Gold Resource Corporation · AMEX:GORO
Gold Resource — Shareholder Meeting (June 2019)
74 slides from Gold Resource's shareholder meeting presentation, Jun 20, 2019
Slide 1: Isabella Pearl Mine, NV USA 2019 Annual General Meeting
Isabella Pearl Mine, NV USA NYSE American: GORO 2019 Annual General Meeting
Slide 2: Forward Looking Statements
This brochure contains statements that plan for or anticipate the future. Forward-looking statements include statements about the Company's ability to develop and produce gold or other precious metals, statements about our future business plans and strategies, statements about future revenue and the
Slide 3: Agenda
AGENDA ➢2018 Highlights ➢Oaxaca Mining Unit ➢Nevada Mining Unit ➢Growth Profile ➢Company Vision ➢Gold 3 NYSE American: GORO Isabella Pearl Mine, NV USA
Slide 4: 2018 Review
✓ 8th consecutive year of profitability ✓ 8 years of organic growth (Q3 2010 – Q3 2018) ✓ $115.3 million net sales, an increase of 5% year-over-year ✓ $9.3 million net income, or $0.16 per share ✓ $84 total cash cost per precious metal gold equivalent ounce sold ✓ $655 total all-in sustaining cash c
Slide 5: 2018 Review
5 NYSE American: GORO 2018 REVIEW ✓ Working capital of $13.5 million ✓ Commenced Isabella Pearl construction and completed heap leach pad ✓ Commenced Isabella Pearl mining, crushing, and ore placement on heap pad ✓ $1.1 million dividends distributed totaling $111 million total to date ✓ Global Prove
Slide 6: Oaxaca Mining Unit
OAXACA MINING UNIT 6 Production, Development & Exploration Stage NYSE American: GORO Aguila Mill, Oaxaca, MX
Slide 7: Oaxaca Mining Unit Update
OAXACA MINING UNIT UPDATE 7 NYSE American: GORO ➢El Aguila Project ➢Grid Power Complete ➢Tailings facility phase IV complete ➢Paste fill plant nearing completion ➢Arista Mine Expansion ➢Alta Gracia Project ➢Mirador Mine Aguila Mill, Oaxaca, MX
Slide 8: 34.5 KVA Power Line Project Complete
➢Successfully connected to the power grid ➢5 year process ➢Reduce unit power costs ➢Saving +$1M (w diesel credit) ➢Savings +$5M (no diesel credit) ➢Reduce generator maintenance and replacement costs ➢25,000 families along the route have first time access to electricity 34.5 KVA POWER LINE PROJECT CO
Slide 9: Tailings Facility Phase IV Complete
➢Tailings lift construction phase IV complete ➢2-3 year capacity, mill throughput dependent ➢Evaluating future phase V and / or dry stack tailings facility TAILINGS FACILITY PHASE IV COMPLETE NYSE American: GORO Phase IV Phase I & II Phase III Mill Phase IV complete
Slide 10: Paste Fill Project
➢Reconstitute tailings and pipe back into mine ➢Final construction phase ➢Safer, lessens surface impoundment needs and should allow for 100% extraction of mine pillars ➢Credit to the team to bring this project in-house (~$4.M vs ~$20M) PASTE FILL PROJECT NYSE American: GORO
Slide 11: Arista Mine Expansion
➢ Arista – 39 modeled veins & splays ➢ Switchback – 22 modeled veins and splays ARISTA MINE EXPANSION NYSE American: GORO
Slide 12: Switchback Vein System; 2019 NW Expansions
SWITCHBACK VEIN SYSTEM; 2019 NW EXPANSIONS NYSE American: GORO ➢ 11.95 meters of 1.04 grams per tonne (g/t) gold and 494 g/t silver, including 2.50 meters of 2.68 g/t gold and 1,420 g/t silver
Slide 13: Alta Gracia Project
➢Independencia Portal ➢Wider high-grade veins ➢Development crosscut in March 2019: 6 meters @ 992 g/t Ag ALTA GRACIA PROJECT NYSE American: GORO Independencia Portal Mirador Portal Future design of mine spiral ramp and levels Mined from this area in 2018 Mirador Portal Independencia Portal Mining fr
Slide 14: Oaxaca Mining Unit Reserves
OAXACA MINING UNIT RESERVES 14 NYSE American: GORO ➢ 2018 delivered strongest Proven & Probable Reserve tonnes to date ➢ Replaced the tonnes mined every year since 2013
Slide 15: Oaxaca Mining Unit Reserves
➢ In production for 3 ½ years prior to P&P report ➢ Consistently increased reserve tonnes since first P&P report in 2013 ➢ Exploration budgets decreased over time due to bear market ➢ More efficient P&P delineation drilling in spite of smaller drill budgets OAXACA MINING UNIT RESERVES 15 NYSE Americ
Slide 16: 2019 Social / Corporate License
Company awarded Mexico’s “ESR” seal for fifth consecutive year ➢ Socially responsible company ➢ Positive social, environmental & economic impact 2019 SOCIAL / CORPORATE LICENSE 33 NYSE American: GORO
Slide 17: Nevada Mining Unit
NEVADA MINING UNIT 17 NYSE American: GORO Production, Development & Exploration Stage Isabella Pearl Mine, NV USA ➢First gold production ➢Project construction photos ➢Drone flyover ➢Nevada exploration
Slide 18: Major NV Milestone 2018
✓ Obtained mine permits in May ✓ Officially broke ground at Isabella Pearl June 2018 MAJOR NV MILESTONE 2018 18 NYSE American: GORO
Slide 19: Major NV Milestone 2019
✓ Produced first gold at Isabella Pearl just 10 months after ground breaking (April) 19 NYSE American: GORO MAJOR NV MILESTONE 2019 Walker Lane Minerals is a 100% owned subsidiary of Gold Resource Corporation.
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Slide 49: Isabella Pearl Project
49 Isabella Pearl Deposit Main Haul Road Office & Lab Crushing Facility Heap Leach Pad ADR Processing Facility Preg & Barron Ponds ISABELLA PEARL PROJECT NYSE American: GORO
Slide 50: Isabella Pearl Project
50 Isabella Pearl Deposit Main Haul Road Office & Lab Crushing Facility Heap Leach Pad ADR Processing Facility Preg & Barron Ponds ISABELLA PEARL PROJECT NYSE American: GORO
Slide 51: Nevada Mining Unit; Isabella Pearl Fly-By
NEVADA MINING UNIT; ISABELLA PEARL FLY-BY 24 Gold Resource Corporation NYSE American: GORO 51
Slide 52: Isabella Pearl Project
52 Isabella Pearl Deposit Main Haul Road Office & Lab First ROM lift Crushing Facility Heap Leach Pad ADR Processing Facility Preg & Barron Ponds ISABELLA PEARL PROJECT NYSE American: GORO
Slide 53: Isabella Pearl Project
53 Waste Isabella Pearl Deposit Main Haul Road Office & Lab First ROM lift Crushing Facility Heap Leach Pad ADR Processing Facility Preg & Barron Ponds ISABELLA PEARL PROJECT NYSE American: GORO
Slide 54: Isabella Pearl Project
54 Low grade stockpile Waste Isabella Pearl Deposit Main Haul Road ADR Processing Facility Preg & Barron Ponds Crushing Facility Heap Leach Pad Office & Lab First ROM lift Conveyors First Crushed lift ISABELLA PEARL PROJECT NYSE American: GORO
Slide 55: Isabella Pearl Project
55 55 Low grade stockpile Waste Isabella Pearl Deposit Main Haul Road ADR Processing Facility Preg & Barron Ponds Crushing Facility Heap Leach Pad Office & Lab First ROM lift Heap Leach Pad First Crushed lift ISABELLA PEARL PROJECT NYSE American: GORO
Slide 56: Major Milestone 2019
56 NYSE American: GORO MAJOR MILESTONE 2019
Slide 57: Major Milestone 2019
✓ Built a project, ground breaking to gold production, in 10 months ✓ Committed team overcoming various challenges along the way 57 NYSE American: GORO MAJOR MILESTONE 2019
Slide 58: Nevada Production Targets
NEVADA PRODUCTION TARGETS 58 NYSE American: GORO 0 10,000 20,000 30,000 40,000 50,000 Year 1 29,383 Year 2 40,886 Year 3 41,261 Year 4 41,623 Year 5 20,000 Gold Ounces ➢ Gold production achieved April 2019 ➢ Ramping up production phase ➢ Targeted production ranges • ~29,300 oz Gold Year 1 • ~40,800
Slide 59: Positioned for 100% Growth
POSITIONED FOR 100% GROWTH NYSE American: GORO 0 10000 20000 30000 40000 50000 60000 IP Build* IP ramp** YR#2 YR#3 YR#4 ~67KAu~ ~56KAu Gold oz’s Nevada Oaxaca production steady state for demonstration purposes ➢ Nevada Mining Unit (Isabella Pearl Project) impact ➢ Substantial gold production increas
Slide 60: Isabella Pearl Pit Expansion
ISABELLA PEARL PIT EXPANSION 60 NYSE American: GORO ➢ Deposit expansion west with 50-meter step-out • 22.86 meters @ 1.03 grams per tonne Au (see 6-5-2019 Co. Press Release) ➢ Potential for northern expansion as well ➢ Targeting mine life increases • 2017 4 year mine life • 2018 4 ½ year mine life •
Slide 61: Isabella Pearl Exploration
ISABELLA PEARL EXPLORATION 61 NYSE American: GORO Isabella Pearl Mine 22.86 meters @ 1.03 g/t Au step out Civit Cat North, pit expansion potential north Scarlet Target: Surface samples from 1-9 g/t Au Historic drilling deep @ ~1 g/t Civit Cat NW target ✓ Exploration potential expanding Isabella Pear
Slide 62: Numerous Targets on Trend
NUMEROUS TARGETS ON TREND 62 NYSE American: GORO ➢ Regional structural trend • Historic open pit deposits • Northwest trending • Numerous targets • Co. controls ~6 miles Historic Santa Fe Deposit Corridor North North West Ridge Rabbit Springs Nevada-Juneau Company Claims ~3,642 Hectares (9,000 acres
Slide 63: Growth / Exploration
GROWTH / EXPLORATION 63 NYSE American: GORO N 63 Synergistic Mining Unit Approach: ➢ Close property proximities ➢ Equipment, facility & management sharing ➢ Cash flow from Isabella Pearl to finance additional projects ➢ Lower CAPEX and operational costs ➢ Lower future shareholder dilution ➢ Excellen
Slide 64: East Camp Douglas North End of Property
EAST CAMP DOUGLAS NORTH END OF PROPERTY 64 NYSE American: GORO ➢ High-grade gold open pit potential ➢ Large district scale property ➢ Known high-grade gold on north end ➢ Third party drill highlights include: • 23.86 m @ 1.99 g/t Au from surface • 9.10 m @ 1.00 g/t Au from surface • 22.86 m @ 13.55
Slide 65: East Camp Douglas South End of Property
EAST CAMP DOUGLAS SOUTH END OF PROPERTY NYSE American: GORO ➢ Lithocap of residual quartz and advanced argillic alteration ➢ High grade surface samples associated within and around the margins of lithocap ➢ Indicates proximity to an intrusive center ➢ Large potential
Slide 66: Growth / Future Dividends
GROWTH / FUTURE DIVIDENDS 66 NYSE American: GORO +US$111M returned to shareholders Dividends may vary in amount and consistency or be discontinued at management’s discretion depending on variables including but not limited to operational cash flows, Company development requirements, strategies, cons
Slide 67: Catalysts
CATALYSTS 67 NYSE American: GORO ➢100% increase in gold production ➢Increased dividends ➢Metal market price increases Three Primary Catalysts
Slide 68: 2019 and Beyond
Clear consistent vision of Gold Resource Corporation as: ✓ Diversified, multi-jurisdictional producer ✓ Low-cost precious metal producer ✓ Explorer ✓ Dividend Payer ✓ Shareholder friendly philosophy ✓ Production growth profile 2019 AND BEYOND 68 NYSE American: GORO
Slide 69: Gold Commentary
GOLD COMMENTARY 69 NYSE American: GORO ➢ London Metal Exchange (LME) to ban day drinking ➢ This is apparently an issue at the LME?
Slide 70: Gold Commentary
70 ➢ Metal traders banned from workday boozing “The days of long, booze-fuelled City lunches appear to be nearing an end as the London Metal Exchange becomes the latest firm to introduce a booze ban.” The exchange has said that all staff who work on its trading floor can no longer drink during worki
Slide 71: Gold Commentary
GOLD COMMENTARY 71 ➢ Gold offers no yield. It has no P/E because it has no earnings. And yet... ➢ Gold has provided investors with a superior return to stocks, bonds, and residential real estate over the past 20 years. NYSE American: GORO Source: goldsilver.com & J.P. Morgan Asset Management
Slide 72: Central Bank Gold
72 ➢ Central banks continue to buy gold ➢ Central Banks aggregate holdings increased Q4 2018 to present ➢ What do they do vs. what they say about gold NYSE American: GORO CENTRAL BANK GOLD Arlington Group, Gold and Central Bank Holdings. Data as at 31st December 2018
Slide 73: Central Bank Gold
73 ➢ ‘In Gold We Trust’: Waning confidence in US sends world’s central banks on buying spree ➢ So far in 2019, they have bought 145.5 tons of gold, which is more in a quarter of a year than central banks have purchased in the preceding six years ➢ Represents a 68 percent increase from the year befor
Slide 74: Thank You
Thank you for being a GORO shareholder and thank you for your time today THANK YOU 74 NYSE American: GORO