Compania De Minas Buenaventura Saa · BVL:BUENAVC1
Compania De Minas Buenaventura Saa — Investor Day (2022)
65 slides from Compania De Minas Buenaventura Saa's investor day presentation, 2022
Slide 1: Investor Day 2022
2022 ois Investor e. 4
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: Board of Directors in charge of the Company’s top decisions
Board of Directors in charge of the Company’s top decisions Roque Benavides Felipe Ortiz de Zevallos William Champion Diego de la Torre Nicole Bernex Marco Antonio Zaldívar, Raúl Benavides Chairman Director Independent director Independent director Independent director Independent director Director
Slide 4: Management with strong experience in the sector
Management with strong experience in the sector Leandro García Daniel Domínguez Juan Carlos Ortiz Aldo Massa Alejandro Hermoza Juan Carlos Salazar CEO CFO VP Operations VP Business Development VP Sustainability Explorations Manager • 35 years of experience in • More than 20 years of • 30 years in th
Slide 5: Peruvian miners working for the country's development
POLITICAL BUENAVENTURA’S SITUATION STRATEGY ESG EXPLORATIONS Peruvian miners working for the country's development FUTURE OPERATIONS GROWTH PROJECTS CAPITAL ALLOCATION
Slide 6: Confident Congress will challenge risky proposals despite political struggle
POLITICAL BUENAVENTURA’S SITUATION STRATEGY Despite the struggle in the political outlook, we remain ESG EXPLORATIONS confident that the majority at the Congress will continue to FUTURE challenge proposals that may be OPERATIONS GROWTH a risk for the country's economy PROJECTS CAPITAL ALLOCATION
Slide 7: 69 years of history, developing Peru through sustainable mining
POLITICAL BUENAVENTURA’S SITUATION STRATEGY 69 years of history, developing ESG EXPLORATIONS Peru through sustainable mining activities. We kept the FUTURE mills rolling non-stop OPERATIONS GROWTH PROJECTS CAPITAL ALLOCATION
Slide 8: Extending the life of our current assets beyond gold
POLITICAL BUENAVENTURA’S SITUATION STRATEGY ESG EXPLORATIONS Extending the life of our current assets beyond gold FUTURE OPERATIONS GROWTH PROJECTS CAPITAL ALLOCATION
Slide 9: From gold to copper; pillars of growth; exploring to expand LOMs
POLITICAL BUENAVENTURA’S SITUATION STRATEGY From gold to copper ESG EXPLORATIONS Our pillars of growth FUTURE Exploring to expand OPERATIONS GROWTH PROJECTS our LOMs CAPITAL ALLOCATION
Slide 10: A diversified and resilient portfolio of 8 assets in 8 regions
POLITICAL BUENAVENTURA’S SITUATION STRATEGY ESG A diversified and resilient EXPLORATIONS portfolio of 8 assets in 8 regions supporting our strategic intent FUTURE OPERATIONS GROWTH PROJECTS CAPITAL ALLOCATION
Slide 11: After restructuring our balance sheet, we focus on reducing OPEX
POLITICAL BUENAVENTURA’S SITUATION STRATEGY After successfully restructuring ESG our balance sheet, we are EXPLORATIONS focusing on reducing our OPEX and increasing our revenues in FUTURE order to boost our margins OPERATIONS GROWTH PROJECTS CAPITAL ALLOCATION
Slide 12: Striking the right balance between short and long-term objectives
POLITICAL BUENAVENTURA’S SITUATION STRATEGY ESG Striking the right balance EXPLORATIONS between our short and long- term objectives FUTURE OPERATIONS GROWTH PROJECTS CAPITAL ALLOCATION
Slide 13: Buenaventura’s Strategy
ESG FUTURE Buenaventura’s Strategy
Slide 14: What has happened in Buenaventura in the last years?
What has happened in Buenaventura in the last 5 years? 5yrs 500 kOz-Au 400 79 197.0 Au GOLD 300 200 100 ESG - 17' 18' 19' 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 34' 35' 36' 37' 38' 39' 40' 41' 42' 30.0 MOz-Ag 25.0 47 107.9 20.0 Ag SILVER 15.0 10.0 5.0 - 17' 18' 19' 20' 21' 22' 23' 2
Slide 15: What has happened in Buenaventura in the last years? (declines)
What has happened in Buenaventura in the last 5 years? 5yrs 500 kOz-Au 79 197.0 400 …a 55% decrease reaching 200kOz mainly due ↓ORC ↓MLZ. However… Au GOLD 300 200 100 ESG - 17' 18' 19' 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 34' 35' 36' 37' 38' 39' 40' 41' 42' 30.0 MOz-Ag 25.0 47 107
Slide 16: How far do our reserves allow us to go?
How far do our reserves allow us to go? 5yrs 20yrs 500 San Gabriel will allow BVN to kOz-Au … reserves of operating mines + 400 79 197.0 stabilize production between 180 - 200 kOz/yr … Au GOLD 300 200 100 ESG - 17' 18' 19' 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 34' 35' 36' 37' 38' 3
Slide 17: Our exploration efforts showing positive results for the next 20 years
Our exploration efforts showing positive results for the next 20 years 5yrs 20yrs 500 operating footprint …multiple exploration targets within our kOz-Au enables to extend LOM for +20 years… 400 79 197.0 Au GOLD 300 200 100 ESG - 17' 18' 19' 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 34
Slide 18: Our next major project: Trapiche
Our next major project: Trapiche 5yrs 20yrs 500 kOz-Au 400 79 197.0 Au GOLD 300 200 100 ESG - 17' 18' 19' 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 34' 35' 36' 37' 38' 39' 40' 41' 42' 30.0 MOz-Ag 25.0 47 107.9 20.0 Ag SILVER 15.0 10.0 5.0 - 17' 18' 19' 20' 21' 22' 23' 24' 25' 26' 27' 2
Slide 19: Long-term vision: diversified portfolio with weight on green metals
Long-term vision: diversified portfolio with great weight on green metals 5yrs 20yrs 500 kOz-Au 400 79 197.0 Au GOLD 300 200 100 ESG - 17' 18' 19' 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 34' 35' 36' 37' 38' 39' 40' 41' 42' 30.0 MOz-Ag 25.0 47 107.9 20.0 Ag SILVER 15.0 10.0 5.0 - 17'
Slide 20: Long-term vision: diversified portfolio with great weight on green metals
Long-term vision: diversified portfolio with great weight on green metals Revenue (US$ M) [2,400-2,500] [2,300-2,400] ESG [900-1,000] 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 34' 35' 36' 37' 38' 39' 40' 41' 42' FUTURE 14% 2022: Revenue mix 42% 36% 15% 2042: Revenue mix 22% 71% 20
Slide 21: Buenaventura’s Challenges
BUENAVENTURA’S CHALLENGES POLITICAL POLITICAL ESG SITUATION SITUATION ESG FUTURE EXPLORATIONS GROWTH OPERATIONS PROJECTS FUTURE CAPITAL ALLOCATION
Slide 22: Political Situation
ESG FUTURE EXPLORATIONS POLITICAL SITUATION
Slide 23: Effectively navigating political climate
Effectively navigating political climate Strong opposition and the continuous challenging of authorities is contributing to maintain certain stability Social incidents vs national conflicts Proposal of a new (Mar 2021 – Mar 2022) Strong Opposition Constitution 208 ESG 90 80 56 70 60 50 40 30 High tu
Slide 24: ESG
ESG FUTURE ESG
Slide 25: Buenaventura key indicators: Building trust and shared responsibility
Buenaventura key indicators Building trust and shared responsibility Regions at the Andes host our Our focus: best practices, Our focus: social inclusion, 8 operations and advanced projects Advanced environmental asset creation and adaptation to climate change Water access to equal opportunities and
Slide 26: From our vision: Building private–public partnerships
From our vision To produce mineral resources creating the most possible value for society Alignment to Sustainability Sustainability Shared responsibility Development goals ESG + + Value generation & FUTURE Building private – Operation needs Building synergies public partnerships and opportunities 2
Slide 27: Buenaventura’s Sustainability focus: five objectives
Buenaventura’s Sustainability focus To produce mineral resources creating the most possible value for society Five objectives that have been the focus ESG and strength of our ESG strategy Governance and value creation Environment: water and innovation FUTURE Our people: Safety and employability Cond
Slide 28: Environment: water and innovation
Environment: water and innovation ESG priorities Responsible use of water Mine closure and reclamation ESG 108 Mm3 195k m3 +60 Technosols: CMC water footprint single family Engineered soils production compensation units reservoirs FUTURE Recirculation Reforestation 13 Participative monitoring 94% 84
Slide 29: Our people: safety and employability
Our people: safety and employability ESG priorities Safety Accidentability Index Safety key indicators1 Worker's health care ESG TOTAL 4.00 3.57 99% of company workers vaccinated with Man-hours worked 32,054,826 third booster dose 2.52 2.00 1.59 2.14 2.46 1.66 Accidentability rate 1.61 0.16 More tha
Slide 30: Competitiveness and local productivity
Competitiveness and local productivity ESG priorities 77 Business plans inclusion of local articulation and Commercial producers1 ESG 14.7 Millions of dollars in sales 1.113 Thousands of jobs created Miski Tapay 1.487 Articulated producers Infrastructure, social We have leveraged public-private Clos
Slide 31: Continuous evolution on our ESG strategy: Materiality Matrix
Continuous evolution on our ESG strategy: Materiality Matrix ESG priorities During 2021 we built our ESG Materiality Matrix that allow us to: Identify main issues that affect and influence in ESG our decisions Plan and manage our risks and opportunities to improve our practices Disclose and report m
Slide 32: Improving our ESG strategy: Materiality Matrix
Improving our ESG strategy: Materiality Matrix ESG priorities Evolution on ESG gaps Prioritization of frameworks 1) Regulatory framework / Regulations Responsible use of water ESG • Water recirculation 98.8% open pit / 83.4% underground • Water footprint measurement TMB, CMC y BRO Climate change • E
Slide 33: Explorations
ESG FUTURE EXPLORATIONS
Slide 34: Northern Zone: Tantahuatay
Northern Zone: Tantahuatay Extensive and multi-phase sulfide mineralization N Sulfide exploration started in 2016 55,000m diamond drilling ESG Preliminary Resource update shows over 600Mt Tantahuatay 2NW with copper grades around 0.5% and 0.25g/t Open pit gold Tantahuatay Drilling highlights of th
Slide 35: Northern Zone: La Zanja moving from oxides to sulfides
Northern Zone: La Zanja moving from oxides to sulfides 59,000m drilling completed Ton Cu Au Ag As Cu eq Width (MM) (%) (g/t) (g/t) (ppm) (%) (m) Cu-As 4.8 2.2 0.5 31.5 5934 2.5 2.4 ESG Cu 5.0 1.6 0.2 8.4 431 1.8 52.4 Cu-Au 0.8 1.1 3.5 7.4 527 3.4 11.1 10.6 1.8 0.6 18.9 2951 2.3 26.6 Include Infered
Slide 36: Central Zone: Uchucchacua
Central Zone: Uchucchacua Produced over 310 Moz silver in 47-year production UCHUCCHACUA history 2022 22,500m drilling exploration program focus on: • Short-term exploration: Nora-Geraldine, Rita and Gina It's expected to add 7MozAg @ +10ozAg into Reserves • Mid to long-term exploration: two untes
Slide 37: Southern Zone: Orcopampa
Southern Zone: Orcopampa Produced over 74.5Moz silver and 5.2 Moz gold in 55-year production history ESG Ramal 4 is a new discovery (2020) 138kozAu @ 10g/t FUTURE 2022 23,400m drilling exploration program focus on: • Southwest extension of Ramal 4 • Pucara northeast • Rosario: fourth structural
Slide 38: Southern Zone: Tambomayo
Southern Zone: Tambomayo Short LOM strategy for new resources: ESG • 2022 three near-mine exploration projects: Los Diques, Soledad and Venturosa • 1,200m exploration tunnels • 10,000m of diamond drilling Significant potential to add mid-term resources from brownfield projects: FUTURE • 2 projec
Slide 39: Operations
ESG FUTURE OPERATIONS
Slide 40: Operations Main Challenges
Operations Main Challenges Optimizing mining plans including prepared ore, not just probable reserves Mining Name method Main challenges Cajamarca ESG Increase 1 Coimolache O/P Transition from Gold to Copper Sulfide North Copper Production 2 La Zanja O/P Transition from Gold Low Grade (Open Pit) to
Slide 41: Northern Zone: From gold to copper
Northern Zone: From gold to copper Coimolache Cajamarca Maximizing gold production, before moving into copper at Coimolache Mine Life 6 years 40.1% Stake Owned ESG Tantahuatay Mineral Resource 0.4 Moz 0.6 Moz Reserve Ore Open Pit LOM 1,100 110 Target CAS US$ / Au oz kozpa Production Main By Products
Slide 42: Northern Zone: From gold to copper (Coimolache)
Northern Zone: From gold to copper Coimolache Cajamarca Maximizing gold production, before moving into copper at Coimolache Mine Life 6 years 40.1% Stake Owned ESG Mineral Resource 0.4 Moz 0.6 Moz Reserve Ore LOM 1,100 110 Target CAS US$ / Au oz kozpa Production Sulfides Open Pit Mine Main By Produc
Slide 43: Northern Zone: From gold to copper (La Zanja)
Northern Zone: From gold to copper Coimolache Cajamarca Transitioning from low grade oxides to high grade sulfates at La Zanja Plant View Mine Life 6 years 40.1% Stake Owned San Pedro Sur Leach PAD ESG Mineral San Pedro Sur Mineral Resource 0.4 Moz 0.6 Moz Reserve Ore San Pedro Sur Open Pit Mine Exp
Slide 44: Center Zone: Continue to develop key operations
Uchucchacua Lima Center Zone: Continue to develop key operations Relaunching a new Uchucchacua for the next 15 years Mine Life 5 years 100% Owned Stake Resource 107 Moz 63 Moz Reserve Mineral Ore Uchucchacua Mine Yumpag Mine Longitudinal View LOM CAS 13 12 Target Production US$/ Ag oz Mozpa Main By
Slide 45: Center Zone: Increasing copper production at El Brocal
Uchucchacua Lima Center Zone: Continue to develop key operations Increasing cooper production at El Brocal mine to capture more value Mine Life 5 years 100% Owned Stake Resource 107 Moz 63 Moz Reserve Mineral Ore Mineral Potential LOM CAS 13 12 Target Production US$/ Ag oz Mozpa Main By Products Pro
Slide 46: Center Zone: Keep operating efficiently at Julcani
Uchucchacua Lima Center Zone: Continue to develop key operations Keep operating with high efficiency throughout all stages at Julcani Mine Life 5 years 100% Owned Stake Resource 107 Moz 63 Moz Reserve Mineral Ore LOM CAS 13 12 Target Production US$/ Ag oz Mozpa Main By Products Products ESG Jesus El
Slide 47: Southern Zone: Focus on expanding Au reserves (Orcopampa)
Southern Zone: Focus on expanding Au reserves Orcopampa Arequipa OrcoMayo, as internally called, are two synergized small high margin operations located 120kms one apart from each other, with premium exploration targets Mine Life 3 years 100% Stake Owned Longitudinal View Orcopampa Plan View ESG Min
Slide 48: Southern Zone: Focus on expanding Au reserves (Tambomayo)
Southern Zone: Focus on expanding Au reserves Orcopampa Arequipa OrcoMayo, as internally called, are two synergized small high margin operations located 120kms one apart from each other, with premium exploration targets Mine Life 3 years 100% Stake Owned Longitudinal View Tambomayo Plan View ESG Min
Slide 49: Cerro Verde
Cerro Verde Largest copper producing mine in Peru: long life and low cost Cerro Verde is an open-pit Working on expanding operations from 400k TPD to beyond. Layout mining complex located approx. set to 30+ years of LOM, becoming the biggest cooper producing mine 20 miles southwest of Arequipa. in P
Slide 50: Growth Projects
ESG FUTURE GROWTH PROJECTS
Slide 51: San Gabriel
San Gabriel Moquegua, 4800 masl, Starting late 2Q2025 San Gabriel is an epithermal intermediate sulphidation deposit to be operated as an ESG underground mine. The metallurgical process will include a CIL plant followed Arequipa by EW and dry-stack TSF Mine Life 14 years 100% Stake Owned Mineral Res
Slide 52: Trapiche
Trapiche Apurimac, 3900 masl, Starting E2028 Trapiche is an Oligocene porphyry copper-moly deposit to be operated as an open pit. The metallurgical process ESG includes a leaching pad and an SX-EW processing plant Arequipa Mine Life 18years 100% Stake Owned Mineral Resource 2.1MT Cu 1.4MT Cu Reserve
Slide 53: Increase Copper Production, Cost Optimization, Mineral Exploration
Increase Copper Production ESG Cost Optimization FUTURE Mineral Exploration LOM 53
Slide 54: Financials: After restructuring, now we focus on value creation
ESG FUTURE FINANCIALS: After restructuring the balance, now we focus on value creation
Slide 55: Condition of the company after the restructuring
Condition of the company after the restructuring Important decisions were taken to return to healthy financial levels Debt (US$ M) SUNAT - US$ 550M • Syndicated Loan - Outcomes of the Strategy US$ 275M ESG • Revolving Loan - 6.14x Bond - US$ 550M US$ 56M • No covenants • Guarantees released 4.67x 3.
Slide 56: First Quarter Financial highlights: Striking the balance
First Quarter Financial highlights: Striking the balance Higher metal prices played an important role in the increase of our revenues and the achievement of better operating margins Revenue Adj. Net Income Exploration expenses (US$ M) ESG US$ 233 M US$ 636 M 126.0 (2022E = US$ 770 – 860 M) 107.6 EBI
Slide 57: 2022-2025 Forecast (1/2)
2022-2025 Forecast (1/2) Buenaventura will return to being a USD 1,000 M revenue company in 2025 1020 Revenue1 CAS - Gold (US$ M) (US$/Oz) 863 860 880 850 1,697 920 1,200 1,200 1,300 1,100 ESG 800 770 770 936 1,000 1,000 1,100 800 2021 2022E 2023E 2024E 2025E 2021 2022E 2023E 2024E 2025E Revenues wi
Slide 58: 2022-2025 Forecast (2/2)
2022-2025 Forecast (2/2) Seeking to strike the right balance between our short and long-term objectives CAPEX Sustaining CAPEX Growth CAPEX Total (US$ M) 300 ESG 220 230 190 270 180 190 120 210 100 120 110 170 110 100 80 160 100 100 100 110 90 90 70 2022E 2023E 2024E 2025E 2022 2023 - 2025 FUTURE •
Slide 59: Cash requirements
New challenges that will allow us to achieve our strategy We make a comprehensive financial analysis of the projects, including their funding Cash inflows CV Dividends CV Dividends CV Dividends UCH – YMP ~ US$ 120 M ~ US$ 120 M ~ US$ 120 M ↑Ag production CV Dividends ~ US$ 120 M ESG Re-start of San
Slide 60: Buenaventura’s Strategy
ESG FUTURE Buenaventura’s Strategy
Slide 61: Well positioned to capture future demand across metals
Well positioned to capture future demand across metals Life of mine, mineral resources, growth projects 5yrs 20yrs kOz-Au 500 400 79 197.0 300 ESG AuGOLD 200 100 - 17' 18' 19' 20' 21' 22' 23' 24' 25' 26' 27' 28' 29' 30' 31' 32' 33' 34' 35' 36' 37' 38' 39' 40' 41' 42' MOz-Ag 30.0 25.0 47 107.9 20.0 A
Slide 62: Striking the right balance between short and long-term objectives
Striking the right balance between our short and long-term objectives ESG From gold to copper Cost Optimization FUTURE Exploring to expand our LOMs 62
Slide 63: Slide 63
Slide 64: Appendix
ESG FUTURE Appendix
Slide 65: Market balance: copper and gold
Market balance: copper and gold Copper supply gap analysis: 2020 – 2045 Gold Market Balance: 2015 – 2036 (kt) (Tones) 40,000 6,000 2,500 5,000 2,000 30,000 4,000 ESG 20,000 1,500 5.2 million tons deficit 3,000 1,000 2,000 10,000 500 1,000 0 0 0 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Compañía de Minas Buenaventura S.A.A. — Investor Day (2022) on 6ix