Centerra Gold Inc. · TSX:CG
Centerra Gold — Q2 2006 Earnings Presentation
18 slides from Centerra Gold's earnings presentation, Jul 28, 2006
Slide 1: Q2 2006 Conference Call
July 28, 2006 Q2 2006 Conference Call
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-Looking Statements contained in this presentation and oral statements made, which are not historical facts are forward looking statements that involve risks, uncertainties and other factors that could cause actual results, performance, prospects and opportunities t
Slide 3: Speakers
Speakers ¾ Len Homeniuk President and Chief Executive Officer ¾ George Burns Vice President and Chief Operating Officer ¾ Ian Atkinson Vice President, Exploration ¾ David Petroff Executive Vice President and Chief Financial Officer July 28 2006 Q2 2006 Results Conference Call 3
Slide 4: Introduction
Introduction ¾ Len Homeniuk President and Chief Executive Officer July 28 2006 Q2 2006 Results Conference Call 4
Slide 5: Operations Review - George Burns, COO
Operations Review - George Burns, COO z Q2 operations review z Pit wall ground movement z Revised mining plan at Kumtor z Outlook for 2H 2006 July 28 2006 Q2 2006 Results Conference Call 5
Slide 6: Operations Review – Q2 Summary
Operations Review – Q2 Summary Kumtor Q2 2006 Q2 2005 Ounces poured 99,592 137,794 Cash Cost $402 $253 Average Mll Grade (g/t) 2.87 3.70 Boroo Q2 2006 Q2 2005 Ounces poured 64,660 75,431 Cash Cost $207 $162 Average Mll Grade (g/t) 4.13 4.18 July 28 2006 Q2 2006 Results Conference Call 6
Slide 7: Gatsuurt
Gatsuurt ¾ Pursuing “Investment Contract” in light of new mineral and tax laws in Mongolia ¾ Suspend development until Investment Contract in place with acceptable legal and tax terms July 28 2006 Q2 2006 Results Conference Call 7
Slide 8: Pit Wall Ground Movement at Kumtor
Pit Wall Ground Movement at Kumtor z Portion of northeast pit wall moved on July 13 – Adjacent to area of slide in 2002; small fraction of size z Mining and milling operation continues -- not in area of slide z Revised mining plan for second half of 2006 – Mining continues in south end of pit – Low
Slide 9: Mining Plan Options Being Assessed
Mining Plan Options Being Assessed 1. Accelerate southwest pit mining rate 2. Modify the Kumtor pushback design 3. Modify the Kumtor pit sequence 4. Accelerate reserve conversion of the Sarytor deposit July 28 2006 Q2 2006 Results Conference Call 9
Slide 10: 2006 Outlook – Production & Cash Cost
2006 Outlook – Production & Cash Cost 100% Basis 2006 Forecast Ounces Poured (ooo oz gold) Kumtor 300 Boroo 270 - 275 Centerra Consolidated 570 - 575 Total Cash Cost per Ounce (USD) Kumtor $530 Boroo $210 - $215 Centerra Consolidated $370 - $380 July 28 2006 Q2 2006 Results Conference Call 10
Slide 11: Exploration Update - Ian Atkinson, VP Exploration
Exploration Update - Ian Atkinson, VP Exploration Kumtor ¾ Four drill holes completed to test dip and strike extensions of SB Zone ¾ Extended a further 40 metres along strike to the south ¾ Intercepts at grade range 5.95 to 30.97 g/t gold over 20.8 to 35.9 metres ¾ SB Zone now delineated over 360 me
Slide 12: Exploration Update (cont)
Exploration Update (cont) REN (Nevada) ¾ Six holes completed in second quarter ¾ Two hole returned significant results: ¾ One hole drilled to infill a 150 metre gap between holes in JB Zone ¾ Returned assays of 21.7 g/t gold /4.6m and 10.2 g/t gold /12m ¾ Additional drilling required to confirm cont
Slide 13: Exploration Update (cont)
Exploration Update (cont) Gatsuurt ¾ Work continuing to develop additional near surface targets in the immediate area ¾ Trenching at Balj exposed gold bearing alteration along N20E fault zone over strike length of 400 metres ¾ Returned assays of 91 g/t gold/2.2m, 35 g/t gold/2m and 16 g/t gold/2.2m.
Slide 14: Financial Review – David Petroff, CFO
Financial Review – David Petroff, CFO Income Statement Highlights– Q2 2006 vs. Q2 2005 US$ millions Q2 2006 Q2 2005 Revenue 107 95 Cost of Sales 57 49 Exploration & Business Development 6 7 Interest and other expense (3.8) 0.3 Net Earnings 29 15 Earnings per common share $0.13 $0.07 July 28 2006 Q2
Slide 15: Financial Review (cont)
Financial Review (cont) Cash US$ millions Jun 30/06 Jun 30/05 Cash provided by Operations 24 25 Cash used in Investing Activities (23) (6) Increase/Decrease in Cash 1 19 Cash at Beginning of Quarter 223 153 Cash Balance at end of Quarter 224 204 July 28 2006 Q2 2006 Results Conference Call 15
Slide 16: Sensitivity to the Gold Price
Sensitivity to the Gold Price US$ millions Q3/Q4 2006 Effect of $25 change in gold price: Revenues $6.4 Earnings $5.6 Cash flow $6.1 July 28 2006 Q2 2006 Results Conference Call 16
Slide 17: Strategic Priorities for 2006
Strategic Priorities for 2006 ¾ Revise mine plan to mitigate impact of pit wall ground movement in ’06 & ’07 ¾ Access Kumtor SB zone ASAP ¾ Develop new reserves and resources at Kumtor, Boroo, Gatsuurt and REN ¾ Explore growth opportunities in Central Asia, FSU and in other emerging markets July 28
Slide 18: Question Period
Question Period July 28 2006 Q2 2006 Results Conference Call 18