Highfield Resources Limited · ASX:HFR
Highfield Resources — Investor Presentation (November 2014)
22 slides from Highfield Resources's investor presentation, Nov 14, 2014
Slide 1: Highfield Resources Ltd Investor Presentation
For personal use only Highfield Resources Ltd Investor Presentation November 2014 ASX Code: HFR
Slide 2: Competent Person Statement and Forward Looking Statements
COMPETENT PERSON STATEMENT Information relating to resources was prepared by Mr Leo Gilbride, P.Eng and For personal use only Ms Vanessa Santos, P.Geo, of Agapito Associates. The Competent Person under JORC Code standards is Mr Leo Gilbride, P.Eng and Ms Vanessa Santos, P.Geo. of Agapito Associates
Slide 3: Corporate Overview Contents
Highfield Resources Ltd. CORPORATE OVERVIEW For personal use only CONTENTS APPENDICES 1. Highfield Resources – A Potash Developer A. Board and Senior Management 2. Corporate Snapshot B. Management Experience Case Study 3. 2014 Achievements C. Potash Prices in Different Markets 4. Four 100% owned pro
Slide 4: Highfield Resources – A Potash Mine Developer
1. Highfield Resources (ASX:HFR) – A Potash Mine Developer • For personal use only ASX-listed developer of potash mines with four projects in Northern Spain (Head office in Pamplona) • Mines will be underground conventional mines with limited visual and environmental impact • Highly attractive PFS d
Slide 5: 2014 Financial Year Achievements
2. 2014 Financial Year Achievements • Highly attractive PFS delivered for combined Muga-Vipasca Project in May 2014 For personal use only • Consistent drilling success across all projects, with high-grade shallower intersections of mineralisation • Two JORC Resource Estimates (maiden inferred and up
Slide 6: Corporate Snapshot
3. Corporate Snapshot Fully Diluted Equity For personal use only Ordinary Shares on Issue 200.50m 0.90 3.50mm Options 39.25m 0.80 3.00mm Performance A* Shares 51.50m 0.70 2.50mm Performance B* Shares 51.50m 0.60 2.00mm Fully Diluted 342.75m 0.50 1.50mm Undiluted Market Cap at 62c $122m 0.40 1.00mm F
Slide 7: Highfield has four 100% owned projects
4. Highfield has four 100% owned projects For personal use only 7
Slide 8: Projects are located in a producing basin
5. Projects are located in a producing basin For personal use only Highfield Iberpotash Navarra Sub-basin Catalan Sub-basin Two producing mines operated Two producing mines operating between 1963 and 1997 since 1925 Underground conventional mining Underground conventional mining accessed via a decli
Slide 9: Muga-Vipasca and Pintano Projects
6. Muga-Vipasca and Pintano Projects For personal use only Vipasca Over 450m tonnes of JORC Resource estimate* Project Area covering less than 15% of Project area Muga Project Area Pintano Project Area ≈ 15 km ≈ 52 km Map of Muga-Vipasca and Pintano Project Areas showing JORC Resource estimate, dril
Slide 10: Sierra del Perdón Project
7. Sierra del Perdón Project For personal use only Photo showing mine operations at Potasas de Subiza in the mid 1990s Potash Production History 600 30 500 25 Annual production ('000 t) 400 20 % KCl 300 15 200 10 100 5 0 0 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 19
Slide 11: Muga-Vipasca Pre-Feasibility Study
8. Muga-Vipasca Pre-Feasibility Study • Post tax NPV10 of US$1.06bn Underground mine accessed via a decline supported by For personal use only first world infrastructure and domestic markets • Post tax, unlevered IRR of 48.4% • EBITDA in first year of full production estimated at $US235m • Initial 2
Slide 12: Muga Project Timeline
8. Muga Project Timeline For personal use only 2014 2015 2016 2017 2018 2019 Construction Production Ph1 DFS and Approvals Full Production… Ph1 Construction Ph2 12
Slide 13: Projects “Tick All the Boxes”
9. Projects “Tick All the Boxes” For personal use only • Shallow mineralisation (less than 250m beneath surface) Extraction • Decline access to mineralisation (All four potash mines in Ebro Basin have been accessed via a decline) • Underground conventional mining (Significant Capex and Opex advantag
Slide 14: First Quartile Cash Costs to Customer
10. First Quartile Cash Costs to Customer For personal use only $350 $317 $300 $280 $250 $239 $229 $212 $215 $200 $186 $165 $171 $162 Operating Costs $154 $152 $150 $137 Total $105 $95 $100 $80 $80 $63 $63 $67 $50 $- Uralkali Belaruskali BHP Jansen* ICL Dead Sea K+S Legacy* Highfield PotashCorp K+S
Slide 15: Real Community Engagement
11. Real Community Engagement Corporate Responsibility through the Geoalcali Foundation For personal use only Four Branches Safety first Ensuring best practice environmental outcomes Delivering positive social benefits Spreading the economic opportunities to all stakeholders Nursery Project with mar
Slide 16: Summary and Outlook
12. Summary and Outlook • ASX-listed potash developer with four projects in Northern Spain. For personal use only • Mines will be underground conventional mines with limited visual and environmental impact. • PFS results for combined Muga-Vipasca Project demonstrated very compelling project showing
Slide 17: Appendix A. Board and Senior Management
Appendix A. Board and Senior Management Derek Carter A geologist with over 40 years experience in exploration and development, including nearly 20 years in management of ASX listed exploration For personal use only Non Executive Chairman companies. Held senior positions in the Shell Group, including
Slide 18: Appendix B. Team Experience Case Study – Aguas Teñidas
Appendix B. Team Experience Case Study – Aguas Teñidas • Aguas Teñidas is a Copper, Lead, For personal use only Zinc concentrates mine in Huelva Province. • The mine was developed, built and initially operated by members of the Highfield senior management team. • The facility opened in 2009 after a
Slide 19: Appendix C. Potash Prices in Different Markets
Appendix C. Potash Prices in Different Markets For personal use only November Spot CIF Europe - €300/t CFR Brazil - US$380/t FOB Vancouver - US$310/t Graph courtesy of Integer Research, Sept 2014 19
Slide 20: Appendix D. Producer – Valuation Metrics
Appendix D. Producer – Valuation Metrics For personal use only EV/EBITDA (x) Price/Earnings (x) % of EBIT Market Cap Net Debt from Producers Ticker Last Price EV (US$m) 2013 2014E 2015E 2013 2014E 2015E (millions) (US$m) Potash Arab Potash APOT JR 24 JOD US$2,824 2,555 269 10.8x 12.4x 11.0x 25.2x 27
Slide 21: Appendix E. Full Break Down of Producer Costs
Appendix E. Full Break Down of Producer Costs 350 For personal use only 300 $33 $13 $14 $15 250 $23 $28 $40 $25 $25 $9 $1 200 Corporate SG&A $40 $23 $45 $30 Royalties $24 $15 $1 Sustaining Capital $19 $36 $35 150 $11 $- $13 Freight Costs $48 $- $9 $21 $37 $20 Operating Costs $10 $33 $6 $58 $35 $16 $
Slide 22: For personal use only
For personal use only REGISTERED OFFICE 169 Fullarton Road Dulwich SA 5065 Australia HEAD OFFICE Calle Navas de Tolosa, 5 – 1°B, 31002 Pamplona, Spain T +34 948 050 577 | F +34 948 050 578 www.highfieldresources.com.au info@highfieldresources.com.au FURTHER INFORMATION Anthony Hall Managing Director
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