First Majestic Silver Corp. · TSX:AG
First Majestic Silver — Investor Presentation (August 2020)
40 slides from First Majestic Silver's investor presentation, August 2020
Slide 1: First Majestic
FIRST MAJESTIC SOL AeEeR pee OR. P:: TSX | FR NYSE | AG FSE | FMV
Slide 2: Cautionary Disclaimer
Cautionary Disclaimer 7 FORWARD LOOKING STATEMENT ret itgee Certain statements contained herein regarding First Majestic Silver Corp. (the “Company") and its operations constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 an
Slide 3: Silver supply and demand fundamentals
• Annual silver consumption is ~1.0B ounces • 80% sourced from mining, 20% sourced from recycling and hedging • Over past 10 years, the silver industry has been in a 500M ounce physical deficit • Silver is one of the world’s most reflective and best conductors of electricity • 55% of silver consumpt
Slide 4: Silver Use In The Auto Sector
Silver Use In The Auto Sector Source: CPM Group Silver Yearbook 2020 3
Slide 5: Silver demand for photovoltaic solar panels
• Solar carports are one of the most viable options for refueling EV’s • Currently in use at a number of Walmart’s, Federal & State offices and colleges Annual Silver Demand for Photovoltaic Solar Panels across the United States Million Ounces Million Ounces • US Department of Energy’s National Rene
Slide 6: Everyday Silver Applications
EVERYDAY SILVER APPLICATIONS JX, wars You Tube f FIRSTMAJESTIC.COM TSX|FR NYSE|AG FSE| FMV
Slide 7: Gold/Silver Ratio
Gold/Silver Ratio The Gold to Silver Ratio Hit an All-Time High of 124:1 on March 18, 2020! 6
Slide 8: About The Company
About The Company The Right Country… Primary Ag Producer ~60% of revenue from Silver (40% Au) One Country: Mexico World’s largest silver producing country Multi-Asset Producer Three producing silver mines; 4,500 direct employees Large Land Package Over 350,000 hectares of mining claims in eight stat
Slide 9: Capital Structure and Top Shareholders
Capital Structure: Top Shareholders: % S/O Market Capitalization: $2.9B Van Eck (GDXJ & GDX) 10.8% Shares Outstanding: 210M (FD 219) Wheaton Precious Metals 9.6% Renaissance Technologies 2.3% 3M Avg. Daily Volume (NYSE &TSX): 8.8M Shares ~ $85M The Vanguard Group 2.3% Working Capital: $114M Keith Ne
Slide 10: Mines and projects map
IN PRODUCTION 1 San Dimas 2 Santa Elena 2 Hermosillo 3 La Encantada 3 TEMP SUSPENDED Durango 4 San Martin 1 9 5 PROJECTS 6 8 4 5 La Parrilla 6 Del Toro Mexico City 7 7 La Guitarra 8 La Luz 9 La Joya (sale pending) 9
Slide 11: Historical production in silver equivalent ounces
30 Silver Ounces Only 25 Silver Eqv. Ounces (M) 20 15 10 5 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020E 10
Slide 12: 2020 production and cost guidance
Mine Silver (Moz) Gold (Koz) Silver Eqv (Moz) Cash Costs ($) AISC ($) San Dimas 6.0 – 6.4 75 – 80 13.5 – 14.4 0.75 – 1.49 7.09 – 8.22 Santa Elena 1.9 – 2.0 31 – 33 4.8 – 5.2 3.60 – 4.38 8.33 – 9.43 La Encantada 3.1 – 3.3 –– 3.1 – 3.3 10.42 – 10.77 12.59 – 13.07 Totals: 11.0 – 11.7 106 – 113 21.4 – 2
Slide 13: Revised guidance by mine
Mine Silver (Moz) Gold (Koz) Silver Eqv (Moz) Cash Costs ($) AISC ($) San Dimas 3.3 – 3.6 42 – 47 7.5 – 8.3 (0.95) – 0.23 4.72 – 6.55 Santa Elena 1.1 – 1.2 16 – 18 2.7 – 3.0 2.53 – 3.72 6.75 – 8.43 La Encantada 1.7 – 1.8 –– 1.7 – 1.8 10.86 – 11.56 12.82 – 13.75 Totals: 6.1 – 6.6 58 – 65 11.9 – 13.1
Slide 14: 2020 CAPEX
2020 CAPEX Include: $54M – U/G Development $21M – Exploration $27M – PP&E $29M – Corporate Projects Expansionary $86M + Sustaining $46M 13
Slide 15: Drill rigs currently active
14 Drill rigs currently active across the Company Avg. Grade (AgEq 179 215 240 217 204 208 306 320 g/t): 14
Slide 16: San Dimas 2020E Operational Highlights
2020E Operational Highlights Our lowest cost and Mill Throughput: 2,000 tpd largest producing mine 2020E Production: 6.0M – 6.4M Ag oz (13.5M – 14.4M AgEq oz) 2020E AISC: $7.09 – $8.22 Produces: 100% Doré Quarter End Full Year Q2 2020 Q1 2020 Q2 2019 2019 Silver production (oz) 1,102,931 1,677,376 1
Slide 17: San Dimas district history
• First reported mining in the San Dimas district in 1757 – over 250 years ago • Considered to be one of the most significant Restarted the precious metal mining districts in Mexico Tayoltita mine in June 2020 • Historic production estimated at 11M Au oz & Current 580M Ag oz mining areas • Over 500
Slide 18: San Dimas cost reductions and upgrades
Since acquisition, production costs have been • Implementation of High Intensity Grinding technology (HIG MILL) and conversion into reduced by over 20% to $125/tonne autogenous mill from standard ball mills • Lime automation and pH control • Upgrading of tailings and filtration plant • Modernization
Slide 19: San Dimas infrastructure
Current Infrastructure 2020 Project Infrastructure Crushing circuit Ore bins Las Truchas Hydro Electric Dam Cyanidation Plant Autogenous mill HIG Installation Control Room at Las Truchas Hydro Electric Dam 18
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Slide 21: La Encantada 2020E Operational Highlights
2020E Operational Highlights Mill Throughput: 3,000 tpd 2020E Production: 3.1M – 3.3M Ag oz 2020E AISC: $12.59 – $13.07 Produces: 100% Doré Quarter End Full Year Q2 2020 Q1 2020 Q2 2019 2019 Silver production (oz) 509,544 924,472 489,194 3,083,410 • Natural gas generators currently supplying 90% of
Slide 22: Santa Elena 2020E Operational Highlights
2020E Operational Highlights Mill Throughput: 3,000 tpd 2020E Production: 1.9M – 2.0M Ag oz (4.8M – 5.2M AgEq oz) 2020E AISC: $8.33 – $9.43 Produces: 100% Doré Quarter End Full Year Q2 2020 Q1 2020 Q2 2019 2019 Silver production (oz) 222,100 550,133 596,872 2,435,604 Silver eqv. production (oz) 595,
Slide 23: Exploration Upside
Las Chispas Santa Elena Silver/Gold Mine 36M AqEq oz Vein Outcropping at the Ermitaño Project Exploration Upside Ermitaño Project 68M AqEq oz • Large land package of mining claims covering 102,244 hectares • New discovery made at Ermitaño in late 2016 • Successfully intersected the Ermitaño vein in
Slide 24: Ermitaño project drill results and resources
• Hole 16-04: 9.9 metres grading 1,209 g/t AgEq • Hole 18-47: 13.0 metres grading 547 g/t AgEq • Hole 19-91: 13.0 metres grading 1,003 g/t AgEq • 4km away from our Santa Elena mill • Pre-Feasibility study expected in Q1 2021 • Not subject to Sandstorm stream • Initial production expected in Q2 2021
Slide 25: Fine grinding technology
With recent advances in science and technology, we are now able to design processes that can grind and treat particles the size of a human red blood cell ~ 5 microns The smaller the particle size, typically more metal can be recovered which increases production and reduces unit costs Pilot HIG Mill
Slide 26: HIG Mill
HIG Mill • Uses rotating grinding disks with ceramic beads to grind ore as fine as 20 microns which has shown to significantly increase recoveries • Low cost energy consumption • Low maintenance compared to standard ball mill • Two 3,000 tpd units delivered in 2019 to Santa Elena and La Encantada •
Slide 27: HIG results: Santa Elena recoveries
HIG RESULTS: SANTA ELENA RECOVERIES An. Ag Recovery 100 100 95 95 Ss 90 90 85 | 85 HIG Start-up 80 80 LI PSIM HPAP PPA PISA SH 8 As ss as ss rod e e e od 26 FIRSTMAJESTIC.COM TSX|FR NYSE|AG FSE| FMV
Slide 28: Every 1% increase in recoveries adds ~125K oz
Microbubbles pH Cyanide Mill & Grind Oxygen Lime feed & monitoring consumption optimization Injection Fine Grinding 90% Target Recovery Goal Every 1% increase in recoveries adds ~125K oz to annual silver production Microbubble Testing at La Parrilla 27
Slide 29: Upcoming catalysts and improvements
• Higher silver recoveries expected at San Dimas following the installation of high-intensity grinding (HIG) mill and autogenous (AG) mill in early 2021 • Converting Santa Elena from diesel to LNG in early 2021 to reduce energy costs and carbon footprint • Ramping production at the Tayoltita mine at
Slide 30: BMO SilverPages report
Source: BMO SilverPages Report – July 3, 2020 2020 metal price assumptions: silver: $18.10/oz, gold: $1,775/oz, lead: $0.80lb, zinc: $0.92/lb, copper: $2.76/lb 29
Slide 31: Production by Metal and Mine by Mine
Production by Metal Production Mine by Mine 30
Slide 32: Share Performance vs Peers
Share Performance vs Peers 1 Year 5 Year 10 Year Source: Bloomberg (as of December 31, 2019) 31
Slide 33: Reported short interest
Source: Bloomberg (NYSE & TSX reported short interest) 32
Slide 34: Our Strategy
Our Strategy… > Continue to Acquire the Best Talent > Build through Development and Acquisitions > Continued Investments in R&D > Industry Leader in Innovation and Processing Technologies > Become World’s Largest Primary Silver Producer 33
Slide 35: Springpole silver stream agreement
• In June 2020, entered into a silver stream agreement to purchase 50% of the silver produced from the Springpole Project, located in Ontario, Canada • Ongoing cash payments of 33% of the silver spot price per ounce, up to a maximum of $7.50 per ounce • Total consideration of $22.5 million in cash a
Slide 36: La Parrilla, Del Toro and San Martin silver mines
La Parrilla Del Toro San Martin Silver Mine Silver Mine Silver Mine • Ongoing testing of new microbubble flotation columns in 2020 • Property consists of 70 mining claims covering 2,159 hectares • 100% Silver/Gold doré producer • Dual-circuit processing facility consisting of a 1,000 tpd • 1,000 tpd
Slide 37: Proven and Probable Mineral Reserves, December 31, 2019
Proven and Probable Mineral Reserves with an Effective Date of December 31, 2019 (1) Mineral Reserves have been classified in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) Definition Standards on Mineral Resources and Mineral Reserves, whose definitions are incor
Slide 38: Measured and indicated mineral resources
Measured and indicated mineral resources with an effective date of December 31, 2019 37
Slide 39: Inferred mineral resources
Inferred mineral resources with an effective date of December 31, 2019 (1) Mineral Resources have been classified in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) Definition Standards on Mineral Resources and Mineral Reserves, whose definitions are incorporated b
Slide 40: First Majestic Silver Corp. contact details
First Majestic Silver Corp. 1800 - 925 West Georgia Street Vancouver, British Columbia, Canada V6C3L2 Email: info@firstmajestic.com Tel: 604.688.3033 Fax: 604.639.8873 North American Toll-Free: 1.866.529.2807 Bullion Sales Email: sales@firstmajestic.com
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