Slide 1: IGO Limited 2Q20 and 1H20 Results Presentation
IGO Limited 2Q20 and 1H20 Results Presentation 30 January 2020
Slide 2: Cautionary Statements & Disclaimer
Cautionary Statements & Disclaimer • This presentation has been prepared by IGO Limited (“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 invitation with respect to those secu
Slide 3: Competent Person's Statements
Competent Person’s Statements • Any references to IGO Mineral Resource and Ore Reserve estimates should be read in conjunction with IGO’s Annual Update of Exploration Results, Mineral Resources and Ore Reserves dated 30 January 2020 (Annual Statement) and lodged with the ASX for which Competent Pers
Slide 4: Safety
Safety Renewed focus following a period of poor performance Key Lag Injury Metrics(1,2,3) 5 Recent safety performance in the last six months has been disappointing 4 3 2 Strategy and work program in place to remedy this situation 1 0 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 MTI
Slide 5: Sustainability
Sustainability Demonstrated commitment to best in class sustainability practices Nova hybrid solar PV-diesel facility completed – set to reduce emissions by ~6,500t CO2/year 2019 Sustainability Report published IGO included in Dow Jones Sustainability Index at 78th percentile 5
Slide 6: 2Q20 Highlights
2Q20 FY19Highlights and 4Q19 Highlights Excellent operational performance from Nova and Tropicana continues Metal production from both Nova and Tropicana above top end of pro-rata FY20 guidance range Net Cash A$396M Underlying EBITDA New offtake agreements signed with BHP and Trafigura A$117M with m
Slide 7: 1H20 Highlights
1H20 FY19Financial and 4Q19Results Highlights Highlights Record half yearly profit and strengthening balance sheet Record half yearly NPAT result Cash of A$453M A$100M Net Cash of A$396M Underlying EBITDA Underlying Free Cash Flow A$271M A$206M Nova and Tropicana remain on track to deliver in line w
Slide 8: 2Q20 Financial Results
2Q20 Financial Results Excellent production result offset by lower realised commodity prices Units 1Q20 2Q20 QoQ Revenue and Other Income A$M 263.1 211.6 (20%) Underlying EBITDA(1) A$M 153.9 116.7 (24%) Profit After Tax A$M 66.0 34.1 (48%) Net Cash from Operating Activities A$M 89.4 156.0 75% Underl
Slide 9: 2Q20 Cash Flow Reconciliation
2Q20 Cash Flow Reconciliation Nova cash flows resulted in 41% increase in cash balance QoQ A$M 600 500 23.3 20.7 2.1 4.5 0.3 1.4 400 136.7 300 452.8 200 321.2 100 - Cash at Nova FCF Tropicana FCF Exploration Payments for Corporate and Finance Costs Lease payments Cash at 30 Sept 2019 Investments Oth
Slide 10: 2Q20 NPAT Reconciliation
2Q20 NPAT Reconciliation Change in QoQ Nova EBITDA primarily driven by 19% lower nickel price A$M 70 60 50 40 49.5 66.0 30 12.2 7.3 7.0 20 1.5 0.1 0.1 3.4 34.1 10 - 1Q20 NPAT Nova Tropicana Exploration Corporate Mark-to- D&A Other Tax 2Q20 NPAT EBITDA EBITDA EBITDA market investments 10
Slide 11: 1H20 Financial Results
1H20 Financial Results Free Cash Flow generation continues to strengthen balance sheet Units 1H19 1H20 Inc/(Dec) Revenue and Other Income A$M 356.4 474.7 33% Underlying EBITDA(1) A$M 130.5 270.7 107% Profit After Tax A$M 0.9 100.1 ~11,000% Net Cash from Operating Activities A$M 163.0 245.3 50% Under
Slide 12: 1H20 Cash Flow Reconciliation
1H20 Cash Flow Reconciliation Nova cash generation enhanced by strong metals prices A$M 700 600 49.8 40.4 22.9 10.9 1.2 2.6 500 28.6 47.3 206.2 400 300 452.7 200 348.2 100 - Cash at Nova FCF Tropicana Exploration Payments for Corporate Finance Lease Debt Dividend Cash at 30 June 2019 FCF Investments
Slide 13: 1H20 Segment Financial Results
1H20 Segment Financial Results Nova and Tropicana delivering outstanding financial performance Operation Metric 1H19 1H20 Change Inc/(Dec) Revenue 215.1 317.3 102.2 48% Nova Underlying EBITDA(1) 94.0 206.8 112.8 120% Free Cash Flow(2) 88.4 206.2 117.8 133% Revenue 136.4 154.3 17.9 13% Tropicana Unde
Slide 14: Resource and Reserves
Resource and Reserves Significant mineral resources remain at Nova and Tropicana Nova Operation – estimates for the end of CY19 Mass Nickel Copper Cobalt (Mt) Grade (%) Metal (kt) Grade (%) Metal (kt) Grade (%) Metal (kt) Total Mineral Resource 11.6 2.01 234 0.80 94 0.07 8 Total Ore Reserve 9.5 1.85
Slide 15: Nova Nickel Operation
Nova Nickel Operation 15
Slide 16: Nova
Nova Quarterly production exceeds top end of pro-rata guidance range for all metals Metric Units 1Q20 2Q20 1H20 Pro-rata Guidance1 Nickel in concentrate t 7,724 7,513 15,236 13,500 - 15,000 Copper in concentrate t 3,490 3,289 6,779 5,500 - 6,250 Cobalt in concentrate t 282 279 561 425 - 475 Cash cos
Slide 17: Nova Production
Nova Production 19% fall in nickel price QoQ impacted financial performance Nova Production Nova Cash Flow Reconciliation Tonnes A$/lb A$M 9,000 $3.00 160 8,000 $2.59 140 4.3 $2.22 $2.50 7,000 $2.42 120 6,000 $2.00 67.6 100 $1.50 5,000 $1.50 80 2.8 4,000 8,375 7,906 139.1 7,724 7,513 3,731 60 3,000
Slide 18: Offtake Agreements
Offtake Agreements Competitive concentrate tender process undertaken in parallel to downstream study Summary of New Offtake Terms Strong global counterparty interest for Nova concentrate BHP Billiton Nickel West Pty Ltd Trafigura Pte. Ltd offtake Materially improved commercial terms negotiated for n
Slide 19: Tropicana Joint Venture
Tropicana Joint Venture (IGO 30%, AngloGold Ashanti 70% and manager) 19
Slide 20: Tropicana Highlights
Tropicana Highlights 1H20 gold production ahead of pro-rata guidance Metric Units 1Q20 2Q20 1H20 Pro-rata Guidance(1) Gold produced (100%) koz 123.3 133.9 257.3 225,000 – 250,000 Gold Sold (IGO 30%) koz 38.9 38.6 77.6 67,500 – 75,000 Cash cost A$/oz 741 698 719 700 – 780 AISC A$/oz 1,066 948 1,007 1
Slide 21: Tropicana
Tropicana Consistent underlying EBITDA and strong margins of 66% Tropicana Production (100% ) and AISC Tropicana Cash Flow Reconciliation A$M oz A$/oz 160,000 $1,200 60 $1,066 140,000 $990 $950 $948 $1,000 50 120,000 13.0 $800 40 100,000 2.5 80,000 $600 30 132,945 133,932 50.8 60,000 123,236 123,320
Slide 22: Tropicana Boston Shaker Underground Update
Tropicana Boston Shaker Underground Update Good progress on decline and raisebore development Development on schedule – first gold expected 1Q21 Studies on additional underground opportunities being completed 1) Refer to ASX release dated 28 March 2019: Tropicana Joint Venture Approves Boston Shaker
Slide 23: Exploration & Growth
Exploration & Growth 23
Slide 24: Nova
Nova Diamond and AC drill program continuing over several targets • 10 surface holes and 7 underground holes drilled for a total of 16,770m • Successfully intersected 9 mafic/ultramafic intrusions outside the Nova “eye”, each containing variable disseminated magmatic nickel-copper sulphides • AC dri
Slide 25: Fraser Range
Fraser Range Work continues to unlock substantial opportunity for discovery Mammoth Prospect(1) • Diamond drilling to test MLEM targets • Narrow zone of semi massive nickel-copper sulphides intersected within mafic intrusive • DHEM identified conductor to be tested in coming months Hook and Pike Pro
Slide 26: Lake Mackay
Lake Mackay Continuation of geophysics and drilling programs Arcee Prospect • 6 RC holes for 850m drilled to test ~600m of strike • Drilling confirmed orientation of mineralisation • Best intercepts include: ─ 4m @ 1.6g/t Au from 72m ─ 4m @ 1.5g/t Au from 104m Grimlock Prospect • Bench scale test wo
Slide 27: Kimberley Projects
Kimberley Projects Airborne surveys underway West Kimberley • 100m line spaced, 38,500 line kilometres of aeromagnetic and radiometric survey completed • Airborne survey to continue during 2H20 East Kimberley • Additional 1,500km2 staked in East Kimberley 1) The West Kimberly JV is a joint venture b
Slide 28: Tropicana Exploration
Tropicana Exploration Focus on Havana resource definition and regional targets Havana (Stage 4 and 6 cutback) resource definition • 5,220m drilled, representing ~50% of total drilling meters for the quarter • Objective was to de-risk resource and assess suitability for underground mining • Results i
Slide 29: Panoramic Takeover Offer
Panoramic Takeover Offer Disciplined approach to M&A Launch of conditional Offer Lapse public takeover offer Offer Period 4 November 2019 17 January 2020 • Offer conditions designed to • PAN breached various of IGO • Public disclosures by PAN following protect IGO shareholders conditions including a
Slide 30: Summary
Summary 30
Slide 31: Concluding Comments
Concluding Comments FY19 and 4Q19 Highlights Excellent operational performance from Nova and Tropicana Metal production on track to meet FY20 production guidance Free cash flow generation continuing to strengthen the balance sheet Continued focus on growth through exploration & disciplined M&A with
Slide 32: We believe in a world where people power makes amazing things happen
We believe in a world where people power makes amazing things happen. Where technology opens up. new horizons and clean energy makes the planet a better place for every generation to come. We are bold, passionate, fearless and fun - a smarter, kinder, more innovative company. Our work is making fund
Slide 33: Nova Mineral Resource and Ore Reserve
Appendix 1 Nova Mineral Resource and Ore Reserve1 Nova Operation – Mineral Resource estimate for the end of CY18/19 31 December 2018 31 December 2019 JORC Source Mass Nickel Copper Cobalt Mass Nickel Copper Cobalt Class (Mt) (%) (kt) (%) (kt) (%) (kt) (Mt) (%) (kt) (%) (kt) (%) (kt) Underground Meas
Slide 34: Tropicana Mineral Resource and Ore Reserve
Appendix 2 Tropicana Mineral Resource and Ore Reserve1 Tropicana Gold Mine – 100% Mineral Resources CY18/19 Tropicana Gold Mine – 100% Ore Reserves CY18/19 31 December 2018 31 December 2019 31 December 2018 31 December 2019 JORC JORC Gold Gold Estimate Mass Gold Mass Gold Estimate Mass Mass Class Cl