Central Asia Metals Plc · LSE:CAML

Central Asia Metals — FY2015 Earnings Presentation

37 slides from Central Asia Metals's earnings presentation, April 2016

  1. Slide 1: 2015 Results Presentation

    2015 RESULTS PRESENTATION April 2016

  2. Slide 2: Disclaimer

    DISCLAIMER This Document comprises an institutional update presentation (the “Presentation”) which has been prepared or regulatory requirement, and, in particular, it or any copy of it, should not be distributed directly or indirectly, by and is the sole responsibility of Central Asia Metals plc (th

  3. Slide 3: 2015 Results and Update

    2015 RESULTS AND UPDATE 2015 proposed dividend  Proposed 2015 final dividend 8p (12.5p total for 2015)   Record copper production 12,071 tonnes (up 8.4% on 2014) Gross revenue $67.3m (2014: $76.6m) 12.5p 4.5p interim + 8p proposed final ($20.3m)  C1 cash costs $0.60/lb based on industry definiti

  4. Slide 4: Share Price Performance Since IPO

    SHARE PRICE PERFORMANCE SINCE IPO 250 12,000 200 180 10,000 200 160 140 8,000 Share price (p) LME Copper ($/t.) 150 120 Price (p) 6,000 100 100 80 4,000 60 50 40 2,000 20 0 0 0 Sep 10 Mar 11 Sep 11 Mar 12 Sep 12 Mar 13 Sep 13 Mar 14 Sep 14 Mar 15 Sep 15 Mar 16 Sep 10 Mar 11 Sep 11 Mar 12 Sep 12 Mar

  5. Slide 5: Financial Review

    FINANCIAL REVIEW CENTRAL ASIA METALS PLC 1 | | aa 1 te \}] HALT ee ; i Ds |||) Xe ——Ss Wirt |

  6. Slide 6: Market Conditions

    MARKET CONDITIONS Challenging market - copper price at 6-year low DETERIORATING COPPER PRICES Maximum Feb 2011 -  Copper at 6-year low < $5,000/t 350 c $10,100  2016 market consensus $4,667/t $1 : ₸340 9,500  Long term consensus $6,525/t beyond 2020 300 8,500 KAZAKHSTAN CURRENCY DEVALUATION 250 L

  7. Slide 7: 2015 Income Statement

    2015 INCOME STATEMENT GROSS REVENUE $67.3m 2015 2014 Change  Sales volume increase 8% YoY Gross revenue, $m 67.3 76.6 -12%  Average sales price $5,336/t, 21% decrease YoY Admin expenses, $m 14.1 10.9 +29% COSTS  Production costs remain in lowest quartile Forex gain, $m 9.0 1.9 +374%  $3m increas

  8. Slide 8: Reconciliation of EBITDA 2014 – 2015 ($m)

    RECONCILIATION OF EBITDA 2014 – 2015 ($m) 50 (9.2) 48 47.3 46 44 42 $m 40 (3.2) 38 36 34.9 34 32 30 2014 EBITDA Lower gross revenue Higher administrative 2015 EBITDA expenses Source: Central Asia Metals plc 8

  9. Slide 9: 2015 Unit Costs of Production

    2015 UNIT COSTS OF PRODUCTION HISTORIC INDUSTRY C1 cash cost methodology 2015 C1 CASH COST REPORTED STANDARD $/lb $/lb Cost of production 0.40 0.40 C1 CASH COST - INDUSTRY STANDARD Mineral extraction tax 0.15  Widely accepted industry definition is Wood Mackenzie Distribution & selling 0.12 0.12 

  10. Slide 10: 2015 Unit Costs of Production

    2015 UNIT COSTS OF PRODUCTION C1 CASH COST $0.60/lb (2014: $0.62/lb) FULLY INCLUSIVE COST $1.58/lb (2014: $1.65/lb)  3% decrease in C1 cash cost YoY  Increased production capacity (Stage 1 Expansion)  276 production staff FULLY INCLUSIVE COST $1.58/lb (2014: $1.65/lb) *  $1m YoY reduction in dep

  11. Slide 11: Cash Flow and Industry Cash Cost Curve

    CASH FLOW AND INDUSTRY CASH COST CURVE 2015 cash flow ($m) Industry cash cost curve 90 5.00 2015 CASH COSTS 33.6 1.1 (10.0) 4.50 80 (8.4) 4.00 70 (20.4) 3.50 60 Cash costs, $/lb 3.00 50 46.2 2.50 $m (0.1) 42.0 40 2.00 30 1.50 20 1.00 10 0.50 CAML C1 cash costs - 0.00 Opening Cash Acquisition Income

  12. Slide 12: 2015 Balance Sheet

    2015 BALANCE SHEET Strong balance sheet – no debt 2015 2014 $m $m ASSET BASE PPE 40.8 74.7  Impacted by Tenge devaluation Intangible assets 40.3 81.6  $81m of PPE and intangible assets  Stage 1 Expansion completed $2.5m under budget Cash 42.0 46.3  Non-cash foreign exchange loss of $77.4m due to

  13. Slide 13: Returns to Shareholders

    RETURNS TO SHAREHOLDERS Returned $74m to shareholders 123% OF FUNDS RAISED AT IPO Return to shareholders pence £m $m 80 RETURNED TO SHAREHOLDERS 2012 special, annual & interim 10.7 9.0 14.2 70 2012 share buyback (pre-dividend) 2.0 $60m raised at IPO 60 2013 interim & final 9.0 9.6 15.6 50 2014 inter

  14. Slide 14: Kounrad Financial Performance to Date

    KOUNRAD FINANCIAL PERFORMANCE TO DATE Total / 2015 2014 2013 2012 average 44 months 12 months 12 months 12 months 8 months* Sales, Cu tonnes 40,275 12,040 11,163 10,689 6,383 Production, Cu tonnes 40,302 12,071 11,136 10,509 6,586 Average sale price, $/t 6,810 5,336 6,794 7,114 7,995 Project revenue

  15. Slide 15: Operations Review

    OPERATIONS REVIEW CENTRAL ASIA METALS PLC

  16. Slide 16: 2015 Production Update and 2016 Outlook

    2015 PRODUCTION UPDATE AND 2016 OUTLOOK 2015 ACTUAL 4.0 4,000 50.0 3.5 45.0  Record annual copper production 12,071t (8.4% 3,500 Cumulative copper production (kt) Quarterly copper production (Kt) 3.0 40.0 3,000 increase YoY) 2.5 35.0 2,500 30.0  Copper cathode sales 12,040t (8% increase YoY) 2.0 2

  17. Slide 17: Kounrad 2015 Operational Overview

    KOUNRAD 2015 OPERATIONAL OVERVIEW 2012 2013 2014 2015  4th extraction stage mixer-settler unit 4.5p commissioned in late April, followed by new 24-cell 12.5p Lost time injuries 0 0 1 2 9.0p EW facility in early May Copper production, t 6,586 10,509 11,136 12,071  Flow rates in May and June were in

  18. Slide 18: Leaching Operations 2012 - 2016

    LEACHING OPERATIONS 2012 - 2016 100% 100% Dump 9-10 90% 90% 90% Dump 6 Dump 9-10, Achieved of target for oxide dumps, % 80% 99% 80% Dump 7 70% 70% Dump 5 (mixed ore) Dumps recovery, % Dump 6, 60% Oxide dumps recovery achieved 60% 96% 50% 50% Dump 7, 40% 40% 84% 30% 30% 20% 20% 10% Dump 5 (mixed 10%

  19. Slide 19: Leach Recovery Curves for Oxide Dumps

    LEACH RECOVERY CURVES FOR OXIDE DUMPS 120 Design 180 days Cum % copper recovered from estimated 100 dump 9-10  Ongoing analysis confirms recovery of copper from dumps 80 dump 6 is taking longer than originally projected, ~240 vs 180 days dump 7  Some ore blocks perform better than others, and each

  20. Slide 20: Maintaining Copper Production

    MAINTAINING COPPER PRODUCTION 16 70 Total material under leach (Mt) Average grade *8*10*4 (%) 14 60  Quantity of copper recovered has increased each 12 Annual copper, t 50 year despite a declining average Cu head grade 10 40 8  Achieved by increasing the area under leach and 30 6 the ore tonnes un

  21. Slide 21: Stage 2 Expansion – Western Dumps

    STAGE 2 EXPANSION – WESTERN DUMPS  State approval and construction permit received in November 2015  12km overhead power line and sub-station completed during winter  Boilers, SRTP and HDPE pipes, pumps and electrical equipment all at site by 31 March  Capex remains within $19.5m estimate  Cons

  22. Slide 22: Stage 2 Expansion - Water Supply

    STAGE 2 EXPANSION - WATER SUPPLY Work recommenced March 2016  15km of 22km-long water pipeline completed from plant towards Lake Balkhash in summer 2015  Lake-side water abstraction pump house 90% complete, capacity 200m3/hr 15 14  Remaining 7km of pipe at site, installation to 13 commence in Apr

  23. Slide 23: Social and Environmental Responsibility

    SOCIAL AND ENVIRONMENTAL RESPONSIBILITY HEALTH & SAFETY 15 4.5p  Independent safety audit, positive result 14 12.5p  Risk management committee established 13 9.0p  Two lost time injuries, LTIFR 1.5 in four years of operations SOCIAL 15  Strong focus on training local staff 14  c.$1m towards loc

  24. Slide 24: Copper Bay Project, Chile (CAML 75%)

    COPPER BAY PROJECT, CHILE (CAML 75%) PFS COMPLETED Q2 2015 15  JORC compliant mineral resource estimate of 124,000t of 14 contained copper (I&I) at 0.24% 13  Indicative metallurgical recoveries 72.8%  Forecast annual copper production 8,600t DFS PROGRESS – Q4 2016 TARGET COMPLETION 15  Further d

  25. Slide 25: 2016 Outlook

    2016 OUTLOOK CENTRAL ASIA METALS PLC

  26. Slide 26: Business Development

    BUSINESS DEVELOPMENT  Over 100 opportunities reviewed in the past two years  Seeking to grow the company through value accretive transactions in base metals  The geographic focus encompasses Kazakhstan and Latin America with flexibility based on project quality  Focusing on development and opera

  27. Slide 27: Board of Directors

    BOARD OF DIRECTORS Robert Cathery Nick Clarke Nurlan Zhakupov Roger Davey Kenges Rakishev Non-Executive Director Chief Executive Officer Non-Executive Director Non-Executive Director Non-Executive Director Nigel Hurst-Brown Howard Nicholson Nigel Robinson David Swan Non-Executive Chairman Technical

  28. Slide 28: Outlook

    OUTLOOK PROFITABLE BUSINESS  EBITDA margins >50%  C1 cost in lowest quartile STRONG BALANCE SHEET  Cash balance $42m at 31 December 2015  No debt HEALTHY CASHFLOWS  Maintain dividend policy  Nigel Hurst-Brown Self-finance $19.5m StageNick Non-Executive Chairmann Clarke 2 Kounrad Expansion by C

  29. Slide 29: Appendices

    APPENDICES CENTRAL ASIA METALS PLC

  30. Slide 30: Cash Flows IPO to 2015, $m

    CASH FLOWS IPO TO 2015, $m 210 128.5 (32.1) 190 170 (59.7) 150 130 $m 110 4.6 (61.0) 90 70 59.0 50 1.4 42.0 1.3 30 Opening cash Net IPO Cash generated Corporate Capex Kounrad Disposal & Dividend paid Other net cash Cash at 31 pre IPO Proceeds in from operating Income Tax paid acquisitions, net flows

  31. Slide 31: Structure and Ownership

    STRUCTURE AND OWNERSHIP MAJOR SHAREHOLDERS AS OF 31 MARCH 2016 Central Asia Metals Plc No. of shares % Holding (UK) MR KENGES RAKISHEV 21,211,751 19.01 HARGREAVE HALE 11,367,500 10.19 FIL INVESTMENT INTERNATIONAL 10,335,561 9.26 100% 100% 100% 75% CAML Sary Kazna LLP CAML D & A INCOME 7,584,147 6.80

  32. Slide 32: Directors’ Biographies

    DIRECTORS’ BIOGRAPHIES Nick Clarke Chief Executive Officer Robert Cathery Non-Executive Director Nick has over 40 years of mining experience, including 16 years spent within senior management Robert became a member of the London Stock Exchange in 1967 and was managing director positions in productio

  33. Slide 33: Kazakhstan Management

    KAZAKHSTAN MANAGEMENT Pavel Semenchenko General Director, Sary Kazna With 24 years of experience of managing businesses in Kazakhstan and a proven record in the industry, Pavel has excellent management skills and in-depth knowledge of the local business environment. Oleg Telnoi Director, Kounrad Cop

  34. Slide 34: Kounrad Resource

    KOUNRAD RESOURCE JORC Code (2004) Resource Estimate Northern Dumps by Wardell Armstrong Resource Quantity, Grade, Contained Category type Mt % copper, kt Eastern Dumps Eastern Dumps Indicated 89.7 0.10 85.8 Oxide† Inferred 79.6 0.10 81.7 Total 169.3 167.5 Western Dumps Western Dumps Indicated 275.4

  35. Slide 35: SX-EW Technology Overview

    SX-EW TECHNOLOGY OVERVIEW CAML SX-EW TEST WORK 2008-2011 PROCESS IN USE GLOBALLY  Pilot in-situ leaching and SX-EW plant operational for three years  More than ten operational dump-leach projects worldwide, including Chuquicamata, Los Bronces, El Chino and Silver Bell in Chile,  Successful year-r

  36. Slide 36: PLS and Groundwater Model

    PLS AND GROUNDWATER MODEL Infiltration of acidic solution and precipitation through leach piles Collector trench. Low permeability liner on down 50m gradient side + Diagramnotto scale CENTRAL ASIA METALS PLC

  37. Slide 37: Contacts

    CONTACTS 11 Albemarle Street, London, W1S 4HH 11 Albemarle 11 +44 207 898 9001 info@centralasiametals.com Investor Relations contact Louise Wrathall louise.wrathall@centralasiametals.com www.centralasiametals.com 37

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