Mineral Resources Limited · ASX:MIN
Mineral Resources — FY2011 Earnings Presentation
31 slides from Mineral Resources's earnings presentation, Aug 22, 2011
Slide 1: 2011 Results Presentation
For personal use only 2011 RESULTS PRESENTATION PETER WADE, EXECUTIVE CHAIRMAN BRUCE GOULDS, CHIEF FINANCIAL OFFICER AUGUST 2011
Slide 2: Agenda
AGENDA For personal use only About Mineral Resources Finance Operations Development Projects Strategy, market and outlook Appendices 2
Slide 3: Disclaimer
DISCLAIMER For personal use only T his p r esen ta tion has been p re p a re d by Miner al Reso u rc es Limi te d (“M R L” o r “ t he Com pany”) . I t sho ul d n ot b e consi de red as an o f fe r o r invi ta tion to s u bs c ri be fo r or p u rc h ase any se c u ri ties in the Com pany o r as an in
Slide 4: Mineral Resources
MINERAL RESOURCES For personal use only Service Provider Minerals Producer Process Minerals Crushing Services PIHA Polaris Metals Mesa Minerals (64% owned) Minerals and base Australia’s largest Pipeline, services, site Specialist Iron Ore Auvex Resources metals processing, specialist BOO crushing, i
Slide 5: Financial Highlights
FINANCIAL HIGHLIGHTS For personal use only Record net profit $150.5 million, up 141% on normalised 2010 Fully franked final dividend of 27.0 cent, brings full year dividend to 42.0 cents (110% increase) DRP effective for final dividend Cash balance - ~$300 million(at 18/8/11) Balance sheet enhanced
Slide 6: Financial History
FINANCIAL HISTORY For personal use only Value of an investment of $1,000 in MIN on float in 2006 16,000 14,000 12,000 10,000 $ 8,000 6,000 4,000 2,000 - 2006 2007 2008 2009 2010 2011 Earnings per share EBITDA 100 250 cents per share 80 200 60 $ millions 150 40 100 20 50 0 - 2006 2007 2008 2009 2010
Slide 7: Cash Flow
CASH FLOW For personal use only $AUD millions 2011 2010 2009 EBITDA 216.0 103.7 74.4 Net Interest Payments (0.5) (2.7) (1.8) Income Taxes Paid (1.6) (17.3) (24.1) Working Capital and Other 9.5 76.6 4.3 CAPEX (including funded items) (272.1) (88.0) (56.6) Sale of assets 82.3 17.4 1.6 Net Operating an
Slide 8: Operational Highlights
OPERATIONAL HIGHLIGHTS For personal use only World class safety record maintained Substantial year on year increase in commodity tonnes exported Christmas Creek 1 plant operating at nameplate Christmas Creek 2 awarded Atlas Iron / GAM crushing facility agreed Carina iron ore project on track for fir
Slide 9: Safety
SAFET Y For personal use only 16 14 12 10 8 6 4 2 0 LTIFR Industry Average Industry Average Source: Worksafe Mining Services category 9
Slide 10: Export Volumes
EXPORT VOLUMES For personal use only ‘000 tonnes 2009/10 2010/11 % increase Actual Actual Iron Ore 875 2,259 158% Manganese 428 449 0% TOTAL 1,303 2,708 107% 10
Slide 11: Commodity Market
COMMODIT Y MARKET For personal use only Demand and pricing of World Steel Production History iron ore continues to be strong China steel production Prices historical high in USD Manganese pricing & Source: Alan Kohler, 2011 volumes expected to improve in 2012 AUD / USD continuing volatility 11
Slide 12: North West Iron Ore
NORTH WEST IRON ORE For personal use only Iron ore volumes limited by allocated export capacity Remaining iron ore stockpile tonnes to be fully utilised in 2012 Poondano operation to provide Fe lump and fines product in Q3 2012 12
Slide 13: Christmas Creek
CHRISTMAS CREEK 1 For personal use only Construction completed on time, within budget Plant fully operational at 19 mtpa Expansion to 25 mtpa concurrent with Christmas Creek 2 project 13
Slide 14: Christmas Creek
CHRISTMAS CREEK 2 For personal use only 10 year, $1 billion+ BOO contract awarded 4 July Construction programme 15 month duration 25 mtpa plant configuration: Remote primary crushing station 7 km overland conveyor Scrubbing & wet screening circuit 25mtpa crushing & screening circuit Jigging benefici
Slide 15: Wodgina Operation
WODGINA OPERATION For personal use only Construction programme to install new 3mtpa tantalum plant in Q4 2012 Existing 7mtpa plant upgraded and dedicated to Atlas iron ore production in Q4 2012 15
Slide 16: Carina Iron Ore Project
CARINA IRON ORE PROJECT For personal use only Mining commenced on site Temporary crusher in place 258 rooms complete / permanent site facilities in construction Permanent processing plant progressing to plan Train load-out facility being automated, civils 95% complete Rail loop installed Haul road s
Slide 17: Kwinana Berth Upgrade
KWINANA BERTH 2 UPGRADE For personal use only Construction activity in line with project plan Programme to coincide with first trains of ore Major equipment items secured and being installed 17
Slide 18: Mesa Minerals
MESA MINERALS For personal use only Mesa Manganese Joint Venture Partners - Mesa Minerals 50%, Auvex Resources 50% Resource – Ant Hill & Sunday Hill manganese tenements MRL holds 64% of Mesa Minerals MRL purchased 100% of Auvex Resources via scheme of arrangement finalised August 2011. Manganese tec
Slide 19: Mt Marion Lithium
MT MARION LITHIUM For personal use only Focus on plant construction Opportunity to vertically integrate Plant operation scheduled for first quarter 2012 MRL key contribution as process plant operator 19
Slide 20: Pipeline Operations
PIPELINE OPERATIONS For personal use only Contract lining projects at record levels Repeat business major local and international companies Order book full for 2012 Entry into coal seam market Maintained reputation as major infrastructure contractor 20
Slide 21: Strategy
STRATEGY For personal use only Major opportunities to grow in contracting – clients looking to accelerate production growth Key to success continues to be seamless execution of major projects for clients and MRL Infrastructure investment provides significant opportunities for client and shareholder
Slide 22: Ports
PORTS For personal use only Port infrastructure is the oxygen of WA mining industry MRL has secured allocation at two WA public bulk materials common user berths Esperance Port MRL is the only southern producers of iron ore with the capacity to be in operation within the next 24 months (Carina opera
Slide 23: Accommodation Infrastructure
ACCOMMODATION INFRASTRUCTURE For personal use only MRL implementing BOO accommod ati on infrastructure at its operating sites at Carina (258 beds) and Nicholas Downs (48 beds). Por t Hedland accommod ati on at a premium MRL proposes to seek approval to develop accommodati on within Por t Hedland to
Slide 24: Exploration Programme
EXPLORATION PROGRAMME For personal use only 24
Slide 25: Exploration - Yilgarn District
EXPLORATION - YILGARN DISTRICT For personal use only 2011/12 program Carina Extended – resource definition drilling of the northern extension Johnson Range – extension of previous resource definition programme Mayfield – metallurgical testing of diamond drill core samples Short term program Carina E
Slide 26: Outlook
OUTLOOK For personal use only Demand and pricing of iron ore to continue to be strong Manganese pricing & volumes to recover through second half 2012 Infrastructure a key element in production growth Improved definition of commodity reserves and resources to be undertaken Award of piping contracts i
Slide 27: Summary
SUMMARY For personal use only Record full year result for MRL All business segments performing above expectations Continued organic growth across all operations Executive team continues to be strengthened to facilitate growth strategy Outstanding balance sheet and cash position Commodity growth stra
Slide 28: Appendices
For personal use only APPENDICES 28
Slide 29: Financial History
FINANCIAL HISTORY For personal use only Revenue NPAT (normalised) 700 160 600 140 500 120 $ millions $ millions 100 400 80 300 60 200 40 100 20 0 0 FY2007 FY2008 FY2009 FY2010 HY2011 FY2007 FY2008 FY2009 FY2010 HY2011 first half second half first half second half 29
Slide 30: Financial Performance
FINANCIAL PERFORMANCE For personal use only $AUD millions 2011 2010 % change Revenue 609.5 322.4 +95% NPAT 150.5 62.5 +141% EPS 90.0 68.5 +31% Net Assets 627.5 485.7 +29% Net Cash 78.4 88.2 Funds Employed 549.1 397.5 +38% 30
Slide 31: Balance Sheet
BALANCE SHEET For personal use only $AUD millions Jun 11 Jun 10 Jun 09 Jun 08 Total Assets 970.1 844.8 288.9 223.6 Total Liabilities (342.6) (359.1) (144.0) (107.6) Net Assets 627.5 485.7 144.8 116.0 Net Cash Position 78.4 88.2 (11.6) 21.5 Funds Employed 549.1 397.5 156.4 94.5 Funds Employed 600 500