1) Titanium feedstock (approximately 8% global supply) One of the world’s largest known titanium minerals Mine life deposits with 100+ years at expanded production levels
Slide 20: Operations Review
Operations Review The Moma Mine Operating Characteristics ➢ Kenmare's expanded operating capacity is 1.2mtpa of ➢ >3mt have been shipped to date ilmenite, plus co-products zircon & rutile ➢ Coastal location; no overland transport ➢ Mining performed by three dredges floating in two artificial ➢ Surfa
Slide 21: Reserves & Resources
Reserves & Resources Reserves & resources table as at 31 December 2013 % % % Ore % % Rutile THM Ilmenite Rutile Zircon Ore Reserve Zone Category Ilmenite Ilmenite Zircon (Mt) THM* in ore (Mt) (Mt) (Mt) (Mt) in THM in ore in ore Reserves Namalope Proved 241 4.3 82 3.5 0.077 0.25 10 8.4 0.18 0.60 Nama