Central Asia Metals Plc · LSE:CAML
Central Asia Metals — H1 2022 Earnings Presentation
40 slides from Central Asia Metals's earnings presentation, Sep 14, 2022
Slide 1: Central Asia Metals H1 2022 Results
CENTRAL ASIA METALS H1 2022 RESULTS 14 September 2022
Slide 2: Disclaimer
DISCLAIMER The information contained in this confidential document (“Presentation”) has been prepared by Central Asia Metals plc (the “Company”). It has not been fully verified and is subject to material updating, revision and further amendment. This Presentation has not been approved by an authoris
Slide 3: H1 2022 Results Summary
H1 2022 RESULTS SUMMARY H1 2022 Revenue H1 2022 EBITDA Creating value for all stakeholders $119.5m $74.9m - H1 2022 dividend 10p (H1 2021: 8p) H1 2021: $106.3m H1 2021: $64.4m - Record H1 2022 EBITDA and cash generation - EBITDA $74.9m (H1 2021: $64.4m) - EBITDA margin 63% (H1 2021: 61%) H1 2022 H1
Slide 4: Financial Results
FINANCIAL RESULTS CENTRAL METALS
Slide 5: Market Conditions
MARKET CONDITIONS H1 2022 H2 2022 outlook - Benefited from elevated metal prices which began to – Support provided to site staff via inflation-beating 2022 pay respond to greater economic uncertainty towards the end of rises in excess of 15% the period – Inflation has caused the prices of reagents a
Slide 6: H1 2022 Income Statement
H1 2022 INCOME STATEMENT EBITDA margin 63% Highlights H1 2022 H1 2021 % change - Gross revenue and EBITDA increased Gross revenue, $m 119.5 106.3 +12% - Higher copper, zinc and lead prices and lower TCs Cost of sales, $m (40.6) (39.3) +3% - Impact of cost inflation reduced by favourable FX - Higher
Slide 7: H1 2022 Kounrad C1 Copper Cash Cost
H1 2022 KOUNRAD C1 COPPER CASH COST H1 2022 C1 cash cost $0.63/lb (H1 2021: $0.57/lb) Cost H1 2022 H1 2021 H1 2022 H1 2021 $m $m $/lb $/lb Local G&A, $0.06 Reagents 1.5 1.8 0.10 0.13 Realisation, Power 1.2 1.1 0.08 0.08 $0.09 Payroll 2.8 1.8 0.19 0.13 Materials 0.6 0.5 0.04 0.03 Consulting & other 1
Slide 8: H1 2022 Sasa C1 Zinc Eq. Cash Cost
H1 2022 SASA C1 ZINC EQ. CASH COST H1 2022 C1 cash cost $0.71/lb (H1 2021: $0.59/lb) H1 H1 H1 H1 C1 cash cost 2022 2021 2022 2021 $m $m Processing , $0.13 Zinc payable production 8,788t 9,486t Mining , $0.24 Pro-rata costing zinc 48% 42% Mining 9.7 9.3 $0.24/lb $0.19/lb Processing 5.2 4.6 $0.13/lb $
Slide 9: 30 June 2022 Balance Sheet
30 JUNE 2022 BALANCE SHEET Corporate debt facility repaid 30 Jun 2022, $m 31 Dec 2021, $m - Net cash $38.9m (2021: $22.7m) PPE 353.8 384.9 Intangible assets 48.4 52.1 - Group cash balance, $57.7m (2021: $59.2m) Cash 51.0 55.7 - Group gross debt, $12.1m (2021: $33.0m) Restricted cash 6.7 3.5 - $7.6m
Slide 10: H1 2022 Capex
H1 2022 CAPEX H1 2022 Group capex $8.0m (H1 2021: $6.6m) 2022E capex - Includes $3.5m for Cut and Fill (C&F) Project $28-30m - Further C&F prepayments of $0.6m bringing total H1 2022 C&F spend to $4.1m - C&F Project payments, includes - Paste Backfill Plant, $1.8m - Central Decline, $1.1m - UG retic
Slide 11: H1 2022 Cash Flow
H1 2022 CASH FLOW 68.8 H1 2022 FCF of $52.1m 57.7 Central Asia Metals PLC 10
Slide 12: Sustainability Update
SUSTAINABILITY UPDATE ASI METALS PLC
Slide 13: Maintaining Health and Safety
MAINTAINING HEALTH AND SAFETY Kounrad H1 H1 H1 2021 2020 2019 2022 2022 2022 CAML CAML CAML - H1 2022 Sasa Kounrad CAML - Zero LTIs or TRIs No. lost time injuries (LTI) 1 0 1 4 0 1 Sasa No. recordable injuries (RI) 2 0 2 4 1 2 - H1 2022 Lost time injury frequency rate (LTIFR) 1.29 0.00 0.85 1.69 0.0
Slide 14: H1 2022 Sustainability Reporting Update
H1 2022 SUSTAINABILITY REPORTING UPDATE CAML 2021 sustainability report published - Published in Q2 2022 - Third sustainability report, second published in accordance with Global Reporting Initiative (‘GRI’) standards (core option) - Incorporates six of the 17 UN SDGs that CAML has the capacity to b
Slide 15: CAML Sustainability Targets
CAML SUSTAINABILITY TARGETS Sustainability pillar 2022 / long term target Delivering value through stewardship - Zero human rights abuses Maintaining health and safety - Zero fatalities - Improve Group lost time injury frequency rate ('LTIFR') versus 2021 (1.69) Focusing on our people - Maintain 99%
Slide 16: Climate Change Update
CLIMATE CHANGE UPDATE Recommendation Disclosure topic and alignment status Governance – Board oversight - board receives regular climate-related updates from Committees and management, findings shape strategies and decision-making – Management’s role - several committees and management-level roles w
Slide 17: Unlocking Value for Our Communities
UNLOCKING VALUE FOR OUR COMMUNITIES As part of CAML’s long-term commitment to the communities in which it works, the Company has committed to funding its Charitable Foundations with at least $0.5m in 2022. Sasa Foundation Contributing to the economic growth of Kounrad Foundation the communities we w
Slide 18: Operational Update
OPERATIONAL UPDATE CENTRAL ASIA METALS PLC
Slide 19: Kounrad Copper Operation
KOUNRAD COPPER OPERATION Eastern Dumps 7 Kounrad 5 6 mine 2 20 9-10 SX-EW 13 plant Western Dumps 21a 15 1a Remaining recoverable 16 Kounrad resources village Eastern c.7,000t Dumps 22 Western c.112,000t Dumps Total c.119,000t Central Asia Metals PLC 18
Slide 20: Kounrad Production
KOUNRAD PRODUCTION In-situ dump leach and SX-EW plant 4.5 140 4.0 Quarterly copper production (kt) Cumulative copper production (kt) 120 - Increased 2022 guidance 3.5 100 - 2022 guidance, 13,500t – 14,000t 3.0 2.5 80 - H1 2022 copper production, 6,617t 2.0 60 - Eastern Dumps 1.5 40 1.0 - Average dum
Slide 21: Kounrad Operating Statistics and ILS
KOUNRAD OPERATING STATISTICS AND ILS Intermediate Leach System (ILS) – Kounrad ILS system enables team to operate older blocks for longer, maintaining PLS grade – ILS phase-1 leaching system is the water transfer pipeline from SX-EW processing plant to Western Dumps, construction and commissioning c
Slide 22: Kounrad Solar Power Plant
KOUNRAD SOLAR POWER PLANT Construction to commence in Q4 2022 - Scoping study undertaken in 2021, and presented to Board for approval in Q4 2021 - Detailed engineering work undertaken to firm up approach and costs in H1 2022, Board approval for project reiterated - Earthworks to commence before wint
Slide 23: Sasa Zinc and Lead Mine
SASA ZINC AND LEAD MINE Mechanised underground mine - Skarn hosted deposit in North Macedonia - Sub-level caving operation, transitioning to cut and fill stoping in 2023 - Reserves and resources to 2037 - Sasa EBITDA since acquisition (<5 years) of $280.2m - All debt associated with acquisition ($18
Slide 24: Sasa Production
SASA PRODUCTION 2022 production Unit H1 2022 2021 2020 2019 2018 - H1 2022 production - 10,465t zinc Ore mined t 402,208 818,609 826,421 817,714 803,101 - 13,827t lead Plant feed t 404,391 830,709 820,215 820,491 804,749 2022 guidance - Ore mined, 790,000-810,000t Zinc grade % 3.07 3.14 3.37 3.29 3.
Slide 25: Cut and Fill Project Overview
CUT AND FILL PROJECT OVERVIEW Development has commenced Paste Backfill Plant location Dry Stack Tailings processing plant confirmed design complete - Development continues from surface and on 910 level – 1,132m developed to date - The ESIA approved in August 2022, additional - Design being adapted i
Slide 26: Sasa Long Section Showing Central Decline
SASA LONG SECTION SHOWING CENTRAL DECLINE Svinja Reka Kozja Reka Golema Reka 21.5Mt mined at 9.6%Pb+Zn 3.7Mt mined at 10.5%Pb+Zn 2.7Mt mined at 7.7%Pb+Zn 1966 – To date 1966 – 1989 1980 - 2010 Process Plant Golema Reka Shaft 1064 830 750 Mined out Indicated Resources Inferred Resources Potential exp
Slide 27: Capital Allocation / Outlook
CAPITAL ALLOCATION / OUTLOOK
Slide 28: Capital Allocation Priorities
CAPITAL ALLOCATION PRIORITIES Returns to shareholders Deleveraging, 2017 – 2022 (corporate debt facility) - H1 2022 dividend, 10p $187m corporate debt fully - 40% of FCF repaid, post period end - CAML dividend policy, 30-50% FCF - Total dividends since 2012, $277.3m or 142p 275 250 225 200 175 150 $
Slide 29: Delivering Growth
DELIVERING GROWTH H1 2022 business development activities H2 2022 Outlook M&A Board strategy discussions - Geography - preference for European time zone plus Kazakhstan - Stage of development - Considering early-stage exploration - Development projects, would have to be compelling valuation to offse
Slide 30: Summary and Outlook
SUMMARY AND OUTLOOK A strong sustainable business - Strong operational and financial performance - Producing the metals essential for modern living safely and sustainably - Record H1 2022 EBITDA and cash generation Capital allocation priorities - 2022 dividend, 10p - On track to deliver Cut and Fill
Slide 31: Contact Details
EXECUTIVE DIRECTOR OF CORPORATE DEVELOPMENT CONTACT Louise Wrathall Sackville House DETAILS 40 Piccadilly London W1J 0DR louise.wrathall@centralasiametals.com +44 (0) 207 898 9001 https://www.centralasiametals.com/
Slide 32: Appendix
APPENDIX
Slide 33: Share Price and Shareholders
SHARE PRICE AND SHAREHOLDERS Share price performance versus peers 300 Share price* (AIM:CAML) £2.38 Total no. voting shares 176,026,619 250 Treasury shares 471,647 Issued shares 176,498,266 Market capitalisation £419m 200 Rebased share price to 100 Free float 96.23% Average daily volume 0.5m 150 *Sh
Slide 34: Board of Directors
BOARD OF DIRECTORS Gavin Ferrar Mike Prentis Nurlan Zhakupov CFO David Swan Senior Independent Director NED - Kazakhstan experience Dr Gillian Davidson NED NED - accounting experience - Capital markets experience Member NED - Nomination Committee - sustainability experience Chair Member - Sustainabi
Slide 35: Kounrad Resources and Technology
KOUNRAD RESOURCES AND TECHNOLOGY Quantity, Mt Grade (%) Contained copper, kt Eastern Dumps Indicated 89.7 0.10 85.8 Inferred 79.6 0.10 81.7 Total 169.3 0.10 167.5 Western Dumps Indicated 296.4 0.10 282.4 Inferred 181.5 0.09 164.3 Total 477.9 446.7 Total East 647.1 614.2 and West Prepared by Wardell
Slide 36: Copper Pullback Presents Long-Term Buying Opportunity
COPPER PULLBACK PRESENTS LONG-TERM BUYING OPPORTUNITY Mounting recessionary fears put pressure on copper - Copper prices fell from an April high of $10,452/t to below US$7,000/t in July despite supply tightness - Buyers worried about a sluggish rebound in China and recession in major economies, infl
Slide 37: Zinc Market Trending to Deficit
ZINC MARKET TRENDING TO DEFICIT Zinc prices stabilise after a period of volatility - Zinc price peak above US$4,000/t on Russia invasion of Ukraine, and fell to under $3,000/t in July - Despite price fall, cash to 3-months backwardation persisted into H2 Supply side shows signs of increasing tightne
Slide 38: Lead Neutral Outlook
LEAD NEUTRAL OUTLOOK Lead prices fall in tandem with other commodities $2,600 Lead Price Chart - Lead prices down 16% since 4 year March highs, as lockdowns $2,400 in China weighed on battery replacement demand Price (US$/t) $2,200 - Contracting global growth and increased competition from $2,000 li
Slide 39: EBITDA H1 2022 vs H1 2021
EBITDA H1 2022 VS H1 2021 74.9 Central Asia Metals PLC 38
Slide 40: Sasa Reserves and Resources (JORC 2021)
SASA RESERVES AND RESOURCES (JORC 2021) Deposit Mt Pb grade (%) Zn grade (%) Ag grade (g/t) Pb metal (kt) Zn metal (kt) Ag metal (koz) Probable Svinja Reka Reserves 9.5 4.1 2.8 22.3 395 272 6,834 Total Reserves 9.5 4.1 2.8 22.3 395 272 5,834 Svinja Reka 11.6 4.6 3.2 25.5 536 370 9,485 Indicated Mine