Igo Limited · ASX:IGO
Igo — Independence Group NL — H1 FY2016 Earnings Presentation
19 slides from Igo's earnings presentation, Feb 17, 2016
Slide 1: Half Year Financial Results Presentation
INDEPENDENCE GROUP NL For personal use only Peter Bradford, Managing Director and CEO Half Year Financial Results Presentation 17 February 2016
Slide 2: Cautionary Statements & Disclaimer
Cautionary Statements & Disclaimer For personal use only • This presentation has been prepared by Independence Group NL (“IGO”) (ABN 46 092 786 304). It should not be considered as an offer or invitation to subscribe for or purchase any securities in IGO or as an inducement to make an offer or invit
Slide 3: H1 FY2016 Highlights
H1 FY2016 Highlights Leading Australian diversified mining company Financial and Corporate For personal use only • Underlying EBITDA of $70M and net operating cash flow of $49M (after expenditure of $9M on exploration) • Loss after tax of $78M following $36M impairment of exploration assets and $67M
Slide 4: Market Profile and Share Ownership
Market Profile and Share Ownership Strong domestic institutional and retail register composition For personal use only Market Profile Share Ownership • $1.5 billion market capitalisation at $2.95/share (1) • Substantial Holders (2) • Mark Creasy 18.88% • Share price 52 Week Range • FIL Limited 5.12%
Slide 5: Financials: H1 FY16 financial results
Financials H1 FY16 financial results For personal use only Highlights ($’million) H1 FY16 H1 FY15 Revenue 220.2 274.3 Underlying EBITDA(1) 69.6 121.4 Underlying NPAT (1) 13.5 51.0 Net (Loss) Profit After Tax (78.0) 49.5 Net Cash Flow From Operating Activities 48.9 113.9 Free Cash Flow(2) (42.6) 75.3
Slide 6: Commodity Prices
Commodity Prices Divergence between base and precious A$ metal price performance For personal use only 40% Gold Australian Dollar Commodity Price Movement since 26 May 2015 30% Silver Nickel 20% Zinc Copper 14% 10% 3% 0% -10% -13% -20% -19% -30% -32% -40% 6
Slide 7: Financials: Underlying EBITDA by asset
Financials H1 FY16 financial results For personal use only Underlying EBITDA ($’million) H1 FY16 H1 FY15 Tropicana 69.9 66.8 Long 8.5 28.5 Jaguar 13.7 48.3 Exploration (13.5) (13.4) Corporate (8.1) (5.9) Hedging 1.3 (1.5) Marketable Securities revaluation (1.9) 0.2 Employee Share Scheme (0.3) (1.4)
Slide 8: H1 FY16 Cash Flow
H1 FY16 Cash Flow Continued discipline and focus on cash management For personal use only • Nova Development attained 68% completion at 31 January 2016 • $260M capital remaining to complete project at 31 December 2015 • $350M term loan undrawn at 31 December 2015 • Exploration spend reduced by $20M
Slide 9: Tropicana H1 FY2016
Tropicana H1 FY2016 Strong operational performance and delivery on growth For personal use only Gold production and costs • 75,584oz gold produced and 76,055oz sold (IGO share) • Cash costs of $625/oz produced and AISC of $801/oz sold • Realised gold price $1,547/oz during the reporting period Minin
Slide 10: Long H1 FY2016
Long H1 FY2016 Operating discipline delivering gains in difficult price environment For personal use only Production and costs • 4,508t contained nickel produced • Cash costs of $3.97/lb payable Ni net of by-product credits and royalties • Realised nickel price $5.49/lb during the reporting period U
Slide 11: Jaguar H1 FY2016
Jaguar H1 FY2016 On track to meet guidance despite lower copper production YTD For personal use only Production and costs • 20,721t Zn and 2,876t Cu produced in concentrates • Cash cost of $0.67/lb payable zinc net of by-product credits and royalties • Realised zinc price $1.05/lb and copper price $
Slide 12: Nova H1 FY2016
Nova H1 FY2016 Fully financed, in construction, on schedule and on budget For personal use only Overall • Continued significant progress made with the project now 68% complete at 31 January 2016 • Project remains on track for commissioning in late 2016 and for production of first concentrates in Dec
Slide 13: Nova Project Progress
Nova Project Progress Project currently on time and on budget For personal use only Access road Crushing section Power building and switch room Heavy vehicle refuelling facility 13
Slide 14: Nova Optimisation Study
Nova Optimisation Study Added value - reduced risk - future growth For personal use only Study outcomes • 36% improvement on the Project NPV • 27% reduction in expected C1 cash costs (after by-product credits) in concentrate to $1.21/lb from $1.66/lb nickel • 21% decrease in all-in sustaining cash c
Slide 15: Exploration Rationalisation
Exploration Rationalisation Long term commitment to delivering organic growth For personal use only CY16 Exploration spend reduced by $20M • In response to continued weak base metal prices greenfields exploration prioritised on core growth projects: • Nova – Tropicana Belt • Lake Mackay JV • Bryah B
Slide 16: Exploration Focus
Exploration Focus Unlocking belt scale opportunities for gold and base metal discoveries For personal use only • IGO is focussed on exploration of belt scale projects that have the potential to deliver Tier 1 assets such as Tropicana and Nova • Combination of 100% owned projects and joint ventures •
Slide 17: FY16 Guidance
FY16 Guidance Updated exploration expenditure guidance For personal use only Tropicana (IGO share) • 129,000 to 141,000oz at average cash cost of $640 to $710/oz Au • AISC of $820 to $910/oz Au sold • Sustaining and improvement capex of $14 to $16M, stripping capex of $18 to $20M and exploration of
Slide 18: Concluding Comments
Concluding Comments Diversified mining company delivering cash flow and growth For personal use only Strong focus on cash management • Market prices for base metals negatively impacted project revenue during the period • Tropicana delivered operationally and on growth projects • Nova remains on sche
Slide 19: For personal use only
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Independence Group NL — H1 FY2016 Earnings Presentation on 6ix