Silvercorp Metals Inc. · TSX:SVM
Silvercorp Metals — Investor Presentation (November 2013)
29 slides from Silvercorp Metals's investor presentation, Nov 15, 2013
Slide 1: Corporate Presentation
November 15, 2013 Corporate Presentation
Slide 2: Forward Looking Statements
Forward Looking Statements Safe Harbor Statement under the United States Private Securities Litigation Reform Act of 1995: Except for the statements of historical fact contained herein, the information presented constitutes "forward-looking statements" within the meaning of the Private Securities Li
Slide 3: Overview: Strategically Focused on Silver Mining in China
Overview: Strategically Focused on Silver Mining in China Ying Mining District, Henan Province FY2013: Produced 4.9Moz Silver China X Mine Projects, Henan Province Silver Lead Zinc Reserves & Resources1 (MOz) (Kt) (Kt) Proven & Probable BYP Project, Reserves 97.2 457.0 277.4 Hunan Province Measured
Slide 4: Silvercorp's Strategy
Silvercorp’s Strategy Our Strategy • Acquire under-explored small-scale mining projects with resource potential • Grow these assets organically • In current low price environment focus on cost saving measures Proven Execution • Successfully acquired and developed projects • Built 800,000 t/y mining
Slide 5: Financial Snapshot
Financial Snapshot FY2014 FY2013 Six Months Ended Year Ended Sept. 30, 2013 March 31, 2013 (millions) (millions) Revenue US$68.3 US$181.6 Net Income US$4.21 US$42.0 Cash Flow from Operations US$23.3 US$85.8 Cash, cash equivalents and short-term investments: US$99.0 Million Shares Outstanding: 171 mi
Slide 6: Fiscal 2014 Q2 Results
Fiscal 2014 Q2 Results Low cost producer of silver - cash cost of Q2 FY2014 Sales Mix by Metal $0.49 per Ag ounce for the latest quarter * Quarter-ended September 30, 2013. 5 5
Slide 7: Consolidation of the Ying Mining District: Next Steps for Growth
Consolidation of the Ying Mining District: Next Steps for Growth Flagship Ying District consists of 4 underground mines including SGX mine and 3 satellite mines Extensive development work (~72,000 m underground tunnels for fiscal 2014) to increase mining capacity from last year’s 2300 t/d to mat
Slide 8: Ying Mining District: Focus on Dilution Control
Ying Mining District: Focus on Dilution Control • Extract cost savings from existing operations by focusing on dilution control • Recent cost savings review discovered that dilutive practices of some of our contract miners caused lower head grades and increased operating costs as additional waste to
Slide 9: Ying Mining District: LM & LM West – Increasing Production
Ying Mining District: LM & LM West – Increasing Production No.1 – 1,000 tpd Mill No. 2 – 2,200 tpd Mill Goal: Increase the combined production capacity of the LM and LM West to 300,000 tonnes of ore per year in Fiscal 2015 matching existing milling capacity: • 2400 meters of 4,800 meter access ramp
Slide 10: GC Mine – Our Next Mine
GC Mine – Our Next Mine • Located in Guangdong Province • Excellent infrastructure and access • Underground silver mine • Estimated 12 year mine life • Processing capacity of 1,600 tpd • Producing lead-silver, zinc, pyrite, sulphur and tin concentrates • Construction substantially complete • Catalys
Slide 11: GC Mine: Progressing towards production
GC Mine: Progressing towards production Mine development: • 1,600 t/d mill – construction complete • Main 2.2km access ramp – construction complete • 4.6km Exploration ramp - 39% complete Mill Exterior with Shaft in the Background • 628 metre vertical shaft – complete • 110KV substation – complete •
Slide 12: GC Mine: Progressing towards production
GC Mine: Progressing towards production • Received a temporary safety production permit which allows for trial mining • Equipment testing and trial processing of mill circuit has identified numerous improvement areas. Test recoveries are close to designed levels for Ag, Pb, Zn, and S but further tes
Slide 13: GC Mine: Progressing towards production
GC Mine: Progressing towards production Temporary Shaft for Mill Plant Sinking the Main Shaft Concentrate Thickener 110KV Power Substation Dewatering Shop Concentrate Warehouse 12 12
Slide 14: BYP Mine
BYP Mine Recent Achievements: • Producing Gold mine in Hunan Province (2,140 Oz Au in Q2) • Completed instillation of shaft equipment for newly completed 265m shaft, headframe construction started • Construction of 1,500 t/d tailings backfill facility completed 500 tpd Mill at the BYP Mine and trial
Slide 15: The X Mines - XBG & XHP Development Projects
The X Mines - XBG & XHP Development Projects • Announced agreement for sale of our 90% interest in the XBG project for $12.4 million. • $8.2 million already received with completion expected within the next 12 months. 350 tpd Flotation Mill at XBG • At XHP activities are suspended as part of cost sa
Slide 16: FY2014 Capital Expenditure Guidance
FY2014 Capital Expenditure Guidance Facilities/ Mine Development Permitting/ Exploration Total Mines/ Equipment ($million) Projects Cost Work* Cost Cost Drilling ($million) (meters) ($million) ($million) (meters) Ying Mining District 21.3 72,000 12.4 5.6 149,000 39.3 GC Mine 12.1 18,400 9.4 1.9 48,0
Slide 17: FY2014 Production Guidance
FY2014 Production Guidance FY2014 Total Guidance Mines/ Projects Silver Gold Lead & Zinc Sulfur (million Oz) (‘000 Oz) (millions lbs.) (million lbs.) Ying Mining District 5.50 4.7 74.7 - GC Mine 0.74 - 18.2 20.5 BYP Mine - 15.8 - - X-Mines Project 0.06 0.30 6.2 - Total 6.30 20.8 99.1 20.5 Guidance g
Slide 18: FY2014 Production Guidance
FY2014 Production Guidance FY2014 Ore Processed & Head Grades Mine/ Project Ore Silver Gold Lead Zinc Tin Sulfur Processed (g/t) (g/t) (%) (%) (%) (%) (‘000Tonnes) Ying Mining District 220 0.33 3.4 1.3 - - 837,000 GC Mine 100 - 0.8 2.2 0.1 6.0 300,000 BYP Mine - 2.39 - - - - 220,000 X-Mines Project
Slide 19: Key Growth Catalysts
Key Growth Catalysts • Ying Mining District : • Increase mining capacity to match milling capacity • More efficient and lower cost mining • More efficient exploration • GC Project: • Construction substantially completed • Receive final approval from local government to commission mine • Continue exp
Slide 20: Paying Dividends to Shareholders Since 2007
Paying Dividends to Shareholders Since 2007 Cash Dividend as % of Operating Cash flow 25% 20% 18% 17% 13% 13% 11% 9% 10% 8% 7% 3% 3% 2007 2008 2009 2010 2011 2012 Silvercorp Silver Wheaton Hecla Pan American *Silvercorp’s fiscal year ends on March 31. Other companies’ fiscal year ends on December 31
Slide 21: Investment Highlights
Investment Highlights • Low Cost, long life silver assets in a mining friendly jurisdiction • Experienced and proven management team • Strong Financial Position - $99 million cash on hand. No debt. • Strong financial performance – generated $23.3 million in cash flow from operations in first half ye
Slide 22: Appendices
Appendices SILVERCORP 21
Slide 23: Appendix I: Ownership and Coverage
Appendix I: Ownership and Coverage Top 10 Institutional Investors – % O/S Analyst Coverage Firms and Funds 1 Van Eck Associates Corporation 9.99 BMO Capital Andrew Kaip 2 Renaissance Technologies Corp. 4.31 Markets 3 Royce & Associates, LLC 2.63 Chris Thompson Raymond James Global X Management Compa
Slide 24: Appendix II: Management & Board
Appendix II: Management & Board Management Board of Directors Rui Feng, Ph.D., Geology Rui Feng Myles J. Gao Chairman, Director Earl Drake Paul Simpson Myles J. Gao, P.Geo. President & CEO, Director David Kong Yikang Liu Maria Tang, CA, CPA Malcolm Swallow Chief Financial Officer Shaoyang Shen, MBA,
Slide 25: Appendix III: Summary of Silver Reserves
Appendix III: Summary of Silver Reserves1,2,3,4 Tonnes Head Grades Contained Metal Reserves Reserve Project (Million) Category Ag (g/t) Pb (%) Zn (%) Ag (Moz) Pb (t) Zn (t) Proven 2.62 273 5.06 2.16 23.0 132,500 56,700 Ying Mining District Probable 7.17 242 3.66 1.12 55.7 262,400 80,200 Proven 0.46
Slide 26: Appendix IV: Summary of Silver Resources
Appendix IV: Summary of Silver Resources1,2,3,4 Tonnes Contained Metal Resources Reserve Head Grades Project (Million) (Inclusive of Reserves) Category Ag (g/t) Pb (%) Zn (%) Ag (Moz) Pb (t) Zn (t) Measured 2.42 360 6.67 2.80 28.0 161,600 67,700 Ying Mining Indicated 6.79 311 4.59 1.49 67.9 311,600
Slide 27: Appendix V: BYP Mine Resource
Appendix V: BYP Mine Resource Mineral Resources for Gold Zones as of December 31, 2011: Contained Metal Cut-off Resource Grades CLASS Resources Grades (g/t) (tonne) Au (g/t) Au (oz) Indicated 1.0 3,510,000 2.59 292,000 Inferred 1.0 2,470,000 1.84 146,000 Mineral Resources for Lead and Zinc Zones as
Slide 28: Endnotes and Cautionary Statements
Endnotes and Cautionary Statements Myles Gao, P.Geo, Silvercorp’s President, is the Qualified Person within the meaning of National Instrument 43-101 – Standards Of Disclosure for Mineral Projects (“NI 43-101”) who supervised the preparation of the scientific and technical information of Silvercorp
Slide 29: Contact Information
Contact Information Head Office Suite #1378 - 200 Granville St., Vancouver, BC, Canada V6C 1S4 Tel: 604-669-9397 | Fax: 604-669-9387 | Toll-Free: 1-888-224-1881 Email: investor@silvercorp.ca Website: www.silvercorp.ca Silvercorp’s disclosure documents are available from the System for Electronic Doc
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