Compania De Minas Buenaventura Saa · BVL:BUENAVC1
Compania De Minas Buenaventura Saa — Compañía de Minas Buenaventura — Investor Day (2023)
58 slides from Compania De Minas Buenaventura Saa's investor day presentation, 2023
Slide 1: 2023 Investor Day
= MORE THAN MINING YEARS 2 0 2 3 Investor Day
Slide 2: Cautionary Statement
Cautionary Statement.- This presentation contains certain information that may constitute forward-looking information under applicable U.S. securities legislation, including but not limited to information about costs applicable to sales, general and administrative expenses; production volumes; curre
Slide 3: Leadership team with strong and diversified experience
Leadership team with strong and diversified experience Board of Directors Executive Team Roque Benavides Raúl Benavides William Champion Leandro García Daniel Domínguez Juan Carlos Ortiz (Chairman) (Independent) CEO since 2020 CFO since 2020 COO since 2018 Diego de la Torre Nicole Bernex Marco A. Za
Slide 4: Buenaventura's Strategy
BUENAVENTURA´S COUNTRY & SUSTAINABILITY MARKET STRATEGY OUTLOOK OPERATIONS GROWTH EXPLORATION PROJECTS & INNOVATION FINANCIALS 4
Slide 5: Buenaventura's Growth Strategy
BUENAVENTURA’S GROWTH STRATEGY Unlocking Value
Slide 6: Unlocking value through exploration and development for 70 years
has delivered continuous organic growth through exploration and development for 70 years… …and today, we embark on a journey that goes beyond the extraction of resources. It’s a journey guided by the core elements of our growth strategy: …foster community …prioritize our Strengthened operational par
Slide 7: Focus on four flagship assets position us as a mining leader
Focus on four flagship assets position us as a mining leader... …through precious and base metals diversification and increased LOM… Yumpag +100MOz-Ag >10 years LOM El Brocal >10 years LOM 12ktpd underground mine San Gabriel Latest project under construction >10 years LOM @ 100kOz-Au Cerro Verde >30
Slide 8: Our DNA of exploring new mineral resources to broaden our portfolio
…our DNA of exploring new mineral resources to broaden our portfolio. Ag Uchucchacua Yumpag CMC Sulf Coimolache Cu El Brocal Orcopampa Au San Gabriel Trapiche Julcani Cu Cerro MLZ Sulf Tambomayo Verde 8
Slide 9: Country & Market Outlook
COUNTRY & MARKET OUTLOOK
Slide 10: Country and Sector Outlook
Country and Sector Outlook Mitigated risk of higher • Mining is a key sector for the mining taxes and new country’s economic recovery. regulation of personnel outsourcing • Special government task force designated to track project progress These initiatives boost exploration, encourage Approved envi
Slide 11: Market Outlook – Copper
Market Outlook – Copper • Positive copper market outlook driven by two main factors: Market Balance (Kt) • Copper supply will not increase drastically in the upcoming 490 500 years. Challenging permits, regulations, and past decade's 360 limited investments make new copper projects difficult 200 120
Slide 12: Market Outlook – Gold and Silver
Market Outlook – Gold and Silver Price (USD/Oz) 2,300 2,100 • Prices should remain high due to geopolitical conflicts GOLD 1,900 • The market expects the FED to begin rate cuts in 2024 1,700 • Weak US dollar is also contributing to a higher gold price 1,500 1,300 2018 2019 2020 2021 2022 2023E 2024E
Slide 13: Market Outlook – Zinc and Lead
Market Outlook – Zinc and Lead Price (USD/t) 4,000 • Zinc demand is expected to struggle in the next few years 3,500 due to weakness in Europe ZINC • Market should turn to deficit by 2028 pushed by the green 3,000 energy transition 2,500 • A 1.2Mt gap expected by 2030 2,000 2018 2019 2020 2021 2022
Slide 14: Sustainability
SUSTAINABILITY
Slide 15: Our sustainability focus: social impact and energy efficiency
15 Across the highlands Our sustainability focus: social impact and of Peru energy efficiency Watershed management: • +100Mm3 stored in seven reservoirs mainly for community use • +700k seedlings planted for forestation and water harvesting • +10 hydraulic infrastructure works that carry +500 liters
Slide 16: Ongoing Assessment and Validation of our Sustainability Strategy
Ongoing Assessment and Validation of our Sustainability Strategy We built our ESG Materiality Matrix that enables us to: Economic and Identify Environmental Social governance main issues that could impact or influence our business, stakeholders or environment SIGNIFICANCE FOR STAKEHOLDERS Plan and m
Slide 17: Sustainability priorities: Community, Environment and Climate
17 Sustainability priorities: Community, Environment and Climate Focusing on Community Engagement, Environmental Compliance, and Mitigating Climate Change Impact through Watershed Initiatives Environment and Climate change: Inclusive business model, Developing projects with value closing gaps promot
Slide 18: Exploration
EXPLORATION
Slide 19: Mineral Resources & Reserves
Mineral Resources & Reserves Exploration is within our DNA: 4.8 +7% 4.6 Focus on Gold, Silver & Copper 4.3 GOLD (MOz-Au) 2.2 2.0 Historical Production 2.6 2.3 North: 1 La Zanja (Au): 1.7 Moz 2021 2022 2023 2 Coimolache (Au): 1.6 Moz +49% Central: 297 12 209 SILVER (MOz-Ag) 3 Uchucchacua (Ag): 315 Mo
Slide 20: Robust pipeline of Brownfield & Greenfield exploration projects
Robust pipeline of Brownfield & Greenfield exploration projects Resource Yumpag delineation • Yumpag: 113.1Moz Ag (M&I + Inf) CMC-Sulfides • CMC-Sulfides: 4.7Mt Cu eq (Ind+Inf) OP & 0.7Mt Cu eq (Ind+Inf) UG MLZ-Sulfides • MLZ-Sulfides: Continued growth of the project’s potential Bx 4 Don Jorge Drill
Slide 21: Robust pipeline of Brownfield & Greenfield exploration projects
Robust pipeline of Brownfield & Greenfield exploration projects Resource delineation • Yumpag: 113.1Moz Ag (M&I + Inf) • CMC-Sulfides: 4.7Mt Cu eq (Ind+Inf) OP & 0.7Mt Cu eq (Ind+Inf) UG Yumpag • MLZ-Sulfides: Continued growth of the project’s potential CMC-Sulfides MLZ-Sulfides Gold/Silver Copper B
Slide 22: Yumpag: +110 million ounces of high-grade silver
Yumpag: +110 million ounces of high-grade silver N New discovery of high-grade silver mineralization (+20ozAg). • First infill drilling program on Tomasa was successfully completed, including the best hole to date: 107.2m at 54.5oz/t Ag • 87% increase in M&I resources from 35Moz to 65Moz Ag Litholog
Slide 23: Coimolache: Large copper-gold sulfide project in northern Peru
Coimolache: Large copper-gold sulfide project in northern Peru • Large-scale copper-gold sulfide project 2km long by 1km wide • The second infill drilling campaign completed 20.5km from 45 DDH • Copper Eq grade increased by 23% from the previous estimate on improved geological understanding of m
Slide 24: La Zanja: Moving from oxides to sulfides
La Zanja: Moving from oxides to sulfides • 42.7km drilled to date on 3 breccia-pipes has led to initial resources of: • Deep holes confirm the system is open at depth 8.5m at 1.4%Cu and 8.3g/tAu (Alba) • Directional drilling is expected to start in 3Q24 Exploration Upside: • New blind breccia pipe
Slide 25: Operations
OPERATIONS
Slide 26: Diverse Operations with World Class Potential
Diverse Operations with World Class Potential Operates in the three most important Mining Districts of Peru with Diversified Portfolio in Tier 1 Jurisdictions great infrastructure 1 Coimolache - O/P Transition from Gold to Copper Sulfide 3 Uchucchacua - U/G 2 La Zanja - O/P Resume operation & ramp-u
Slide 27: Production Guidance Reflects Growth and Diversification
Production Guidance Reflects Growth and Diversification 215 - 220 9.5 – 10.0 56 - 58 2023 kOz MOz kton 2024 170 - 180 13.0 – 14.0 50 - 55 kOz MOz kton 2025 165 - 185 kOz 14.0 – 16.0 MOz 50 - 60 kton 220 - 240 14.0 – 16.0 50 - 60 2026 kOz MOz kton 27 Guidance figures include 100% BVN, 100% El Brocal,
Slide 28: El Brocal Mine: Large Scale & Long-Life Copper Mine
El Brocal Mine: Large Scale & Long-Life Copper Mine El Brocal Mine EL Brocal Copper 200 Contribution Copper Production (kt) 150 Open Pit N 100 Mine Trapiche Project (FS) Coimolache Project (SS) 50 UG Mine El Brocal Mine - Inferred Resources 0 Central 2024 2025 2026 2027 2028 2029 2040 2030 2031 2032
Slide 29: Uchucchacua
Uchucchacua Resume Operations Uchucchacua Mine Operations Uchucchacua Mine SE Polymetallic Areas NW HUANTAJALLA CARMEN SOCORRO MINE MINE MINE Underground mine productivity increased 20% with mine sectorization 4450 Developed a new metallurgical process that 4120 optimizes the value of the mineral Mi
Slide 30: Yumpag
Yumpag Start-Up Yumpag Mine (high grade) Yumpag 14.0 Silver Production (M Oz) Surface Infrastructure almost 100% 12.0 implemented. At Q2.2024, energy supply 10.0 from the national grid will be concluded 8.0 The first areas mined confirm the high silver 6.0 content of the ore with an average of 25 Oz
Slide 31: Yumpag
Yumpag Start-Up Yumpag Mine (high grade) 31
Slide 32: Coimolache
Coimolache Transition from Gold to Copper Sulfide Copper-Gold project Cost competitive assets Sulfide Copper-Gold overlaps evaluating opportunities to best in established mining jurisdictions current Au-oxide mine footprint exploit significant Mineral Resource Potential base Oxide Pit Limit Sulfide
Slide 33: Growth Projects
GROWTH PROJECTS
Slide 34: Continuous Pipeline of Projects
Copper 34 Gold Continuous Pipeline of Projects Silver Othes Increase value through our diversified portfolio focusing on projects with LOM ↑10 years Exploration Dorita Mulanan Chaska Bx 4 Llicllao La Zanja Coimolache Mayra Sulfides El Sulfides Brocal Tinka 10Y Anama- San Gaby ray Trapiche Gabriel Yu
Slide 35: San Gabriel: Our next large gold project
San Gabriel: Our next large gold project Progress as of: Item Description Project Milestones 1Q23 2Q23 3Q23 1 Engineering 66% 81% 90% San Gabriel campsite First gold 2 Procurement 85% 85% 89% completed bar 3 Construction 3% 7% 14% Start UG mining Finish Earthworks contractor contractor 4 Commissioni
Slide 36: San Gabriel: Project components
San Gabriel: Project components FRESH WATER DAM MINE PORTAL SAN GABRIEL CAMP WASTE DUMP 36
Slide 37: San Gabriel: Our commitment to sustainable mining
San Gabriel: Our commitment to sustainable mining 3 5 3 1 4 WASTE DUMP 2 5 STOCKPILE 1 CRUSHING 2 PROCESSING PLANT 4 OFFICES AND LABORATORY PROCESSING PLANT PLATFORM 37
Slide 38: Trapiche: Our next large copper project
Trapiche: Our next large copper project Metallurgical laboratory on site Trapiche Schedule Variability testing Viable external 2nd campaign access EIAd file Approve EIAd issue 3Q23 4Q23 2025 2026 Feasibility Power line right-of- Complete Power study finish pass at 30% line right of pass Feasibility
Slide 39: Trapiche: Project components
Trapiche: Project components Signed: Cusco ENRICHED ORE OXIDE & TRANSITIONAL 54km LEACH PAD ORE LEACH PAD CC. Mollocco Área de Amortiguamiento Ayacucho Reserva Cotahuasi CC. Mollebamba TRAPICHE National Highway National Highway OPEN PIT Arequipa SX/EW-AREA Qda. Arpa Orcco Power line: 66,1km TRAPICHE
Slide 40: Financials
FINANCIALS
Slide 41: Nine-Months 2023 Financial Highlights: Strong on copper
Nine-Months 2023 Financial Highlights: Strong on copper Copper output growth, higher metal prices, and dividends from Cerro Verde drove cash generation Revenue Dividends from Cerro Verde(2) Cash Position US$ 570 M US$ 150 M US$ 222 M (2023E = US$ 800 – 860 M) Revenue Mix CAPEX(3) Net Debt Cu Au Ag U
Slide 42: Increase Margins and Cash Generation
Increase Margins and Cash Generation Cost optimization Improving business performance by identifying and implementing efficient operational processes Capital allocation Strategically distributing financial resources to optimize returns and support long-term goals, with a main focus on capital expend
Slide 43: Increased Margins and Cashflow by Redefining Mining and Metallurgical Processes
Increased Margins and Cashflow by Redefining Mining and Metallurgical Processes, Plus Decreased G&A 6,584 6,613 6,300 6,250 6,150 6,050 Copper El Brocal 5,133 • Become self-operators of mining activities. Gradual US$/TMF-Cu implementation since 2024 • Optimizing stopes, reducing preparation meters •
Slide 44: Capital Allocation
Capital Allocation Prioritizing available resources with a focus on San Gabriel, leading to limited dividends in the coming years. This financial discipline will yield higher and steadier future dividends Prioritization of Cash proceeds: Maintenance capex for 1 continuing operations Shaping the rock
Slide 45: Investing in value generation
Investing in value generation Intensive CAPEX phase to take our flagships to the next level In US$ millions Sustaining Capex (+/- 5%) San Gabriel Growth Capex (+/- 5%) • Concrete Batch Plant, for concrete installation works (USD 4M, 2023) 330 310 • Concrete Installation, for process plant and infras
Slide 46: Securing the liquidity to finance our upcoming growth projects
Securing the liquidity to finance our upcoming growth projects Revolving Credit Facilities Negotiating the final terms and conditions of the facilities with local banks Term 1 $100M Committed $60M - $100M In negotiation Rate 7.0% - 9.0% 30 months (matching corporate bond duration) Bond refinancing:
Slide 47: Free cash flow generation
Metal prices: Free cash flow generation (in US$ millions) Au ($/Oz) Ag ($/Oz) Cu ($/TMF) Zn ($/TMF) Pb ($/TMF) 1,700 22.0 8,500 2,500 2,000 Striking the right balance between our short and long-term objectives FX = 3.75 PEN/USD Uchucchacua/Yumpag San Gabriel full year of operations starts operations
Slide 48: Buenaventura's Growth Strategy
BUENAVENTURA’S GROWTH STRATEGY Unlocking Value
Slide 49: Au Ag Cu production outlook
200 79 197.0 150 Au kOz-Au 100 GOLD 50 - 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 20.0 15.0 MOz-Ag 47 107.9 AgSILVER 10.0 5.0 - 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 150 125 100 Kton-Cu 29 63.5 Cu COPPER 75 50 25 - 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32'
Slide 50: San Gabriel will allow BVN to stabilize production
200 79 197.0 150 San Gabriel will allow Au kOz-Au 100 BVN to stabilize production GOLD 50 ↑175 kOz/yr - 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 20.0 15.0 MOz-Ag 47 107.9 AgSILVER 10.0 5.0 - 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 150 125 100 Kton-Cu 29 63.5 Cu COPPER
Slide 51: Yumpag + Tomasa will boost silver production
200 79 197.0 150 San Gabriel will allow Au kOz-Au 100 BVN to stabilize production GOLD 50 ↑175 kOz/yr - 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 20.0 15.0 Yumpag + Tomasa MOz-Ag 47 107.9 Ag 10.0 will boost BVN’s production to SILVER 5.0 ↑15 MOz/yr - 20' 21' 22' 23' 24' 25' 26' 27' 28'
Slide 52: El Brocal transition to a 100% copper producer
200 79 197.0 150 San Gabriel will allow Au kOz-Au 100 BVN to stabilize production GOLD 50 ↑175 kOz/yr - 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 20.0 15.0 Yumpag + Tomasa MOz-Ag 47 107.9 Ag 10.0 will boost BVN’s production to SILVER 5.0 ↑15 MOz/yr - 20' 21' 22' 23' 24' 25' 26' 27' 28'
Slide 53: Trapiche will turn BVN to a world class copper producer
200 79 197.0 150 San Gabriel will allow Au kOz-Au 100 BVN to stabilize production GOLD 50 ↑175 kOz/yr - 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 20.0 15.0 Yumpag + Tomasa MOz-Ag 47 107.9 Ag 10.0 will boost BVN’s production to SILVER 5.0 ↑15 MOz/yr - 20' 21' 22' 23' 24' 25' 26' 27' 28'
Slide 54: Focus on four flagship assets, building our pipeline of diverse projects
Focus on four flagship assets, building our pipeline of diverse projects and increased LOM position us as a mining leader... Ag Yumpag Yumpag producing at full potential Cu El Brocal El Brocal underground mine expansion @ 12ktpd Au San Gabriel San Gabriel ramp-up and first gold bar Cu Cerro Verde Ce
Slide 55: 2023 Investor Day
= MORE THAN MINING YEARS 2 0 2 3 Investor Day
Slide 56: Appendix
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Slide 57: Securing the liquidity to finance our upcoming growth projects
Securing the liquidity to finance our upcoming growth projects We have made significant progress towards improving Buenaventura's financial health, which will allow for continued growth 2022 2025 Sale of BVN’s total stake in → Bond refinancing Yanacocha ($300M) will initiate Newmont transferred
Slide 58: CMC Sulfides will boost BVN copper production
250 79 197.0 200 CMC Sulfides will allow Au 150 kOz-Au BVN to stabilize production 100 GOLD 50 ↑175 kOz/yr - 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 25.0 20.0 Yumpag + Tomasa MOz-Au 47 107.9 15.0 Ag 10.0 will boost BVN’s production to SILVER 5.0 ↑15 MOz/yr - 20' 21' 22' 23' 24' 25' 2