Grange Resources Limited · ASX:GRR
Grange Resources — Shareholder Meeting (November 2010)
31 slides from Grange Resources's shareholder meeting presentation, Nov 26, 2010
Slide 1: Grange Annual General Meeting
GRANGE RESOURCES Australia’s Australia s leading magnetite producer For personal use only Grange Annual General Meeting Grange Resources Limited (GRR) 26th November 2010 Level 11, 200 St Georges Terrace Perth, WA 6000, Australia Phone + 61 8 9327 7901 Fax + 61 8 9327 7932 Russell Clark www grangeres
Slide 2: Disclaimer
Disclaimer For personal use only The material in this presentation (“material”) ( material ) is not and does not constitute an offer offer, invitation or recommendation to subscribe for, or purchase, any security in Grange Resources Limited (“GRR”) nor does it form the basis of any contract or commi
Slide 3: Snapshot 2009
Snapshot 2009 For personal use only • High Debt • Unhelpful banks • Major pre-existing • Share register issues liabilities • Market Cap ~$200m $200m • Prices below costs • Cash constrained NOT FOR DISTRIBUTION IN THE US 3
Slide 4: Snapshot 2010
Snapshot 2010 For personal use only • No net debt, debt no hedging • Institutional investment • $97m cash at bank • Greater liquidity • $ $49m leasing g and State p , ASX 300 • Investors tripled, liabilities • Market cap ~$900m • Market pricing for all • Southdown development product • Strong margin
Slide 5: Magnetite – The premium iron ore
Magnetite – The premium iron ore For personal use only ~US$150 $ • Iron Ore Pellet ~65-69% Fe RICE LITY • Direct Shipping pp g Lump p ~63% Fe E & PR QUAL VALUE • Magnetite Concentrate ~67% Fe V • Direct Shipping Fines ~58% Fe ~US$100 NOT FOR DISTRIBUTION IN THE US 5
Slide 6: For personal use only
For personal use only NOT FOR DISTRIBUTION IN THE US 6
Slide 7: Company Snapshot
Company Snapshot For personal use only Current Ownership p Structure B Board d off Di Directors t Mr Xi Zhiqiang Chairman Free float Mr Neil Chatfield Deputy Chairman Mr Russell Clark Managing Director, CEO 32.70 PML Mr Zhao Honglin Non Executive Director 46.90 Mr Clement Ko Non Executive Director R
Slide 8: Best performing ASX stock, Q1 2010
Best performing ASX stock, stock Q1 2010 For personal use only N mber of Grange Shareholders Number 4500 4000 3500 3000 2500 2000 1500 NOT FOR DISTRIBUTION IN THE US 8
Slide 9: Best performing ASX stock, Q1 2010
Best performing ASX stock, stock Q1 2010 For personal use only 1000 Market Capitalisation $Am 900 800 700 ASX 300 600 September 500 2010 400 300 200 100 0 NOT FOR DISTRIBUTION IN THE US 9
Slide 10: Key Information
Key Information September Quarter, Quarter FY 2010/11 For personal use only Production Production and Costs and Costs Sept Qtr 2010 Sept Qtr 2009 Total Mined (‘000 BCM) 4,055 4,350 Total Ore (‘000 ( 000 BCM) 217 516 Pellets Produced (‘000 t) 558 515 Direct Operating Costs 78.80 80.26 A$/tonne Pellet
Slide 11: Revenue surge
Revenue surge For personal use only July- January- April-June September March 2010 2010 2010 Pellets Sold ‘000t 588 581 582 Average Price US$/t 55 118 150 Average Price A$/t 61 134 167 Revenue A$m 35.7 77.6 97.0 Since July 2010, all product has been sold at index based market prices, rather than at
Slide 12: Large Scale Operations
Large Scale Operations For personal use only NOT FOR DISTRIBUTION IN THE US 12
Slide 13: Own Downstream Infrastructure
Own Downstream Infrastructure For personal use only NOT FOR DISTRIBUTION IN THE US 13
Slide 14: Own Port & Shiploading Infrastructure
Own Port & Shiploading Infrastructure For personal use only NOT FOR DISTRIBUTION IN THE US 14
Slide 15: Savage River - Leveraged to price
Savage River - Leveraged to price For personal use only Margin leverage to price @2.3Mtpa 500 450 Revenue 400 Costs 350 A$ million n MARGIN 300 A 250 200 150 100 77 90 100 110 120 130 140 150 160 170 180 190 NOT FOR DISTRIBUTION IN THE US 15
Slide 16: Growth - The Southdown Magnetite Project
Growth - The Southdown Magnetite Project For personal use only 4. Pellet Plant 3. Concentrate shipped 2. 100km slurry pipeline to Albany Port 1. Targeting 10Mtpa mining and concentrating operations for over 25 years NOT FOR DISTRIBUTION IN THE US 16
Slide 17: Southdown Resource
Southdown Resource For personal use only 654 MT at 36.5% magnetite NOT FOR DISTRIBUTION IN THE US 17
Slide 18: Southdown Super Pit
Southdown Super Pit Superimposed on Savage River photography For personal use only 3 Kilometres NOT FOR DISTRIBUTION IN THE US 18
Slide 19: Southdown Project
Southdown Project For personal use only NOT FOR DISTRIBUTION IN THE US 19
Slide 20: Southdown Project
Southdown Project For personal use only NOT FOR DISTRIBUTION IN THE US 20
Slide 21: Southdown Project
Southdown Project For personal use only NOT FOR DISTRIBUTION IN THE US 21
Slide 22: Project Infrastructure
Project Infrastructure Power & Pipelines For personal use only Power Western Power Networks 220kv line from Muja j (150MW ( capacity). EPA Assessed Interconnected to SWIS1 Transmission T i i line li easements established Slurry Pipeline Optimal transport method Finalising easements with
Slide 23: Southdown Infrastructure
Southdown Infrastructure Port of Albany For personal use only New Berth Location NOT FOR DISTRIBUTION IN THE US 23
Slide 24: Southdown Magnetite Project Schedule
Southdown Magnetite Project Project Schedule For personal use only 2010 2011 2012 2013 2014 Prefeasibility DFS and Detailed Design Power Dredge Port Albany Sourcing Funding Commitment Long lead Items (Mill, Transformer) Business Readiness & Project Execution Pre-Strip and Mine Establishment (Tails e
Slide 25: Resources and Reserves 2010
Resources and Reserves 2010 Supporting Long Mine Lives For personal use only Grange has 764Mt of attributable Mineral Resources and 391Mt of attributable Ore Reserves. Reserves Mineral Resources (inclusive of reserves) Ore Reserves Tonnes Grade Tonnes Grade ((Mt)) ((%DTR)) ((Mt) t) (% (%DTR)) Savage
Slide 26: Production growth prospects
Production growth prospects For personal use only kt 10000 9000 8000 7000 6000 S thd Southdown 5000 4000 3000 2000 Savage River 1000 0 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 (Production shown is attributable to Grange) NOT FOR DISTRIBUTION IN THE US 26
Slide 27: Summary
Summary For personal use only Australia's leading magnetite & iron ore pellet producer Solid investor, customer and revenue base Extensive magnetite technical and operational expertise Strengthened balance sheet with strong cashflow forecasts Mix of Cornerstone Cornerstone, Institutional a
Slide 28: Key Contacts
Key Contacts For personal use only Primary contacts: Russell Clark Managing Director & Chief Executive Officer +61 8 9327 7901 managingdirector@grangeresources.com.au NOT FOR DISTRIBUTION IN THE US 28
Slide 29: Competent Person Statement
Competent Person Statement For personal use only Southdown Project j The information in this presentation which relates to the Mineral Resources of the Southdown Project is based on information compiled by James Farrell who is a full-time employee of Golder Associates Pty Ltd and a Member of the Aus
Slide 30: Appendix A – Southdown Project
Appendix A – Southdown Project For personal use only Mineral Resource Estimate Classification Measured Resources Indicated Resources Inferred Resources Total Resources Tonnes (Mt) 219.7 210.3 224.4 654.4 DTC wt% 37.4 38.9 33.4 36.5 DTC Fe% 69.2 69.3 69.1 69.2 DTC SiO2% 1.72 1.94 2.07 1.91 DTC Al2O3%
Slide 31: Appendix B – Savage River
Appendix B – Savage River For personal use only Mineral Resource and Ore Reserve Estimates Grade Grade Mineral Resource Tonnes (Mt) Ore Reserve Tonnes (Mt) (%DTR) (%DTR) Savage-River Total Measured 86.4 54 S Savage-River Ri T t l Total Indicated 131.9 53 Proved 50.6 51 Inferred 87.8 49 Probable 67.9
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