Slide 1: Full Year Results Presentation
INDEPENDENCE GROUP NL For personal use only PETER BRADFORD, MANAGING DIRECTOR AND CEO Full Year Results Presentation 30 August 2017
Slide 2: Cautionary statements & disclaimer
Cautionary statements & disclaimer • This presentation has been prepared by Independence Group NL (“IGO”) (ABN 46 092 786 304). It should not be considered as an offer or invitation to subscribe for or purchase any For personal use only securities in IGO or as an inducement to make an offer or invit
Slide 3: FY17 business highlights
FY17 business highlights FY17 investments provide the platform for a great FY18 For personal use only Improved Safety results across major lag indicators • 12 month rolling LTIFR at 1.7 (FY16 LTIFR at 3.6) Strong performance from Tropicana and Long combined with higher metal prices to deliver a stro
Slide 4: FY17 financial highlights
FY17 financial highlights Stronger financial results driven by improved metal prices For personal use only Higher Revenue and EBITDA • Driven by higher metal prices and better than guidance production at Tropicana and Long offset by lower production at Jaguar Higher NPAT of A$17M compared to FY16 lo
Slide 5: Financial results summary
Financial results summary Improving metal prices through FY17 and into FY18 For personal use only A$’million FY17 FY16 Change % Revenue 421.9 417.1 1% Underlying EBITDA(1) 150.5 137.5 9% Net Profit after Tax 17.0 (58.8) n/a Cash Flow from Operations(2) 77.7 102.1 (24%) Underlying Free Cash Flow (3)
Slide 6: Earnings summary
Earnings summary FY17 a solid year for Revenue, EBITDA and Net Profit after Tax For personal use only Net Profit After Tax (A$M) Revenue (A$M) 100 600 500 80 400 300 60 499 200 399 417 422 40 77 100 0 49 20 FY14 FY15 FY16 FY17 17 Underlying EBITDA (A$M)(1) 250 (20) 200 -59 150 (40) 100 213 (60) 148
Slide 7: FY17 NPAT variance
FY17 NPAT variance Lower production offset by strong metal prices and acquisition costs For personal use only NPAT variance A$M 40 6.4 1.0 0.9 1.0 10.5 20 9.8 9.9 3.9 17.0 - 56.3 (20) 48.7 (58.8) 61.2 (40) (60) (80) NPAT FY16 FY16 Acquisition Volume variance Price Variance Cost of D&A Corporate Grow
Slide 8: FY17 EBITDA waterfall
FY17 EBITDA waterfall External (prices) and internal (production volume) impact earnings For personal use only Underlying EBITDA variance(1) A$M 250 External A$58.3M Internal (A$45.3M) 2.0 200 48.7 56.3 3.9 0.9 0.3 1.0 150 100 195.8 150.5 137.5 50 - Price (2) Investments Production Costs of Corporat
Slide 9: FY17 EBITDA components
FY17 EBITDA components EBITDA contributions across all operations For personal use only Underlying EBITDA(1) A$M 140 120 114.9 FY17 A$150.5 M FY16 A$137.5 M 106.1 100 80 60 50.2 43.1 40 32.1 18.9 20 3.2 1.6 - (20) (17.0) (17.9) (24.1) (23.1) (40) Tropicana Long Jaguar New Business Corporate Other 1)
Slide 10: FY17 cost of production variance
FY17 cost of production variance Ongoing focus on cost management For personal use only Cost of production variance FY16 to FY17 FY17 Decrease in A$ M Long Jaguar Tropicana Production Costs - (3.9) (7.1) (4) 5.7 (8) (2.5) (12) • Production costs continued to fall at Long benefiting from business res
Slide 11: Cash flow summary
Cash flow summary Strong balance sheet with A$200 million debt facility undrawn For personal use only Underlying Free Cash Flow (A$M)(1) Operating Cash Flow (A$M) 150 250 200 150 Operating cash 100 flow is net of 136 A$58M Taxes 100 202 (Stamp Duty) 127 payment 116 50 102 50 78 0 FY14 FY15 FY16 FY17
Slide 12: FY17 free cash flow by half year
FY17 free cash flow by half year Lower operating underlying free cash flow in 2H17 For personal use only 1H17 Free Cash Flow A$(49.1M) 2H17 Free Cash Flow A$(64.1M) A$ M 40 30.9 27.6 24.7 20 16.7 11.4 1H17 2H17 - (5.5) (3.3) (7.6) (8.0) (12.2) (10.4) (11.9) (20) (40) (60) (80) (73.4) (100) (92.2) Tr
Slide 13: Hedge book
Hedge book Mark to market hedge book value of A$21M(1) For personal use only Hedging Strategy • IGO will identify, evaluate and pro-actively manage its financial market risks within pre-determined Board approved frameworks with the aim of reducing a portion of the downside price risk Current Hedge B
Slide 14: Segment financial results
Segment financial results Higher base metals prices drive improved results For personal use only FY17 FY16 Inc/(Dec) Inc/(Dec) Operation Metric (A$M) (A$M) (A$M) (%) Revenue 211.9 215.0 (3.1) (1%) Tropicana Underlying EBITDA 106.1 114.9 (8.8) (8%) Free Cash Flow 55.6 68.7 (13.1) (19%) Revenue 70.5 6
Slide 15: Nova: FY17 operational scorecard and FY18 guidance
Nova FY17 operational scorecard and FY18 guidance For personal use only Metric Units FY17 Guidance FY17 Actual FY18 Guidance Nickel in concentrate t 3,400(1) 3,502 23,000 to 27,000 Copper in concentrate t 1,500(1) 2,106 10,000 to 12,000 Cobalt in concentrate t - 112 800 to 1,050 Cash cost (payable)(
Slide 16: Nova: Capital expenditure reconciliation
Nova Capital expenditure reconciliation For personal use only Nova Capitalised Actual Initial Estimate Variance Change % Development Costs A$M A$M A$M Process Plant & Infrastructure 160.6 176.0 (15.4) (9%) Non-mine Infrastructure 90.4 98.6 (8.2) (8%) Mine Development 64.4 54.7 9.7 18% Mine Infrastru
Slide 17: Tropicana: FY17 operational scorecard and FY18 guidance
Tropicana FY17 operational scorecard and FY18 guidance For personal use only Metric Units FY17 Guidance FY17 Actual FY18 Guidance Gold produced (100% basis) oz 390,000 to 430,000 431,625 440,000 to 490,000 Gold Sold (IGO’s 30% share) oz 117,000 to 129,000 128,601 132,000 to 147,000 Cash cost A$/oz A
Slide 18: Jaguar: FY17 operational scorecard and FY18 guidance
Jaguar FY17 operational scorecard and FY18 guidance For personal use only Metric Units FY17 Guidance FY17 Actual FY18 Guidance Zinc in concentrate t 39,000 to 43,000 32,638 29,000 to 33,000 Copper in concentrate t 4,600 to 5,100 4,565 2,600 to 3,000 Cash cost (payable) A$/Ib Zn 0.70 to 0.80 0.76 0.8
Slide 19: Long: FY17 operational scorecard and FY18 guidance
Long FY17 operational scorecard and FY18 guidance For personal use only Metric Units FY17 Guidance FY17 Actual FY18 Guidance Nickel (contained metal) t 7,400 to 8,200 8,433 5,400 to 6,000 Cash Cost (payable) A$/Ib Ni 3.50 to 3.90 3.28 4.40 to 4.90 Sustaining capex A$M 1 0.8 0.5 to 1 Development cape
Slide 20: Exploration
Exploration Committed to delivering growth through exploration For personal use only FY18 Exploration Guidance A$2M Greenfields & A$4M Generative A$5M Nova Tropicana A$9M A$31M Jaguar Long Key developments and potential • Substantial increase in greenfields exploration in FY18 • Fraser Range the key
Slide 21: Portfolio catalysts
Portfolio catalysts 1H18 activities to generate significant news flow For personal use only September Quarter December Quarter March Quarter FY18 FY18 FY18 Drill testing of 3D Seismic survey & processing EM targets Nova Ramp-up to full Complete LoM grade control production Interim Ore Reserve Delive
Slide 22: Concluding comments
Concluding comments FY17 investments provide the platform for a great FY18 For personal use only Strong performance from Tropicana and Long combined with higher metal prices to deliver a strong FY17 financial result • Offset by lower production at Jaguar Significant progress made at Nova • Surface i
Slide 23: For personal use only
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