Mgx Resources Limited · ASX:MGX
Mgx Resources — Mount Gibson Iron — Investor Presentation (October 2014)
23 slides from Mgx Resources's investor presentation, Oct 14, 2014
Slide 1: October Investor Presentation
October Investor Presentation For personal use only Built on quality MGX 14 October 2014
Slide 2: Disclaimer
Disclaimer This Document is Confidential and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person, or published, For personal use only in whole or in part, for any purpose without prior written approval from Mount Gibson Iron Limited. This Document is not a
Slide 3: Company snapshot – strong fundamentals
Company snapshot – strong fundamentals For personal use only A leading mid-tier iron ore exporter • Issued capital 1090.8 million shares • Index S&P/ASX 200 • Market cap1 A$500 million • Cash and term deposits2 A$465 million • Debt3 A$9.5m equipment leases Financials (year ended 30 June) 2009 2010 2
Slide 4: Business overview
Business overview For personal use only Koolan Island • Premium DSO lump and fines • Ramping up to 4 Mtpa run rate • Long life asset with extension potential • Simple logistics, remaining LOM strip ratio ~4.5:1 Mid West Region Tallering Peak, Extension Hill, Shine & Geraldton Port facilities Talleri
Slide 5: Maximising value – a simple strategy
Maximising value – a simple strategy For personal use only • Cost reduction and elimination of waste Leverage off • Operational optimisation and business improvement • Extension of production profile: existing asset – Optimise resources and reserves inventory – Brownfields exploration base to extrac
Slide 6: Maximising value – a solid start to FY2015
Maximising value – a solid start to FY2015 For personal use only • Cash of $465m at 30 Sept, minimal debt Strong • Group ore sales 1.9 Mwmt • Ore sales revenue of $117m FOB operating • On track to achieve 6.6 to 7.0 Mwmt in FY15 • Koolan Island unit cash mining and admin costs performance in reduced
Slide 7: Optimising the sales profile
Optimising the sales profile For personal use only Ore sales history and indicative outlook* 12 Actual Forecast 10 First 8 priority goal Ore Sales 6 (Mwmt) 4 2 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Year to 30 June FY'15 guidance 6.6 -7.0 Mt Shine
Slide 8: MGX – ore grade and quality set us apart
MGX – ore grade and quality set us apart For personal use only High quality ores: • Average Group Ore Reserves grade 62.0% Fe* − Koolan Island 63.9% Fe − Extension Hill 58.4% Fe − Shine 59.3% Fe − Low moisture content (MGX average ~3%) • Low in contaminants − Low Alumina - average 1.20% (Group Ore R
Slide 9: MGX – moving further up the quality curve
MGX – moving further up the quality curve Mount Gibson’s superior grade product mix protects it against increasing discounts For personal use only for low grade products WA Iron Ore Projects - Iron Grade and Phosphorous Content 65 64 MGX Koolan Island (Reserves) 63 Rio Tinto Pilbara Blend Fines 62 M
Slide 10: Koolan Island – a unique high quality asset
Koolan Island – a unique high quality asset For personal use only 1km N West End targets Main Pit 10
Slide 11: Koolan Island – a unique high quality asset
Koolan Island – a unique high quality asset For personal use only • Long life asset: ~7 years* • High quality DSO product • 3.7 Mt sold in FY14, including RSP • Ramping up to 4 Mtpa • Ramp-up reducing unit mining costs and increasing productivity • Sept Qtr unit mining costs at bottom end of $7-9/t
Slide 12: Koolan Island – recapitalising for strong future cashflow
Koolan Island – recapitalising for strong future cashflow For personal use only Indicative Koolan Island waste stripping and iron ore sales profile 12 Actual Forecast 10 8 6 4 2 0 Year to 30 June 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Iron Ore Sales (Mwmt) Indicat
Slide 13: Koolan Island – West End exploration
Koolan Island – West End exploration For personal use only • Program of Works (PoW) approved for 33 hole RC programme • Contractor engagement and mobilisation underway • Work planned to commence in October • Drilling to test for extensions of hematite West End sandstone mineralisation exploration fr
Slide 14: Mid West – established infrastructure and potential to grow resources
Mid West – established infrastructure and potential to grow resources For personal use only • Established infrastructure footprint gives MGX a competitive edge • Extension Hill region shaping as a potential resources hub • Shine Hematite Project – Low-capex DSO opportunity • Positive results from in
Slide 15: Geraldton Port – a competitive advantage
Geraldton Port – a competitive advantage For personal use only Ship Loader Rail Unloader MGX Berth 5 MGX Shed Berth 4 Shed 15
Slide 16: Extension Hill – a low cost growth platform
Extension Hill – a low cost growth platform For personal use only • Established road, rail and port solutions • ~0.6:1 remaining LOM strip ratio • +3 years life at 3Mtpa* • High potential near-mine exploration targets with known mineralisation • Potential regional operations hub 4 *Refer Slide at en
Slide 17: Extension Hill South – high potential target
Extension Hill South – high potential target • For personal use only Multiple known hematite targets located 1-3km from crusher • Iron Hill Prospect Exploration Target of 5-7 Mt @ 58-61% Fe.* N • Significant intercepts in 15 of 16 holes targeting primary Iron Hill hematite, including: • 22m @ 63.8%
Slide 18: Shine – low-capex DSO option
Shine – low-capex DSO option For personal use only • Hematite Mineral Resource of 7.8 Mt @ 59.0% Fe* • Ore Reserves of 5.6Mt @ 59.3% Fe* • Advanced approvals/permitting • Indicative ore production target of 1.6 Mtpa • Indicative $9-11m development cost (<$7/t installed capacity) • Close to existing
Slide 19: Tallering Peak – a final year of adding value
Tallering Peak – a final year of adding value • For personal use only Tenth anniversary of sales February 2014 • Life of mine ore sales +25 Mt • FY14 ore sales of 3 Mt vs 2.5 Mt forecast • LG stockpile sales generated strong cash margins while market window was open • Final year contribution from T6
Slide 20: Summary
Summary For personal use only • An established mid-cap iron ore producer • Strong balance sheet • Increasing ore grade and quality profile • Established transport infrastructure and long term customer contracts • Exploration upside and disciplined value-focused growth strategy is delivering • Experi
Slide 21: Thank You
Thank You For personal use only MGX For more information: Phone: +618 9426 7500 Email: admin@mtgibsoniron.com.au Web: www.mtgibsoniron.com.au 21
Slide 22: Supplementary information: Mineral Resources and Ore Reserves
Supplementary information Mineral Resources and Ore Reserves For personal use only Mineral Resources and Ore Reserves at 30 June 2014 Total Group Mineral Resources and Ore Reserves at 30 June 2014 Koolan Island Tonnes Fe SiO2 Al2O3 P Total Group Mineral Resources and Ore Reserves at 30 June millions
Slide 23: Five Year Performance Summary
Five Year Performance Summary For personal use only 30 June 30 June 30 June 30 June 30 June 12 months ended: 2010 2011 2012* 2013 2014 Mineral Resources Mt 108.6 103.3 95.2 88.6 83.3 Mineral Reserves Mt 56.4 52.0 44.3 45.2 44.3 Operating Mines # 2 3 3 3 2 Sales M wmt 6.5 5.2 5.2 8.8 9.7 Ore tonnes m
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