Champion Iron Ltd. · ASX:CIA
Champion Iron — Non-Deal Roadshow (May 2019)
41 slides from Champion Iron's roadshow presentation, May 2019
Slide 1: Roadshow Presentation May 2019
ROADSHOW PRESENTATION MAY 2019 a PREMIUM PRODUCT, TIER 1 JURISDICTION, C HAM P| O N | R O N Lx HIGH QUALITY INFRASTRUCTURE
Slide 2: Disclaimer
DISCLAIMER CHAMPION IRON 24 This presentation contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words “expect”, “anticipate”, “continue”, "estimate", “may”, “will, "project", "should", "believe", "plans", “intends”, “f
Slide 3: Corporate Overview
CORPORATE OVERVIEW BLOOM LAKE
Slide 4: Structural Shift in Iron Ore
STRUCTURAL SHIFT IN IRON ORE ✓ Champion sells based on P65 premium benchmark P62 and P65 Premium - 5 Years (US$/t) > > >
Slide 5: Canada 2nd Largest Region in High-Grade
CANADA 2ND LARGEST REGION IN HIGH-GRADE > > SWEDEN – 16,1 RUSSIA CANADA 52 18,1 > UKRAINE 17 2,5 INDIA 385,4 AUSTRALIA 31,7 BRAZIL SOUTH AFRICA – 14,0
Slide 6: Competing on Cost Curve
COMPETING ON COST CURVE > GLOBAL COST CURVE (CFR CHINA – ADJUSTED FOR VIU) > BLOOM LAKE
Slide 7: Positioned for Profitability
POSITIONED FOR PROFITABILITY > >
Slide 8: Corporate Snapshot
CORPORATE SNAPSHOT (CIA-TSX; CIA-ASX) MARKET STATISTICS (C$M) SHAREHOLDERS
Slide 9: History of Bloom Lake vs Iron Ore Price
HISTORY OF BLOOM LAKE VS IRON ORE PRICE (C$/T) QIO Acquires Bloom Lake Cliff Acquires Bloom Lake Recommissioned CLM for C4.9B Cliff seeks creditor QIO Releases protection Feasibility Study 1st Shipment VALE Events
Slide 10: Labrador Trough = World-Class Opportunity
LABRADOR TROUGH = WORLD-CLASS OPPORTUNITY > > > > > >
Slide 11: Cost Structure Improvement
COST STRUCTURE IMPROVEMENT (2014 VS TODAY) >
Slide 12: Bloom Lake Today
BLOOM LAKE TODAY CHAMPION IRON 24 > Achieved highest production on record > Achieved lowest cash cost on record BLOOM LAKE PRODUCTION BLOOM LAKE TOTAL CASH COST HISTORY (WMT/YEAR) (C$/DMT) - YTD (9-MONTHS) 7,000,000 $60 a $50 $7.17 $49.74 6,000,000 || $19.32 $40 5,000,000 $30 $2.11 $9.64 4,000,000 $
Slide 13: Diversified Customer Base
DIVERSIFIED CUSTOMER BASE Product sold to 12 different GERMANY – 5% CHINA SOUTH KOREA – 2% customers in 1st year of operation > > > 35% JAPAN - 28% INDIA – 2% UK – 2% BAHRAIN – 22% SINGAPOOR – 3%
Slide 14: Realized Pricing
REALIZED PRICING (FQ3/19) CHAMPION IRON 24 Net price realized $100 Pine for Bloom Lake y reference $20.0 $91.6 concentrate ($C)/t $90 for pricing $20.7 $86.2 internationally- $80 traded iron ore $71.6 $70 Quality premium $65.5 $60 realized for 66.2% -$26.1 FX conversion Freight to end customers $50
Slide 15: Operational Results
OPERATIONAL RESULTS > > > > OPERATIONAL HIGHLIGHTS Q1 2019 Q2 2019 Q3 2019 Q4 2019 YTD >
Slide 16: Financial Results
FINANCIAL RESULTS > Generated C$173,6M of operating cash flow in first year of operations > Proven ability to sustain total cash cost sub C$50/t > Strong cash operating margin > Not incombered by stream or royalties Iron ore concentrate produced (wmt) 1542900 1858 300 1791300 5192500 Iron ore concen
Slide 17: Rapidly Improving Capital Structure
RAPIDLY IMPROVING CAPITAL STRUCTURE LONG-TERM DEBT OUTSTANDING STRUCTURE AMOUNT MATURITY $115.2 26% $185.0 37% $316.8 $329.4 63% 74%
Slide 18: Strong Leverage to Commodity Price
STRONG LEVERAGE TO COMMODITY PRICE > >
Slide 19: Bloom Lake Phase 1 7.4Mtpa
BLOOM LAKE PHASE 1 7.4MTPA > > > > > >
Slide 20: Bloom Lake Phase 2 15Mtpa
BLOOM LAKE PHASE 2 15MTPA > > > > >
Slide 21: Regional Opportunities Phase 3
REGIONAL OPPORTUNITIES PHASE 3 > > >
Slide 22: Valuation
VALUATION CHAMPION IRON 24 > Despite exposure to short-term opportunity to double production (pending FID of feasibility) + substantial mine life above peer average, current valuation stands below peers EV / EBITDA - CONSENSUS 2019 5.0 cs) 4.0 3.5 - a 2.5 Champion Iron Global majors North American P
Slide 23: Health & Safety
HEALTH & SAFETY CHAMPION IRON 29 > Lost time injury remain below benchmark for open pit mine* QUEBEC IRON ORE + CONTRACTORS BENCHMARK FOR MINE OPEN-PIT -YEAR 2017- (SOURCE*:APSM) Lost Time Injury Frequency Rate (LTIFR) 2.4 8.02 7.47 6.07 15.34 4.32 49 Disability Injury Severity Rate (DISR) 3.2 Zils)
Slide 24: Environmental Focused
ENVIRONMENTAL FOCUSED CHAMPION IRON 24 ELECTRIC BOILER CONVERSION Reduction of 3,800,000L Fuel oil 10,300 t/yr GHG - 40% TAILINGS PUMPING SYSTEM Reduction of 4,900,000L of diesel 13,600 t/yr GHG 2014 GHG EMISSIONS 2014 FIXED GHG (tons) 2014 MOBILE GHG (tons) 24
Slide 25: Experienced Management Team
EXPERIENCED MANAGEMENT TEAM > > > > > > > > > > > > > > > > > > >
Slide 26: Track-Record of Success
TRACK-RECORD OF SUCCESS $20 $15 $10 $5 – Sep-04 May-06 Jan-08 Oct-09 Jun-11 > > > > > > > > > > > > > > >
Slide 27: Appendix
Slide 28: Corporate Structure
CORPORATE STRUCTURE Champion Iron Limited 100% CHAMPION IRON 29 Corporate Structure Ressources Québec 63.20% Champion Iron Mines 100% Fermont Property Holdings - 8 prospective land properties > 700km? 36.80% Québec Iron Ore (“QIO”) 100% Bloom Lake Mine and Infrastructure Note: QIO is consolidated in
Slide 29: Iron Ore Value Chain
IRON ORE VALUE CHAIN SLINTER PELLETS >
Slide 30: Tailing Management
TAILING MANAGEMENT CHAMPION IRON 24 CHAMPION’S TAILING MANAGEMENT SETS A NEW STANDARD IN THE INDUSTRY > Fine and coarse tailing separation representing 12% & 88%, respectively > 10:1 slope for upstream dam construction vs. industry standard of 6:1 > Fines managed with center line dam systems > Real
Slide 31: Infrastructure and Logistics
INFRASTRUCTURE AND LOGISTICS > > > > > > > > > > > > > > > > > >
Slide 32: Bloom Lake Updated Recovery Flowsheet
BLOOM LAKE UPDATED RECOVERY FLOWSHEET > > > > >
Slide 33: Investment Highlights: Updated Feasibility Economics Phase 1
INVESTMENT HIGHLIGHTS UPDATED FEASIBILITY ECONOMICS – PHASE 1
Slide 34: Bloom Lake Reserves & Resources
BLOOM LAKE RESERVES & RESOURCES
Slide 35: Valuable and Sought-After Product
VALUABLE AND SOUGHT-AFTER PRODUCT > > > > > ✓ ✓ ✓
Slide 36: Bloom Lake Mine Complex
BLOOM LAKE CHAMPION IRON 24 MINE COMPLEX
Slide 37: Phase 1 Plant
PHASE 1 PLANT CHAMPION IRON 24 37
Slide 38: Phase 2 Plant
PHASE 2 PLANT CHAMPION IRON 24 38
Slide 39: Multi-User Port
MULTI-USER PORT CHAMPION IRON 29 39
Slide 40: First Vessel
FIRST VESSEL CHAMPION IRON 24 4l
Slide 41: Thank You!
THANK YOU! Contact us for more information. DAVID CATAFORD, MICHAEL MARCOTTE, CEO VP INVESTOR RELATIONS dcataford@championrionmines.com mmarcotte@championironmines.com 1100 René-Lévesque Blvd. West, Suite 610 Montreal QC H3B 4N4 Lx Tel.: +1 514 316 4858 M P Fax.: +1 514 819 8100 CHA | 0 N CHAMPIONIR