Sylvania Platinum Ltd. · LSE:SLP
Sylvania Platinum — H1 FY2019 Earnings Presentation
38 slides from Sylvania Platinum's earnings presentation, February 2019
Slide 1: Corporate Presentation: Results for the half year ended 31 December 2018
PLATINUM LIMITED CORPORATE PRESENTATION Results for the financial half year ended 31 December 2018 London Investor presentation P L A T I N U M L I M I T E D
Slide 2: Disclaimer
Disclaimer • This document, which is personal to the recipient and has been issued by Sylvania Platinum Limited (the “Company”), comprises written materials/slides for presentations to be held in February 2019. This document does not constitute or form part of any offer or invitation to sell or issu
Slide 3: FY2019 H1 Results
FY2019 H1 RESULTS 3
Slide 4: FY2019 H1 at a glance
FY2019 H1 at a glance GROUP REVENUE GROUP EBITDA PGM PRODUCTION 14% Increased 14% to $32.1m, primarily 19% 0.5% assisted 14% higher PGM basket Increased 19% to $12.3m, aided by SDO production of 34,045oz 4E PGM price, while PGM oz were slightly higher PGM basket price while PGM for H1 was 0.5% highe
Slide 5: H1 FY2019 Achievements
H1 FY2019 Achievements SDO delivered 34,045 4E PGM ounces (HY1 FY2018: 33,892 4E PGM ounces) Net Revenue is up 14% to $32.0 million (HY1 FY2018: $28.2 million) Group EBITDA up 19% to $12.3 million (HY1 FY2018: $10.3 million) Net profit up 29% to $6.95 million (HY1 FY2018: $5.4 million) A t
Slide 6: Challenges
Challenges Power utility infrastructure and supply interruptions and instability still present challenges to existing operations and the execution of expansion processes Abnormal summer heat and drought conditions resulted in water shortages, particularly at Lesedi with significant production do
Slide 7: Opportunities
Opportunities Company remains debt free and continues to generate sufficient cash reserves to fund capital expansion projects Project Echo MF2 module for Mooinooi is fast tracked to mitigate the impact of the delay to the Tweefontein MF2 module due to power availability (Scheduled for commission
Slide 8: Company Overview
COMPANY OVERVIEW 8
Slide 9: Share Structure and Ownership
Share Structure and Ownership CAPITALISATION SUMMARY – 31 DEC 2018 TOP SHAREHOLDERS Africa Asia Capital Listed: AIM 20.59% M&G Investment Domiciled: Bermuda Management 9.88% FIL Investment International 8.63% Ticker symbol: SLP LN Majedie Asset Management 6.68% Basic shares outstanding 1: 28
Slide 10: Overview – Sylvania Dump Operations
Overview – Sylvania Dump Operations Sylvania Dump Operations (SDO) comprises a number of chrome beneficiation and PGM processing plants, treating a combination of current and historical chrome tailings at host-mine sites SDO is the largest PGM producer from chrome tailings re-treatment in the in
Slide 11: Overview – Development
Overview – Development Sylvania holds prospecting and mining rights for a number of PGM projects on the Northern Limb of the Bushveld Igneous Complex in South Africa Volspruit Volspruit is an open pit mine project at the southern end of Northern Limb with projected life-of- mine production of
Slide 12: Location of Operations and Projects
Location of Operations and Projects LEGEND Operating Complexes 1 Millsell (SDO) C 2 Mooinooi Dump & ROM (SDO) 3 Lesedi (SDO) Acquired: Nov ’17 Previously Phoenix Platinum 4 Doornbosch (SDO) B A 5 Lannex (SDO) 6 Tweefontein (SDO) 4 Dormant Operations 7 Steelpoort (SDO) 7 5 Decommi
Slide 13: Operations
OPERATIONS 13
Slide 14: Production profile
Production profile HY1 FY2019 production of 34,045 4E PGM ounces, marginally up on H1 FY2018, but lower than planned Primarily impacted by water shortage and associated downtime at Lesedi and re-mining constraints and instability at Doornbosch operation FY2019 Production Guidance of 73,000oz t
Slide 15: Project ECHO Progress
Project ECHO Progress Millsell and Doornbosch secondary PGM milling & flotation (MF2) circuits commissioned during H2 FY2018 as first phase of Project ECHO roll-out Doornbosch MF2 performed according to design since commissioning increased overall PGM recovery by more than 10% year-on-year for o
Slide 16: Other Technical Projects
Other Technical Projects New fines classification and chrome circuit at Lesedi Civils & earth works in progress at Lesedi Relocation of redundant Steelpoort chrome circuit to Lesedi in order to improve chrome removal ahead of flotation which will enable higher PGM feed grades, analogous to the s
Slide 17: Financial Performance
FINANCIAL PERFORMANCE 17
Slide 18: Operating cost
Operating cost SDO FY2019 cash cost outlook improving on FY2018 in dollar terms based on weaker ZAR/$ exchange rate, but marginally up in Rand terms Cash Cost $/oz 800 SDO - Base 700 Case 600 500 400 -10% R/$ Exchange 300 Rate 200 100 +10% R/$ Exchange 0 Rate 2010 2011 2012 2013 2014 2015 2016 201
Slide 19: Industry position on PGM Producers Cash Cost curve
Industry position on PGM Producers Cash Cost curve Sylvania remains one of the lowest cash cost PGM producers in the industry Western Limb Assets Global PGM Cash Cost+Capex Curve (CY19E - At Spot) Northern Limb Assets Eastern Limb (and other) Assets Cumulative Annual Production (4E Koz.) 499 999 1
Slide 20: Group EBITDA trend
Group EBITDA trend Growing company profits supported by combination of PGM production growth, lower production unit cost and improved PGM basket price Group EBITDA - US$ US$ 55,000,000 Base Case - 50,000,000 SPOT 45,000,000 40,000,000 -10% Basket 35,000,000 Price 30,000,000 +10% Basket 25,000,000
Slide 21: Gross PGM Metal Price trend
Actual HY1 FY2019 PGM Prill Split Rh 12.6% Au 0.3% Gross PGM Metal Price trend 4E PGM Basket price of $1,201/oz in H1 FY2019 is 14% higher than H1 FY2018, supported by improvements in Palladium and especially Rhodium prices Pd 24.5% ZAR 4E PGM Basket price was ~21% higher, based on combination o
Slide 22: Capital expenditure
Capital expenditure Project capital expenditure from late 2017 to early 2021 primarily associated with Project Echo and smaller strategic projects contributing towards PGM ounce profile and tailings dam replacement projects SDO Capital spend is primarily in ZAR, hence US$ forecasts are impacted
Slide 23: Summary
SUMMARY ae 7 r #
Slide 24: Corporate Strategy
Corporate Strategy Value creation Shareholder-friendly use of cash Free cash flow generation Only commit capital to growth projects when Production of approximately 76koz to 78koz/year internal hurdle rate is met; from current operations1 Funding Project ECHO from cash resources. Low cash cos
Slide 25: Why Sylvania?
Why Sylvania? Significant industry experience and proven track record in development and operations of tailings re- treatment operations Shareholder-friendly corporate strategy Operations generate positive free cash flow Disciplined capital allocation and funding of expansion program from in
Slide 26: Contact us
Contact us Sylvania Platinum Limited Terry McConnachie +44 777 533 7175 Liberum Capital Limited (NOMAD) Richard Crawley / Chris Britton +44 20 3100 2000 Alma (Communications) Josh Royston / Helena Bogle +44 758 021 6203 +27 11 673 1171 www.sylvaniaplatinum.com P L A T I N U M L I M I T E D
Slide 27: Glossary
Glossary GLOSSARY OF TERMS FY2019 4E PGM ounces include the precious metal elements Platinum, Palladium, 4E PGMs MPRDA Mineral and Petroleum Resources Development Act Rhodium and Gold MRA Mining Right Application 6E PGMs 6E ounces include the 4E elements plus additional Iridium and Ruthenium MTO Min
Slide 28: Appendices
Appendices 28
Slide 29: H1 FY2019 – Key Statistics
H1 FY2019 — Key Statistics usD ; 5 ; ZAR che, HY1 2018 HY1 2013 Ue Unaudited une HY1 2018 Hy1 2012 | % Change o% 1,097.568 1.195.906 T Plant Feed T 4.195.906 1.007.568 o% ~4%% 246 226] of Feed Head Grade an 2368 2.46 4% a% 554,650 607.018 T PGM Plant Feed Tons r 607.018 554.850 me 2% 3.60 3es| ot PG
Slide 30: Dividend guideline
Dividend guideline The revised dividend policy, as referenced in the last annual report, has been uploaded onto the Company’s website Key considerations by the Board before recommending a dividend or any other value enhancing methods (eg. Share repurchases) are listed below: • Liquidity and fore
Slide 31: Dividend guideline (cont)
Dividend guideline (cont) • Sustainability: The Company’s intention is to return excess cash to shareholders at regular intervals. The level of dividends (or substantial share repurchases) must therefore be at a level which can be supported on an on-going basis. • Metal prices and South African Rand
Slide 32: Sylvania Corporate Structure
Sylvania Corporate Structure Lesedi (Phoenix) 32
Slide 33: Schematic Process Flow
Schematic Process Flow Generic process flow sheet for Sylvania’s Millsell, Lannex, Doornbosch, Tweefontein, and TYPICAL SDO PROCESS FLOW Mooinooi Dump operations Treating current and historical chrome tailings material Recover and return chrome product to host-mine Generate cash from recover
Slide 34: Typical PGM concentrate metal prill splits
Typical PGM concentrate metal prill splits Sylvania Rhodium portion typically higher than average UG2 and Merensky ores, and Palladium portion lower PGMPrill PGM Prill Splits Splits 100% 100% 90% 90% 80% 80% 70% 70% 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% Typical Typical Typical Typi
Slide 35: SDO cash operating cost breakdown
SDO cash operating cost breakdown Sylvania Dump Operations Cash Cost Breakdown Work in Progress Inventory Cost Sylvania Shared Services Charge Other Royalties Tax 0% 5% 1% 0% Equipment Hire 2% Safety , PPE & Insurance 2% Salary & Wages Electrical Consumption 37% 13% Tailings Deposition 4% Laboratory
Slide 36: Project ECHO MF2 Modules commissioned at Millsell & Doornbosch
Project ECHO MF2 Modules commissioned at Millsell & Doornbosch Above: Doornbosch Secondary Flotation Circuit (old Steelpoort PGM plant relocated) Below: Doornbosch Secondary Flotation circuit Above: Millsell Secondary Flotation circuit Below: Millsell Secondary SMD Milling circuit 36
Slide 37: Board of directors
Board of directors Stuart Angus Murray: Non-executive chairman Roger Williams: Non-executive director Mr Murray joined the board of Sylvania Platinum Limited as non- Mr Williams was appointed to the Board on 29 December 2011. executive chairman on 1 April 2013. He has over 25 years of He is a Charte
Slide 38: Key executives
Key executives Jaco Prinsloo: Managing Director Sylvania Metals Mr Prinsloo was appointed as Managing Director in April 2014, after joining Sylvania as Executive Officer – Operations in January 2012. He is a metallurgical engineer who obtained a B.Eng (Extractive Metallurgy) from the University of P