Slide 1: Operational & Financial Results Q3
Q1 Q2 OPERATIONAL & FINANCIAL RESULTS Q3 › November 5, 2019 Q4
Slide 2: Disclaimer & Forward Looking Statements
DISCLAIMER & FORWARD LOOKING STATEMENTS Cash cost per ounce and all-in sustaining cash cost per ounce are non-GAAP performance measures with no standard meaning under IFRS. This presentation contains “forward-looking statements” including but not limited to, statements with respect to Endeavour’s pl
Slide 3: Speakers and Table of Contents
SPEAKERS TABLE OF CONTENTS SÉBASTIEN DE MONTESSUS 1 Q3-2019 & YTD IN REVIEW President & Chief Executive Officer 2 FINANCIAL SUMMARY LOUIS IRVINE CFO 3 DETAILS BY MINE 4 MARK MORCOMBE COO CONCLUSION PATRICK BOUISSET EVP Exploration and Growth 5 APPENDIX Note : All amounts are in US$, except where ind
Slide 4: Key Takeaways
Q3-2019 RESULTS KEY TAKEAWAYS Transitioned from high capital intensive phase to cash flow phase KEY Q3-2019 TAKEAWAYS KEY FOCUS GOING FORWARD STRONG QUARTER DESPITE STRONG CASH FLOW GENERATION TO SEVERE RAINY SEASON ACCELERATE DELEVERAGING AND Production up 6% and AISC flat DEMONSTRATE ROCE OPERATIN
Slide 5: Strong Safety Record
Q3-2019 RESULTS STRONG SAFETY RECORD Our safety record remained below the industry average Lost Time Injury Frequency Rate (on a rolling 12-months basis) 0.72 0.13 LTM Lost Time Injury Frequency Rate 0.40 0.29 1 LTI 0.16 0.13 0.00 0.00 0.00 Peer FY2016 FY2017 FY2018 Q3-2019 Houndé Agbaou Ity Average
Slide 6: Production Increased Despite Rainy Season
Q3-2019 RESULTS PRODUCTION INCREASED DESPITE RAINY SEASON Weather mitigated by mine scheduling and utilization of stockpiles Group Production and AISC +6% Discontinued operations Other continuing operations Ity HL AISC from all operations 204koz (record quarter!) Sale of Tabakoto and 181koz Producti
Slide 7: Performance During the Q3 Rainy Season
Q3-2019 RESULTS PERFORMANCE DURING THE Q3 RAINY SEASON Diversified across multiple assets with a focus on long-term planning BURKINA RAINFALL DURING Q3 PRODUCTION AND AISC WITHIN 5% OR BETTER OVER PAST 4 YEARS While rain is a key performance driver, many other variables AISC Total Production 877mm a
Slide 8: Ity CIL Operation's Performance
CEO INTRODUCTION Q3-2019 RESULTS ITY CIL OPERATION’S PERFORMANCE Built ahead of schedule and continued to ramp-up in Q3-2019 CONSTRUCTION ACHIEVEMENTS STRONG RAMP-UP UPCOMING CATALYST EXPECTED TO ACHIEVE TOP- END OF FY-2019 GUIDANCE UPSIZE BY 25% OF 160-200Koz TO 5MTPA UNDERWAY ON-SCHEDULE 64koz 58k
Slide 9: Adjusted Group Full Year 2019 Guidance
Q3-2019 RESULTS ADJUSTED GROUP FULL YEAR 2019 GROUP GUIDANCE Reflective of Ity’s strong performance and royalties Production +3% +35koz (mid-point) 615-695koz 650-695koz +35koz Agbaou strong Wide initial guidance of performance 160-200koz narrowed offsetting Houndé to 195-200koz Adjusted low end of
Slide 10: Operating Cash Flow
Q3-2019 RESULTS OPERATING CASH FLOW Operating cash flow benefited from full quarter of Ity CIL and higher gold prices Operating cash flow before working capital (from all operations) +$58m $115m +101% Q3-2019 vs. Q2-2019 $64m $57m $48m $45m +$70m Q3-2019 vs. Q3-2018 Q3-2018 Q4-2018 Q1-2019 Q2-2019 Q
Slide 11: Cash Flow per Share
Q3-2019 RESULTS CASH FLOW PER SHARE Strong focus on per share metrics as dilution was protected to fund growth Operating Cash Flow Before Non-Cash Working Capital from all operations, in $/share $1.05/share INSIGHTS 11% Annualized cash flow yield $0.59/share Operating activities, in US$m 96 Less inv
Slide 12: Growth Capital Spend
Q3-2019 RESULTS GROWTH CAPITAL SPEND Investments largely completed in Q2-2019 Project growth capex In US$m 800m Growth capex Cumulative growth capex $1,000m +$ $811m Growth CAPEX $800m $719m Since 2016 $600m $452m 6m $400m $317m $267m +$ $200m $135m Growth CAPEX $92m in Q3-2019 $0m 2016 2017 2018 YT
Slide 13: Return on Capital Employed
Q3-2019 RESULTS RETURN ON CAPITAL EMPLOYED Strong focus on demonstrating returns following investment phase Return on capital employed (1) 15% 15% ROCE based on Q3-2019 annualized 7% 6% +8pts Q3-2019 annualized vs. FY-2018 2017 2018 2019 (Q3 annualized) (1) EBIT (Adjusted EBITDA as in MD&A less depr
Slide 14: Net Debt Reduction
Q3-2019 RESULTS NET DEBT REDUCTION Completed investments and reduced net debt Ity project growth capex and net debt $52m Ity capex incurred the period Ity capex remaining INVESTMENT DEBT REDUCTION Net Debt PHASE PHASE Net Debt / Adj. EBITDA (LTM) $660m -$52m Net Debt reduced $635m $608m Q3-2019 vs.
Slide 15: Continued Exploration Success
Q3-2019 RESULTS CONTINUED EXPLORATION SUCCESS $47m of the 2019 budget of $45-50m already spent KEY PRIORITIES Exploration expenditure for YTD-2019 1. Extend mine life on flagship mines (77%) (23%) ‒ Houndé: Fetekro Kari Centre and Kari West discoveries $6m (13%) ‒ Ity: Le Plaque discovery Houndé $22
Slide 16: Extend Mine Life on Flagship Mines (Houndé)
Q3-2019 RESULTS EXTEND MINE LIFE ON FLAGSHIP MINES Houndé expected to be extended with Kari Pump, West and Center discoveries DISCOVERIES MADE SINCE STUDIES KARI PUMP Houndé production plan WERE PUBLISHED (HOUNDÉ) (As per 2016 Optimized Study(2), excludes Kari Pump discovery) 1.1Moz of total reserve
Slide 17: Extend Mine Life on Flagship Mines (Ity)
Q3-2019 RESULTS EXTEND MINE LIFE ON FLAGSHIP MINES Ity expected to be extended with Le Plaque discovery DISCOVERIES MADE SINCE STUDIES LE PLAQUE Ity production plan (As per 2017 Optimized Study (2), based on 4Mtpa plant and excludes Le Plaque discovery) WERE PUBLISHED (ITY) 0.5Moz of total reserve a
Slide 18: Fetekro Greenfield Exploration
Q3-2019 RESULTS FETEKRO GREENFIELD EXPLORATION Grown to 1.2Moz of Indicated Resources INSIGHTS Simplified Map of the Fetekro Property Showing Lafigué › Low discovery cost of $9 per Indicated resource ounce › M&I resource: 1.2Moz at 2.54g/t › High quality resource: ‒ Amenable to open pit mining ‒ Pre
Slide 19: Financial Summary
1 Q3-2019 & YTD IN REVIEW 2 FINANCIAL SUMMARY 3 DETAILS BY MINE 4 CONCLUSION 5 APPENDIX
Slide 20: Financial Overview
FINANCIAL SUMMARY FINANCIAL OVERVIEW Benefited from the Ity CIL start-up and lower growth capex QUARTER ENDED NINE MONTHS ENDED +289% Sept. 30, June 30, Sept. 30, Sept. 30, For Continuing Operations Variance Variance (in US$ million unless otherwise stated) 2019 2019 2019 2018 PRODUCTION AND AISC HI
Slide 21: All-in Margin Breakdown
FINANCIAL SUMMARY ALL-IN MARGIN BREAKDOWN Margin increased by $305/oz in Q3-2019 compared to Q2-2019 IN US$M IN $/OZ INSIGHTS From continuing operations unless otherwise 1. Increased due to both higher production and Q3-2019 Q2-2019 Q3-2019 Q2-2019 Variance specified realized gold price. GOLD SOLD,
Slide 22: Net Free Cash Flow
FINANCIAL SUMMARY NET FREE CASH FLOW Net free cash flow turned positive in Q3-2019 following completion of investments From continuing operations unless otherwise specified Q3-2019 Q2-2019 Variance INSIGHTS (in US$ million) 1. Mainly due to a $34m outflow of payables ALL-IN MARGIN 106 46 +60 (largel
Slide 23: Cash Flow Analysis
FINANCIAL SUMMARY CASH FLOW ANALYSIS Capital requirements wind-down following completion of Ity CIL Net Cash Variation Analysis OPERATING ACTIVITIES › YTD-2019 increased by $63m compared to YTD-2018, mainly due to a $94m increase in revenue which was partially offset by a $38m increase in taxes paid
Slide 24: Net Debt and Liquidity Analysis
FINANCIAL SUMMARY NET DEBT AND LIQUIDITY ANALYSIS Financial position significantly improved Available sources of financing and liquidity INSIGHTS As at September 30, 2019 › Net Debt decreased by $52m over Q2-2019 due to lower growth capital requirements and increased free cash flow generation. › The
Slide 25: Adjusted Earnings per Share
FINANCIAL SUMMARY ADJUSTED EARNINGS PER SHARE Strong increase due to benefit of low cost Ity CIL and higher gold prices Adjusted earnings per share Adjusted EPS from all operations, in $/share $0.30/share +275% Q3-19 vs. Q2-19 $0.15/share $0.08/share ($0.01/share) ($0.04/share) +$0.22 Q3-19 vs. Q2-1
Slide 26: Details by Mine
1 Q3-2019 & YTD IN REVIEW 2 FINANCIAL SUMMARY 3 DETAILS BY MINE 4 CONCLUSION 5 APPENDIX
Slide 27: Ity Mine – CIL Operation, Côte d'Ivoire
DETAILS BY MINE ITY MINE – CIL OPERATION, CÔTE D’IVOIRE Continued to ramp-up in Q3-2019 Q3-2019 vs Q2-2019 INSIGHTS Production and AISC › As guided, production continued to Production, koz AISC, US$/oz increase, despite the heavier than normal HL CIL rainy season, due to greater tonnes milled. › Pla
Slide 28: Houndé Mine, Burkina Faso
DETAILS BY MINE HOUNDÉ MINE, BURKINA FASO Severe rainy season mitigated through use of lower-grade stockpiles Q3-2019 vs Q2-2019 INSIGHTS Production and AISC › Severe rainy season mitigated by utilization of Production, koz AISC, US$/oz lower-grade stockpiles and mining the higher- grade Bouéré depo
Slide 29: Agbaou Mine, Côte d'Ivoire
DETAILS BY MINE AGBAOU MINE, CÔTE D’IVOIRE Production and costs benefitted from higher throughput and recovery rates Q3-2019 vs Q2-2019 INSIGHTS Production and AISC › Production increased, despite rainy season, Production, koz AISC, US$/oz due to higher mill throughput and recovery 44koz rate while
Slide 30: Karma Mine, Burkina Faso
DETAILS BY MINE KARMA MINE, BURKINA FASO Stronger production due to higher-grade oxide ore from the Kao North pit Q3-2019 vs Q2-2019 INSIGHTS Production and AISC › Production increased as expected, despite the Production, koz AISC, US$/oz severe rainy season, due to significantly higher 33koz stacke
Slide 31: Conclusion
1 Q3-2019 & YTD IN REVIEW 2 FINANCIAL SUMMARY 3 DETAILS BY MINE 4 CONCLUSION 5 APPENDIX
Slide 32: Successful Execution of Our Strategy
CONCLUSION SUSSCESSFUL EXECUTION OF OUR STRATEGY De-risked and repositioned the Group as a cash-generating business Strong achievements KEY FOCUS GOING FORWARD across our 4 pillars over past 4 years STRONG CASH FLOW GENERATION TO ACCELERATE DELEVERAGING AND DEMONSTRATE ROCE UPCOMING GROWTH WITH LOW
Slide 33: Appendix
1 Q3-2019 & YTD IN REVIEW 2 FINANCIAL SUMMARY 3 DETAILS BY MINE 4 CONCLUSION 5 APPENDIX
Slide 34: Net Earnings Breakdown
APPENDIX NET EARNINGS BREAKDOWN Adjusted EPS of $0.30 for Q3-2019 THREE MONTHS ENDED SEPT. 30, JUNE. 30, INSIGHTS (in US$ million) A = Adjustments made of Adjusted Net Earnings 2019 2019 1. Higher operating expenses due to increased GOLD REVENUE 267 219 production Operating expenses (115) (103) 1 2.
Slide 35: Revenue Protection Program
APPENDIX REVENUE PROTECTION PROGRAM Increased certainty of cash flow during construction and debt repayment phases Gold revenue protection program Gold price in US$/oz INSIGHTS 1,600 › Strategy aimed at maximizing cash flow certainty during construction and debt reimbursement phases. › A deferred pr
Slide 36: Houndé Exploration, Burkina Faso
APPENDIX HOUNDÉ EXPLORATION, BURKINA FASO Kari Pump 710koz maiden reserve increased Houndé reserves by 41% INSIGHTS Drill map and selected intercepts per area (true width/grade) › High M&I resource to reserve conversion rate: 89% based on a gold price of $1,250/oz › Significantly higher grade: 53% h
Slide 37: Houndé Exploration, Burkina Faso
APPENDIX HOUNDÉ EXPLORATION, BURKINA FASO Strong reserve additions at Hounde expected to be published INSIGHTS › Kari gold in soil anomaly covers a 6km-long by 3km-wide area. › Houndé is Endeavour’s largest exploration focus this year with a budget of approximately 195,000m of drilling › Mineralizat
Slide 38: Ity Exploration: Le Plaque
APPENDIX ITY EXPLORATION: LE PLAQUE Maiden resource added 0.4Moz of indicated resources added at >3 g/t Au LE PLAQUE INSIGHTS Le Plaque targets › Indicated resource has increased from 85koz to 476koz › Continued low discovery cost of $15/oz › Ity mine M&I resource up 11% with significantly higher gr
Slide 39: Karma Mine Exploration, Burkina Faso
APPENDIX KARMA MINE EXPLORATION, BURKINA FASO Focus on North Koa, Yabonsgo and near-mill targets INSIGHTS Karma Site Map › An exploration program totaling approximately 27,000 meters was planned for 2019, with the aim of delineating near-mill oxide targets › The 2019 exploration program began in lat
Slide 40: Agbaou Mine Exploration, Côte d'Ivoire
APPENDIX AGBAOU MINE EXPLORATION, CÔTE D’IVOIRE Short drilling campaigns on near-mine targets underway Agbaou Site Map INSIGHTS › An exploration program of up to $2 million, totaling approximately 10,000m has been initially planned for 2019 with the aim of delineating oxide material in extensions of
Slide 41: Kalana Project Exploration, Mali
APPENDIX KALANA PROJECT EXPLORATION, MALI Aim to increase resource base for project Several Licenses INSIGHTS under negotiation › In line with this strategy, further exploration is With Private underway at Kalana with the goal of delineating owners additional satellite deposits, and updating the fea
Slide 42: Production and Cost Details by Mine (Quarterly)
APPENDIX PRODUCTION AND COST DETAILS BY MINE On a quarterly basis AGBAOU ITY CIL ITY HL KARMA HOUNDÉ (on a 100% basis) Unit Q3-2019 Q2-2019 Q3-2018 Q3-2019 Q2-2019 Q3-2018 Q3-2019 Q2-2019 Q3-2018 Q3-2019 Q2-2019 Q3-2018 Q3-2019 Q2-2019 Q3-2018 Physicals Total tonnes mined – OP1 000t 6,236 6,556 6,94
Slide 43: Production and Cost Details by Mine (YTD)
APPENDIX PRODUCTION AND COST DETAILS BY MINE For the 9-month period ended September 30, 2019 and 2018 AGBAOU ITY CIL ITY HL KARMA HOUNDÉ (on a 100% basis) Unit YTD-2019 YTD-2018 YTD-2019 YTD-2018 YTD-2019 YTD-2018 YTD-2019 YTD-2018 YTD-2019 YTD-2018 Physicals Total tonnes mined – OP1 000t 19,009 22,