Alamos Gold Inc. · TSX:AGI
Alamos Gold — Investor Presentation (May 2021)
49 slides from Alamos Gold's investor presentation, May 17, 2021
Slide 1: Corporate Presentation May 2021
Corporate Presentation May 2021
Slide 2: Cautionary Notes
Cautionary Notes This presentation, the information contained herein, any other materials provided in connection with this presentation and any oral remarks accompanying this presentation (collectively, the “Presentation”), has been prepared by Alamos Gold Inc. (“Alamos” or the “Company”) solely for
Slide 3: Strong platform for delivering sustainable long-term value
Strong platform for delivering sustainable long-term value Growing, diversified, Expanding margins & Conservative, low- Sustainable business intermediate gold profitability risk strategy model supporting producer growing returns over the long-term 470-510k oz $1,025-$1,075 Safe jurisdictions Balance
Slide 4: ESG – leading on key metrics with focus on continuous improvement
ESG – leading on key metrics with focus on continuous improvement Environment Social Governance Lower GHG emissions per oz gold produced1,2 Lost time injury rate 90% 33% 0.34 Director independent board per 200,000 hours 0.59 0.51 independence members are women 5% 59% tCO2e/oz worked 0.36 0.17 o Alig
Slide 5: Q1 2021 results – solid operational & financial performance
Q1 2021 results – solid operational & financial performance Q1 2021A Q1 2020A 2021 Guidance Gold production (000 oz) 125.8 110.8 470-510 Gold sales (000 oz) 126.5 111.9 - 126 koz Average realized gold price (US$/oz) $1,798 $1,582 - produced, exceeding first quarter Cost of sales (US$/oz, includes am
Slide 6: 2021 guidance – higher production, lower costs; fully funded organic growth
2021 guidance – higher production, lower costs; fully funded organic growth Gold production Total cash costs Sustaining & growth capital (000 oz) (US$/oz)1 (US$m)1 $761 427 470-510 $710-760 15% $210-225 Production growth from $146 20204 $82 $110-125 2020A 2021E 2020A 2021E 2020A 2021E 2020A Growth 2
Slide 7: Sustainable business model
Sustainable business model Balanced approach to capital allocation supporting growth & higher returns to shareholders over the long term o 67% increase in dividend since Q2/20 Return capital to o 400% increase in dividend since 2018 shareholders o Share buyback Strong free cash flow growth since Q2/
Slide 8: Diversified asset base; low political risk profile
Diversified asset base; low political risk profile Island Gold, Ontario, Canada 2021E Au Production 130-145 koz 2021E Mine-site AISC4 $750-800/oz ~500 koz Long-life annual production base; Young-Davidson, Ontario, Canada 2021E Au Production 190-205 koz growth potential to ~750 koz in 2021E Mine-site
Slide 9: Young-Davidson – lower mine expansion driving strong free cash flow growth
Young-Davidson – lower mine expansion driving strong free cash flow growth • One of Canada’s largest underground gold mines • Transitioned to new, larger, highly automated infrastructure July 2020 • Record mining rates of 7,791 tpd in Q1/21 driving $22m mine-site FCF2 • Production growth to 190-205k
Slide 10: Island Gold – Phase III Expansion to drive 70% production growth
Island Gold – Phase III Expansion to drive 70% production growth • World’s sixth highest grade gold mine1 • Phase II expansion: record mine-site FCF3 of $101m in 2020 • Phase III Shaft Expansion: 70% production growth at industry low costs • 236k oz/yr at mine-site AISC of $534/oz starting in 2025 •
Slide 11: Island Gold – ongoing exploration success driving growth in size & quality
Island Gold – ongoing exploration success driving growth in size & quality Significant Growth in Mineral Reserves & Resources Since November 2017 Acquisition 5,000 12 Mineral Reserves M&I Mineral Resources Inferred Mineral Resources 4,000 Mineral Reserve grade 10 Cumulative oz produced 3,000 3,208 8
Slide 12: Mulatos District – stable production; declining cost profile
Mulatos District – stable production; declining cost profile • Founding asset; produced >2 m oz of gold & ~$460m FCF2 to date • Declining cost profile; connection to grid power & development of La Yaqui Grande • Cerro Pelon built for $25m in 2019; strong driver of $68m mine-site FCF2 in 2020 • La Ya
Slide 13: Growing, long-life North American production; declining cost profile
Growing, long-life North American production; declining cost profile ~750k oz annual production potential by 2025 at ~$800/oz AISC1 800 Lynn Lake3 700 10 year reserve life2 ~170k oz per year 2025+ 600 Mulatos Production (000 oz Au) 500 7 year reserve life2 ~150k oz per year 2021+ 400 Island Gold 15
Slide 14: Growth: Lynn Lake Project – low cost, high-grade, open pit
Growth: Lynn Lake Project – low cost, high-grade, open pit • Favourable jurisdiction: Manitoba, Canada • High-grade, open pit with significant exploration potential across large land package (58,000 ha) • Feasibility Study (Dec 2017) based on Mineral Reserves of 1.6m oz3,4 • Mineral Reserves have si
Slide 15: Turkish Development Projects
Turkish Development Projects • $1B investment treaty claim will be filed against Republic of Turkey for expropriation & unfair & inequitable treatment of its Turkish gold projects1 • Construction of Kirazlı project suspended in October 2019 after government failed to grant routine renewal of the Com
Slide 16: Strong balance sheet; long-term focus on returning capital to shareholders
Strong balance sheet; long-term focus on returning capital to shareholders Cash & Total Liquidity Balance Sheet Cash & Cash Eq.1,2 US$238 million $238m Total Liquidity3 US$738 million Total Debt2 US$0 1,2,3 $738M Capital Structure Shares Outstanding (Basic) 392.7 million $500m Shares Outstanding (Fu
Slide 17: Track record of adding value through M&A & exploration
Track record of adding value through M&A & exploration Mulatos (US$m) Young-Davidson (US$m) Island Gold (US$m) $69 $209 $460 $1,465 $1,319 $950 $624 $530 $10 Acquisition Cost (2003) Consensus NAV & Acquisition Cost (2015) Consensus NAV & Acquisition Cost (2017) & 3 Consensus NAV & Cumulative FCF Cum
Slide 18: Track record of adding value on aggregate & per share basis
Track record of adding value on aggregate & per share basis Gold Production (000 oz Au) Mineral Reserves (M oz Au) Cash provided by operations before changes in WC (US$M) +250% 490 +471% 9.9 +800% $459 140 1.7 $51 2 3,4 2014A 2021E1 2014A 2020A 2014A 2021E Gold Production Per Share Gold Reserves Per
Slide 19: Long-term track record of delivering shareholder value
Long-term track record of delivering shareholder value Long-term track record of outperformance 1 2 Average annualized return since 2003 1.61 Consensus P/NAV 1.33 14% 1.12 0.97 10% 0.88 0.87 0.85 0.85 0.76 0.69 0.59 0.55 0.49 3% AGI (TSX) S&P/TSX Global Gold Gold (US$/oz) PAAS Sr BTO YRI NGD AGI Int
Slide 20: Alamos – value creation opportunities
Alamos – value creation opportunities Growing, diversified, Expanding margins & Conservative, low- Sustainable business intermediate gold profitability risk strategy model supporting producer growing returns over the long-term Catalysts 15% production growth in 2021 & further ~50% growth potential t
Slide 21: Appendices
Appendices TSX:AGI ǀ NYSE:AGI 21
Slide 22: Board of Directors, Executive and Management Team
Board of Directors, Executive and Management Team Board of Directors Paul J. Murphy John A. McCluskey Elaine Ellingham David Fleck David Gower Claire M. C. Kennedy Monique Mercier J. Robert S. Prichard Ronald E. Smith Kenneth Stowe Chairman Director Director Director Director Director Director Direc
Slide 23: 2021 guidance
2021 guidance 2021 Guidance 2020A Young-Davidson Island Gold Mulatos Other Total Total Gold production (000’s oz) 190-205 130-145 150-160 — 470-510 427 Cost of Sales (in millions) (3) $255 $108 $177 — $540 $482 Cost of Sales ($ per ounce) (3) $1,290 $785 $1,145 — $1,105 $1,136 Total cash costs ($ pe
Slide 24: 2021 guidance – capital budget
2021 guidance – capital budget 2021 Guidance 2020A Sustaining Capital Growth Capital Total Total Operating Mines (US$M) Young-Davidson $40-45 $25-30 $65-75 $102 Island Gold $40-45 $80-85 $120-130 $69 Mulatos $30-35 $95-100 $125-135 $41 Total – Operating Mines $110-125 $200-215 $310-340 $212 Developm
Slide 25: COVID-19 – focused on the health & safety of our people & communities
COVID-19 – focused on the health & safety of our people & communities Strict health & safety protocols at each operation Supporting our communities • We continue to be diligent in taking precautions to help prevent the potential spread of COVID-19 • All operations have returned to normal operating l
Slide 26: Young-Davidson – flagship, long-life production
Young-Davidson – flagship, long-life production Location: Ontario, Canada Stage: Producing Ownership: 100% interest Operation: Underground • One of Canada’s largest underground gold mines • 14 year mine life based on YE 2020 Mineral Reserves • Large resource base & exploration potential to support m
Slide 27: Young-Davidson – transition to lower mine infrastructure completed July 2020
Young-Davidson – transition to lower mine infrastructure completed July 2020 Lower mine infrastructure larger, more productive & highly automated Upper mine infrastructure Upper mine Lower mine % infrastructure infrastructure Change Long term – July Timeline Pre-July 2020 2020 onward Design ore 6,00
Slide 28: Young-Davidson – lower mine expansion to drive costs lower
Young-Davidson – lower mine expansion to drive costs lower H1 2021E mining cost per tonne ~C$50/t Upper mine Lower mine Incremental improvement C$2.00/tonne; excluding productivity Lateral material handling trucking conveying improvements C$10/t decrease LOM Mid shaft ore trucking from below truckin
Slide 29: Young-Davidson – increasing mining rates & productivity
Young-Davidson – increasing mining rates & productivity Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Q1/20 Q2/20 Q3/20 Q4/20 Q1/21 Gold production (oz) 38,201 44,694 39,065 42,644 43,629 44,662 40,400 47,300 55,800 56,500 41,000 39,100 4
Slide 30: Island Gold – high-grade, low-cost production
Island Gold – high-grade, low-cost production Location: Ontario, Canada Stage: Producing Ownership: 100% interest Operation: Underground • World’s sixth highest grade gold mine1 • Phase III Shaft Expansion to 2,000 tpd expected to be completed 2025 • Significant exploration potential laterally & at
Slide 31: One of Canada’s highest-grade gold mines
One of Canada’s highest-grade gold mines Mineral Reserve Grade (g/t Au) 21.9 +52% 13.4 9.8 9.7 9.2 8.4 6.9 6.5 6.4 6.3 5.9 5.1 5.0 4.9 4.4 4.1 3.0 2.4 1.6 Source: Company filings TSX:AGI ǀ NYSE:AGI 31
Slide 32: Island Gold Shaft Expansion – cash flow profile at $1,450/oz Au
Island Gold Shaft Expansion – cash flow profile at $1,450/oz Au S2000 $270 $266 $244 $229 $229 $223 $202 $188 $179 $173 $174 $173 $153 $150 $151 $161 $160 $152 $134 $136 $132 $131 $122 $117 $103 $68 $56 $68 $12 -$14 -$1 -$15 -$40 -$42 -$35 -$30 -$54 -$59 -$47 -$52 -$48 -$77 -$65 -$124 -$162 -$169 -$
Slide 33: Island Gold Shaft Expansion – cash flow profile at $1,750/oz Au
Island Gold Shaft Expansion – cash flow profile at $1,750/oz Au S2000 $332 $301 $302 $291 $253 $251 $239 $236 $196 $214 $220 $207 $223 $203 $192 $204 $195 $175 $177 $172 $162 $173 $161 $156 $137 $86 $98 $86 $52 -$15 -$9 -$14 -$15 -$1 -$26 -$40 -$35 -$30 -$52 -$48 -$42 -$77 -$65 -$124 -$162 -$169 -$1
Slide 34: Island Gold Shaft Expansion – detailed mine plan
Island Gold Shaft Expansion – detailed mine plan 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Mill Feed mined (tonnes) 438,000 437,999 437,994 439,198 557,150 719,805 730,000 731,957 729,934 729,951 730,000 731,947 730,000 721,154 296,654 Waste mined (tonnes) 440,063 61
Slide 35: Island Gold – changes in Mineral Reserves as of December 31, 2020
Island Gold – changes in Mineral Reserves as of December 31, 2020 Planned shaft W E Crown pillar Mineral Reserves as of December 31, 2020 Category Tonnage Grade Au (g/t) Ounces Au Proven: 894,500 10.95 314,800 Probable: 3,302,900 9.37 995,200 340 Level TOTAL: 4,197,400 9.71 1,310,000 - 500 m - 500 m
Slide 36: Island Gold – changes in Mineral Resources as of December 31, 2020
Island Gold – changes in Mineral Resources as of December 31, 2020 Planned shaft W E Crown pillar Mineral Resources as of December 31, 2020 Category Tonnage Grade Au g/t Ounces Au Measured & 718,000 7.18 165,900 Indicated: 340 Level Inferred: 6,915,300 14.43 3,208,300 100,200 t at 11.29 g/t Au, 36,4
Slide 37: Island Gold – Trillium Mining acquisition adds to significant exploration potential
Island Gold – Trillium Mining acquisition adds to significant exploration potential Alamos Gold & Trillium Mining Land Tenure Map Surface Projection of Island Gold Mine YE 2019 Mineral Reserves & Resources • 56% increase in land package to 15,053 ha with C$25m Trillium Mining acquisition • Significa
Slide 38: Island Gold – historical operational results
Island Gold – historical operational results $1,600 16 1,400 40,000 $1,400 14 1,200 35,000 $1,200 12 30,000 1,000 25,000 $1,000 10 800 20,000 $800 8 600 15,000 $600 6 400 10,000 $400 4 5,000 $200 2 200 0 $0 0 0 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18
Slide 39: Mulatos – our founding operation
Mulatos – our founding operation Location: Sonora, Mexico Stage: Producing Ownership: 100% interest Operation: Open pit, heap leach • Initial production 2005 • ~$460m of free cash flow2 generated to date • Declining cost profile with connection to grid power & development of La Yaqui Grande • No thi
Slide 40: Mulatos – district exploration potential
Mulatos – district exploration potential La Yaqui Grande La Yaqui Phase I 820k oz Combined Mineral Reserves1,2 at the La Yaqui Grande & Cerro Pelon higher grade discoveries District potential Large underexplored land package; >70% of past drilling focused 1 See Mineral Reserve and Resource estimates
Slide 41: La Yaqui Grande Internal Economic Study – 2020
La Yaqui Grande Internal Economic Study – 2020 La Yaqui Grande Project Highlights Life of Mine1 Production Mine life (years) 5 Total gold production (000 ounces) 616 Total silver production (000 ounces) 1,471 Average annual gold production (000 ounces) 123 Total ore mined (000 tonnes) 19,205 Average
Slide 42: Development – Lynn Lake, Esperanza & Quartz Mountain
Development – Lynn Lake, Esperanza & Quartz Mountain Lynn Lake Esperanza Quartz Mountain Location: Manitoba, Canada Location: Morelos State, Mexico Location: Oregon, United States Ownership: 100% interest Ownership: 100% interest Ownership: Right to earn a 100% interest4 Stage: Permitting Stage: Per
Slide 43: Lynn Lake Feasibility Study – 2017
Lynn Lake Feasibility Study – 2017 Feasibility Study Highlights - December 2017 Production Mine life (years) 10.4 Total gold production (000 ounces) 1,495 Total silver production (000 ounces) 1,263 Average annual gold production1 Years 1 to 6 (000 ounces) 170 Years 1 to 10 (000 ounces) 143 Total ore
Slide 44: Kirazlı, Ağı Dağı & Çamyurt Economic Studies – 2017
Kirazlı, Ağı Dağı & Çamyurt Economic Studies – 2017 Feasibility Study - 2017 Preliminary Economic Assessment - 2017 Kirazlı Ağı Dağı Çamyurt Production Mine life (years) 5 6 4 Total gold production (ounces) 540,000 937,300 373,200 Total silver production (ounces) 3,141,000 2,365,200 1,612,600 Averag
Slide 45: Proven & Probable Mineral Reserves
Proven & Probable Mineral Reserves PROVEN AND PROBABLE GOLD MINERAL RESERVES (as at December 31, 2020) Proven Reserves Probable Reserves Total Proven and Probable Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces (000's) (g/t Au) (000's) (000's) (g/t Au) (000's) (000's) (g/t Au) (000's) Yo
Slide 46: Total Measured & Indicated Mineral Resources
Total Measured & Indicated Mineral Resources MEASURED AND INDICATED GOLD MINERAL RESOURCES (as at December 31, 2020) Measured Resources Indicated Resources Total Measured and Indicated Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces (000's) (g/t Au) (000's) (000's) (g/t Au) (000's) (000'
Slide 47: Total Inferred Mineral Resources
Total Inferred Mineral Resources INFERRED GOLD MINERAL RESOURCES (as at December 31, 2020) Tonnes Grade Ounces (000's) (g/t Au) (000's) Young-Davidson – Surface 31 0.99 1 Young-Davidson – Underground 2,301 2.88 213 Total Young-Davidson 2,331 2.86 214 Island Gold 6,915 14.43 3,208 Mulatos 8,122 0.92
Slide 48: Notes to Mineral Reserve and Resource estimates
Notes to Mineral Reserve and Resource estimates Qualified Persons Chris Bostwick, FAusIMM, Alamos Gold’s Vice President, Technical Services, has reviewed and approved the scientific and technical information contained in this presentation. Chris Bostwick is a Qualified Person within the meaning of C
Slide 49: Scott K. Parsons, CFA
Scott K. Parsons, CFA VP, Investor Relations 416.368.9932 x 5439 sparsons@alamosgold.com