Igo Limited · ASX:IGO
Igo — Independence Group NL — Diggers and Dealers Mining Forum 2015
44 slides from Igo's conference presentation, Aug 3, 2015
Slide 1: Diggers and Dealers Mining Forum
Diggers and Dealers Mining Forum For personal use only Independence Group NL Peter Bradford, Managing Director and CEO 3 August 2015
Slide 2: Cautionary Notes and Disclaimer
Cautionary Notes and Disclaimer For personal use only This presentation has been prepared by Independence Group NL (“IGO”) (ABN 46 092 786 304). It should not be considered as an offer or invitation to subscribe for or purchase any securities in IGO or as an inducement to make an offer or invitati
Slide 3: IGO: our business
For personal use only IGO: our business
Slide 4: Corporate Snapshot
Corporate Snapshot Unaudited financial snapshot to 30 June For personal use only Key Highlights Highlights FY15 FY14 Change Revenue $499M $399M 25% Underlying EBITDA(2) $213M $148M 45% Leading ASX200 Gold and Base Metals Producer Profit after tax(2) $77M $49M 57% Net Operating Cash Flow(2) $202M $12
Slide 5: History of growth
History of growth For personal use only Annual Revenue ($M) IPO with Mkt Cap of $9M in 2002 600 Acquired Long Operation in Sept 2002 500 400 Acquired Jaguar Operation in June 300 2011 through takeover of Jabiru Metals 200 100 Agreement to Acquire Sirius through - Scheme of Arrangement in May
Slide 6: Focus on safety
Focus on safety For personal use only Significant improvement over the past 1-2 years is a credit to our people 16 50 45 14 40 12 35 10 30 LTIFR TRIFR 8 25 20 6 15 4 12 Mthly Rolling LTIFR 12 Mthly Rolling TRIFR 10 2 5 0 0 Jul 13 Oct 13 Jan 14 Apr 14 Jul 14 Oct 14 Jan 15 Apr 15 Jul 15 (1) LTIFR is l
Slide 7: Tropicana: tier 1 gold mine
Tropicana: tier 1 gold mine For personal use only 30% IGO – 70% AngloGold Ashanti (Manager) One of best virgin Australian gold discoveries since 2000 Located 370 km NE of Kalgoorlie Low cost with 9 year mine life 3.6Moz Ore Reserves, 7.5Moz Resources(1) Open Pit mining with avg LOM strip
Slide 8: Tropicana: FY15 scorecard
Tropicana: FY15 scorecard For personal use only Annual gold production and cash costs better than original guidance Total Mined (Mt) Mill Throughput (Mt) Milled Grade (g/t) 16 2.0 4.0 14 12 1.5 3.0 10 8 1.0 2.0 6 4 0.5 1.0 2 0 0.0 0.0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Actual Guidance Actual Guidan
Slide 9: Tropicana: reserves optimised at $1,249/oz gold price
Tropicana: reserves optimised at $1,249/oz gold price For personal use only Page 9
Slide 10: Tropicana: resource extension
Tropicana: resource extension For personal use only Page 10
Slide 11: Tropicana: regional exploration
Tropicana: regional exploration For personal use only Systematic regional exploration continuing Non-prospective ground dropped Prioritising geological and structural targets in prospective domains and rock packages Near Mine Exploration AC, RC and DDH drilling at several targets within 50
Slide 12: Long: getting longer
Long: getting longer For personal use only Located in Kambalda, 60km south of Kalgoorlie High grade underground Nickel (3.8% avg grade) 35 year operating history Consistent track record Production and costs Positive reserve call factor Replacing production with new reserves Largely r
Slide 13: Long: FY15 scorecard
Long: FY15 scorecard For personal use only Annual nickel production and cash costs better than original guidance Ore Mined (kt) Ni Grade (%) Ni Produced (t) 80 5 3,000 4 2,500 60 2,000 3 40 1,500 2 1,000 20 1 500 0 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Ore Mined Guidance Midpoint Ni Grade Guidance
Slide 14: Long: long-section through orebodies
Long: long-section through orebodies For personal use only Page 14
Slide 15: Long: Moran South exploration
Long: Moran South exploration For personal use only Page 15
Slide 16: Jaguar: starting to growl
Jaguar: starting to growl For personal use only Located 300 km north of Kalgoorlie High grade underground Zn / Cu VMS deposit Significant improvement in operation over last 1-2 years Fly in – fly out from Perth Some drive in drive out from Kalgoorlie Owner mining ~500 ktpa processing p
Slide 17: Jaguar: FY15 scorecard
Jaguar: FY15 scorecard For personal use only Annual zinc & copper production and cash costs better than or within original guidance Ore Mined and Ore Milled (kt) Grade (%) Zn Production in Concentrate (t) 150 12.0 15,000 10.5 9.0 12,000 100 7.5 9,000 6.0 4.5 6,000 50 3.0 3,000 1.5 0 0.0 0 Q1 Q2 Q3 Q
Slide 18: Jaguar: Bentley resource extension & exploration
Jaguar: Bentley resource extension & exploration For personal use only Page 18
Slide 19: Triumph: taking shape – only 6km from Jaguar mill
Triumph: taking shape – only 6km from Jaguar mill For personal use only Page 19
Slide 20: FY15 Scorecard and FY16 Guidance
For personal use only FY15 Scorecard and FY16 Guidance
Slide 21: Scorecard: core metrics
Scorecard: core metrics For personal use only Metric Target(1) Achieved Score Tropicana Gold production (oz) 141 to 147,000 148,923 Cash Cost ($/oz) 590 to 630 568 Long Nickel production (t) 9,000 to 10,000 10,198 Cash Cost ($/lb) 4.30 to 4.70 4.01 Jaguar Zinc Production (t) 40,000 to 43,000
Slide 22: Scorecard: strategic metrics
Scorecard: strategic metrics For personal use only Objective Achieved Score $26M Brownfields exploration $25.7M $27M Sustaining Capex $24.4M $11M Development Capex $11.4M ● (1) $11M Greenfields exploration $11.5M ● (2) $3M Stockman development $0.8M Supplement exploration portfolio with mature
Slide 23: FY16 guidance
FY16 guidance For personal use only Metric FY16 Guidance Change(1) $40M brownfields exploration Tropicana Up 50% year on year Gold production (oz) 129 to 141,000 9% Mostly Long and Tropicana Cash Cost ($/oz) 640 to 710 11% $13M development capex Long Up 20% year on year Nickel producti
Slide 24: Transformation
For personal use only Transformation
Slide 25: Criteria for targeting opportunities
Criteria for targeting opportunities For personal use only Five Primary Targeting Criteria High Margin • Bottom third cost curve (minimum all in sustaining cash margin of 25% and above) • Equivalent, or bigger, in scale to our 30% interest in Tropicana Scale • Circa 150,000oz/year Au, 15,000tpa
Slide 26: Sirius transaction highlights
Sirius transaction(1) highlights For personal use only Creating a leading Australian diversified mining company Clear strategic rationale for transaction Acquisition of Sirius is consistent with IGO's clearly defined growth strategy Delivers shareholders of both companies exposure to Tropica
Slide 27: Exploration: consolidation of Fraser Range and Tropicana belts
Exploration: consolidation of Fraser Range and Tropicana belts For personal use only Dominant land position Allows a focused and efficient exploration effort Both provinces under-explored “The shareholders of the merged entity will be exposed to the unrealised exploration potential of both the
Slide 28: A portfolio focused on Western Australia
A portfolio focused on Western Australia For personal use only “This transaction brings together the producing assets of Independence and the near production asset of Sirius.” Mark Creasy, 25 May 2015 Page 28
Slide 29: Strengthening the business
For personal use only Strengthening the business
Slide 30: Sustainability and community
Sustainability and community For personal use only Page 30
Slide 31: Strengthening exploration portfolio
Strengthening exploration portfolio For personal use only Why? Exploration is our future Why now? Unique opportunity currently to accumulate belt scale land positions which was not possible 3-4 years ago Can now target the ground we want How? Back to the drawing board Focusing on maj
Slide 32: Investing in innovation
Investing in innovation For personal use only Project generation targeting In-house geophysical capability and R&D development Potential to deploy this capability to Sirius’ Fraser Range portfolio University R&D programs to: Improve dynamic ground support capability Better determine prob
Slide 33: Investing in people
Investing in people For personal use only Need consistent investment in people to develop industry leaders of the future IGO is investing in people: Currently sponsor geology undergraduate scholarship through WA Mining Club Currently sponsor Masters/PhD thesis work Provide opportunities fo
Slide 34: Commodity Prices
For personal use only Commodity Prices
Slide 35: Commodity prices
Commodity prices For personal use only 2,500 25 Gold Price (US$/oz) Nickel price (US$/lb) 2,000 20 1,500 15 1,000 10 500 5 0 0 1970 1980 1990 2000 2010 2020 2030 1970 1980 1990 2000 2010 2020 2030 300 500 Copper Price (US$ cents/lb) Zinc Price (US$ cents/lb) 250 400 200 300 150 200 100 50 100 0 0 19
Slide 36: Conclusion
Conclusion For personal use only FY15 Full Year (Unaudited) Achieved or bettered guidance on production and cash costs at all mines Achieved record revenue and operating cash Strong balance sheet flow Outlook High-margin quality cash flow generating assets delivering consistent performance
Slide 37: Questions?
Questions? For personal use only Independence Group NL (www.igo.com.au) Peter Bradford, Managing Director and CEO 3 August 2015
Slide 38: Resources & Reserves: Competent Persons Statements
Resources & Reserves For personal use only Competent Persons Statements Exploration Results The information in this report that relates to Exploration Results is a compilation of previously published data for which Competent Persons consents were obtained. Their consents remain in place for subseque
Slide 39: Resources & Reserves: Tropicana JV (IGO 30%)
Resources & Reserves: Tropicana JV (IGO 30%) For personal use only Mineral Resource 30 June 2014 Ore Reserve 30 June 2014 100% Project 100% Project Classification Tonnes Mt Au g/t Contained Au Moz Classification Tonnes Mt Au g/t Contained Au Moz OPEN PIT Measured 22.8 2.11 1.56 OPEN PIT Proved 20.2
Slide 40: Resources & Reserves: Long Operation
Resources & Reserves: Long Operation For personal use only Mineral Resource 30 June 2014 Ore Reserve 30 June 2014 Classification Tonnes Ni% Ni Tonnes Classification Tonnes Ni% Ni Tonnes LONG Measured 70,000 5.5 3,900 LONG Proved 50,000 3.8 1,900 Indicated 270,000 5.5 15,000 Probable 56,000 3.1 1,700
Slide 41: Resources & Reserves: Jaguar Operation
Resources & Reserves: Jaguar Operation For personal use only Mineral Resource 30 June 2014 Ore Reserve 30 June 2014 Classification Tonnes Cu% Zn% Ag g/t Au g/t Classification Tonnes Cu% Zn% Ag g/t Au g/t BENTLEY Measured 706,000 2.2 12.3 172 0.8 BENTLEY Proved 499,000 2.1 12.1 168 0.8 Indicated 1,50
Slide 42: Resources & Reserves: Stockman Project
Resources & Reserves: Stockman Project For personal use only Mineral Resource 30 June 2014 Ore Reserve 28 November 2014 Classification Tonnes Mt Cu% Zn% Ag g/t Au g/t Classification Tonnes Mt Cu% Zn% Ag g/t Au g/t CURRAWONG Measured - - - - - CURRAWONG Proved - - - - - Indicated 9.58 2.0 4.2 42 1.2
Slide 43: FY16 Guidance
FY16 Guidance For personal use only Tropicana Jaguar 129,000 to 141,000oz (IGO 30% share) 35,000 to 40,000t Zn in conc. Average cash cost of $640 to $710/oz Au 7,500 to 8,500t Cu in conc. AISC of $820 to $910/oz Au sold Average cash cost of $0.40 to 0.60/lb Zn Sustaining capex (IGO 30%
Slide 44: Hedging as at June 2015
Hedging as at 30 June 2015 For personal use only Nickel Q1 FY16: 250 t/mth at avg. price of $19,701/t Copper Q1 FY16: 550t at $8,001/t in Sept 15 Gold FY16: Average 3,208 oz/month zero cost collars (range $1,342 to $1,672/oz) FY17: 2,500 oz/month zero cost collars to November 2016 (range $1,
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