Fresnillo Plc · LSE:FRES
Fresnillo — Denver Gold Forum 2014
16 slides from Fresnillo's conference presentation, Sep 16, 2014
Slide 1: Looking beyond the cycle – Denver Gold Forum
“Looking beyond the cycle” Denver Gold Forum September 16, 2014 Octavio Alvídrez, CEO Fresnillo plc LSE: FRES BMV: FRES www.fresnilloplc.com
Slide 2: Disclaimer
Disclaimer This document includes statements that are, or may be deemed to be, “forward-looking statements”. These forward- looking statements can be identified by the use of forward-looking terminology, including the terms “believes”, “estimates”, “plans”, “projects”, “anticipates”, “expects”, “int
Slide 3: Fresnillo at a Glance
Fresnillo at a Glance Location Key Highlights HERRADURA World’s largest silver producer and Mexico’s second largest DISTRICT gold producer ORISYVO Market cap of US$10 billion* SAN JULIÁN Mining concessions of 2.1m hectares in Mexico and almost 90 thousand hectares in Peru Cash costs and AISC amongst
Slide 4: Our strategy - four pillars to create value
Our strategy - four pillars to create value 1. Operate - Maximise potential of existing operations Operate at 100% capacity Low-cost producer Optimise mining method and metallurgy to maintain high recovery rates 3. Develop – Deliver growth through development projects Track record of delivery on tim
Slide 5: Production Overview
Production Overview 2013 PRODUCTION 2012 PRODUCTION SILVER GOLD SILVER GOLD (Koz) (Oz) (Koz) (Oz) Fresnillo mine Silver underground mine 22,764 33,079 26,383 29,573 Saucito mine Silver underground mine 11,581 45,177 7,054 45,246 Ciénega mine Gold-Silver underground 4,240 112,053 3,329 125,275 San Ra
Slide 6: 2013 Highlights
2013 Highlights • 2013 Silver production of 42,743 koz and Gold production of 425,831 oz • Revenues: US$1.6 billion • Continued focus on cost control • Operating profit: US$488.1 million • Total assets: US$4.1 billion • Capital invested in exploration: US$233.3 million • Total workforce: 6,412 (50.9
Slide 7: 1H14 Highlights
1H14 Highlights • Production: – Attributable silver production, including the Silverstream), of 21.3moz up 1.7% due to higher ore processed at Saucito and increased production from the Silverstream – Attributable gold production decreased by 18.9% as a result of temporary disruptions at Herradura wh
Slide 8: Penmont acquisition
Penmont acquisition Proposed Binding agreement signed to acquire Newmont Mining’s 44% interest in the Penmont Joint Venture Acquisition Fresnillo currently holds 56% interest in JV and would hold 100% post completion Consolidates control of producing and exploration assets already operated by Fresni
Slide 9: Strategic rationale for acquisition
Strategic rationale for acquisition Full control of the Penmont assets enables Fresnillo to maximize the value of current producing mines, develop quality assets in a key growth area and continue aggressive regional exploration programme Fresnillo has both extensive experience of operating in the He
Slide 10: High quality portfolio supports long-term growth
High quality portfolio supports long-term growth Fresnillo Saucito Mine Operations Herradura (DLP) Soledad NocheBuena Ciénega – San Ramón Development Projects Saucito II San Julián Mega Centauro Centauro Deep Pyrites Plant Juanicipio Advanced Exploration Cluster Cebollitas Orisyvo Guachichil Fresnil
Slide 11: Significant Group Growth Profile
Significant Group Growth Profile Investment Expected YEAR Risk (US$ m illion) Production 2014 2015 2016 2017 2018 PROJECT (1) (2) Medium 8.4 m ill Oz Ag & 235 SAUCITO II CONSTRUCTION PRODUCTION Low 35 thds Oz Au 10.3 m ill Oz Ag Medium 515 & 44 thds Oz SAN JULIÁN CONSTRUCTION PRODUCTION Au 15 thds O
Slide 12: Achieving 65moz silver by 2018
Achieving 65moz silver by 2018 Million Oz 90,000 Juanicipio - 56% 80,000 Pyrites plant 70,000 San Julián 60,000 Saucito II 50,000 Saucito I 40,000 Ciénega expansion 30,000 Ciénega 20,000 Fresnillo expansion 10,000 Fresnillo - 2013 2014 2015 2016 2017 2018 Note: Attributable silver production. Silver
Slide 13: New target of 750koz gold by 2018
New target of 750koz gold by 2018 Thousand Oz Orisyvo 1,400 1,300 Centauro Deep 1,200 Mega Centauro 1,100 Juanicipio - 56% 1,000 Soledad&Dipolos 900 San Julián 800 Pyrites Plant 700 Saucito II 600 Saucito I 500 Dynamic Leaching 400 Nochebuena 300 Herradura 200 Cienega expansion 100 Ciénega - 2013 20
Slide 14: Outlook
“Looking beyond the cycle” Outlook
Slide 15: Outlook: balancing growth & returns
Outlook: balancing growth & returns Ongoing efficiency gains at operations, investing in productivity and controlling costs to maintain our cost position and world-class margins Focus on managing ore grades at Fresnillo Start up of Saucito II in Q4 2014 and San Julián in 2H 2015 Proposed acquisition
Slide 16: Thanks
“Looking beyond the cycle” Thanks