Slide 1: Equity Raising Investor Presentation
Equity Raising Investor Presentation 17 July 2017 1 ASX:MMI
Slide 2: Important Notice
Important Notice No reliance: To the maximum extent permitted by law, the information contained in this presentation is Mr McLean consents to the inclusion in this presentation of the matters based on information in the form given without any liability whatsoever being accepted by Metro Mining Limit
Slide 3: Equity Raising Overview
Equity Raising Overview 3. | ASX : MMI | Equity Raising Investor Presentation | 17 July 2017
Slide 4: Equity Raising Overview
Equity Raising Overview Two tranche placement (Placement)to raise $38 million1 Tranche 1 to raise $33.9 million with 251.0 million new Metro shares (New Shares) to be issued under Offer Structure & Size Metro’s existing placement capacity Tranche 2 to raise $4.1 million with 30.5 million New S
Slide 5: Equity Raising Timetable
Equity Raising Timetable Key Event Time / Date1 (AEST) Trading Halt, Announcement of Equity Raising Pre-Open Monday, 17 July 2017 Bookbuild Opens 10:00am Monday, 17 July 2017 Australia / Asia Bookbuild Closes 6:00pm Monday, 17 July 2017 UK / Europe Bookbuild Closes Midnight Monday, 17 July 2017 Anno
Slide 6: Sources & Uses to First Production
Sources & Uses to First Production Sources1 Amount Uses1 Amount Remaining Capital Costs Equity Raising $38.0m $38.0m (with added truck haulage fleet) Debt Financing Package2 $40.0m Drilling (exploration & grade control) $4.0m Cash on Hand (30-June-2017) $15.3m Financial Assurance & Environmental Cos
Slide 7: Metro Investment Highlights
Metro Investment Highlights 7. | ASX : MMI | Equity Raising Investor Presentation | 17 July 2017
Slide 8: Investment Highlights
Investment Highlights 1 Proven Board & management team focused on shareholder value 2 Backed by high quality and supportive partners 3 Transformational growth in China’s seaborne bauxite demand driven by fundamentals 4 Simple DSO project well located in Cape York with significant competitive advanta
Slide 9: Corporate Snapshot
Corporate Snapshot Capital Structure (pre Equity Raising) Share Price Share Price (14-July-17) $0.15 $0.18 $0.16 Shares on Issue 1,004.0m $0.14 Market Cap $150.6m $0.12 $0.10 Options Unlisted 11.7m $0.08 Cash (30-June-17) $15.3m $0.06 $0.04 BUY (Jul-17) Unsecured Debt (30-June-17) $15.0m Target Pric
Slide 10: Proven Management Team
Proven Management Team ▪ Metro’s Board & management have collectively been involved in the development and operation of over 30 mines globally ▪ Significant bauxite knowledge and expertise, focused on Cape York bauxite operations and product marketing into China ▪ Strategy is to develop and operate
Slide 11: Recent Achievements & Value Platform
Recent Achievements & Value Platform ▪ Metro has completed several value adding milestones in 2017 to be primed for near term production 1 4 Binding Sales Agreement ✓ ✓ Doubled reserves for 7Mt over 4 years & Developed LOI for 2.5Mt over 3 years Acquired Gulf Gained infrastructure Customer Bas
Slide 12: Supportive Partners
Supportive Partners Metro and Bauxite Hills Mine has attractive strong support from leading product partners and financial investors Product Quality & Demand Economics & Financial Returns 20% cornerstone shareholder China’s 2nd largest bauxite importer Balanced Shareholder since Oct 2014 4
Slide 13: Structural Change in China
Structural Change in China China’s seaborne bauxite imports are forecast to grow from ~50mtpa in 2015 to ~150mtpa by 2030 Chinese Aluminium Production & Growing Seaborne Bauxite Demand Declining Chinese Bauxite Reserve Life Years 50.0 60 Imported Alumina as Bauxite Imported Bauxite 53 Domestic Bau
Slide 14: Positive Bauxite Price Outlook
Positive Bauxite Price Outlook Bauxite has experienced relatively steady and positive price growth since the GFC with growing Chinese demand to support longer term price growth CM Group historic CBIX price & forecast USD$/DMT CFR 80.0 CM Group CBIX BFS Group CM Assumption CBIX Forecast 70.0 60.0 5
Slide 15: Key Market End Users & Off-take
Key Market End Users & Off-take * Summary of Xinfa Off-take Binding off-take secured (Xinfa), China’s 2nd largest private bauxite importer. Term 4 years Agreement covers ~50% of first 4 years production with market linked pricing. Total Tonnage 7Mt Lubei LOI (non-binding) for 0.5-1.0mt pa for a
Slide 16: Bauxite Market Update
Bauxite Market Update Five (5) alumina refineries planned in China with a potential stage 1 capacity of 8-10Mtpa which could increase imported bauxite into China by 20-25Mtpa These planned refineries support the view that new refineries will be built in coastal locations to take advantage of the
Slide 17: Bauxite Hills Mine Snapshot
Bauxite Hills Mine Snapshot Location Key Statistics 1 Ownership: Metro (100%) Location: Cape York, Qld Project Overview Commodity Bauxite Product Type Direct Shipping Ore Mine Type Surface mining Contained mineral: • Reserves 92.2Mt* • Resources 144.8Mt* Status EA Granted, ML Pending Construction H2
Slide 18: Simple DSO Project
Simple DSO Project Operational simplicity and specialist mining and transhipment contractors enables easy to manage operations Proven, well known operator TSA to be transhipment contractor and will supply all vessels Metro’s low cost logistics are a sustainable cost advantage to China relative
Slide 19: Steady Production Ramp-up
Steady Production Ramp-up Initial production rate of 2Mtpa with steady ramp up to ~6Mtpa over the first four years Current 17 year mine life 6.2Mt Environmental approvals allow for up to 10mtpa production 4.9Mt ~6.0Mtpa for next Production Ramp-up 13-years 3.0Mt 2.0Mt Year 1 Year 2 Year 3 Year
Slide 20: Competitive Transport Costs
Competitive Transport Costs Metro’s low cost shipping is a sustainable cost advantage to China relative to competing bauxite producers 20. | ASX : MMI | Equity Raising Investor Presentation | 17 July 2017
Slide 21: Compelling Economics
Compelling Economics * Compelling project economics provide attractive investment upside 3 High Margin Low Capex Avg. LOM OPEX1,2 vs. Avg. LOM Price Received (CIF) CAPEX vs. Avg. LOM EBITDA ~43% margin Payback within 1.7 years $61/WMT $73m $145m Expansion $37m $35/WMT Capital Initial Capex 3 $
Slide 22: Strong Cost Curve Positioning
Strong Cost Curve Positioning 2nd quartile cost curve positioning provides attractive long term competitive advantage China Seaborne Bauxite Supply Cost Curve 2019 – Value-in-use Adjusted US$/Dmt (CFR) 1St Quartile 2nd Quartile 3rd Quartile 4th Quartile US$/DMT 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.
Slide 23: BFS Summary
BFS Summary Bankable Feasibility Study Highlights* ▪ Completed by MEC Mining in March 2017 ▪ 6Mtpa steady state (initial 2Mtpa) ▪ Contract mining and transhipment ▪ 8 months per year dry season operation (April to Nov) ▪ 5 month construction period Key Results and Assumptions 1 Description Result As
Slide 24: Early Construction Underway
Early Construction Underway Bauxite Hills Village New camp under construction Installation planned for Nov 2017 Existing camp used during construction Barge Load-Out Facility TSA appointed as marine infrastructure manager Fabrication of piles completed and due for August 2017 arrival Con
Slide 25: Rapid Pathway to Production
Rapid Pathway to Production Early works now underway with first production scheduled for April 2018 9 months to Production (est) 2017 2018 May June July Aug Sept Oct Nov Dec Jan Feb Mar April Financing Piles & Steel Fabrication Camp Refurbishment Tug & Barge Mobilisation Civil Works ▪ Barge Loadin
Slide 26: Summary – A Compelling Investment
Summary – A Compelling Investment 1 Metro has significant advantages and is backed by leading partners 2 Strong seaborne bauxite fundamentals in China drive positive outlook 3 Recent achievements have delivered platform for value creation 4 Compelling metrics provides significant share price upside
Slide 27: Background Slides
Background Slides 27. | ASX : MMI | Equity Raising Investor Presentation | 17 July 2017
Slide 28: Board of Directors
Board of Directors Stephen Everett Chemical engineer with 40+ years experience in the resources and construction industries both in Australia and overseas Chairman Formerly Chair of BeMaX Resources, Australian Solomons Gold, JMS Civil &Mining & IronRidge Resources Mining executive with +30 yea
Slide 29: BFS Capital Cost Estimates
BFS Capital Cost Estimates* Capital Cost Item Amount Capital Cost Item Amount Initial Capital Expansion Capital (in years 2 and 3) Integrated Truck dump and Site establishment and haul A$3.1M screens and upgraded haul A$13.9M roads roads Key infrastructure including BLF A$25.8M Transhipment upgrades
Slide 30: BFS Operating Cost Estimates
BFS Operating Cost Estimates* Operating Cost Item BFS LOM Average Mining, haulage and operation of BLF1 A$7.07/t Transhipment activities A$6.71/t Site and administrative costs A$2.65/t Total Operating Costs (ex-royalties and ocean freight) A$16.42/t Royalties A$6.57/t Ocean Freight A$11.71/t Total O
Slide 31: Reserves & Resources
Reserves & Resources* Bauxite Hills – DSO Mineral Resource &Ore Reserve Estimates DSO Bauxite Qualities (Dry Basis) Area Category DSO2 Tonnes (Mt)1 Total Al2O3 (%) Total SiO2 BH1 & BH6 Measured Resource 54.7 50.0 11.9 BH1, BH2 & BH6 Indicated Resource 66.4 49.2 14.5 BH1 & BH6 Inferred Resource 23.7
Slide 32: Attractive Debt Facility
Attractive Debt Facility Debt Financing Secured to Underpin Project Construction Quantum $40m Sprott Resource Lending Providers Ingatatus AG (a related party of Balanced Property) Term ~3 years Security Yes Coupon Low Flexible drawdown schedule Repayment Schedule No principal repayme
Slide 33: Risks & Selling Restrictions
Risks & Selling Restrictions 33. | ASX : MMI | Equity Raising Investor Presentation | 17 July 2017
Slide 34: Risks
Risks SPECIFIC RISKS Mineral resources and ore reserves Mineral Resources and Ore Reserves are estimates of mineralisation Funding Metro is operating in a capital intensive sector. It may require additional funding, from that have reasonable prospects for eventual economical extraction in the future
Slide 35: Risks
Risks Regulatory GENERAL RISKS Metro’s activities in the bulk commodities industry are subject to legislation, regulation and various approvals. The introduction of new legislation or regulations, or alteration of current legislation and Market risks regulations, could have a material adverse effect
Slide 36: Foreign Selling Restrictions
Foreign Selling Restrictions This document does not constitute an offer of new ordinary shares (New Shares) of Metro in any United Kingdom: Neither the information in this document nor any other document relating to the jurisdiction in which it would be unlawful. In particular, this document may not
Slide 37: Foreign Selling Restrictions
Foreign Selling Restrictions Canada (British Columbia, Ontario and Quebec provinces) This document constitutes an offering of The following is a summary of the statutory rights of rescission or to damages, or both, available to New Shares only in the Provinces of British Columbia, Ontario and Quebec
Slide 38: Foreign Selling Restrictions
Foreign Selling Restrictions Switzerland The New Shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange ("SIX") or on any other stock exchange or regulated trading facility in Switzerland. This document has been prepared without regard to the disclosure st
Slide 39: For Further Information
For Further Information Contact: Simon Finnis – Chief Executive Officer & Managing Director Finance & Business Development – Duane Woodbury Ph: +61 (0) 7 3009 8000 Head Office: Lvl 2, 247 Adelaide Street, Brisbane Q 4000 GPO Box 10955, Brisbane Q 4000