Igo Limited · ASX:IGO

Igo — Independence Group NL — H1 FY15 Earnings Presentation

36 slides from Igo's earnings presentation, Feb 23, 2015

  1. Slide 1: February 2015 Investor Presentation

    For personal use only Au Ni Cu/Zn February 2015 Investor Presentation

  2. Slide 2: Cautionary Notes and Disclaimer

    Cautionary Notes and 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 For personal use only purchase any securities in IGO or as an inducement to make an offer or invitati

  3. Slide 3: Table of Contents

    Table of Contents  Introduction For personal use only  Financials  Operations • Tropicana • Long • Jaguar  Growth  Summary Page 3

  4. Slide 4: Corporate Overview

    Independence Group NL Corporate Overview Key Highlights Financial Snapshot For personal use only Highlights H1 FY15 H1 FY14 Change Revenue $274M $167M 64% Underlying EBITDA(2) $121M $48M 152% Profit after tax(2) $50M $14M 257% Net Operating Cash Flow(2) $114M $41M 178% Leading ASX200 Gold and Base M

  5. Slide 5: Share Ownership and Performance

    Independence Group NL Share Ownership and Performance  ASX listed (IGO.AX) Institutional Retail & other Domestic Instos Foreign Instos For personal use only • Head Office in Perth  234.3M shares on issue • $1.28 billion (~US$1bn) market capitalisation(1) • 2.4M potentially dilutive employee perfor

  6. Slide 6: Diversified Mining, Development and Exploration Company

    Independence Group NL Diversified Mining, Development and Exploration Company MINING DEVELOPMENT EXPLORATION For personal use only Au Ni Zn/Cu Cu/Zn TROPICANA LONG JAGUAR STOCKMAN VARIOUS 30% JV Interest 100% owned 100% owned 100% owned 70-100% WA, Australia WA, Australia WA, Australia Vic, Australi

  7. Slide 7: H1 FY15 Financials

    Financials H1 FY15 Financials For personal use only Highlights H1 FY15 H1 FY14 Change Revenue $274.3M $166.7M 64% Underlying EBITDA(1)(3) $121.4M $48.5M 158% Profit after tax(2)(3) $49.5M $13.6M 264% Net Cash Flow From Operating Activities(3) $113.9M $41.4M 175% Free Cash Flow(2) $75.3M ($21.7M) N/A

  8. Slide 8: Quarterly Financials

    Financials Quarterly Financials for the last 18 months For personal use only Dec 14 Sept 14 June 14 Mar 14 Dec 13 Sept 13 Highlights Qtr Qtr Qtr Qtr Qtr Qtr Profit after tax(1)(4) $21.6M $27.9M $14.7M $20.2M $8.8M $4.8M Underlying EBITDA(2)(4) $57.4M $64.0M $47.6M $51.8M $32.1M $16.4M Net Cash Flow

  9. Slide 9: Underlying EBITDA by Mine

    Financials Underlying EBITDA(1) by Mine For personal use only 80 70 60 Underlying EBITDA ($’M) 50 40 30 20 10 0 Q3FY13 Q4FY13 Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15 -10 Tropicana Long Jaguar (1) Underlying EBITDA is a non-IFRS measure and comprises net profit or loss after tax, adjusted to exclud

  10. Slide 10: Commodity Prices

    Commodity Prices Australian Dollar Metal Prices Still Strong For personal use only Australian Dollar Commodity Price Movement 150% Gold Silver 140% Copper Zinc Nickel Movement Since One Year Ago (%) 130% IGO share price 120% 110% 100% 90% 80% 70% Page 10

  11. Slide 11: Tropicana: Tier 1 Gold Mine on New Belt

    Tropicana Tier 1 Gold Mine on New Belt  370km northeast of Kalgoorlie by road For personal use only  Unincorporated joint venture • 70% AngloGold Ashanti (Manager) • 30% Independence  Belt scale concession package (~8,000km2) • Eastern edge of the Yilgarn craton along the Fraser-Albany orogeny –

  12. Slide 12: Tropicana: December Quarter Benefits from Higher Grade

    Tropicana December Quarter Benefits from Higher Grade  Health, Safety and Environment For personal use only 16 4.00 Total Mined (Mt) • No lost time incidents for the quarter 14 Milled (Mt) 3.50 Milled (Mt) and Milled Grade (g/t) • 12-month LTIFR is currently 3.6(1) 12 Grade Milled (g/t) 3.00 Total

  13. Slide 13: Tropicana: 3.6Moz Reserves Optimized

    Tropicana 3.6Moz Reserves Optimized at A$1,249/oz For personal use only Page 13

  14. Slide 14: Tropicana Gold Exploration

    Tropicana Gold Exploration  Gold exploration managed by AngloGold For personal use only Ashanti  Tropicana Resource Extension • 3D seismic data processing and interpretation continued • Near surface targets identified from initial interpretation  Near Mine Exploration • Drilling continued at a nu

  15. Slide 15: Tropicana Base Metals Exploration

    Tropicana Base Metals Exploration  Beachcomber JV N For personal use only Tropicana Gold • Managed by IGO Mine • Aggregate area of ~140km2 • IGO spending a total of $3M over 4 years to increase interest from Domains 30% to 70% Salt Creek Complex Northern Foreland  Salt Creek JV Tropicana Domain Al

  16. Slide 16: Long Nickel Mine

    Long Nickel Mine High Grade Ni, Good Fe:MgO Ratio, Low Impurities  Located 57km south of Kalgoorlie For personal use only  Fantastic orebody • Total of 309kt contained Ni to date at an average mined grade of 3.8% Ni mined over 35 year history • Acquired by IGO in 2002 • Good Fe:MgO ratio (1.4 to 1

  17. Slide 17: Long: Consistent Performance

    Long Consistent Performance  Health, Safety & Environment 3,000 $6.00 For personal use only • No lost time injuries 2,500 $5.00 Cash Costs ($/lb Ni) Contained Nickel (t) • 12 month LTIFR improved to 3.0(2) 2,000 $4.00  Solid quarter 1,500 $3.00 • 62kt ore mined at 4.13% Ni 1,000 Contained Nickel (

  18. Slide 18: Long: Brownfields Exploration Targets Being Tested

    Long Solid Brownfields Exploration Targets Being Tested  McLeay South For personal use only • McLeay South drill drive in progress • 119m of 530m planned development completed  Moran South • Currently drilling 9-hole program • Hole 3 intersected 5.4m at 12.4% Ni • Hole 4 (80m south) intersected na

  19. Slide 19: Jaguar Zn/Cu Mine: A Turnaround Success Story

    Jaguar Zn/Cu Mine A Turnaround Success Story  Located 300km north of Kalgoorlie For personal use only  Cu-Zn-AG VMS camp • IGO controls +50km long corridor prospective for Cu-Zn-Ag VMS deposits • Three mines discovered and developed • First discovery at Teutonic Bore made by BP in 1976  Acquired

  20. Slide 20: Jaguar: Strong Contribution

    Jaguar Strong Contribution Over Last 12 Months  Health, Safety & Environment For personal use only 16,000 $0.70 • Two lost time injuries 14,000 $0.60 • 12 month LTIFR improved to 3.4(2) 12,000 $0.50 Contained Metal (t) Cash Costs ($/lb Zn)  Solid quarter 10,000 $0.40 • 125kt ore mined (500ktpa rat

  21. Slide 21: Jaguar: 50km Long Corridor Prospective for Cu-Zn-Ag VMS

    Jaguar 50km Long Corridor Prospective for Cu-Zn-Ag VMS For personal use only Three known mines with similar metal endowment Ten Cu-Zn-Ag alteration anomalies under cover, being systematically tested Page 21

  22. Slide 22: Jaguar: Priority 1: Explore for Resource Extensions at Bentley

    Jaguar Priority 1: Explore for Resource Extensions at Bentley  Inferred Resource For personal use only • Inferred resource at bottom of Arnage and Flying Spur • Planning drill drive to provide drill access to drill off inferred resource  Bentley Deeps • 7.8m @ 10% Zn and 2.5% Cu drilled in October

  23. Slide 23: Jaguar: Priority 2: Using Science to find the Next Bentley

    Jaguar Priority 2: Using Science to find the Next Bentley  Triumph For personal use only • JHDD0003 intersected 8.4m @ 9.7% Zn and 44g/t Ag drilled in September quarter • Drilling continued in December quarter • Now undertaking a 3D review of all work prior to continuing any further drilling  Daim

  24. Slide 24: Growth: Invest to sustain and grow value of the business

    Growth Invest to sustain and grow value of the business For personal use only  Target opportunities to build value of portfolio • Exploration, development stage and producing assets • Focus on longer mine life, high margin assets • Gold and base metals • Australia and selected jurisdictions offshor

  25. Slide 25: Stockman Project (VIC)

    Stockman Project (VIC) Continuing to De-risk Project in 2015 $3,000  460 km by road NE of Melbourne Zinc price For personal use only $2,500  Optimisation study results released 28 Nov 2014 $2,000 • Cu-Zn VMS Price (USD/t Zn)  10 year mine life based on Ore Reserves(1) $1,500 Bloomberg consensus •

  26. Slide 26: Summary: Business is in good shape

    Summary Business is in good shape  Business is in good shape For personal use only • Record H1 FY14 and strong December Quarter production • Consistent history of low cost production • Generating excellent cashflow  Continued stewardship of operating assets • Safety, productivity and cost control

  27. Slide 27: Contact Details

    Contact Details For personal use only Peter Bradford Managing Director & CEO Tony Walsh Company Secretary Suite 4, Level 5, South Shore Centre 85 South Perth Esplanade South Perth, Western Australia, 6151 PO Box 496, South Perth, Western Australia, 6951 Telephone: +61 8 9238 8300 Facsimile: +61 8 92

  28. Slide 28: Resources & Reserves: Competent Persons Statement

    Resources & Reserves Competent Persons Statement For personal use only Exploration Results The information in this report that relates to Exploration Results is a compilation of previously published data for which Competent Persons consents were obtained. Their consents remain in place for subsequen

  29. Slide 29: Resources & Reserves: Tropicana

    Resources & Reserves Tropicana (IGO 30% share) For personal use only Mineral Resource 30 June 2014 Ore Reserve 30 June 2014 100% Project 100% Project Classification Tonnes Mt Au g/t Contained Au Moz Classification Tonnes Mt Au g/t Contained Au Moz OPEN PIT Measured 22.8 2.11 1.56 OPEN PIT Proved 20.

  30. Slide 30: Resources & Reserves: Long

    Resources & Reserves Long (100% IGO) For personal use only Mineral Resource 30 June 2014 Ore Reserve 30 June 2014 Classification Tonnes Ni% Ni Tonnes Classification Tonnes Ni% Ni Tonnes LONG Measured 70,000 5.5 3,900 LONG Proved 50,000 3.8 1,900 Indicated 270,000 5.5 15,000 Probable 56,000 3.1 1,700

  31. Slide 31: Resources & Reserves: Jaguar

    Resources & Reserves Jaguar (100% IGO) For personal use only Mineral Resource 30 June 2014 Ore Reserve 30 June 2014 Classification Tonnes Cu% Zn% Ag g/t Au g/t Classification Tonnes Cu% Zn% Ag g/t Au g/t BENTLEY Measured 706,000 2.2 12.3 172 0.8 BENTLEY Proved 499,000 2.1 12.1 168 0.8 Indicated 1,50

  32. Slide 32: Resources & Reserves: Stockman

    Resources & Reserves Stockman (100% IGO) For personal use only Mineral Resource 30 June 2014 Ore Reserve 28 November 2014 Classification Tonnes Mt Cu% Zn% Ag g/t Au g/t Classification Tonnes Mt Cu% Zn% Ag g/t Au g/t CURRAWONG Measured - - - - - CURRAWONG Proved - - - - - Indicated 9.58 2.0 4.2 42 1.

  33. Slide 33: FY15 Guidance

    FY15 Guidance(1)(2) Upgraded to Reflect H1 FY15 Over-performance Tropicana Exploration and Development For personal use only • 144,000 to 153,000oz (IGO 30% share) • $11M on greenfields and generative exploration • Average cash cost of $590 – $630/oz Au • $3M on Stockman Project evaluation, permitti

  34. Slide 34: Hedging Summary

    Hedging Summary Opportunistic hedging to protect cash costs For personal use only Nickel • FY15 H2: Average 250t/month averaging $18,421/t • FY16 Q1: Average 250t/month averaging $19,701/t Copper • FY15 Q3: 550t at $8,294/t in March 15 • FY15 Q4: 550t at $8,500/t in June 15 Gold • FY15 H2 : Average

  35. Slide 35: Dec14 Quarter statistics

    Dec14 Quarter statistics Tropicana Statistics Units Dec 14 Qtr Dec 13 Qtr Change Jaguar Statistics Units Dec 14 Qtr Dec 13 Qtr Change For personal use only Mining Development Mt Operational m 146 361 60% Total Material 13.5 10.2 32% Mt Capitalized m 622 448 (39%) ROM Ore (>0.6g/t Au) 3.2 2.1 52% ROM

  36. Slide 36: FY14 Financials

    Financials FY14 Financials For personal use only Highlights FY14 FY13 Change Revenue $399.0M $225.9M 77% Underlying EBITDA(1)(3) $147.9M $27.6M 436% Profit after tax(3) $48.6M ($2.3M) NA Net Cash Flow From Operating Activities(3) $127.3M $34.6M 268% Free Cash Flow(2) $30.2M ($147.6M) NA Fully Franke

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