Slide 1: Corporate Update
TSX: LUN OMX: LUMI Corporate Update August 2015
Slide 2: Cautionary Statements
Cautionary Statements Caution Regarding Forward-Looking Information This presentation contains forward-looking information, including, but not limited to, guidance on estimated annual production and cash costs. This forward-looking information is not based on historical facts, but rather on current
Slide 3: Diversified Assets: Americas, Europe and Africa
Diversified Assets: Americas, Europe and Africa Zinkgruvan (100%) Freeport Cobalt (24%) Zinc-Lead-Copper (Sweden) Cobalt Refinery (Finland) Eagle (100%) Nickel-Copper (USA) Neves-Corvo (100%) Aguablanca (100%) Nickel-Copper Copper-Zinc (Spain) (Portugal) Candelaria (80%) Copper-Gold-Silver Tenke Fun
Slide 4: Q2 2015 Operating Highlights
Q2 2015 Operating Highlights Operations Performed Well – meeting or exceeding expectations Copper Zinc Nickel (Cu) (Zn) (Ni) • Increased production • Largely met • Continued excellent guidance and lowered expectations with production performance cost outlook at strong results at at Eagle and Aguabla
Slide 5: Q2 2015 Revenue Breakdown by Mine and Metal
Q2 2015 Revenue Breakdown by Mine and Metal 68% of sales were from Candelaria and Eagle 66% of sales were from copper Sales Breakdown by Mine Sales Breakdown by Metal 5
Slide 6: YTD Cash Costs – Very Competitive
YTD Cash Costs – Very Competitive Source: Cost curves from Wood Mackenzie as of Q2 2015. * Cash cost curves are based on the expected annual costs for 2015, whereas YTD costs have been highlighted for LUN assets for illustrative purposes. 6
Slide 7: Strong Financial Position
Strong Financial Position US$ M June 30, 2015 Cash and Cash Equivalents $507 Net Debt1 $497 Available Credit Facilities $360 Cash and Cash Equivalents 600 $507 400 $355 $US M 200 $175 - Q4/14 Q1/15 Q2/15 • Cash balance grew by over $300M in the last six months • Net debt has improved from $829M at y
Slide 8: 2015 Outlook – Guidance Improved
2015 Outlook – Guidance Improved • Raising copper and lead (contained tonnes) Revised Guidancea Tonnes Cash Costsb production guidance and Candelaria (80%) 135,000 – 140,000 $1.35/lb lowering copper cost outlook Eagle 20,000 – 23,000 Neves-Corvo 50,000 – 55,000 $1.55/lb • Zinkgruvan outperforming, C
Slide 9: Operational Overview and Outlook
Operational Overview and Outlook Candelaria (80%) Neves-Corvo (100%) Eagle (100%) Zinkgruvan (100%) Tenke Fungurume Aguablanca (100%) (24%) 9
Slide 10: Candelaria (Cu/Au/Ag), Chile
Candelaria (Cu/Au/Ag), Chile Atacama Province, Region III, approximately 20 km south of Copiapó 10
Slide 11: Candelaria Q2 2015 Results and Outlook
Candelaria Q2 2015 Results and Outlook • Production (100% basis) of 46.7 kt exceeded Location Chile expectations as a result of higher Ownership 80% throughput and recoveries 2015 Production 135,000-140,000 t Cu • Cash costs averaged $1.21/lb due to lower Guidance (80%) mine/mill costs, FX and highe
Slide 12: Candelaria New Mine Plan
Candelaria New Mine Plan • Improved production and operating cost profile expected Production & C1 Costs: 2016E 2017E 2018E 2019E over next 5 years Copper Production kt 154 156 144 161 Cash Costs $/lb Cu 1.58 1.57 1.82 1.71 • Annual Cu production for 2016- (after precious metal stream) 2019 expected
Slide 13: Eagle Mine (Ni/Cu), Michigan, U.S.A.
Eagle Mine (Ni/Cu), Michigan, U.S.A. 50 km northwest of Marquette in the Upper Peninsula of Michigan 13
Slide 14: Eagle Q2 2015 Results and Outlook
Eagle Q2 2015 Results and Outlook • Nickel production of 6.3 kt in-line, with Location Michigan, USA slightly lower throughput offset by Ownership 100% higher recoveries 2015 25,000–28,000 t Ni • Copper production of 5.4 kt benefitted Production Guidance 20,000–23,000 t Cu from higher grades and rec
Slide 15: Neves-Corvo (Cu/Zn), Portugal
Neves-Corvo (Cu/Zn), Portugal Situated 220 km southeast of Lisbon 15
Slide 16: Neves-Corvo Q2 2015 Results and Outlook
Neves-Corvo Q2 2015 Results and Outlook • Strong copper production (15.3 kt) Location Portugal reflects higher throughput and grades Ownership 100% 50,000–55,000 t Cu › Increased use of productive bulk 2015 Production 60,000–65,000 t Zn Guidance mining method resulted in more 4,000-5,000 t Pb copper
Slide 17: Zinc Expansion Project – Neves-Corvo
Zinc Expansion Project – Neves-Corvo • Feasibility Study for expansion of zinc substantially complete • Scope covers underground development of lower Lombador Zn deposits › Expansion of shaft capacity to 5.6 Mtpa › Zinc plant expansion to 2.5 Mtpa of ore throughput › Maximum zinc production nominall
Slide 18: Zinkgruvan (Zn/Pb/Cu), Sweden
Zinkgruvan (Zn/Pb/Cu), Sweden Situated 200 km southwest of Stockholm 18
Slide 19: Zinkgruvan Q2 2015 Results and Outlook
Zinkgruvan Q2 2015 Results and Outlook • Zinc production of 21.2 kt strong due to Location Sweden higher grades and recoveries Ownership 100% 80,000–85,000 t Zn › Record amount of ore mined 2015 Production 30,000–33,000 t Pb Guidance 2,000–3,000 t Cu • Lead production of 7.4 kt was impacted 2015 Cos
Slide 20: Aguablanca (Ni/Cu), Spain
Aguablanca (Ni/Cu), Spain Situated 80 km north of Seville 20
Slide 21: Aguablanca Q2 2015 Results and Outlook
Aguablanca Q2 2015 Results and Outlook • Nickel production (2.2 kt) and copper Location Spain production (2.0 kt) benefitted from Ownership 100% higher grades – outperforming YTD 2015 Production 7,000–7,500 t Ni Guidance 5,500–6,000 t Cu • Open pit mining completed in April, 2015 Cost Guidance $3.75
Slide 22: Tenke Fungurume (Cu/Co), DRC
Tenke Fungurume (Cu/Co), DRC Situated 175 km northwest of Lubumbashi 22
Slide 23: Tenke Q2 2015 Results and Outlook
Tenke Q2 2015 Results and Outlook • Copper production (100% basis) of Location Democratic Republic 52.3 kt was stronger due to higher of Congo throughput and recoveries Ownership 24% 2015 Production Guidance 50,000 t Cu • Cobalt production of 4.1 kt (attributable share) benefitted from higher grades
Slide 24: Well Positioned in Any Market
Well Positioned in Any Market High quality, diversified asset base Diversified metals exposure Meaningful production scale Strong free cash flow and good margins Conservative balance sheet 24
Slide 25: TSX: LUN OMX: LUMI
TSX: LUN OMX: LUMI