Oceanagold Corporation · TSX:OGC
Oceanagold — Shareholder Meeting (June 2015)
43 slides from Oceanagold's shareholder meeting presentation, Jun 12, 2015
Slide 1: Annual General Meeting
Annual General Meeting June 12 2015
Slide 2: Cautionary Notes
Cautionary Notes Cautionary Notes - Information Purposes Only The information contained in this presentation is provided by OceanaGold Corporation (“OGC”) for informational purposes only and does not constitute an offer to issue or arrange to issue, or the solicitation of an offer to issue, securiti
Slide 3: Today’s Agenda
Today’s Agenda 1. Introduction 2. Formal Business of the Meeting 3. Overview of 2014 Performance 4. High Quality Assets 5. Other Investments 6. Sustainability 7. Strategy & Outlook Note: All amounts in this presentation are listed in USD unless otherwise stated 3 OceanaGold Corporation Innovation Pe
Slide 4: Introduction
4 OceanaGold Corporation Innovation Performance Growth
Slide 5: Board of Directors
Board of Directors Mick Wilkes Denham Shale Joey Leviste Managing Director & CEO Lead Director Non Executive Director Jim Askew Chairman Bill Myckatyn Dr Geoff Raby Paul Sweeney Non Executive Director Non Executive Director Non Executive Director 5 OceanaGold Corporation Innovation Performance Growt
Slide 6: Executive Management Team
Executive Management Team Mark Cadzow Mark Chamberlain Michael Holmes Chief Development Officer Chief Financial Officer Chief Operating Officer Mick Wilkes Managing Director & CEO Darren Klinck Yuwen Ma Liang Tang Head of Business Company Secretary & Head of Human Resources Development Corporate Cou
Slide 7: Report on Proxies
Report on Proxies Resolutions FOR WITHHOLD 2 Election of Directors 2.1 James E. Askew 2.2 Jose P. Leviste Jr. 2.3 Geoff W. Raby 2.4 J. Denham Shale 2.5 Michael F. Wilkes 2.6 William H. Myckatyn 2.7 Paul B. Sweeney 3 Appointment of Auditors Ratify PWC LLP as Auditors 4 Performance Rig
Slide 8: Overview of 2014 Performance
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Slide 9: Delivering on Strategy
Delivering on Strategy Low cost, dividend paying mid-tier producer generating significant free cash flows STRATEGY DELIVERY Operate safely & efficiently to Generating industry leading free cash maximise profitability flows Delivering Didipio – underground underway; and grid connection by Q4/15 Spend
Slide 10: 2014 Performance Highlights
2014 Performance Highlights Strong operational & financial performance increased shareholder wealth Record revenue of $563.3m, record profit of $111.5m despite lower commodity prices Record financials Reduced total debt by $77.4m, increased cash by $26.4m Exceeded production guidance for second co
Slide 11: 2014 Results Summary
2014 Results Summary Didipio New Zealand Consolidated 2014 Guidance Gold production oz 106,256 201,207 307,463 275,000 to 305,000 Copper production t 25,010 – 25,010 21,000 to 24,000 Gold sales oz 110,510 208,462 318,972 – Copper sales t 25,886 – 25,886 – Cash costs $/oz (420)1 862 4181 400 to 4501
Slide 12: Consolidated Financial Results
Consolidated Financial Results Year Year Year Year 2014 2013 2012 2011 Gold sales (ounces) 318,972 308,081 230,119 249,261 Copper sales (tonnes) 25,886 21,290 – – Gold price received ($ per ounce) 1,273 1,382 1,675 1,587 Copper price received ($ per pound) 3.11 3.23 – – (USDm) Revenue 563.3 553.6 38
Slide 13: Financial Position (as at 31 Mar 2015)
Financial Position (as at 31 Mar 2015) LIQUIDITY Total debt at end of 2014 Cash $60m $118 million (interest paid: $12m) Undrawn Revolving Credit Facility* $97m TOTAL LIQUIDITY $157m Total debt at end of 2013 DEBT $194 million Revolving Credit Facility* $78m (interest paid: $27m) Equipment leases $27
Slide 14: Dividend Declared
Dividend Declared Effectively managing a balanced business that delivers a sustainable dividend Board of Directors approved sustainable dividend Dividend policy policy implemented Includes ordinary dividend of US$0.02 per share plus a discretionary payment 2014 dividend of US$0.04/share declared Dis
Slide 15: Total Shareholder Return
Total Shareholder Return Consistently positive performance underpins shareholder return 2014 Total Shareholder Return 97% Gold Spot Price Market Vectors Junior Gold Miners ETF 50% 25% 0% -25% -50% -75% -100% SEMAFO Alacer Gold B2Gold OceanaGold Perseus Mining Dundee Precious Metals Troy Resources Si
Slide 16: High Quality Assets
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Slide 17: Current 2015 Guidance
Current 2015 Guidance1 Strong production with sector leading cost structure from high quality operations Gold Production Detailed Guidance Production Costs2 295,000 to 335,000 Gold Copper Cash Costs AISC ounces (koz) (kt) (per oz) (per oz) ($240) – Copper Production Didipio 100 – 120 21 – 23 ($190)
Slide 18: New Zealand Highlights
New Zealand Highlights New economic conditions have increased profitability, organic growth in NZ Mine life at Frasers Underground extended to 2016+ New Zealand dollar continues to weaken (NZD:USD 0.83 in 2014 vs. current 0.70*) Strong profit margins from Reefton due to reduced material mined New Ze
Slide 19: Expanding New Zealand
Expanding New Zealand New exploration program initiated at Macraes targeting mine life extensions Current Drilling Future Drilling Exploration program includes surface and North of Macraes underground drilling NZ$8m spend over next two years on exploration at Macraes Goldfield South of Macraes Surfa
Slide 20: Organic Growth in New Zealand
Organic Growth in New Zealand Organic growth demonstrates potential for increased value from NZ asset base Blackwater Project Macraes Gold-Tungsten Project Near Reefton At Macraes • PEA completed with robust financials • Scoping study underway • Currently reviewing mining method; • Advancing to feas
Slide 21: Waihi Transaction Overview
Waihi Transaction Overview Waihi represents a high-grade, low-cost asset in a stable, well-known jurisdiction Municipality Signed Definitive Acquisition Agreement with Newmont for US$101m OGC operation Auckland OGC project New asset Waihi Purchase price to be funded from existing cash and increased
Slide 22: Investment Highlights
Investment Highlights Transaction strongly aligns with OceanaGold’s value creation strategy High-grade, low-cost, meaningful Invest in high-quality assets production Substantial free cash flow generation Immediate cash flow generation Accretive transaction EPS and CFPS Synergistic with existin
Slide 23: Waihi – Asset Overview
Waihi – Asset Overview Comprises Correnso Underground Mine and highly prospective tenement packages Experienced workforce with track record of success Magazine and skills complementary to OceanaGold Newmont Head Office Conventional SAG & ball mills, CIP circuit w/plant MacMahon Office capacity of up
Slide 24: Recent Historical Production and Reserves
Recent Historical Production and Reserves Waihi has a track record of reserve replenishment over its 27 year history Waihi Historical Production, Year End Reserves and Cumulative Production since 2007 1,000 1,00 0 900 864 900 800 732 800 700 622 700 555 500 600 600 460 458 500 410 350 500 360 360 36
Slide 25: Waihi’s Significant Exploration Upside
Waihi’s Significant Exploration Upside Interests in three groups of highly prospective tenement packages Regional Group (22-75 km from Waihi) • 50 adularia-sericite epithermal Au-Ag deposits for a historical production of 11.3 Moz Au and 53 Moz Ag • 1 prospecting and 3 exploration permits • Includes
Slide 26: Trading Comparables
Trading Comparables OGC’s New Zealand assets with Waihi demonstrate clear value compared to producing peers TSX-Listed OGC NZ Company NZ Portfolio Lake Shore Klondex Richmont + Waihi Market Cap. US$m 416 326 192 Enterprise Value US$m 451 312 141 ? FY15E Production(1) koz 175 123 83 >250 FY15E AISC(1
Slide 27: Didipio Highlights
Didipio Highlights Increased NPV of Didipio operation following successful completion of optimisation study Process plant consistently operating at or above 3.5 Mtpa throughput rate Power grid connection on track for Didipio Results Q1 2015 2014 completion by Q4 2014 Gold produced oz 35,122 106,256
Slide 28: Enhanced Didipio Operation
Enhanced Didipio Operation Didipio optimisation resulted in technical and operational de-risking, higher NPV After Tax Cash Flow Profile1 (USDm) Smaller open pit $215 million in 150 cost savings between 2018 and 2020 133 135 123 123 100 88 87 Lowered U/G mining costs ($34/t to 84 78 62 69 72 66 $2
Slide 29: Philippines Exploration
Philippines Exploration Early success from Didipio drilling; Paco geophysics tracking well Paco Tenements Didipio Drilling Paco Geophysics Bayugo Deposit: 125M tonnes at 0.60% Cu and 0.66 g/t Au (M&I) Kalayaan Exploration Permit EX-XIII-04 Boyongan Deposit: 273M tonnes at 0.52% Cu and 0.72 g/t Au 29
Slide 30: Other Investments
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Slide 31: Gold Standard Ventures
Gold Standard Ventures Strategic investment in one of the most prolific gold regions globally Private placement for 14.9% of common shares for C$16.2m Technical representation along with anti-dilution provision with right to increase stake to 19.9%1 GSV holds 2nd largest land package in the Carlin t
Slide 32: El Salvador
El Salvador Continuing to work collaboratively with stakeholders from El Salvador Investing in Infrastructure Investing in Social Programs Building Capacity Building Collaborative Relationships 32 OceanaGold Corporation Innovation Performance Growth
Slide 33: Sustainability
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Slide 34: Key 2014 Environment Highlights
Key 2014 Environment Highlights Didipio received ISO14001 Environment Management System Certification Commissioned Didipio water treatment plant Planted and donated nearly 315,000 trees in the Philippines Restored over 11 hectares of land at Reefton Sponsored the inaugural Emerging River Professiona
Slide 35: Key 2014 Health & Safety Highlights
Key 2014 Health & Safety Highlights Didipio achieved 10 million man hours worked without an LTI Reduced overall Lost Time Injury Frequency Rate (LTIFR) by 96% Established a smoke-free work place across New Zealand operations Enhanced health & safety reporting to report on all near-misses and hazard
Slide 36: Key 2014 Community Highlights
Key 2014 Community Highlights Invested nearly US$3 million on community related programs Continued to advance Didipio catchment project with the IRF, strong local support achieved Continued strong support of enterprise development in Philippines and El Salvador Provided scholarships and tuition assi
Slide 37: Awards and Recognition
Awards and Recognition Received Gold Award for Women Empowerment at Didipio 2014 Presidential Mineral Industry Environment Awards (PMIEA) – received prestigious safest mining operation award in the Philippines 37 OceanaGold Corporation Innovation Performance Growth
Slide 38: Strategy & Outlook
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Slide 39: OceanaGold Vision & Strategy
OceanaGold Vision & Strategy We will be a mid-tier, multinational gold producer delivering superior shareholder returns in a safe and sustainable manner by developing and operating high quality assets. We will be the partner, employer and mining company of choice. Unwavering commitment to the enviro
Slide 40: 2015 Priorities
2015 Priorities Be the mining company of choice 1. Continue to deliver positive operational & financial results 2. Complete Waihi transaction & optimise operation Increased mineral reserves through successful exploration, Be the 3. other growth employer of choice 4. Complete organic growth studies B
Slide 41: Looking Ahead
Looking Ahead Continue to produce positive results from effective delivery of strategy Forecasted for another consecutive year of strong Significant free cash flow free cash generation generation Development of Didipio underground progressing well; power grid connection on track for Q3 2015 Low cost
Slide 42: OceanaGold Today
OceanaGold Today Mineral Reserves* (excluding Waihi, GSV) Gold 3.02 Moz Copper 0.21 kt Silver 3.58 Moz Didipio Gold Copper Paco Waihi (pending) Gold Standard Gold Ventures Silver Vancouver Reefton Gold El Dorado Melbourne Blackwater Macraes Gold Tungsten Macraes Gold Operating Mine Project/Study Exp
Slide 43: oceanagold.com
oceanagold.com Innovation Performance Growth