Barrick Mining Corporation · TSX:ABX
Barrick Mining — Barrick Gold — Merger or Acquisition (June 2001)
18 slides from Barrick Mining's merger presentation, Jun 26, 2001
Slide 1: Barrick and Homestake: Built to Last
BARRICK AND HOMESTAKE BUILT TO LAST
Slide 2: Benefits for Homestake Shareholders
BARRICK /HOMESTAKE MERGER PROPOSAL BENEFITS FOR HOMESTAKE SHAREHOLDERS 1. Significant premium over and above strong share performance year-to-date 2. Transaction is accretive to earnings and cash flows 3. Merger enhances operating and financial strengths by every measure: - Higher production - Lower
Slide 3: Benefits for Barrick Shareholders
BARRICK /HOMESTAKE MERGER PROPOSAL BENEFITS FOR BARRICK SHAREHOLDERS 1. Strategic merger strengthens Barrick's industry leadership position in terms of quality and scale: - Operating strengths - creates larger, low-cost asset base with the least geo-political risk - Financial strengths - most profit
Slide 4: Why Barrick? Track Record of Creating Shareholder Value
WHY BARRICK ? 10 YEAR TRACK RECORD OF CREATING SHAREHOLDER VALUE INCREASING GOLD PRODUCTION WHILE REDUCING CASH COSTS 4000 400 (Ounces – Thousands) 3000 300 (US$ per ounce) 2000 200 1000 100 0 0 91 92 93 94 95 96 97 98 99 2000 HIGH CASH MARGINS DESPITE DECLINING SPOT PRICE 250 450 450 (US$ per ounce
Slide 5: Why Barrick? Relative Share Price Performance
WHY BARRICK ? OVER THE PAST TEN YEARS, BARRICK HAS OUTPERFORMED ALL OTHER MAJOR NORTH AMERICAN GOLD COMPANIES RELATIVE SHARE PRICE PERFORMANCE (January 1991 to December 2000) 300 BARRICK 200 NEWMONT Da ily P rice PLACER DOME 100 HOMESTAKE 0 12/28/90 1/ 2/ 91 12/30/91 1/ 1/ 92 12/ 30/ 92 12/ 29/ 93 1
Slide 6: Positioned to Prosper - Operations
WHY BARRICK ? POSITIONED TO PROSPER - OPERATIONS COMBINE DOWNSIDE PROTECTION AND UPSIDE LEVERAGE ! Large, long-life asset base - longest-life assets outside of South Africa ! Low-cost producer - 10-year track record of low-cost production and a portfolio of low-cost assets for the future ! Developed
Slide 7: Positioned to Prosper - Financials
WHY BARRICK ? POSITIONED TO PROSPER – FINANCIALS COMBINE DOWNSIDE PROTECTION AND UPSIDE LEVERAGE ! Premium Gold Sales Program The past - 54 consecutive quarters of realizing a premium over the spot price - Generated $2 billion in additional revenue - Generating an average premium of $68 per ounce Th
Slide 8: Mergeco
MERGECO (1) B ARR ICK HOME STAKE 1 OPERATING STRENGTH 2 FINANCIAL STRENGTH 3 STRONG GROWTH PROFILE 4 CAPITAL MARKETS STRENGTH (1) Pro-forma Barrick and Homestake 2000 actual results B A R R I CK A N D H O M ES TA K E B U I L T TO L A S T 7
Slide 9: Global Leader in Gold Production
GLOBAL LEADER IN GOLD PRODUCTION 1 OPERATING STRENGTH MERGECO WOULD BECOME THE SECOND LARGEST GOLD PRODUCER GLOBALLY WITH A SUBSTANTIAL CASH COST ADVANTAGE 2000 GOLD PRODUCTION 8.0 7.24 7.0 5.95 5.73 Million ounces 6.0 5.0 3.94 3.74 4.0 2.98 3.0 2.21 1.97 2.0 1.0 Anglogold Mergeco Newmont Gold Field
Slide 10: High Cash and Profit Margins
HIGH CASH AND PROFIT MARGINS 1 OPERATING STRENGTH MERGECO’S PROFIT MARGIN WILL BE AMONG THE TOP 50 COMPANIES OF THE S&P 500 2000 CASH MARGIN (1) 250 215 200 187 178 163 US$/oz. 150 114 109 100 95 68 50 0 Barrick Placer Dome Mergeco Normandy Homestake Newmont Anglogold Gold Fields 2000 PROFIT MARGIN
Slide 11: Large High Quality, Long-Life Reserves
LARGE HIGH QUALITY, LONG-LIFE RESERVES 1 OPERATING STRENGTH MERGECO WILL HAVE SUBSTANTIAL RESERVES THAT ARE LESS SENSITIVE TO LOWER GOLD PRICES WITH KEY ASSETS HAVING GREATER THAN 10 YEARS OF RESERVE LIFE GOLD RESERVES 100 87.6 79.3 75 70.1 Million ounces 66.3 58.5 50 32.1 (1) 25 21.8 20.8 0 Anglogo
Slide 12: Low Geo-Political Risk Profile - Reserves
LOW GEO-POLITICAL RISK PROFILE - RESERVES 1 OPERATING STRENGTH MERGECO’S RESERVES ARE WELL-DIVERSIFIED AND LOCATED IN POLITICALLY FRIENDLY COUNTRIES MERGECO: 79,299,000 oz. PLACER DOME: 46,975,000 oz. Chile Peru 7% Papua New 2% United States Guinea 10% 10% Africa 13% United States Canada 12% 35% Arg
Slide 13: The Highest EBITDA Levels in the Industry
THE HIGHEST EBITDA LEVELS IN THE INDUSTRY 2 FINANCIAL STRENGTH MERGECO GENERATED THE HIGHEST EBITDA LEVELS BY 35% 2000 EBITDA 856 800 704 632 597 600 US$ Millions 528 400 236 209 200 152 0 Mergeco (1) Barrick Placer Dome Anglogold Newmont Normandy Gold Fields Homestake (1) Excluding synergies B A R
Slide 14: Strong Cash Flow Generation
STRONG CASH FLOW GENERATION 2 FINANCIAL STRENGTH CRUCIAL IN A PERIOD OF WEAK GOLD PRICES AND EQUITY MARKETS 2000 OPERATING CASH FLOW (1) 797 800 672 600 600 478 US$ Millions 445 400 277 216 200 125 0 Mergeco Barrick Anglogold Placer Dome Newmont Normandy Gold Fields Homestake (1) Before changes in w
Slide 15: Strong/Flexible Gold Sales Program
STRONG/FLEXIBLE GOLD SALES PROGRAM 2 FINANCIAL STRENGTH THE COMBINED POSITION PROVIDES A COMFORTABLE LEVEL OF GOLD PRICE PROTECTION FOR MERGECO AND IS IN LINE WITH THE HISTORIC PARAMETERS OF BARRICK’S PROGRAM BARRICK’S HEDGE POSITION AS A PERCENTAGE OF RESERVES 30% Pre-merger Percent of Reserves Ave
Slide 16: New Project Pipeline
NEW PROJECT PIPELINE 3 STRONG GROWTH PROFILE ATTRACTIVE DEVELOPMENT PROJECTS CREATE TREMENDOUS GROWTH OPPORTUNITIES BARRICK HOMESTAKE ! BULYANHULU – Tanzania ! VELADERO – Argentina - Potential to add low-cost production at - One of the most significant exploration Bulyanhulu is amongst the best in t
Slide 17: The Pre-eminent Gold Company
THE PRE-EMINENT GOLD COMPANY 4 CAPITAL MARKETS STRENGTH MERGECO WILL BE DOUBLE THE SIZE OF ITS CLOSEST COMPETITORS EQUITY VALUE (as at June 22, 2001) 10,000 (1) 8,254 8,000 6,503 US$ Millions 6,000 3,990 3,967 4,000 3,304 2,038 1,751 2,000 1,349 0 Mergeco Barrick Newmont Anglogold Placer Dome Gold F
Slide 18: Contact us
You can contact us toll-free within Canada and the United States at 1-800-720-7415 Email us at investor@barrick.com Visit our investor relations web site at www.barrick.com In connection with their proposed merger, Barrick Gold Corporation and Homestake Mining Company filed a preliminary joint proxy