First Majestic Silver Corp. · TSX:AG

First Majestic Silver — Investor Presentation (July 2015)

36 slides from First Majestic Silver's investor presentation, July 2015

  1. Slide 1: First Majestic Silver Corp. - One Metal, One Country

    FIRST MAJESTIC SILVER CORP. TSX: FR | NYSE: AG | FWB: FMV | BMV:AG ONE METAL, ONE COUNTRY...

  2. Slide 2: Forward-looking statements

    2 Certain statements contained herein regarding First Majestic Silver Corp. (the “Company”) and its operations constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. All statemen

  3. Slide 3: Market emotion cycle

    3 EUPHORIA ANXIETY THRILL DENIAL EXCITEMENT FEAR PANIC OPTIMISM OPTIMISM RELIEF DESPERATION HOPE DESPONDENCY DEPRESSION

  4. Slide 4: Pure silver producer in Mexico

    4 Pure Silver Producer 77% Ag in 2014 (5% Au, 13% Pb, 5% Zn) One Country: Mexico World’s largest silver producing country Five producing silver mines; 100% owned Multi-Asset Producer Projecting 11.8M – 13.2M Ag oz in 2015 Future Growth Two advanced stage silver projects Goal Achieve annual productio

  5. Slide 5: Production ounces and capital structure

    5 Market Capitalization: US$550M Shares Outstanding: 122.2M (FD 130.7M) Avg. Daily Volume: 1.8M shares ~ US$9M in daily liquidity Cash & Cash Equiv1: US$22.4M (not including C$30M from equity financing) Production Ounces (Millions) 1) As of quarter end, March 31, 2015

  6. Slide 6: Broad depth of people

    6 BROAD DEPTH OF PEOPLE • 100% Mexican operating talent - No Expats • Internally design, develop and construct 100% of our silver projects • ~ 3,500 direct employees • Awarded ‘Socially Responsible Company’ for seven consecutive years, 2008 to 2014, from the Centro Mexicano para la Filantropia (CEME

  7. Slide 7: Q1 2015 financial highlights

    7 Quarter End Full Year (All shown in $USD) Q1 2015 Q4 2014 Q1 2014 2014 Revenue 54.6M 72.5M 65.3M 245.5M Mine Operating Earnings 5.0M 5.8M 16.6M 30.2M Net Earnings after taxes (1.1M) (64.6M) 6.0M (61.4M) Earnings per share - Adjusted1 0.00 0.04 0.06 0.07 Operating Cash Flows, before movements in WC

  8. Slide 8: Mexican mines in production and permitting

    8 IN PRODUCTION 1 La Encantada 2 La Parrilla 1 3 San Martin 4 La Guitarra 5 Del Toro 2 6 5 7 3 PERMITTING 4 6 Plomosas 7 La Luz

  9. Slide 9: Strong production growth

    NYSE: AG FWB: FMV. BMV: AG STRONG PRODUCTION GROWTH @ Plomosas* 15 mi La Luz* Silver Ounces (Millions) @ La Guitarra 10 -- @ Del Toro fl La Encantada | | @ La Parrilla J UJ UJ mSan Martin “ rd *Pending permits FIRST MAJESTIC SILVER CORP, 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E 3-5 Year Go

  10. Slide 10: Silver reserves increased over 115% since 2010

    10 Silver Reserves have increased by over 115% since 2010 Silver Ounces (M) Silver Price Ag Grade (g/t): 223 163 166 174 211

  11. Slide 11: Lowest capital investment in five years

    11 Lowest capital investment in five years following aggressive growth period (Growth was funded by reinvesting operating profits; non-dilutive growth!)

  12. Slide 12: 2014 production by mine

    12 Mine Ag Oz (M) Ag Eqv. Oz (M) AISC/Oz ($USD)* La Encantada 1.1 1.2 TBA La Parrilla 1.2 2.1 TBA Del Toro 1.5 2.5 TBA San Martin 1.2 1.4 TBA La Guitarra 0.4 0.6 TBA Total: 5.5 7.7 TBA *Metal price assumptions for calculating equivalents are: silver: $16.55/oz, gold: $1,204/oz, lead: $0.85/lb, zinc:

  13. Slide 13: 2015 production and AISC guidance

    13 Mine Ag Oz (M) Ag Eqv. Oz (M) AISC/Oz ($USD)* La Encantada 4.0 – 4.5 4.0 – 4.5 $12.19 – $12.78 La Parrilla 2.6 – 2.9 4.3 – 4.8 $12.51 – $13.93 Del Toro 2.6 – 2.9 3.7 – 4.2 $13.70 – $14.77 San Martin 1.8 – 2.0 2.1 – 2.3 $13.73 – $14.96 La Guitarra 0.8 – 0.9 1.2 – 1.3 $15.74 – $18.07 Total: 11.8 –

  14. Slide 14: 2015E AISC excluding non-cash items

    14 Excluding non-cash items: 2015E AISC $13.50 - $14.96 1) AISC is a non-GAAP measure and was calculated based on guidance provided by the World Gold Council (“WGC”)

  15. Slide 15: First Majestic

    15 FIRST MAJESTIC

  16. Slide 16: Del Toro plant operations

    16 Plant Operations Mill Throughput: 2,000 tpd 2015E Production: 2.6 – 2.9M Ag oz (3.7 – 4.2M Ag Eq oz) Reserves & Resources Proven & Probable: 24.7M Ag oz Measured & Indicated: 27.4M Ag oz Inferred: 32.5M Ag oz *M&I Resources are inclusive of Reserves Quarter End • Connected to National Power Grid

  17. Slide 17: La Encantada plant operations

    17 Plant Operations Mill Throughput: 3,000 tpd 2015E Production: 4.0 – 4.5M Ag oz Reserves & Resources Proven & Probable: 28.4M Ag oz Measured & Indicated: 33.5M Ag oz Inferred: 30.6M Ag oz *M&I Resources are inclusive of Reserves Quarter End Full Year • New 12’ X 14’ ball mill installed to Q2 2015

  18. Slide 18: La Parrilla plant operations

    18 Plant Operations Mill Throughput: 2,000 tpd 2015E Production: 2.6 – 2.9M Ag oz (4.3 – 4.8M Ag Eq oz) Reserves & Resources Proven & Probable: 20.4M Ag oz Measured & Indicated: 23.9M Ag oz Inferred: 64.2M Ag oz *M&I Resources are inclusive of Reserves • Connecting the mines with an Quarter End Full

  19. Slide 19: San Martin plant operations

    19 Plant Operations Mill Throughput: 1,300 tpd 2015E Production: 1.8 – 2.0M Ag oz (2.1 – 2.3M Ag Eq oz) Reserves & Resources Proven & Probable: 18.3M Ag oz Measured & Indicated: 23.0M Ag oz Inferred: 38.5M Ag oz *M&I Resources are inclusive of Reserves • Increasing silver production and Quarter End

  20. Slide 20: La Guitarra plant operations

    20 Plant Operations Mill Throughput: 500 tpd 2015E Production: 0.8 – 0.9M Ag oz (1.2 – 1.3M Ag Eq oz) Reserves & Resources Proven & Probable: 9.4M Ag oz Measured & Indicated: 11.7M Ag oz Inferred: 4.7M Ag oz *M&I Resources are inclusive of Reserves Quarter End Full Year Q2 2015 Q1 2015 Q2 2014 2014

  21. Slide 21: First Majestic 5 year chart

    21 FIRST MAJESTIC (AG) (5 year chart) % AG Silver GDX Source: Bloomberg

  22. Slide 22: Revenue forecasts

    22 1) Revenue forecasts calculated using metal price assumptions of US$1,200/oz gold, US$17.00/oz silver, US$3.00/lb copper, US$0.95/lb lead and US$1.10/lb zinc. 2) Source: BMO

  23. Slide 23: Share performance 1, 3 and 5 year

    23 1 Year 3 Year 5 Year Source: Bloomberg (as of June 30, 2015)

  24. Slide 24: Silver has underperformed other commodities

    24 Silver has underperformed other commodities causing pain for silver companies Source: Bloomberg

  25. Slide 25: Attractive value relative to peer group

    25 Price / Cash Flow EV / EBITDA Attractive value relative to peer group Source: Bloomberg analyst consensus (as of July 9, 2015)

  26. Slide 26: Catalysts and recent milestones

    26  Updated NI 43-101Technical Report for La Encantada expected in Q4 2015  Expansion decision pending at La Guitarra which could increase production capacity to 1,000 tpd in 2015  Completion of underground haulage system at La Parrilla aimed to further reduce costs  Exploration discovery potent

  27. Slide 27: Our Strategy

    27 Our Strategy… One Metal One Country Continue to Acquire the Best Talent in Mexico Build through Development and Acquisitions Become a 20 Million Ounce Producer

  28. Slide 28: Reliance on technology and silver

    “AS WE BECOME MORE RELIANT ON TECHNOLOGY... WE BECOME MORE RELIANT ON SILVER’

  29. Slide 29: Appendix

    NYSE: AG FWB: FMV. BMV: AG APPENDIX jm FIRST MAJESTIC SILVER CORP,

  30. Slide 30: Research coverage and institutional holders

    30 Research Coverage Institution % S/O David Forster - Bank of America Van Eck (GDXJ ETF) 9.3% Andrew Kaip - Bank of Montreal Van Eck (GDX ETF) 7.1% Graeme Jennings - Cormark Resolute Funds 4.2% Mike Parkin - Desjardins M&G Investment Mgmt 3.7% Matthew O'Keefe - Dundee Vertex One 1.9% Stuart McDouga

  31. Slide 31: Beta versus silver peers

    31 1 Year 3 Years 5 Years First Majestic 1.36 1.30 1.24 Silver Standard 1.56 1.39 1.03 Silver Wheaton 0.99 1.08 0.99 Coeur 1.25 1.08 0.99 Hecla 0.74 0.91 0.92 Fresnillo 0.91 1.02 0.83 Pan American 1.00 0.90 0.76 Spot Silver 1.00 1.00 1.00 GDX ETF 0.91 0.97 0.73 Spot Gold 0.49 0.53 0.41 Source: Bloom

  32. Slide 32: Shown as % of total cash costs

    32 Shown as % of Total Cash Costs

  33. Slide 33: Proven and probable mineral reserves, December 31, 2014

    33 PROVEN AND PROBABLE MINERAL RESERVES WITH AN EFFECTIVE DATE OF DECEMBER 31, 2014 Mine Category Mineral Type k tonnes Ag (g/t) Au (g/t) Pb (%) Zn (%) Ag-Eq (g/t) Ag (k Oz) Ag-Eq (k Oz) Proven (UG) Oxides 1,084 248 - - - 248 8,639 8,639 LA ENCANTADA Probable (UG) Oxides 2,115 291 - - - 291 19,754 1

  34. Slide 34: Measured and indicated mineral resources

    34 Measured and Indicated Mineral Resources are reported inclusive of Mineral Reserves) MEASURED AND INDICATED MINERAL RESOURCES WITH AN EFFECTIVE DATE OF DECEMBER 31, 2014 Mine / Project Category Mineral Type k tonnes Ag (g/t) Au (g/t) Pb (%) Zn (%) Ag-Eq (g/t) Ag (k Oz) Ag-Eq (k Oz) Measured (UG)

  35. Slide 35: Inferred mineral resources

    35 INFERRED MINERAL RESOURCES WITH AN EFFECTIVE DATE OF DECEMBER 31, 2014 Mine / Project Category Mineral Type k tonnes Ag (g/t) Au (g/t) Pb (%) Zn (%) Ag-Eq (g/t) Ag (k Oz) Ag-Eq (k Oz) LA ENCANTADA Inferred (UG) Oxides 899 340 - - - 340 9,832 9,832 Inferred (Tailings) Tailings 6,026 107 - - - 107

  36. Slide 36: Plomosas historical resources notes

    36 (1) Plomosas historical resources figures are taken from Grupo Mexico’s estimates prepared in 2001 (2) Tonnage is expressed in thousands of tonnes, metal content is expressed in thousands of ounces. (3) A qualified person has not done sufficient work to classify the historical resources at Plomos

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