Golden Star Resources — IPO Roadshow (July 2016)
29 slides from Golden Star Resources's IPO roadshow presentation, Jul 25, 2016
Slide 1: Disclaimer and Other Matters
DISCLAIMER AND OTHER MATTERS 2 SAFE HARBOR: Some statements contained in this presentation are forward-looking statements or forward-looking information (collectively, “forward-looking statements”) within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicabl
Slide 2: Disclaimer and Other Matters (Continued)
DISCLAIMER AND OTHER MATTERS (CONTINUED) 3 SECURITIES LAW COMPLIANCE: This presentation does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to
Slide 3: Delivering on Strategy
DELIVERING ON STRATEGY 4 GOAL: to become a stable, reliable, predictable gold producer Eliminated the high cost refractory production Converted mineral reserve base to all non–refractory ounces 2016 strategic focus: Bring Wassa Underground into production as planned Advance Prestea Underground Impro
Slide 4: Investment Highlights
INVESTMENT HIGHLIGHTS 5 Price / Net Asset Value (ratio)(1)(2) Price / 2017E CFPS (ratio)(2)(3) Multi-asset diversification with two core projects situated in the Ashanti Gold Belt in Ghana Clearly defined near-term production growth profile, with underground projects at Wassa and Prestea projected t
Slide 5: Illustrative Pro Forma Financial Impact
Q2 2016 DEBT Maturity Schedule (US$ MM) Net Debt(2) 3. Includes equipment financing loans, finance leases and vendor agreement. 4. Q2 cash balance adjusted for publically disclosed subsequent events (Receipt of US$20 mm Royal Gold deposit). Source: Company filings 1. Proceeds are used to retire US$5
Slide 6: Focused on Low Cost Ounces – Refractory Operation Suspended in Q3 2015
7 Over 2015, the high cost refractory ounces were phased out The refractory operation was suspended in Q3 with some residual ounces in Q4 YTD 2016 production comprised of only non-refractory production Quarterly Production (koz) FOCUSED ON LOW COST OUNCES – REFRACTORY OPERATION SUSPENDED IN Q3 2015
Slide 7: What to Expect in 2016
WHAT TO EXPECT IN 2016 8 See note on slide 2 regarding Non-GAAP Financial Measures * - includes 20,000 – 25,000 of pre commercial production from the Wassa Underground 2016 Production*: 180,000 – 205,000 ounces Cash Operating Costs1 : $815 – $925 per ounce Stable production base established Q3 is ex
Slide 8: Future Production Profile
FUTURE PRODUCTION PROFILE 9 2016 production expected 180,000 – 205,000 ounces Future production* increases by approximately 30% once both Underground operations are fully ramped up to average annual production: Total Wassa* – 160,000 ounces Total Prestea* – 90,000 ounces Opportunity Continued growth
Slide 9: Two Operating Mines on Prolific Ashanti Gold Belt
TWO OPERATING MINES ON PROLIFIC ASHANTI GOLD BELT 10
Slide 10: Wassa – Underground Stoping Commenced
Wassa – Underground Stoping Commenced
Slide 11: Wassa Underground
WASSA UNDERGROUND Feasibility study estimates total LOM average annual production of 160 koz Average LOM Cash Operating Costs of US$780/oz Stoping commenced at Wassa Underground in mid-2016, as scheduled First stope blasted in the F Shoot using longitudinal longhole open stoping Development rate is
Slide 12: Changing the Approach to Unlock Value
CHANGING THE APPROACH TO UNLOCK VALUE 13 New focus resulted in significant cost reductions Mining costs reduced by 37% from 2013 to 2015 Site G&A reduced by over 40% over the same period To accelerate cash flow generation – higher grade portion of the ore body to be accessed from the underground Acq
Slide 13: Underground Mine Design
UNDERGROUND MINE DESIGN 14 BS West stopes F Shoot BS Stopes
Slide 14: Wassa Q2 2016 Operational Performance
WASSA Q2 2016 OPERATIONAL PERFORMANCE 15 Q2 2016 Q1 2016 Q4 2015 Ore mined kt 651 610 806 Waste mined kt 2,629 2,406 2,924 Ore processed kt 574 641 620 Grade processed g/t 1.16 1.64 1.77 Recovery % 94.0 94.1 93.9 Gold Production oz 21,543 31,273 31,395 Gold sales oz 21,092 30,887 30,880 Cash Operati
Slide 15: Wassa Q2 2016 Operational Performance
WASSA Q2 2016 OPERATIONAL PERFORMANCE Q22016 Q12016 Q42015 | OFemined M654 610806 soar performance Waste mined kt | 2,629, leading up to scheduled plant shutdown at the beginning of Crepes ere gat cao 0 rocessed + Grades and recovery were Gold Production ° Cash Operating Cost kee 975-705 625 Note: S
Slide 16: Prestea Open Pit & Underground Mines
PRESTEA OPEN PIT & UNDERGROUND MINES Production from Prestea replaced high cost refractory ounces Open pit bridging the production gap until underground production established Prestea open pits have been contributing to production since July 2015 Growth in Prestea Mineral Reserves indicates potentia
Slide 17: Prestea Underground Project Update
PRESTEA UNDERGROUND PROJECT UPDATE 18 Rehabilitation works – COMPLETED Long lead time equipment ordered – COMPLETED Mechanical and electrical upgrades – to be completed in Q3 2016 Pre-development of the Mineral Resource to begin Q4 2016 Stoping expected to commence in mid-2017 Ramping up to 650 tonn
Slide 18: Prestea Open Pits & Prestea Underground
PRESTEA OPEN PITS & PRESTEA UNDERGROUND 19 West Reef (WR) Prestea Open Pits Mineral Resources Tonnes (000) Grade g/t Au Ounces (000) Prestea South 2,568 2.12 175 Prestea Underground 1,597 15.52 797 Bogoso / Prestea Other 2,151 1.70 118 Total 6,316 5.37 1,090
Slide 19: Prestea Open Pits Q2 2016 Operational Performance
PRESTEA OPEN PITS Q2 2016 OPERATIONAL PERFORMANCE Q2 2016 Q1 2016 Q4 2015 Ore mined kt 306 383 301 Waste mined kt 1,067 1,145 894 Ore processed kt 378 362 318 Grade processed g/t 1.95 2.21 2.36 Recovery % 85.9 84.4 83.1 Gold Production oz 20,918 21,944 20,746* Gold sales oz 20,912 21,782 20,498* Cas
Slide 20: Moving Forward – 2016 and Beyond
Bring Wassa Underground into production as planned Advance Prestea Underground De risk balance sheet Disciplined approach to all aspects of the business Moving Forward – 2016 and Beyond
Slide 21: +1 3800 NYSE MKT: GSS investor@gsr.com
+1 416 538 3800 NYSE MKT: GSS investor@gsr.com TSX: GSC
Slide 22: +1 3800 investor@gsr.com
+1 416 538 3800 investor@gsr.com
Slide 23: Reserves and Resources as at December 2015
RESERVES AND RESOURCES AS AT 31 DECEMBER 2015 24 Note: Resources shown inclusive of reserves. Tonnes Grade Ounces (000) (g/t Au) (000) Proven Reserves Wassa 1,046 1.09 37 Bogoso / Prestea 25 2.69 2 Total 1,071 1.12 39 Probable Reserves Wassa 19,319 2.33 1,450 Bogoso / Prestea 3,237 6.29 654 Total 22
Slide 24: Royal Gold Financing Arrangement
ROYAL GOLD FINANCING ARRANGEMENT 25 In July 2015 (subsequently amended in December 2015) Golden Star announced a financing from Royal Gold, for total aggregate proceeds of US$165 mm Facilitate development of Wassa and Prestea underground mines Retire outstanding Ecobank I loan debt Gold stream of US
Slide 25: New Sustainable Cost Structure
NEW SUSTAINABLE COST1 STRUCTURE 26 Cash Operating Costs - See note on slide 2 regarding Non-GAAP Financial Measures Q2 2016 cash cost of $959/oz, due to a 15% decrease in gold sold in the second quarter at Wassa arising from scheduled plant downtime. Significant reduction in power & consumables refl
Slide 26: Wassa Feasibility Study
Indicated Resource Inferred Resource WASSA FEASIBILITY STUDY 27 FS includes M&I Resources only Underground Reserves of 5.4Mt at 4.26 g/t Au for 745,000 oz FS RESULTS – MARCH 2015 COC PER OZ $780 AISC PER OZ $938 IRR 83% NPV5% $176M CAPEX $39M *Assumption of a gold price of $1,200 per ounce used in t
Slide 27: Wassa Future Potential
Indicated Resource Inferred Resource WASSA FUTURE POTENTIAL 28 PEA included Resources of 8.3Mt at 4.49 g/t Au for 1.20M oz PEA RESULTS – SEPTEMBER 2014 COC PER OZ $684 AISC PER OZ $778 IRR 90% NPV5% $271M *Assumption of a gold price of $1,200 per ounce used in these calculations. For further critica
Slide 28: Wassa - B Shoot and F Shoot Relation
WASSA - B SHOOT AND F SHOOT RELATION 29 B Shoot stopes F shoot Resource
Slide 29: Wassa - B Shoot and F Shoot Relation
WASSA - B SHOOT AND F SHOOT RELATION GOLDEN ST#R