Kinross Gold Corporation · TSX:K
Kinross Gold — BMO Capital Markets Global Mining & Metals Conference 2013
36 slides from Kinross Gold's conference presentation, Feb 25, 2013
Slide 1: Kinross Gold Corporation 2013 Montreal Marketing Presentation
March 21 KINROSS GOLD CORPORATION 2013 Montreal Marketing Presentation 11 www.kinross.com
Slide 2: Cautionary Statement on Forward-Looking Information
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION All statements, other than statements of historical fact, contained or incorporated by reference in or made in giving this presentation, including any information as to the future performance of Kinross, constitute “forward looking statements” with
Slide 3: Kinross Today: Operating Mines in 4 Core Regions
KINROSS TODAY OPERATING MINES IN 4 CORE REGIONS • Diversified portfolio of assets located in some of the world’s best gold districts producing RUSSIA Dvoinoye Kupol Fort Knox Kettle River - Buckhorn Round Mountain WEST AFRICA NORTH AMERICA Tasiast Chirano Fruta del Norte Paracatu La Coipa Maricunga
Slide 4: Principles for Building Value
PRINCIPLES FOR BUILDING VALUE 1. Internal focus on operational fundamentals 2. Pursuing quality versus quantity in mine planning, production and resource strategies 3. Maintaining a strong balance sheet 4. Disciplined approach to capital allocation and project development 44 www.kinross.com
Slide 5: North America
NORTH • 2012 production: 708,371 gold equivalent ounces at cost of sales of $637/oz. AMERICA • Well-run, stable open-pit and underground operations 55 www.kinross.com
Slide 6: South America
SOUTH • 2012 production: 881,945 gold equivalent ounces at cost of sales of $870/oz. AMERICA • Multi-year Paracatu expansion projects now complete 66 www.kinross.com
Slide 7: West Africa
WEST • 2012 production: 449,245 gold equivalent ounces at cost of sales of $784/oz. AFRICA • Strong focus on increasing efficiency and performance in the region 77 www.kinross.com
Slide 8: Russia
• 2012 production: 578,252 gold equivalent ounces at cost of sales of $472/oz. RUSSIA • Model for successfully operating in a remote region 88 www.kinross.com
Slide 9: Kinross Exceeds 2012 Production Guidance
PRINCIPLE ONE: INTERNAL FOCUS KINROSS EXCEEDS 2012 PRODUCTION GUIDANCE • Production of 2.62 mm gold equivalent ounces exceeded 2012 production guidance • Production cost of sales of $706/oz. was in-line with guidance GOLD EQUIVALENT PRODUCTION(1) PRODUCTION COST OF SALES(2) 724,510 $742 672,173 $725
Slide 10: 2012 Financial Results Highlights
PRINCIPLE ONE: INTERNAL FOCUS 2012 FINANCIAL RESULTS HIGHLIGHTS • Non-cash goodwill impairment reduced reported net earnings by approximately $3.2 billion REVENUE ADJUSTED CASH FLOW(3) ADJUSTED NET EARNINGS(3) +12% -2% +3% $1,562 $1,527 $4,311 $879 $851 $3,843 $1.37/sh $0.77/sh $0.75/sh US$ millions
Slide 11: The Kinross Way Forward
PRINCIPLE ONE: INTERNAL FOCUS THE KINROSS WAY FORWARD • 7 key areas form the basis of The Kinross Way Forward: • Prioritizing cash flow 1. MINE PLAN OPTIMIZATION • Optimizing pushback widths, mine sequencing • Exploiting zero / low-capex productivity improvements 2. CONTINUOUS IMPROVEMENT • Reducing
Slide 12: 2013 Production & Costs Outlook
PRINCIPLE TWO: QUALITY VERSUS QUANTITY 2013 PRODUCTION & COSTS OUTLOOK(4) • 2013 outlook shaped by continued focus on cost control, margin improvement and cash flow • 2013 all-in sustaining cost(5) expected to be $1,100 - $1,200 per gold ounce Gold Production % of Total Production Cost of Sales Regi
Slide 13: Mineral Reserve and Resource Update
PRINCIPLE TWO: QUALITY VERSUS QUANTITY MINERAL RESERVE AND RESOURCE UPDATE(6) • Strategic decision to maintain gold price assumptions used for 2011: Reserves - $1,200/oz.; resources -$1,400/oz. • Example of Kinross’ commitment to focus on higher quality, higher margin ounces PROVEN & PROBABLE GOLD
Slide 14: Solid Financial Position
PRINCIPLE THREE: MAINTAINING A STRONG BALANCE SHEET SOLID FINANCIAL POSITION • Investment grade credit ratings from all three major rating agencies • Cash and cash equivalents: $1,633 million • Up to $460 million may be used to repurchase the senior convertible notes on March 15, 2013 STRONG LIQUIDI
Slide 15: Capital Discipline Continues in 2013
PRINCIPLE THREE: MAINTAINING A STRONG BALANCE SHEET CAPITAL DISCIPLINE CONTINUES IN 2013 2012 estimate following project resequence Identified $200 mm of capital Actual 2012 $2.2 reductions spend Continued focus $2.0 on disciplined $1.9 spending Capital Expenditures (US$ billions) $1.6 February Q2 -
Slide 16: Portfolio of Growth Projects
PRINCIPLE FOUR: DISCIPLINED PROJECT DEVELOPMENT PORTFOLIO OF GROWTH PROJECTS • Optimized project sequencing, with Dvoinoye and Tasiast as key development priorities Dvoinoye Tasiast Fruta del Norte Lobo-Marte GLOBAL PORTFOLIO Operating mine Development project 1616 www.kinross.com
Slide 17: Update on Tasiast Pre-Feasibility Study
PRINCIPLE FOUR: DISCIPLINED PROJECT DEVELOPMENT UPDATE ON TASIAST PRE-FEASIBILITY STUDY • PFS on a mid-size, expandable CIL mill in the 30k tpd range is expected to be complete at the end of March Not proceeding with a 60k tpd mill option • A smaller mill at Tasiast offers a number of anticipated
Slide 18: Update on Tasiast Optimization
PRINCIPLE FOUR: DISCIPLINED PROJECT DEVELOPMENT UPDATE ON TASIAST OPTIMIZATION INFRASTRUCTURE DEVELOPMENT • Operational as of Q4 2012: New tailings pumping system West Branch dump leach pads Interim water supply On-Site Power Plant Other non-process buildings • Permanent camp nearing complet
Slide 19: Russia
• Dvoinoye continues to progress on budget and on schedule RUSSIA • First shipment of ore to the Kupol mill expected in the second half of 2013 1919 www.kinross.com
Slide 20: Dvoinoye on Budget & on Schedule
PRINCIPLE FOUR: DISCIPLINED PROJECT DEVELOPMENT DVOINOYE ON BUDGET & ON SCHEDULE • First shipment of ore to the Kupol mill expected Site infrastructure development in the second half of 2013 • Underground development continues to progress ahead of plan Main ventilation fans installed • Surface inf
Slide 21: Fruta del Norte
PRINCIPLE FOUR: DISCIPLINED PROJECT DEVELOPMENT FRUTA DEL NORTE • Negotiations with the government continue on the commercial terms of exploitation and investment protection agreements • Continue to make progress on a mutually acceptable agreement and have reached conceptual understanding in a numbe
Slide 22: Tasiast District Exploration
2012 EXPLORATION PROGRAM TASIAST DISTRICT EXPLORATION(7) • Drilling at step-out targets confirm presence of narrow, high- Fennec grade veins at C67, Fennec and C68 C67 C67 & FENNEC C68E C68W • Drilling at the Fennec target, 300 m northwest of C67 • Further drilling planned for Q1 2013 to assess size
Slide 23: Kupol-West Moroshka
2012 EXPLORATION PROGRAM KUPOL-WEST MOROSHKA(7) • Additional high-grade mineralization discovered at the Moroshka target Kupol located 5 km southeast of Kupol Moroshka trend (geochemistry) • Presence of high-grade mineralization Moroshka over a strike length of 300 metres and vein a vertical range o
Slide 24: Kinross: Foundation for the Future
KINROSS: FOUNDATION FOR THE FUTURE • Significant reserve & resource base • Four operating regions generating robust cash flow • Strong balance sheet & liquidity position • Focused plan for reducing costs, improving margins & increasing free cash flow • Portfolio of development projects and a discipl
Slide 25: Appendix
APPENDIX 2525 www.kinross.com
Slide 26: Fort Knox, Alaska (100%)
UNITED STATES FORT KNOX, ALASKA (100%) • Production commenced in 1997 • Began construction of a new heap leach facility to extend mine life in 2008 • Heap leach production commenced in late 2009 OPERATING RESULTS PRODUCTION PRODUCTION COST (Au eq. oz.) OF SALES ($/oz.) FY 2012 359,948 $663 FY 2011 2
Slide 27: Round Mountain (50%)
UNITED STATES ROUND MOUNTAIN (50%) • Kinross-operated JV with Barrick • Bulk tonnage open-pit operation • Commercial production began in 1977 OPERATING RESULTS PRODUCTION PRODUCTION COST (Au eq. oz.) OF SALES ($/oz.) FY 2012 192,330 $717 FY 2011 187,444 $697 2012 GOLD RESERVES AND RESOURCES(6) TONNE
Slide 28: Kettle River – Buckhorn (100%)
UNITED STATES KETTLE RIVER – BUCKHORN (100%) • Entered production in Q4/08 • Small foot-print, underground mine • Near-mine exploration targets OPERATING RESULTS PRODUCTION PRODUCTION COST (Au eq. oz.) OF SALES ($/oz.) FY 2012 156,093 $482 FY 2011 175,292 $420 2012 GOLD RESERVES AND RESOURCES(6) TON
Slide 29: Kupol (100%)
RUSSIA KUPOL (100%) • Completed transaction increasing ownership to 100% from 75% on April 27, 2011 • High-grade underground mine with 3,000 tpd mill • Produced its 2 millionth ounce of gold in 2011 OPERATING RESULTS PRODUCTION PRODUCTION COST (Au eq. oz.) OF SALES ($/oz.) FY 2012 578,252 $472 FY 20
Slide 30: Paracatu (100%)
BRAZIL PARACATU (100%) • Plant 2 expansions now largely complete: 3rd ball mill commissioned in Q2 2011 4th ball mill commissioned in Q3 2012 OPERATING RESULTS PRODUCTION PRODUCTION COST (Au eq. oz.) OF SALES ($/oz.) FY 2012 466,709 $881 FY 2011 453,396 $720 2012 GOLD RESERVES AND RESOURCES(6) T
Slide 31: La Coipa (100%)
CHILE LA COIPA (100%) • Expect to suspend mining of the existing orebody in the second half of 2013 • Continuing to assess the remaining reserves, resources and exploration potential Including the future potential of La Coipa Phase 7 (Pompeya) OPERATING RESULTS PRODUCTION PRODUCTION COST (Au eq. o
Slide 32: Maricunga (100%)
CHILE MARICUNGA (100%) • Located in the highly prospective Maricunga District • High-altitude heap leach operation OPERATING RESULTS PRODUCTION PRODUCTION COST (Au eq. oz.) OF SALES ($/oz.) FY 2012 236,369 $779 FY 2011 236,249 $457 2012 GOLD RESERVES AND RESOURCES(6) TONNES GRADE OUNCES (thousands)
Slide 33: Tasiast (100%)
MAURITANIA TASIAST (100%) • Open-pit mine ~300 km north of the city of Nouakchott • Remote, flat, sparsely populated desert OPERATING RESULTS PRODUCTION PRODUCTION COST (Au eq. oz.) OF SALES ($/oz.) FY 2012 185,334 $889 FY 2011 200,619 $702 2012 GOLD RESERVES AND RESOURCES(6) TONNES GRADE OUNCES (th
Slide 34: Chirano (90%)
GHANA CHIRANO (90%) • 90% owned by Kinross; Government of Ghana holds a 10% carried interest • 9 open-pits and 2 recently-discovered underground deposits • Achieved first gold pour in 2005 OPERATING RESULTS(1) PRODUCTION PRODUCTION COST (Au eq. oz.) OF SALES ($/oz.) FY 2012 263,911 $721 FY 2011 235,
Slide 35: Endnotes
ENDNOTES 1) Unless otherwise noted, gold equivalent production, gold equivalent ounces sold and production cost of sales figures in this presentation are based on Kinross’ 90% share of Chirano production and 75% of Kupol production up to April 27, 2011 (100% thereafter), and do not include productio
Slide 36: Kinross Gold Corporation
KINROSS GOLD CORPORATION 25 York Street, 17th Floor │Toronto, ON │ M5J 2V5 www.kinross.com 3636 www.kinross.com
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