Orbit Garant Drilling Inc. · TSX:OGD
Orbit Garant Drilling — Investor Presentation (February 2024)
26 slides from Orbit Garant Drilling's investor presentation, February 2024
Slide 1: Investor Presentation
February 2024 INVESTOR PRESENTATION TSX: OGD
Slide 2: Cautionary Statements
Cautionary Statements Forward-Looking Information Certain statements contained herein constitute “forward-looking statements” which reflect the current expectations of management regarding the Company’s future growth, results of operations, performance, business prospects and opportunities based on
Slide 3: Company Overview
Company Overview Val-d’Or ~ 1,300 Employees 208 Drill Rigs Underground & Surface Drilling Regional offices: Sudbury, ON, Moncton, NB, United States, Chile and Guyana Current field operations: Canada, Chile and Guyana Chile INVESTOR PRESENTATION – FEBRUARY 2024 3
Slide 4: Market Position (by % of revenue)
Market Position (by % of revenue*) Drilling Activity Customers Regions 1% 10% Underground Juniors 29% International 62% 37% Surface Majors & Manufacturing 71% Canada 90% Intermediates Resource Exposure Drilling Services Base Metals / 36% 41% Specialized Other 64% Gold 59% Conventional * For the six
Slide 5: Competitive Strengths
Competitive Strengths • Long-established, leading Canadian-based mineral driller focused primarily on gold projects in Canada • Combined surface and underground expertise / specialized drilling • Senior management field experience • Focus on continuous innovation • Vertically-integrated manufacturin
Slide 6: Drilling Services & Expertise
Drilling Services & Expertise Surface Underground Specialized Drilling • Standard diamond coring / core rod • Standard rod / core rod • Drilling projects that are in remote • Standard / reverse circulation and locations or, because of the scope, • AWL - HWL calibre grade control complexity or techni
Slide 7: Continuous Innovation
Continuous Innovation Computerized Monitoring and Control Technology Performance Highlights Additional Feature Benefits for Customers Greater accuracy Real-time, remote monitoring Improved productivity (+30%) of drilling progress Fewer consumables Ability to view core samples remotely Rig components
Slide 8: Vertical Integration / Health & Safety / Driller Training
Vertical Integration / Health & Safety / Driller Training • Vertically integrated manufacturing operations provide competitive advantage o Ability to design and manufacture custom drill rigs and equipment for customers at a competitive cost with faster delivery o Key to continuous innovation (e.g. c
Slide 9: Strong Customer Relationships
Strong Customer Relationships Core competitive strengths support long-term customer relationships INVESTOR PRESENTATION – FEBRUARY 2024 9
Slide 10: International Operations
International Operations Chile / South America International Revenue ($ millions) • Operating subsidiary established in Chile (FY 2013) 52.2 50.3 48.9 • Acquisition of Captagua in FY 2016 43.3 • Strong platform for growth in Chile / South America 33.3 • Increasing customer demand and improving perfo
Slide 11: Low Global Gold Discovery Rates
Low Global Gold Discovery Rates Global Gold Discoveries vs. Exploration Spending, 1990-2021 Gold in discoveries (millions of ounces) Gold exploration budget (US$ billions) Projected new gold in discoveries Gold in reserves, resources and past production Gold Exploration Budget • Gold discovery rates
Slide 12: Declining Reserves in Global Gold Sector
Declining Reserves in Global Gold Sector Major Gold Producers’ Years of Reserves Remaining, 2010 vs. 2019 Years of reserves remaining 2010 years remaining 2019 years remaining • The mineable reserves of most senior gold producers have dropped sharply, driving the need for significant spending on exp
Slide 13: Global Exploration Budgets
Global Exploration Budgets Annual nonferrous exploration budgets, 1997-2023 20,000 • 2023 aggregate global nonferrous exploration Exploration Budget (US$millions) budgets are an estimated US$12.8 billion 15,000 ♦ ~3% decline from 2022 levels • Second highest annual level since 2013 despite year-over
Slide 14: Gold Price
Gold Price (USD$) (February 8, 2024) • Spot gold price reached record high above US$2,100 per ounce in December 2023 and is currently trading at historically strong levels • Current price of gold (~US$2,032) is 59% above its trailing 5-year low in May 2019 • Strong price of gold supports access to c
Slide 15: Copper Price
Copper Price (USD$) (February 8, 2024) • Copper price reached record level above US$4.90 per pound in March 2022, and remains elevated • Strong long-term demand outlook • Copper has an important role in the electrification of the global economy needed to achieve “net-zero” emissions targets • Copper
Slide 16: Utilization Rates
Utilization Rates (Average Annual Utilization Rate %) 69% 62% 63% 58% 58% 59% 56% 54% 56% 43% 45% 40% 35% 386* 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 H1 2024 Fiscal years ended June 30 Target utilization rate of ~75% INVESTOR PRESENTATION – FEBRUARY 2024 16
Slide 17: Q2 2024 Financial Review
Q2 2024 Financial Review Revenue EBITDA¹ Adjusted Gross Margin¹ ($ millions) ($ millions) 18.1% 51.6 6.9 49.3 15.9% 46.8 15.2% 44.3 43.4 14.4% 12.2% 4.5 3.0 1.8 1.0 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q2 23 Q3 23 Q4 23 Q1 24 Q2 24 Q2 2024 G&A Expense: Q2 2023 G&A Expense: Q2
Slide 18: First Half Fiscal 2024 Financial Review
First Half Fiscal 2024 Financial Review ($ millions, except margin % and per Six months ended Six months ended share amounts) December 31, 2023 December 31, 2022 Revenue 87.7 104.9 Gross Profit 6.9 13.0 EBITDA1 4.0 12.7 Adjusted Gross Margin1 13.7% 17.2% G&A expenses 8.1 7.8 Net earnings (loss) (2.1
Slide 19: Solid Balance Sheet
Solid Balance Sheet ($ millions) As at December 31, 2023 As at June 30, 2023 Cash and cash equivalents 1.2 2.2 Total current assets 79.6 82.0 Total assets 126.1 127.6 Total current liabilities 30.8 31.6 Long-term debt and lease liabilities 36.2 33.0 Total shareholder equity 59.1 61.6 Working capital
Slide 20: Strategic Direction: Bottom Line Orientation
Strategic Direction: Bottom Line Orientation Five-Point Plan 1. Primary focus on Canadian gold drilling operations 2. Prioritize longer-term, specialized drilling contracts with major and intermediate customers 3. Opportunistic international contracts with high degree of cost and margin certainty 4.
Slide 21: Investment Highlights
Investment Highlights • Industry leader in mineral drilling innovation and specialized drilling (underground & surface) • Comprehensive infrastructure with turn-key customer solutions and vertically-integrated manufacturing operations • Long-term relationships with leading senior and intermediate mi
Slide 22: Appendix
APPENDIX FORAGE ORBIT GARANT DRILLING
Slide 23: Capital Market Profile
Capital Market Profile ANALYST COVERAGE: TSX: OGD Recent close (February 8, 2024): $0.49 52-week high / low: $0.97 / $0.45 Market Cap: ~$18 million Shares Outstanding: 37,372,756 Fully Diluted: 39,487,756 Institutional / retail: ~ 40% / 60% (float) Management own approximately 27% of shares outstand
Slide 24: Board of Directors
Board of Directors • More than 25 years of experience in finance and accounting with extensive experience in the mining sector Jean-Yves Laliberté ¹ ² • Chair of Cartier Resources Inc. (previously served as Chief Financial Officer) Chair of the Board of Directors • Former Chief Financial Officer of
Slide 25: Senior Management
Senior Management • Co-founder and largest shareholder of Orbit Garant Pierre Alexandre • More than 36 years of experience in diamond drilling President & CEO • Expertise in operational planning and business development • Joined Orbit Garant in 2006, assumed COO duties in December 2022 Sylvain Laroc
Slide 26: Reconciliation of Non-IFRS Financial Measures
Reconciliation of Non-IFRS Financial Measures (unaudited) 3 months ended 3 months ended 6 months ended 6 months ended (in millions of dollars) December 31, 2023 December 31, 2022 December 31, 2023 December 31, 2022 • “EBITDA”: Net earnings (loss) before interest, taxes, Net (loss) earnings for the p
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