Sandfire Resources Ltd · ASX:SFR
Sandfire Resources — UBS Australasia Conference 2018
27 slides from Sandfire Resources's conference presentation, Nov 13, 2018
Slide 1: A quality Australian copper-gold miner
For personal use only A quality Australian copper-gold miner with consistent low-cost production, strong margins and global growth pipeline 13 November 2018 – Karl Simich, Managing Director and CEO 1
Slide 2: Important Information and Disclaimer
Important Information and Disclaimer Forward-Looking Statements For personal use only This presentation has been prepared by Sandfire Resources NL. This document contains background information about Sandfire Resources NL current at the date of this presentation. The presentation is in summary form
Slide 3: Sandfire – Investment Overview
Sandfire – Investment Overview • +6 years of consistent, safe operations For personal use only Consistent mid- tier performer • +420kt Cu and +240koz Au produced to date • $3.2 billion in revenue to end-FY18 Consistent, low- • FY2018 production: 64,918t Cu, 39,273oz Au – record low C1 US$0.93/lb cos
Slide 4: Key Corporate, Financial and Shareholding Data
Key Corporate, Financial and Shareholding Data Key Corporate Data For personal use only Issued Capital Market Capitalisation Cash Debt 159.6 ~$1.18 $218 NIL MILLION BILLION MILLION Shares at $7.40 At 30 September 2018 Repaid FY2017 Growing Cash Balance Geographic Analysis of Investors 4
Slide 5: Record Revenue, Cash-Flow and Dividends in FY2018
Record Revenue, Cash-Flow and Dividends in FY2018 Cumulative financial performance For personal use only FINANCIAL FY 2013 FY 2014 FY 2015 FY2016 FY2017 FY2018 Sales Revenue OVERVIEW: Revenue $492.8M $529.6M $532.0M $485.8M $532.5M $606.7M $3.2 Operating BILLION $272.4M $249.5M $250.1M $166.5M $248.
Slide 6: Copper – Despite the Recent Pullback….It's Not All Over
Copper – Despite the Recent Pullback….It’s Not All Over ► ~15% retracement in copper price in Q1FY2019 to US$5,800-6,000/t For personal use only due to escalating trade frictions and “risk-off” investment climate ► Some forecasters like S&P have revised their price forecasts down for 2018 to US$6,00
Slide 7: Copper – Declining Grades, Falling Production….
Copper – Declining Grades, Falling Production…. ► Continued decline in global copper mine reserve grade and steady decline in number of new discoveries For personal use only ► Supply not able to meet demand over the long run at current prices ► Mine supply growth is forecast to slow down after 2020
Slide 8: …As Long-term Copper Demand Gets Super-Charged
…As Long-term Copper Demand Gets Super-Charged ► The global copper market is set to be transformed by new demand sources For personal use only ► EV demand and related infrastructure is set to account for two-thirds of conservative global copper demand between 2018 and 2030 ► This could affect pricin
Slide 9: Summary of Key Assets – Mineral Resources
Summary of Key Assets – Mineral Resources For personal use only DeGrussa Copper-Gold Mine (production) 7.6Mt @ 4.1% Cu, 1.6g/t Au * Black Butte copper-gold project (development) 18.0Mt @ 3.3% Cu, 14g/t Ag and 0.10% Co ** Monty Copper-Gold Mine (development) 1.05Mt @ 9.4% Cu, 1.6g/t Au* * Refer SFR A
Slide 10: DeGrussa Operations – Consistent, Reliable, Low-Cost
DeGrussa Operations – Consistent, Reliable, Low-Cost For personal use only Six successive years of consistent, safe and profitable production Milling rates maintained at 1.6Mtpa and recoveries targeted at ~92% (LOM) PRODUCTION OVERVIEW – Key Figures FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
Slide 11: Mine Plan, Ore Reserve and Mineral Resource
Mine Plan, Ore Reserve and Mineral Resource ► DeGrussa and Monty Mine Plan For personal use only (Monty at 100%): ►6.6Mt at 5.0% Cu and 1.7g/t Au (332,000t Cu, 354,000oz Au) ► DeGrussa mine life into CY2022 Tonnes Copper Gold Contained Contained Gold DeGrussa and Monty (Mt) (%) (g/t) Copper (t) (oz)
Slide 12: Monty – Set to Become One of the World's Highest-Grade Copper Mines
Monty – Set to Become One of the World’s Highest-Grade Copper Mines ► New satellite mine located 10km east of For personal use only DeGrussa ► Now 100%-owned following acquisition of Talisman’s 30% interest ► Mining by underground method to 400m below surface ► Mine Plan: 0.8Mt at 9.4% Cu, 1.5 g/t A
Slide 13: Development – Monty Site Infrastructure
Development – Monty Site Infrastructure Waste Dump, Crushing & Mine Office For personal use only Screening Pad ROM Pad Discharge Pond PAF Runoff Pond Laydown Yard Haul Road Boxcut 13
Slide 14: DeGrussa and Monty
DeGrussa and Monty Debt-free with rising production profile in a rising copper market For personal use only 14
Slide 15: Development Pipeline – Doolgunna Growth Projects
Development Pipeline – Doolgunna Growth Projects Growth projects currently under evaluation against the backdrop of an For personal use only improved copper price environment Near-Mine Opportunities Oxide Copper Project Thaduna Copper Projects ► ~2.7Mt oxide stockpiles at Structurally controlled ► ►
Slide 16: Development Pipeline – Black Butte Copper Project, USA
Development Pipeline – Black Butte Copper Project, USA ► 86% stake in copper development subsidiary Sandfire Resources America For personal use only Inc. (TSX-V: SFR) – ~A$60M invested to date Acquisition cost equivalent to ~US$4c/lb of contained copper in resource ► Black Butte: an advanced, high q
Slide 17: Development Pipeline – Black Butte Copper Project, USA
Development Pipeline – Black Butte Copper Project, USA ► Upfront capital expenditure of For personal use only ~US$220M * ► 2 year construction period with operations over 11-14 years * ► Very small surface footprint – will be 100% reclaimed ► Highly engineered, state-of-the- art underground mine ► M
Slide 18: Doolgunna – Dominant Position in a World-Class VMS Province
Doolgunna – Dominant Position in a World-Class VMS Province ► Sandfire has more than tripled its ground position in the past two years ►Greater Doolgunna region: 6,588km2 including 65km strike length of For personal use only prospective VMS lithologies ►Recent farm-in deals: ► Enterprise Metals (ASX
Slide 19: Doolgunna Exploration – Multi-Pronged and Systematic Approach
Doolgunna Exploration – Multi-Pronged and Systematic Approach ► 90km of prospective For personal use only stratigraphy in the southern limb of Bryah Basin ► Exploration continuing as priority along prospective VMS corridor hosting DeGrussa and Monty ► Systematic aircore drilling commenced in May at
Slide 20: Morck's Well – Opening Up a New VMS Corridor
Morck’s Well – Opening Up a New VMS Corridor For personal use only ► Recent drilling intersected narrow zones of sulphide and supergene copper mineralisation outside of DeGrussa and Monty * ► First sulphides to be intersected outside of DeGrussa and Monty ► Deep RC drilling and DHEM surveying underw
Slide 21: Australian Regional Exploration Projects
Australian Regional Exploration Projects Targeting world-class discoveries in Australia’s premier exploration provinces For personal use only Northern Territory ► Active drilling by JV partners in Borroloola tenements Queensland Base Metals ► 2,400km² in Mt Isa-Cloncurry province including 100km str
Slide 22: Global Investments
Global Investments Developing a strong growth pipeline of quality base metal opportunities For personal use only Adriatic Metals PLC (ASX: ADT) ►Cornerstone 7.7% investment in recent $10m IPO ►Strategic partnership allowing Adriatic to access Sandfire’s technical expertise ►Exploring the Veovaca and
Slide 23: Strong commitment to sustainability and local communities
Strong commitment to sustainability and local communities ► +$600,000 in community sponsorships and donations in FY2018 For personal use only ► Committed to local procurement: - 96% of total spend on contractors and suppliers was within Australia - 81% was within Western Australia - 38% of total spe
Slide 24: Summary – Positioned for Growth and Success
Summary – Positioned for Growth and Success ► Consistent low-cost production For personal use only ► Strong balance sheet – net cash position ► Growing free cash-flows ► Committed to organic growth via exploration ► Unlocking the potential at Doolgunna ► Developing a growth pipeline for the future ►
Slide 25: A quality Australian copper-gold miner
For personal use only A quality Australian copper-gold miner with consistent low-cost production, strong margins and global growth pipeline 13 November 2018 – Karl Simich, Managing Director and CEO 25
Slide 26: Competent person's statements
Competent person’s statements DeGrussa and Monty Mineral Resource For personal use only The information in this report that relates to the DeGrussa Mineral Resource is based on information compiled by Mr Callum Browne who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Browne
Slide 27: Competent person's statements
Competent person’s statements Thaduna and Green Dragon Mineral Resource For personal use only The information in this report that relates to the Thaduna and Green Dragon Mineral Resource is based on information compiled by Mr Ekow Taylor who is a Member of The Australasian Institute of Mining and Me