Kinross Gold Corporation · TSX:K
Kinross Gold — Shareholder Meeting (May 2014)
31 slides from Kinross Gold's shareholder meeting presentation, May 8, 2014
Slide 1: Kinross Gold Corporation 2014 Annual Meeting of Shareholders
May 08 KINROSS GOLD CORPORATION 2014 ANNUAL MEETING OF SHAREHOLDERS www.kinross.com
Slide 2: Cautionary Statement on Forward-Looking Information
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION All statements, other than statements of historical fact, contained or incorporated by reference in or made in giving this presentation and responses to questions, including any information as to the future performance of Kinross, constitute “forwa
Slide 3: The Way Forward
THE WAY FORWARD PRINCIPLES FOR BUILDING VALUE • Focus on operational excellence • Quality over quantity • Disciplined capital allocation • Maintaining a strong balance sheet www.kinross.com 3
Slide 4: Principles for Building Value
THE WAY FORWARD PRINCIPLES FOR BUILDING VALUE Focus on operational • Record production in 2013 excellence • Achieved all-in sustaining cost(2) below guidance in 2013 • Launched Way Forward in 2012 Quality over quantity • Framework for pursuing quality over quantity across the business Disciplined ca
Slide 5: Operational Excellence
THE WAY FORWARD OPERATIONAL EXCELLENCE (4) Refer to endnote #4. www.kinross.com 55
Slide 6: Strong Operating Performance in 2013: All-in Sustaining Cost
OPERATIONAL EXCELLENCE STRONG OPERATING PERFORMANCE IN 2013 ALL-IN SUSTAINING COST(2) • Full-year all-in sustaining $1,079 $1,079 $1,063 cost BELOW guidance $1,063 $950 - of $1,100 to $1,200 per $1,050 $ per gold ounce gold ounce 2012 2013 2014E(1) (1) Refer to endnote #1. (2) Refer to endnote #2. w
Slide 7: Strong Operating Performance in 2013: Production Cost of Sales
OPERATIONAL EXCELLENCE STRONG OPERATING PERFORMANCE IN 2013 PRODUCTION COST OF SALES(3) • Full-year production cost $730 - of sales at LOW END of $780 $ per gold equivalent ounce $743 guidance of $740 to $705 $790 per gold equivalent ounce 2012 2013 2014E(1) (1) Refer to endnote #1. (3) Refer to end
Slide 8: Strong Operating Performance in 2013: Gold Equivalent Production
OPERATIONAL EXCELLENCE STRONG OPERATING PERFORMANCE IN 2013 GOLD EQUIVALENT PRODUCTION(4) • RECORD annual production 2.63 million gold equivalent ounce (millions) 2.5 - 2.7 2.63 gold equivalent ounces 2.62 2012 2013 2014E(1) (1) Refer to endnote #1. (4) Refer to endnote #4. www.kinross.com 8
Slide 9: Record Production at Mines in 2013
OPERATIONAL EXCELLENCE RECORD PRODUCTION AT 3 MINES IN 2013 FORT KNOX PARACATU TASIAST ALASKA BRAZIL MAURITANIA www.kinross.com 9
Slide 10: Strong Q1 2014 Operating Performance
OPERATIONAL EXCELLENCE STRONG Q1 2014 OPERATING PERFORMANCE GOLD EQUIVALENT PRODUCTION COST OF ALL-IN SUSTAINING COST(2) PRODUCTION(4) SALES(3) 664,690 $1,030 $1,001 648,897 $ per gold equivalent ounce $ per gold equivalent ounce $729 $727 Ounces Q1 2013 Q1 2014 Q1 2013 Q1 2014 Q1 2013 Q1 2014 (2) R
Slide 11: Exceptional Safety Performance
OPERATIONAL EXCELLENCE EXCEPTIONAL SAFETY PERFORMANCE • In 2013, we achieved lowest reportable injury and severity rates in company history www.kinross.com 11
Slide 12: Strong In-House Technical Expertise
OPERATIONAL EXCELLENCE STRONG IN-HOUSE TECHNICAL EXPERTISE • Increased in-house technical bench strength in many areas, including mine planning, metallurgy and project engineering • COO Brant Hinze to retire at the end of Q3 2014 • Brant to be succeeded by Warwick Morley-Jepson, currently Regional V
Slide 13: Completed Dvoinoye Project on Schedule & on Budget
OPERATIONAL EXCELLENCE COMPLETED DVOINOYE PROJECT ON SCHEDULE & ON BUDGET www.kinross.com 13
Slide 14: Quality Over Quantity
THE WAY FORWARD QUALITY OVER QUANTITY www.kinross.com 14
Slide 15: Targeting Margins and Cash Flow
QUALITY OVER QUANTITY TARGETING MARGINS AND CASH FLOW FULLY-LOADED COSTING METHODOLOGY FOR RESERVE ESTIMATES(5) • Includes costs such as: sustaining capital, mine waste management costs, etc. • Contributed to a reduction in gold reserves estimates, which is offset by estimated: Higher estimated gr
Slide 16: Paracatu Mine Plan Optimization
QUALITY OVER QUANTITY PARACATU MINE PLAN OPTIMIZATION • Grade increase of 5% to 0.42 g/t • LOM capital expenditures reduced by ~$2 billion • Greater estimated NPV www.kinross.com 16
Slide 17: Disciplined Capital Allocation
THE WAY FORWARD DISCIPLINED CAPITAL ALLOCATION www.kinross.com 17
Slide 18: Continued Focus on Capital Expenditures
DISCIPLINED CAPITAL ALLOCATION CONTINUED FOCUS ON CAPITAL EXPENDITURES 2012 spend Initial 2013 $1.9 bn estimate Identified $340 mm in savings throughout 2013 $1.6 bn $1.4 bn Expecting $1.26 bn another significant reduction in 2014 $675 mm Full-year Original 2013 Revised 2013 Actual 2013 2014E(1) 201
Slide 19: Tasiast: Feasibility Study on Mill Expansion Complete
TASIAST, MAURITANIA FEASIBILITY STUDY ON MILL EXPANSION COMPLETE • Feasibility study based on 38,000 tpd mill produced promising results • A mill expansion has the potential to: Add a major source of new production to Kinross’ portfolio Lower the company’s overall cost structure Generate signi
Slide 20: Tasiast: Potential Mill Expansion
TASIAST, MAURITANIA POTENTIAL MILL EXPANSION • Do not expect to make a final decision whether to proceed with a potential mill expansion until 2015 at the earliest • Pursuing a number of strategies aimed at further enhancing viability of the expansion Mine plan and operating cost enhancements Fu
Slide 21: Tasiast: District Exploration
TASIAST, MAURITANIA DISTRICT EXPLORATION C616 Fennec C613 C614 C69 C67 Aoueouat C615 C68 C611 C612 Tamaya 80 Km For additional information, please see Kinross’ news release dated February 12, 2014 and Appendices A and B, which are available on our website at www.kinross.com, as well as the Explanato
Slide 22: Tasiast: Piment Central
WEST AFRICA TASIAST: PIMENT CENTRAL Piment Central High Grade Footwall Vein Prolongation Piment West Branch West Branch South For additional information, please see Kinross’ news release dated February 12, 2014 and Appendices A and B, which are available on our website at www.kinross.com, as well as
Slide 23: Focused on High-Quality Targets
EXPLORATION STRATEGY FOCUSED ON HIGH-QUALITY TARGETS LA COIPA PHASE 7 – CATALINA TARGET • Drilling continues to outline the geometry of the mineralization • Remains open to the northwest 600 metres KUPOL-MOROSHKA • Drilling confirmed continuity of high grades along 400 strike metre vein • Moroshka c
Slide 24: Balance Sheet Strength
THE WAY FORWARD BALANCE SHEET STRENGTH www.kinross.com 24
Slide 25: Solid Financial Position
MAINTAINING A STRONG BALANCE SHEET SOLID FINANCIAL POSITION • Balance sheet strength continues to be a priority objective • Net debt position of $1.3 billion at March 31, 2014 INCREASED FINANCIAL FLEXIBILITY • Completed $500 million debt offering in March 2014 Net proceeds used to repay $500 milli
Slide 26: Maintaining Our Social License to Operate
TAKING RESPONSIBILITY MAINTAINING OUR SOCIAL LICENSE TO OPERATE www.kinross.com 26
Slide 27: Building on a Strong Foundation
THE WAY FORWARD BUILDING ON A STRONG FOUNDATION AMERICAS RUSSIA ENTERING 2014 IN A POSITION OF STRENGTH • Excellent operational track record • Declining costs WEST AFRICA • Encouraging growth prospects • Solid community relationships • Strong balance sheet • Financial flexibility GLOBAL PORTFOLIO Op
Slide 28: Principles for Building Value
THE WAY FORWARD PRINCIPLES FOR BUILDING VALUE • Focus on operational excellence • Quality over quantity • Disciplined capital allocation • Maintaining a strong balance sheet www.kinross.com 28
Slide 29: Endnotes
ENDNOTES 1) For more information regarding Kinross’ production, cost and capital expenditures outlook for 2014, please refer to the news release dated February 12, 2014, available on our website at www.kinross.com. Kinross’ outlook for 2014 represents forward- looking information and users are cauti
Slide 30: Explanatory Notes: Exploration
EXPLANATORY NOTES: EXPLORATION Tasiast Exploration Results Hole identifiers ending with suffix DD are diamond drill core holes (HQ diameter) and those ending with suffix RC are reverse circulation (RC) holes. Holes with “A” prefixing DD or RC are diamond core or reverse circulation re-drills of the
Slide 31: Explanatory Notes: Exploration
EXPLANATORY NOTES: EXPLORATION Kupol and Dvoinoye Exploration Results All drill holes at Moroshka are diamond drill core holes (HQ or NQ core diameter). The Moroshka vein dips sub-vertically to the east. Drill holes are angled between minus 50° and 75° to the east and west. Results provided for Moro