md’s presentation to annual general meeting … · md’s presentation to annual general meeting....
Post on 31-Aug-2018
228 Views
Preview:
TRANSCRIPT
26 November 2014
The Manager Company Announcements Office ASX Limited PO Box H224 Australia Square SYDNEY NSW 2000
Dear Sir/Madam,
MD’s PRESENTATION TO ANNUAL GENERAL MEETING
Please find attached a copy of the presentation to be given by Saracen Mineral Holdings Limited’s Managing Director, Raleigh Finlayson, at today’s Annual General Meeting.
Yours sincerely
G F Kaczmarek Company Secretary
Saracen Mineral Holdings Ltd
ACN 009 215 347 Level 4, 89 St Georges Terrace
Perth, WA 6000 Australia
Telephone (61 8) 6229 9100 Facsimile (61 8) 6229 9199
For
per
sona
l use
onl
y
RALEIGH FINLAYSON : MANAGING DIRECTOR DANIEL HOWE : GENERAL MANAGER – GEOLOGY & EXPLORATION
ASX GOLD PRODUCER AGM Presentation – 26 November 2014
For
per
sona
l use
onl
y
Qualification
2
This presentation has been prepared by Saracen Mineral Holdings Limited (Saracen or the Company) based on information from its own and third party sources and is not a disclosure document. No party other than the Company has authorised or caused the issue, lodgement, submission, despatch or provision of this presentation, or takes any responsibility for, or makes or purports to make any statements, representations or undertakings in this presentation. You should be aware that as an Australian company with securities listed on the ASX, the Company is required to report reserves and resources in Australia in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (The JORC Code 2012 Edition ) ("JORC Code"). You should note that while the Company's reserve and resource estimates comply with the JORC Code, they may not comply with the relevant guidelines in other countries. This is a presentation about geology, geoscientific interpretation, geoscientific speculation, gold deposits, gold potential, engineering, infrastructure, potential values, costs, risks, and related matters pertinent to Saracen’s present and future activities as a publicly listed mineral exploration and production company. It includes forecasts, predictions, targets and estimates of future expenditures which may vary over time. It is uncertain if further exploration will result in the determination of a Resource or Reserve. Where exploration, evaluation, operational and feasibility study expenditure estimates and budgets amounts are presented herein, ongoing prioritisation and scaling of expenditures will be subject to results and, where applicable, scheduling changes. Targeted production and other outcomes are subject to change, and may not eventuate, depending on the results of ongoing performance and assessment of data. All Reserves and Resources as referred to herein are in accordance with the JORC Code. Refer to last slide of this presentation for the relevant Competent Person statements. Resources are inclusive of Reserves. Certain statements contained in the Presentation Materials, including information as to the future financial or operating performance of the Company and its projects, are forward looking statements. Such forward looking statements: a) are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Company, are inherently subject to significant technical, business, economic, competitive, political and
social uncertainties and contingencies; b) involve known and unknown risks and uncertainties that could cause actual events or results to differ materially from estimated or anticipated events or results reflected in such forward looking statements; and c) may include, among other things, statements regarding estimates and assumptions in respect of prices, costs, results and capital expenditure, and are or may be based on assumptions and estimates related to future
technical, economic, market, political, social and other conditions. The Company disclaims any intent or obligation to publicly update any forward looking statements, whether as a result of new information, future events or results or otherwise. The words “believe”, “expect”, “anticipate”, “indicate”, “contemplate”, “target”, “plan”, “intends”, “continue”, “budget”, “estimate”, “may”, “will”, “schedule” and similar expressions identify forward looking statements. All forward looking statements contained in the Presentation Materials are qualified by the foregoing cautionary statements. Recipients are cautioned that forward looking statements are not guarantees of future performance and accordingly recipients are cautioned not to put undue reliance on forward looking statements due to the inherent uncertainty therein. The Presentation Materials do not purport to be all inclusive or to contain all information about the Company. This presentation is not a prospectus, disclosure document or other offering document under Australian law or under any other law. It is provided for information purposes and is not an invitation nor offer of shares for subscription, purchase or sale in any jurisdiction. Take care to question and carefully evaluate any judgments you might make, on the basis of the Presentation Materials, as to the value of Saracen and its securities. This presentation is not intended to provide the sole or principal basis of any investment or credit decision or any other risk evaluation and may not be considered as a recommendation by Saracen or its officers. Any investor reading the Presentation Materials should determine its interest in acquiring securities in Saracen on the basis of independent investigations that it considers necessary, prudent or desirable. Saracen and its officers do not accept any liability for any loss or damage suffered or incurred by any investor or any other person or entity however caused (including negligence) relating in any way to this presentation including, without limitation, the information contained in it, any errors or omissions however caused by any other person or entity placing any reliance on the Presentation Materials, its accuracy or reliability.
For
per
sona
l use
onl
y
Corporate Overview
Corporate Structure ASX Code SAR
Shares 792.8m
Share Price1 A$0.27
Market Cap1 A$214m
Enterprise Value1 A$190m
Cash & Bullion2 A$36.3m
Debt2 A$12.0m
Net Cash2 A$24.3m
Forward Hedging3 89koz @ A$1,709/oz
Spot Deferred Hedging3 72koz @ A$1,404/oz
Total Hedging3 160koz @ A$1,572/oz
Total Hedge Value4 A$33.7m
Last Hedge Delivery June 2016 @ A$1,750/oz
Board Non-Executive Chairman Guido Staltari (retiring at AGM)
Managing Director Raleigh Finlayson
Non-Executive Director Barrie Parker
Non-Executive Director Martin Reed
Non-Executive Director Samantha Tough
Non-Executive Director Geoff Clifford (Chairman elect)
Management Chief Financial Officer Gerry Kaczmarek
Chief Operating Officer Craig Bradshaw
Substantial Shareholders Van Eck Associates 12.8%
Wroxby / Seven Group 8.0%
Paradice Investments 6.9%
Eley Griffiths Group 5.1% 1. As at 25 November 2014 2. As at 30 September 2014 3. As at 31 October 2014 4. As at 6 November 2014 (Spot Price A$1,338/oz)
3
For
per
sona
l use
onl
y
FY2014 LTIFR
4
5.2 5.4 5.5 5.6
6.7 6.8 7.0 7.2
8.3
7.4
5.3
3.2
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
0
1
2
3
4
5
6
7
8
9
10
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May June
Frequency Rate
# of
LTI
s
12 month rolling Lost Time Injury Frequency Rate
LTIs LTIFR
For
per
sona
l use
onl
y
FY2014 Total Incident Frequency Rate
5
356
435
276
705
484 444 425
383
581 548
443
310 TIFR Target 440
0
100
200
300
400
500
600
700
800
Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14
Tota
l Inc
iden
t Co
unt
Month TIFR Weighted Weighted TIFR Target
For
per
sona
l use
onl
y
6
Key Assets Thunderbox Operations: • 2.5Mtpa CIL plant • Operational 2002 – 2007 • Produced 805koz @ US$290/oz • 2.8Moz Resource • 783koz Reserve • 5 year mine life already in reserve • Capex A$45-55m • AISC Forecast of ~A$1,100/oz
Carosue Dam Operations: • 2.4Mtpa CIL Plant • Whirling Dervish OP provides declining strip ratio,
increasing grade and margins • Karari Exploration Decline future upside catalyst Red October: • High grade underground mine (6.9g/t reserve) • Set to deliver 60koz again in FY2015
Combined Assets: • 6.9Moz Mineral Resources • 1.6Moz Ore Reserves • Milling capacity 5.0Mtpa • Potential production ~290kozpa • +3,000 km2 tenement package • Progressive and measured approach
For
per
sona
l use
onl
y
Carosue Dam Operations (CDO)
7
Red October: • Red October UG: 333kt @ 6.9g/t for 74koz • 60koz delivered in FY2014 @ 6.4g/t • 60koz guidance in FY2015 @ 6.9g/t • “All In” sustaining costs A$1,150/oz • Recent High grade drilling results (26 Nov 2014):
• 0.7m @ 314.6g/t • 6.9m @ 62.3g/t • 4.9m @ 104.7g/t
Carosue Dam: • 2.4mtpa modern processing facility • Whirling Dervish OP: provides base load feed • Remaining Strip Ratio 1.2:1 (26/11/14) • Remaining Average Grade 1.80g/t (26/11/14) • Whirling Dervish UG: 1.5mt @ 3.0g/t for 150koz • “All in” sustaining costs decreasing to A$1,075/oz • Karari: Exploration decline STARTED! • Karari drilling to follow up:
• 25m @ 7.9g/t & 19m @ 5.1g/t
For
per
sona
l use
onl
y
Carosue Dam Operations – Red October Cross Section
8
For
per
sona
l use
onl
y
9
Red
Oct
ober
Lon
gsec
tion Started OCT 2011
OCT 2014
10km Dev Milestone: • 20/11/2014 • 266 metres/month • 4.3 meters/day
Updated Mine Plan
Current Drilling
3 Years
For
per
sona
l use
onl
y
Carosue Dam Operations – Red October Long Section (FW)
10
Recent drilling
Exploration drilling
For
per
sona
l use
onl
y
Carosue Dam Operations – Red October (Footwall Lode)
11
Results 26th Nov 2014:
RORD045: 0.7m @ 314.6g/t
ROGC397: 6.9m @ 62.3g/t
ROGC390: 4.9m @ 104.7g/t
Results 10th Sep 2014:
ROGC305: 10.4m @ 11.2g/t
ROGC355: 0.4m @ 93.9g/t
ROGC357: 1.8m @ 216.3g/t
Limit of Ore Reserves (as at 9 October 2014)
Current Drilling
Program
Outside Reserve
For
per
sona
l use
onl
y
12
Red
Oct
ober
Foo
twal
l F
or p
erso
nal u
se o
nly
Red October Village
13
Saracen purchased the Red October village from the hirer
in October 2014 for $1.5m
For
per
sona
l use
onl
y
Carosue Dam Operations – Whirling Dervish & Karari
14
KARARI WHIRLING DERVISH
PROCESSING PLANT
Slides 15 & 16 Sections
Slides 18 & 19 Sections
For
per
sona
l use
onl
y
15
2013 AGM Whirling Dervish
Whi
rling
Der
vish
Cro
ss S
ectio
n F
or p
erso
nal u
se o
nly
16
Whi
rling
Der
vish
Cro
ss S
ectio
n
2014 AGM Whirling Dervish
For
per
sona
l use
onl
y
17
Whi
rling
Der
vish
Gra
de &
Stri
p R
atio
s
INC
REA
SIN
G M
ARG
INS
For
per
sona
l use
onl
y
18
Whi
rling
Der
vish
GC
Dril
ling
Final Pit Design
Hangingwall Lodes
48m @ 3.25g/t
23m @ 2.49g/t
For
per
sona
l use
onl
y
19
Whi
rling
Der
vish
GC
Dril
ling
Final Pit Design
Footwall Lode
18m @ 3.06g/t
10m @ 9.03g/t
For
per
sona
l use
onl
y
20
Whi
rling
Der
vish
Ope
n P
it
November 2014
For
per
sona
l use
onl
y
FY2015 Carosue Dam Mill Feed
21
Mine to ROM (FY2015) Whirling Dervish OP 3.9mt @ 1.7g/t = 207,000con oz (using latest reserves)
ROM to Mill (FY2015) Whirling Dervish OP 2.1mt @ 1.60g/t = 110,000con oz
ROM to Mill (FY2016) Whirling Dervish OP 1.8mt @ 1.70g/t = 97,000con oz
RO ROM to Mill (FY2015) Red October UG 0.3mt @ 6.4g/t = 60,000con oz
Key Points: • All mining costs expensed against rec oz milled in
FY2015 (no non-cash deferrals) • Only requires processing, administration and corporate
costs to realise • Approx A$520/oz AISC for 90,000 rec oz in FY2016
For
per
sona
l use
onl
y
22
Car
osue
Dam
Mill
Pro
duct
ion
For
per
sona
l use
onl
y
FY2013 Delivery
23
FY2013 Reconciliation
Deposit Reserves Actual Variance
Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces
Karari 1,388,000 1.24 55,000 1,274,000 1.48 61,000 -8% +19% +11%
Deep South 221,000 2.30 16,000 210,000 3.90 26,000 -5% +70% +63%
Wallbrook 87,000 1.13 3,000 66,000 1.31 3,000 -24% +16% 0%
Margarets 222,000 1.45 10,000 199,000 1.56 10,000 -10% +8% 0%
Butchers Well 180,000 1.63 10,000 163,000 1.95 10,000 -9% +20% 0%
Red October 98,000 8.33 26,000 116,000 8.30 31,000 18% 0% +19%
Total 2,196,000 1.70 120,000 2,028,000 2.16 141,000 -8% +27% +18%
Highlights: 8% less dilution across all sources (actual versus planned) 20% grade overcall at Karari – trend continued into FY2014… 70% grade overcall at Deep South – deposit subject to future UG mining (FY2017 onwards, min 3 year reserve) 19% ounce overcall at Red October – trend continued into FY2014…
For
per
sona
l use
onl
y
FY2014 Delivery
24
FY2014 Reconciliation
Deposit Reserve Actual Variance
Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces
Karari 191,000 1.72 10,000 134,000 3.35 14,000 -30% +95% +40%
Whirling Dervish 1,953,000 1.03 65,000 1,767,000 1.14 65,000 -10% +11% 0%
Red October 300,000 5.00 48,000 293,000 6.38 60,000 -2% +28% +25%
Total 2,444,000 1.57 123,000 2,194,000 1.97 139,000 -10% +26% +13%
Highlights: 10% less dilution across all sources (actual versus planned) 11% grade overcall at Whirling Dervish – 67% contribution to FY2015 production guidance 28% grade overcall at Red October – 33% contribution to FY2015 production guidance 95% grade overcall at Karari – deposit subject to exploration decline and drilling program in FY2015, followed by production in FY2016…
For
per
sona
l use
onl
y
FY2015 Guidance
25
FY2015 Production (oz)1 Cash Costs (A$/oz)2 AISC (A$/oz)3 Growth Capital (A$m)4
Whirling Dervish OP 101,000 rec oz A$910/oz A$1,075/oz Inclusive in AISC
Red October UG 49,000 rec oz A$800/oz A$1,150/oz Inclusive in AISC
Sustaining Capital Inclusive in AISC Inclusive in AISC
Royalties Inclusive in AISC Inclusive in AISC
Corporate & Interest A$50/oz
Deferred waste adjustment5 Nil Nil
Ore Inventory adjustment5 Nil Nil
Karari Exploration Decline A$9-11m
New TSF (CDO) ~4 year’s life A$4-6m
Exploration (CDO) A$4-6m
Exploration (TBO) A$4-6m
Thunderbox – C&M, Feasibility6 A$5-7m
Total 150,000 rec oz A$875/oz A$1,150/oz A$26-36m
1. Production (oz) is the mid-point of the guidance range provided and represents recovered mill production (oz) 2. Cash Costs (A$/oz) includes cash costs for open pit and underground mining, ore cartage, processing, site administration, exclusive of any accounting adjustments 3. ASIC (A$/oz) represents “All in Sustaining Costs” and includes Cash Costs, royalties, open pit and underground sustaining capital, corporate and interest costs , exclusive of any accounting adjustments 4. Growth Capital (A$m) represents capital incurred to increase production, as opposed to sustain production, and includes regional/greenfields exploration, new acquisitions and development that increases production 5. Non-cash adjustments have been excluded in Cash Costs and AISC’s calculations, therefore represent actual movements in cash 6. Includes Thunderbox Care & Maintenance, feasibility and approvals costs in preparation for a development decision in Q3 FY2015 to re-commence operations in Q2 FY2016
95% complete started 18/11
ongoing started 4/10 ongoing
For
per
sona
l use
onl
y
Tailings Storage Facility
26
• FY2015 Capex $4-6m • ~4 years capacity • $2mpa less working capital
required over next 4 years
For
per
sona
l use
onl
y
Exploration
27
Exploration Budget FY2015
Red October Exploration
($5m)
Bio-Geochemistry & Gravity Surveys
($<1m)
Blue Manna Auger & RC Drilling
(<$1m)
Karari Exploration Decline & Drilling
($10m)
Thunderbox Ops Drilling ($5m)
1-2 Rigs 1-2 Rigs 3 Rigs 2 Rigs 2 Crews
For
per
sona
l use
onl
y
Carosue Dam Operations – Whirling Dervish & Karari
28
KARARI WHIRLING DERVISH
PROCESSING PLANT
For
per
sona
l use
onl
y
Carosue Dam Operations – Karari Exploration *2m intervals
18m @ 5.8g/t
For
per
sona
l use
onl
y
30
Karari Open Pit August 2013
HG
Kar
ari
For
per
sona
l use
onl
y
Carosue Dam Operations – Karari Long Section
31
For
per
sona
l use
onl
y
Carosue Dam Operations – Karari Exploration
32 Looking South
Main Decline
Exploration Drill Drive
Ore Zones
For
per
sona
l use
onl
y
Carosue Dam Operations – Karari Exploration
33
Interpretation Extensions
Exploration Drill Drive
Exploration Drilling
400m
(~4
year
s m
ine
life)
Looking South
Looking West
600m (~4 years mine life)
South Shoot
Central Shoot
North Shoot
For
per
sona
l use
onl
y
Carosue Dam Operations – Karari Exploration
34
18th November 2014
For
per
sona
l use
onl
y
Carosue Dam Operations – Karari Exploration
35
For
per
sona
l use
onl
y
Carosue Dam Operations – Karari Exploration
36 25th November 2014
For
per
sona
l use
onl
y
Carosue Dam Operations – Karari Exploration
37
N D J F M A M J J A S O N DKarari Main Decline
Karari Exploration Decline
Karari Stope Definition Drilling
Karari Exploration Drilling
Karari Exploration Results
Karari Ore Development
Karari Stoping
Exploration FY2015
Gold Ore
FY2016
Legend:Development
Drilling
Results
For
per
sona
l use
onl
y
38
Thun
derb
ox O
pera
tions
F
or p
erso
nal u
se o
nly
39
Consideration: • A$20 million cash on Settlement; • A$3 million cash upon the sooner
of commencement of commercial production, or if, after a period of 24 months following settlement, the prevailing gold price has exceeded A$1,550/oz for a calendar month;
• 1.5% NSR Royalty on the Thunderbox Operations (capped at A$17 million).
Equates to an acquisition cost of A$11 per Resource ounce & A$32 per Reserve ounce
Thun
derb
ox O
pera
tions
F
or p
erso
nal u
se o
nly
Thunderbox 2.5mtpa CIL Plant
40
For
per
sona
l use
onl
y
Thunderbox Open Pit
41
For
per
sona
l use
onl
y
42
Breaking new ground at Thunderbox…
24 November 2014
VM Drilling
Thun
derb
ox E
xplo
ratio
n
DDH1
For
per
sona
l use
onl
y
43
Breaking new ground at Bannockburn…
12 November 2014
Orlando Drilling
Ban
nock
burn
Exp
lora
tion
For
per
sona
l use
onl
y
Thunderbox Development Timeline
44
Settlement
Approvals
Feasibility Study
Thunderbox Extension Drilling
Thunderbox Drilling Results
Bannockburn Infill Drilling
Bannockburn Drilling Results
Development Decision*
Plant Refurbishment
Development
Commissioning
Production
* Subject to positive feasib ility results
Jun QThunderbox Operations FY2016Dec Q Mar Q Jun Q Sep Q Dec Q Mar Q
FY2015
For
per
sona
l use
onl
y
Saracen Exploration
45
Exploration Budget FY2015
Red October Exploration
($5m)
Bio-Geochemistry & Gravity Surveys
($<1m)
Blue Manna Auger & RC Drilling
(<$1m)
Karari Exploration Decline & Drilling
($10m)
Thunderbox Ops Drilling ($5m)
1-2 Rigs 1-2 Rigs 3 Rigs 2 Rigs 2 Crews
For
per
sona
l use
onl
y
46
Thun
derb
ox L
ongs
ectio
n F
or p
erso
nal u
se o
nly
47
Thun
derb
ox C
ross
sec
tion
Zone
“C”
For
per
sona
l use
onl
y
48
Thun
derb
ox C
ross
sec
tion
Zone
“A”
For
per
sona
l use
onl
y
49
Car
osue
Dam
Gra
vity
Sur
vey
Deep South
Carosue Dam
For
per
sona
l use
onl
y
Bio-Geochemistry Survey
50
For
per
sona
l use
onl
y
Blue Manna
51
For
per
sona
l use
onl
y
52
Blu
e M
anna
F
or p
erso
nal u
se o
nly
53
Blu
e M
anna
F
or p
erso
nal u
se o
nly
Exploration Activity
54
Red October Drilling
Red October Results
Karari Exploration Decline
Karari Drilling
Karari Results
Blue Manna Drilling
Blue Manna Results
Thunderbox Drilling
Thunderbox Results
Bannockburn Drilling
Bannockburn ResultsThun
derb
ox
Legend:
Car
osue
Dam
Development
Drilling
Results
Op Exploration Dec Q Mar QFY2015
Jun Q
For
per
sona
l use
onl
y
SAR FY2014 Share Price Performance
55
For
per
sona
l use
onl
y
SAR FY2015 YTD Share Price Performance
56
For
per
sona
l use
onl
y
Gold Price Performance
57
For
per
sona
l use
onl
y
58
H
edgi
ng 5 YEAR GOLD PRICE IN AUD/oz
For
per
sona
l use
onl
y
Points of Difference
59
Delivery • One of Saracen’s core values • Consistently delivery into guidance quarter by quarter over 2.5 years • Resource confidence and reconciliation performance underpins guidance
1
Declining Cost Profile
• AISC set to decrease over A$350/oz to A$1,150/oz (Carosue Dam Operations) • Thunderbox cash costs of A$1,100/oz (approx 5 year mine life) • Increasing margins via declining costs & increasing hedge prices
2
Progressive & Measured
• Carosue Dam Operation forecast to deliver 150,000 ounces per annum • Thunderbox Operations potential to deliver 140,000 ounces per annum • Potential to double production to 290,000 ounces per annum and increase free cashflow
4
Exploration Pipeline
• A$10m regional exploration budget (Carosue Dam & Thunderbox Operations) • A$10m exploration decline & drilling program at Karari (Carosue Dam Operations) • A$5m exploration budget for Red October program
3
Safe Gold Bet • Protection to the downside… via hedgebook, 100% protection in FY2015, ~32% in FY2016 • Leverage to the upside… via our 1.6Moz ore reserve base, with significant upside • Reliable Board & Management, focused on cashflow and delivery
5 For
per
sona
l use
onl
y
Farewell Guido F
or p
erso
nal u
se o
nly
For
per
sona
l use
onl
y
62
Gro
up M
iner
al R
esou
rces
- G
old
For
per
sona
l use
onl
y
63
Gro
up M
iner
al R
esou
rces
- N
icke
l F
or p
erso
nal u
se o
nly
64
Gro
up O
re R
eser
ves
F
or p
erso
nal u
se o
nly
Group Mineral Resources & Ore Reserves
Competent Persons Statement: The information on Exploration Results, Group Mineral Resources and Ore Reserves is extracted from the report entitled “2014 Mineral Resources and Ore Reserves” dated 9 October 2014 This report is available to view on the ASX Website at www.asx.com.au and the Company’s website at www.saracen.com.au. The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and, in the case of estimates of Mineral Resources and Ore Reserves, that all market assumptions and technical assumptions underpinning the estimates in the relevant market announcements continue to apply and have not materially changed. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement.
65
For
per
sona
l use
onl
y
top related