Mmg Ltd. · HKEX:1208
Mmg — BMO 28th Global Metals Mining Conference (February 2019)
24 slides from Mmg's conference presentation, February 2019
Slide 1: MMG Investor Presentation
MMG Investor Presentation February 2019
Slide 2: Disclaimer
Disclaimer The information contained in this presentation is intended solely for your personal reference and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person (whether within or outside your organisation/firm) or published, in whole or in part, for any pu
Slide 3: Safety, Environment and Social Performance
Safety, Environment and Social Performance Safety performance 4.5 4.5 4.7 ▪ Safety – our first value 4.3 4.1 3.9 ▪ In 2017, MMG’s TRIF was the lowest of all International Council on Mining and Metals (ICMM) 3.0 members globally 2.4 2.3 2.1 ▪ Committed to ICMM’s 10 principles of Sustainable 1.9 Devel
Slide 4: MMG asset base
MMG asset base We have a globally diversified portfolio of base metals operations and development projects HIGH LAKE IZOK LAKE LAOS HONG KONG VIENTIANE LAS BAMBAS (62.5%) DUGALD RIVER (100%) 2019 production guidance: 2019 production guidance: 385,000 to 405,000 tonnes of DRC 165,000 – 175,00 tonnes
Slide 5: Strategy and objectives
Strategy and objectives MMG’s objective is to be valued as one of the world’s top mid-tier miners by 2020 and, in the longer term, as one of the world’s top miners. To achieve this objective, we deliver value through four strategic drivers: People and ✓ We provide a safe, healthy and secure workplac
Slide 6: Fundamentals remain strong – near term
Fundamentals remain strong – near term 1. Demand outlook for 2019 is robust 1. Demand outlook for copper and zinc over the short and medium term is strong 3.5% Cu CAGR 2015-18: 2.6% Zn CAGR 2015-18: 1.6% 3.0% 2. Global metal stocks at multi year lows 2.5% 2.0% 1.5% 3. China’s credit cycle appears to
Slide 7: Fundamentals remain strong – medium and longer term
Fundamentals remain strong – medium and longer term Mined copper supply gap and requirement for new capacity Attractive fundamentals and insights from major shareholder support commodity outlook 28 Base Case Production 26 Capability ▪ Supply risks growing – social, political, grade 24 Primary Demand
Slide 8: Las Bambas update
Las Bambas update 2019 outlook > Production guidance of 385-405kt of copper C1 guidance US$1.15-1.25/lb. > 2018 Production impacted by localised geotechnical instability in a section of the Ferrobamba pit, major scheduled plant maintenance during 1H18 and the transition to lower grades as we continu
Slide 9: Dugald River – top zinc mine, world class ramp up
Dugald River – top 10 zinc mine, world class ramp up ▪ Commercial Production 1 May 2018. ▪ Total development capital ~US$550m1 ▪ Early commissioning has resulted in lower net capital expenditure in 2018 ▪ 2018 production guidance 147kt2 ▪ 2019 guidance 165-175kt pa and C1 cost of US$0.58-0.68/lb Dug
Slide 10: Excellence in project delivery and ramp up
Excellence in project delivery and ramp up Ramp up profiles of greenfield copper concentrators1 Ramp up profiles of greenfield zinc concentrators1 140% 120% 120% Mill throughput % of installed Capacity Mill throughput as % of installed Capacity 100% 100% 80% 80% 60% 60% 40% 40% Las Bambas Dugald Riv
Slide 11: Business improvement
Business improvement Right sizing the base ▪ Business improvement is a group wide focus and one of our strategic drivers for value creation ▪ Delivering the right platform to support value creation at existing asset US$30m reduction in base and retain flexibility to grow overhead costs ▪ Portfolio o
Slide 12: World-class asset base delivering value
World-class asset base delivering value ▪ World class asset base with geographic diversity and track record of C1 zinc cost curve (2019)1 delivering operational commitments 160 140 ▪ Las Bambas and Dugald River – world top 10 copper and zinc mines 120 2019 Dugald C1 cash cost (c/lb) ▪ Low cost posit
Slide 13: Focused, Efficient and Delivering Growth
Focused, Efficient and Delivering Growth Growth ✓ Las Bambas then Dugald River – World top 10 copper and zinc mines Operational Excellence ✓ Track record of continuous improvement Shareholder ✓ 2 year total shareholder return of 67% compared to -2% for EMIX value Global base metals index. Strong cas
Slide 14: 4Q18 Production summary and highlights
4Q18 Production summary and highlights Key highlights ▪ Strongest quarter for 2018, following production disruptions in 1Q and 3Q ▪ Total 20018 Cu and Zn production 467kt and 223kt ▪ 29% increase in 4Q18 production at Las Bambas. Actions to remediate wall slip completed ▪ Dugald River produced 147kt
Slide 15: 2018 Financial Update
2018 Financial Update Voluntary announcement – 18 January 2019 ▪ FY2018 NPAT of approximately US$135 to US$140 million, vs FY2017 NPAT of $348.4 million ▪ FY2018 NPAT attributable to equity holders of approximately US$65 to US$70 million, vs FY2017 NPAT attributable to equity holders of $147.1 milli
Slide 16: Appendix
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Slide 17: DRC Contribution - MMG Kinsevere
DRC Contribution - MMG Kinsevere INVESTMENTS Mining Code $1.2bn $250m 2018 Additional capital Purchase of Anvil invested for mine Mining in 2012 Revised Mining Code development to 2017 enacted March 2018 WORKFORCE Increased royalties, fees, duties, State’s rights and super profits tax. >96% Reduced
Slide 18: Guidance for 2019
Guidance for 2019 Las Bambas Rosebery Copper – production 385,000 – 405,000 tonnes Zinc – production 85,000 – 95,000 tonnes Copper – C1 costs US$1.15 – 1.25 / lb Zinc – C1 costs US$0.25 – 0.35 / lb Kinsevere Dugald River Copper – production 77,500 - 80,000 tonnes Zinc – production 165,000 – 175,000
Slide 19: Financial dashboard – 1H18
Financial dashboard – 1H18 Revenue by commodity Revenue by customer location Copper China 7% 4%1% Japan&Korea 5% Zinc 2% 10% Asia 9% Lead Middle East Gold 11% 49% Australia Silver Others 3% Molybdenum 79% 20% EBITDA by operating segment Operating expenses (sites) 3% 12% 11% 17% People 6% External Se
Slide 20: MMG overview
MMG overview Overview ▪ Founded in 2009, MMG is a diversified base metals company with four operating mines located across four continents Broker Coverage ▪ Headquartered in Melbourne (Australia), with a primary listing on the Broker Name HKEx (1208 HK) and a secondary listing on the ASX (MMG ASX) A
Slide 21: Mineral Resources
Mineral Resources Copper and zinc Mineral Resources of 12.8Mt and 10.9Mt respectively Mineral Resources – Contained Metal (100% asset basis) As at 30 June 2018 Project Copper Zinc Lead Silver Gold Molybdenum kt kt kt moz moz kt Las Bambas 10,649 168 2.4 310 Kinsevere 1,313 Dugald River 99 7,052 1,03
Slide 22: Ore Reserves
Ore Reserves Copper and zinc Ore Reserves of 7.4Mt and 3.8Mt respectively Ore Reserves – Contained Metal (100% asset basis) As at 30 June 2018 Project Copper Zinc Lead Silver Gold Molybdenum kt kt kt moz moz kt Las Bambas 6,882 107 1.7 187 Kinsevere 488 Dugald River 3,336 580 35 Rosebery 11 428 161
Slide 23: Executive team – global experience
Executive team – global experience Chief Executive Officer Chief Financial Officer EGM Business Support EGM Marketing & Risk Geoffrey Gao Ross Carroll Greg Travers Xu Jiqing ▪ Appointed as CEO of the ▪ 25+ years’ experience in the ▪ Executive General Manager ▪ 25+ years’ experience in Company in Aug
Slide 24: “proress IMEIVIG
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