Mcewen Inc. · NYSE:MUX
Mcewen — McEwen Mining — Investor Presentation (January 2016)
24 slides from Mcewen's investor presentation, Jan 25, 2016
Slide 1: Cautionary Statement
Cautionary Statement 2 This presentation contains certain forward-looking statements and information, including "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements and information expressed, as at the date of this ne
Slide 2: Cautionary Statement
Cautionary Statement This presentation contains certain forward-looking statements and information, including “forward-looking statements" within the meaning of the Private ‘Securities Litigation Reform Act of 1995. The forward-looking statements and information expressed, as at the date of this new
Slide 3: We are Performing Well
We are Performing Well 4 154koz 127koz 121koz 88koz Production in gold equivalent ounces. Gold / silver ratio 75:1. 2016 based on internal estimates. 1 141koz # Production Growth
Slide 4: Decreasing Costs
Decreasing Costs 5 $674 $914 US $ / oz Au Eq $- $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 Total Cash Costs All-in Sustaining Cash Costs
Slide 5: Generating Positive Cash Flow
Generating Positive Cash Flow 6 Cash flow defined as the net increase (decrease) in cash, cash equivalents and precious metals at market. -$25 -$20 -$15 -$10 -$5 $0 $5 $10 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 US$ Millions
Slide 6: Treasury Growing
Treasury Growing 7 Cash, cash equivalents and precious metals at market. As of January 13, 2016. No Debt No Streaming Anti-Royalties Treasury $32M $0 $10 $20 $30 $40 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2014 2015 Cash & Equivalents US$ M
Slide 7: Capital Distribution (1% yield)
Capital Distribution 8 (1% yield) 1¢ / Share Paid Semi-annually First Payment Aug 2015 Next Payment Feb. 12, 2016 (Record date Feb. 3, 2016) Tax Free in Canada
Slide 8: MUX vs Peers Year (US $)
9 MUX vs Peers 1 Year (US $) Alamos Goldcorp Barrick Source: Bloomberg. As of January 22, 2016. Gold GDXJ GDX McEwen US -60 -40 -20 0 20
Slide 9: MUX vs Peers Year (Canadian $)
10 MUX vs Peers 1 Year (Canadian $) Alamos Goldcorp Barrick Source: Bloomberg. As of January 22, 2016. Gold McEwen CDN -60 -40 -20 0 20
Slide 10: Unique & Large Insider Ownership
No salary No cash bonus No options Cost Base $127M Unique & Large Insider Ownership 11 2 Rob McEwen Chief Owner 25% # !
Slide 11: Next Largest Shareholders
Next Largest Shareholders 12 Van Eck Global X Blackrock Staley Capital D E Shaw Vanguard 5% 2% 2% 2% 1% 1%
Slide 12: Our Production & Development Pipeline
Our Production & Development Pipeline 13 Gold Bar (Nevada) Permitting El Gallo Gold Producer Los Azules Large Copper Deposit El Gallo Silver Permitted 3 # San José Mine Gold / Silver Producer Exposure to Gold, Silver & Copper
Slide 13: Production: El Gallo Mine - Gold
Production: El Gallo Mine - Gold Sinaloa State Mexico 14 Open Pit, Heap Leach Low Startup Capex: $18M High Grade: +2 gpt Au Low Cost / oz: $429 Cash - AISC $578 Short Life: +3 Years 2016 Exploration Budget: $5M 2015 Production: 63,366 oz AuEq El Gallo Silver El Gallo Mine N 0 5 10 Km Year end costs
Slide 14: Production: San José Mine - Gold & Silver
Production: San José Mine - Gold & Silver 15 1Production in gold equivalent ounces. Gold / silver ratio 75:1. 100% basis. 22015 Q1-Q3. Santa Cruz Province, Argentina Shallow Underground Mine, Narrow Vein Ownership: 51% Hochchild 49% MUX 2015 Production: 186,000 oz AuEq1 MUX’s 49% Share: 91,000 oz Au
Slide 15: Argentina: Turnaround Story of 2016!
17 “Argentina to lift currency controls good for mining” December 11, 2015 Argentina: Turnaround Story of 2016! Pro-business, pro-mining “Soros Bets on Argentina & Latin America ” December 17, 2015 “Peso Drops 30% as Macri Propels Argentina Into New Currency Era” November 18, 2015 “Macri believes a
Slide 16: Development Pipeline: Gold Bar
MUX Barrick Waterton Positive Feasibility Study (Oct. 2015) @ $1,150/oz Open Pit, Heap Leach Low Capex: $60M After-tax IRR: 20% Pay-Back Period: 3 Year @ $1,150/oz Cash Costs: $728/oz: Annual Average Production: 65,000 oz Au Average Ore Grade: 0.032 opt (1.1 gpt) In-pit Resource: 611,000 oz M&I and
Slide 17: Gold Bar Exploration – Potential to Grow
Gold Bar Exploration – Potential to Grow Gold Bar Target Areas Gold Bar Final Pit Outline Afgan Resource 2.2 gpt Au / 52 m 4.7 gpt Au / 41 m 1.8 gpt Au / 38 m 1.1 gpt Au / 23 m 6 Km 18 Afgan* Indicated 66 koz Au @ 0.66 gpt Inferred 55 koz Au @ 0.44 gpt *NI 43-101 June 24, 2011 NV Gold Corp, property
Slide 18: Development Pipeline: El Gallo Silver
Development Pipeline: El Gallo Silver 19 Permitted for Open Pit / Mill Requires Higher Silver Price +$18 / oz Q2 2016 Updated Economic Study Ongoing Optimization to Lower Capex & Opex Sinaloa State Mexico 5 km Road El Gallo Silver El Gallo Mine
Slide 19: Innovation: El Gallo Silver Optimization
20 Innovation: El Gallo Silver Optimization Prev. % Now Recoveries 87% 3% 91% Retention Time 144 hrs 61% 56 hrs Grind Size 72 μm 11% 80 μm
Slide 20: Advanced Exploration with PEA: Los Azules - Copper
San Juan Province, Argentina Advanced Exploration with PEA: Los Azules - Copper 19.7 B lbs Cu at 0.5%: Resources* Recent Transaction: First Quantum / Lumina $433M or 1.7¢ / lb Cu *August 1, 2013 NI 43-101 Technical Report, Los Azules Porphyry Copper Project. 19 Advanced Exploration Looking to Moneti
Slide 21: Catalysts
Catalysts 22 # 4 Argentina New Government (Pro-business) Peso Devaluation Export Taxes Lifted Mexico Low Cost Production $5M Exploration Economic Study Q2 2016 USA Exploration Permits Jan. 2017 Corporate Capital Distribution Share Repurchase Program M&A
Slide 22: Market Cap and Contact
$325M Market Cap 306 M Fully Diluted 298 M Shares Outstanding Options 23 Source: Bloomberg. As of January 22, 2016 3 Month Avg. Daily Share Volume 935K CONTACT: Christina McCarthy, Director, Corporate Development, www.mcewenmining.com • 1.866.441.0690 • cd@mcewenmining.com NYSE & TSX: MUX
Slide 23: High Beta To Gold
24 Source: Bloomberg. As of January 22, 2016. High Beta To Gold 2.7x 5 # Significant Upside Potential $9.50 $9.15 $0.42 $0.36 $1.09 26x 22x ?x
Slide 24: High Beta
"5 High Beta To Gold Significant Upside Potential muse $0.36 650.42 ss st.09 2007 2009 2011 2013 2015 ‘Source: Bloomberg. As of January 22, 2016. 24