going for gold - investor relations: investor &...
TRANSCRIPT
1
January 2013
Going for Gold
2 January 2013
Disclaimer
This document may contain statements that constitute “forward-looking statements”, including, but not limited to, statements
relating to the implementation of strategic initiatives, and other statements relating to our future business development and
economic performance. While these forward-looking statements represent our judgments and future expectations
concerning the development of our business, a number of risks, uncertainties and other statutory requirements may render
actual developments and results to differ materially from our expectations. These factors include, but are not limited to, (1)
general market, macro-economic, governmental and regulatory trends, (2) movements in local and international securities
markets, currency exchange rates and interest rates, (3) competitive pressures, (4) technology developments, (5) changes in
the financial position or creditworthiness of our customers, obligors and counterparts, and changes in the developments in
the markets in which they operate, (6) legislative developments, (7) management changes and changes to our business
group structure and (8) other key factors that may adversely affect our business and financial model.
We are not under any obligation to (and expressly disclaims any such obligations to) update or alter its forward-looking
statements whether as a result of new information, future events or otherwise. The technical and financial information
presented are best estimates of management and are not JORC or NI43-101 compliant unless otherwise stated. Investors
are cautioned not to place undue reliance on this information and not rely solely on the information presented for purposes of
making investment decisions. This material may not be reproduced, distributed or transmitted to any other person or
incorporated in any way into another document or other material without the prior written consent of LionGold.
3 January 2013
LionGold Corp Ltd
Asia’s Own - Global Gold Company
SGX’s only Main Board-listed gold company
Market Value: S$975m / US$787m
Average Daily Trading Value: S$20-25m / US$16-20m
• MSCI Small Cap, Global + Singapore
• FTSE ST Mid Cap
• Supportive of global listings
• New focus on resource stocks, gold
• Active, diversifying investor base
Mid Cap
Liquid
Index
Inclusion
SGX-listed
Source: ShareInvestor 30 January 2013
Share price : S$1.065
52wk high/low : S$1.30/0.865
Shares in issue : 915.5m
Bloomberg : LIGO SP
Gold
Investments
Prioritising
Business
Index
Inclusion
Key
Acquisitions
New Inst’l
Shareholders
Warrant price : S$0.112
Warrants in issue : 269.9m
Bloomberg : R5UW SP
Board, Shareholder
Changes
4 January 2013
LionGold Corp - Going for Gold
Dynamic, Expanding Operations • Gold mining, from 2011
• Five projects
- One in commercial production
• Initial growth acquisition-led, value accretive
- 5.5m oz acquired in 2012 at US$26/oz, US$126m (S$154m)
LionGold Resources
(ounces)
Reserves (ounces)
Production Target
Annualised (ounces)
Current 5,506,000 897,300 40-50,000
Target 2014 10,000,000 2,000,000 200,000
Figures are extracted from previous JORC- and NI 43-101-compliant
announcements and are based on LionGold’s equitable stake in gold projects.
Differentiated Business Platform
Proactively managed project portfolio
Financial flexibility
Growth - 2-3 acquisitions pa
- Financial backing
- Operational support
• 3 acquisitions
• 1 IPO
• Funding partners Value - 1 IPOs pa
- Funding partners
- Low debt, dilution
Acquire scalable
junior miners at
attractive discounts
Augment
shareholder
returns
5 January 2013
Key Mining Assets…Today
- 5.5m oz Gold Resources since March 2012 at US$26/oz
AFRICA
AMERICAS AUSTRALIA
Castlemaine Goldfields Central Victoria
Minera Nueva Vista
Amayapampa, Bolivia
Signature Metals (76%)
Ashanti Gold Belt, Ghana
Citigold Corp (17.69%) Queensland
Brimstone Resources Western Australia
6 January 2013
Opportunity: Junior gold miners - Consolidation of a highly fragmented sector
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BOOM Rising gold prices
Easy credit
CONSOLIDATE Stagnant gold prices
Credit constrained
Gold Prices vs Junior Miner Index Dec 2002 – Dec 2012
Dow Jones North American Select Junior Miner Gold Total Return Index
Spot Price of Gold
Cost & time overruns
Discovery + production gaps
Risk adversity: banks and shareholders
Funding
Shortfall
Substantial Discounts
7 January 2013
Shareholder return +36%
Global Junior Miners : -16% STI : 24%
ST Mid-Cap : 31%
2012, US$
2012, US$
Delivering Value
Natural born gold bugs, and:
Retail
Few listcos regionally
PE Fund restrictions - Out-of-reach for many
LGC vs Junior Miners - Differently positioned, sustainable strategy
vs Junior Miners
Risk / Reward Imbalance
Funding • Poor bankability • Illiquid shares • Limited audience • High dilution risk
Geographic limitations
Plentiful: ASX, TSX, AIM
Operational • Single asset entity • Recruitment constraints • Technical restricted • Vendor terms
Institutions
LionGold Corp
Liquid, Diversified, Returns-focused
Funding • Strong balance sheet • Institutionally traded • Global funding alliances • In-house CF ability
Global assets, funding base
Unique position: SGX, Asia, globally
Operational • Diversified projects • Recruitment allure • Int’l technical team • Vendor leverage
Market cap +65%
8 January 2013
Other Asian-listed Goldcos - Single-project / country focus
Company Bourse Market
Cap
Ave Dly
Trading
Volume Resource Operations
LionGold Corp SGX
Main Board US$820m US$15m 5.5m oz 5 Projects: Australia, Africa, LatAm
CNMC Goldmine SGX
Catalist US$145m US$0.2m 0.5m oz Malaysia, Sokor project
G-Resources HSE US$950m US$2.5m 8.1m oz Indonesia, Martabe project
Zhaojin Mining HSE
H-Share US$4.3b US$12m 25m oz Projects in China, in production
China Gold ,,,
HSE US$1.14b US$0.8m 14m oz Projects in China, in production
Zijin Mining HSE
H-Share US$12b US$12m 30m oz Projects in China, in production
Lingbao Gold HSE
H-Share US$334m US$0.5m 1.4m oz Projects in China, in production
China Precious
Metals HSE US$800m US$1m 7.2m oz
Projects in China, Mongolia,
in production
14 January 2013
9 January 2013
Acquisition Strategy - Accelerate Value Creation
• EV < US$50 oz
• Investment up to US$100m
• > 500,000 oz gold resource
• Turnaround: 6-18 months
• Low / no debt
• Willing seller
• Competent management
• Assets vs companies
LGC ALLURE
• Shares ≈ cash
• SGX-listed
• De-risking of assets
- Geographic
- Funding access
- Lower dilution risk
• Broader opportunities
- Bigger, global group
SCREENING
Junior miners globally
10 January 2013
End Production
Exploration
Targeting the “Sweet Spot” - Assets-in-the-Ground
Mining Project Life Cycle
Pre- Feasibility
Feasibility Study Scoping Study
Extension
Valu
e Ris
k
5-10% 10-20%
Brownfields
Greenfields
Indicative Capital Allocation
70-85%
Maximise Value,
Mitigate Risk
Development
Production
11 January 2013
Geographically diversified - Risk Management
Developed Stable business environment
Infrastructure, skilled labour, funding
Can be high-cost
Australia Established global mining industry
Excellent skills-base
Many junior miners
45%
10%
“De-risking” Investment & Resource
Friendly Emerging
Developed
Friendly Emerging Bigger opportunities
Lower entry cost
Ghana, Ashanti Gold Belt Stable, foreign-friendly
Established gold industry
Highly prospective, scalable
“Challenging” Good value
Bolivia Relationships key
Bolivia 6%
“Challenging”
BMT
CTO
CGT
Australia 60%
Ghana 34%
12 January 2013
Operating Objectives - Balance & Prioritise
Mine Profile
Resource expansion
Reserve replacement
Production stable, growing
Increasing Li fe of Mine
Prioritise
Community
Environment, Health, Safety
Education & Training
P r o d u c t i o n E f f i c i e n c y
13 January 2013
Results delivered - Going forward
Bolivia Developments
Castlemaine Goldfields
Signature Metals
Minera Nueva Vista
Brimstone Resources
Acquire
“Gold in the Ground”
Fortify
the Business
2012 2013 2014
Divest Non-Core Assets
Raise production
Increase ozs
Integrate resources
Grow team, alliances
Expanded Funding Options
Project IPO Project financing
Complementary
Acquisitions
10 million oz Resource
2 million oz Reserve
200,000 oz pa Production
5 year LOM
Ongoing
Initiatives
Shareholder Return
Minimise Volatility
Raise Transparency
Mitigate Balance Sheet Risk
Strategic Investment
Citigold Corporation (18%)
Global
Gold Co
36% Shareholder Return 2012, US$
14 January 2013
Optimise Funding : Projects - Maximise Growth, Protect Shareholders + Balance Sheet
LGC Market cap
~ US$820m
Grow • Bankable assets
• Gold production
• Fee income
Execution of 100 day +
2 year business plans
Fund • Listing of subsidiaries
• Project financing
• Venture capital
• Structured options
Mitigate equity dilution,
Maintain strong balance sheet
Invest
Undervalued gold interests
Up to 20% of share capital
per annum
Project
Development
Strategy
Self-fund
Grow market cap
• List cos
• Private Companies
• Assets
2-3 acquisitions yearly
15 January 2013
Shareholding Structure - Local HNW + Retail, Growing Institutional
Asian Institutional Investors
- Pension, mutual, sovereign
• Dedicated Singapore, Malaysia, ASEAN + commodity-focused funds
• Few investable metals / gold stocks, in Southeast Asia
Global Institutional Investors
- Boutique, Private Equity
• Diminished selection of mid-cap gold companies
• Few Asian-listed options
Retail Investors
- Singapore, Malaysia, HK/China
• Gold Bugs, news flow sensitive
• Limited investment options vs US, UK, Australia, Canada
• Private Equity vehicles: largely available only to HNW investors
Broadening Investor Base
Asiasons Capital Ltd 8.5%
Dato’ Md Wira Dani Bin Abdul Daim
6.4%
Van Eck: Market Vector Junior Gold Miners ETF
5.8%
Tan Sri Dato’ Nik Ibrahim Kamil
4.4%
30 January 2013
SGX-listed private equity group; early investor
Non-Executive Director
Non-Executive Director
Among other noteworthy institutional investors are Weiss Capital, Nomura, Macquarie and Credit Suisse
16 January 2013
Healthy Balance Sheet - As at 30 September 2012
Convertible Bond – US$23m
• 9% coupon, due 2015
• Placed with institutional investors
• Convertible into 24.8m new LGC shares
Warrants - 1:4 – S$15m • 229m warrants
• Issue price of 6.5¢, strike price of S$1.1717
• 1:1 exchange into new LionGold shares
• Valid for 3 years from issue, SGX-listed
• Raised S$15m, up to S$268m on warrant conversion
Placement – S$47m • 42m new shares at S$1.056 each
+ 41m detachable warrants at 6.5¢
• New shares to rank pari passu with existing shares
• Raised S$47m, up to S$48m on warrant conversion
Oct
2012
S
ep
2012
M
ay
2012
Non-core assets divestment to raise a further S$29m by 1H13
Assets
Current assets
Non-current assets
Total Assets
Current liabilities
Non-current
Total Liabilities
NET ASSETS
S$m
143.8
159.4
303.2
65.3
50.5
115.8
187.4
17 January 2013
Core Management Team - Seasoned financial & technical expertise
CEO & MD Nicholas Ng
Board of Directors
General Counsel Raymond Tan
COO Matthew Gill
• Also Executive Director and
Company Secretary
• Provided legal advisory to
LionGold since 2007.
• Over 30 years legal experience
including 15 years with
Robert Wang & Woo LLP
where he was Partner, and
Head of the Corporate &
Commercial Department.
• 18 years in investment
banking and corporate
advisory in Asia-Pacific.
• Former Corporate Finance,
Co-Head for DMG Partners
and Corporate Finance Head
for HL Bank.
• Former CFO of SGX-listed
Darco Water Technologies.
• Mining engineer with over 30
years experience in all
aspects of exploration and
mining in Australia, India and
Papua New Guinea.
• Turned around Ballarat Mine
for Castlemaine and the
Beaconsfield Mine, Tasmania.
• Australian Mine Manager of the
Year for 3 years.
•17 years as a corporate
lawyer, including acting as
general legal counsel for public
listed companies.
• 7 years actively involved in the
setting up of iron ore and gold
mining operations around the
world, from Mali to Mongolia.
• Spearheading LionGold’s
M&A effort globally.
• 28 years in financial markets.
• Former CEO of DMG Partners, and MD of
Singapore-based investment Bank,
Citicorp. Also previously Head of Asia
Investment Banking at Rabobank.
•Concluded numerous IPO, M&A,
privatisations and other financial
transactions in Asia-Pacific.
CFO Brendan Goh
Corporate & Business Development Director
Peter Chen
• Audit Committee
• Remuneration Committee
• Nomination Committee
• Technical Committee - Dr Denis Clarke - Gary Scanlan
18 January 2013
Group Structure
- As at January 2013
Signature Metals
76%
Castlemaine Goldfields
100%
100%
18% Citigold Corporation
Operations
Brimstone Resources
Owere Mines
70%
Minera Nueva Vista
100%
Board of Directors
LionGold
Corp Ltd
Investment
Tan Sri Dato’ Nik Ibrahim Kamil
Non-Executive Chairman
Over 45 years managerial and business experience across a range of industries, including mining, media, financial, energy and infrastructure.
Asiasons WFG Financial Chairman. Actively involved in resource M&A in Asia and Africa and banking in sub-Saharan Africa.
Professionally qualified accountant with affiliations in the UK, Australia and Malaysia with experience in Australia, Southeast Asia and South Africa.
Over 40 years experience in senior technical, financial and management roles in the mining industry globally, including with Rio Tinto and Plutonic.
Ten years with PwC, followed by more than two decades evaluating, developing, financing and administrating mining projects globally.
Twenty years of legal practice with a broad range of experience ranging from litigation and conveyance to corporate and commercial matters.
Accountant with extensive experience in project development, finance and business development throughout Asia.
Nicholas Ng Chief Executive Officer and Managing Director
Raymond Tan General Counsel and
Executive Director
Dato’ Md Wira Dani Abdul Daim
Non-Executive Director
Roland Selvanayagam
Independent Non-Exec Director
Dr Denis Clarke Independent
Non-Executive Director
Gary Scanlan Independent
Non-Executive Director
Lynne Ng Su Ling Independent
Non-Executive Director
Bernard Soo Independent
Non-Executive Director
Former CEO of DMG Partners and MD of Singapore-based investment bank, Citicorp. Also previously head of Asia investment banking at Rabobank.
Over 30 years legal experience including 15 years with Robert Wang & Woo LLP where he was Partner and Head of the Corporate & Commercial Department.
19 January 2013
On track for 2014 target - 5.5 million gold ounces acquired in 9 months
Figures are extracted from previous JORC- and NI 43-101-compliant announcements. Resources include Reserves. For Projects in which LionGold has a controlling
stake, the Resources and Reserves are based on 100% of the Project’s holding. For Citigold Corporation, Resources and Reserves are based on LionGold’s 17.69%
equitable holding of the Charters Towers Project’s 11 million ounces of gold Resources, inclusive of 620,000 ounces of Reserves.
Company LGC
Interest Country Project
Resources (ounces)
Reserves (ounces)
Production Target
Annualised (ounces)
Castlemaine Goldfields 100% Australia Castlemaine 686,000 ̅ 40-50,000
Ballarat 71,700 ̅ 20-30,000
Signature Metals 76% Ghana Konongo 1,470,000 ̅ 20-25,000
Minera Nueva Vista 100% Bolivia Amayapampa 1,280,000 787,300 20-30,000
Brimstone Resources 100% Australia Penny’s Find 52,300 ̅ Under review
Citigold Corporation 17.69% Australia Charters Towers 1,946,000 110,000 20-30,000
Total 5,506,000 897,300 120-165,000
TARGET 2014 10,000,000 2,000,000 200,000
20 January 2013
Castlemaine Goldfields Ltd
- High grade nuggety ore
Excellent facilities in established gold region,
Central Victoria, Australia Five concessions in total with JORC Resources
in Ballarat (producing) and Castlemaine
Ballarat Mine production at 40-50,000 oz pa - Ore processing capacity of 600,000 tpa
- Ramped up from ~mid-2012
- Cash Operating Costs <US$800/oz
- Further reduction in costs and improvement in gold recovery in 2013 Life of mine + production enhancement through ongoing extension and exploration
Resource Gold (ounces)
Tonnage (tonnes)
Grade (g/t)
Castlemaine 686,000 2,760,000 7.7
Ballarat 71,700 263,000 8.5
Total 757,700 3,023,000 7.9 Figures indicate historical gold production at Castlemaine Goldfields’
five tenements 100% owned by LionGold from October 2012
Figures shown are based on previously quoted JORC-compliant statements
21 January 2013
Flagship Owere Mines (70% owned) has
the Konongo Gold Project, Ghana
192 km2 concession in Ashanti Gold Belt
- 16 known gold deposits, 12 km strike
- 80 km along strike from Ashanti AngloGold’s >200,000 oz pa, 30m ounce Obuasi mine
Substantial untapped high-grade UG potential
Now managed in-house
Signature Metals Ltd - Prioritising exploration targets
Konongo
Gold
Project
Resources1 Gold
(ounces) Tonnage (tonnes)
Grade (g/t)
Measured & Indicated 779,600 13,100,000 1.9
Inferred 687,100 10,500,000 2.0
Total 1,466,700 23,600,000 2.0
76.22% owned by LionGold as at April 2012 and listed on the ASX.
Figures shown are based on previously quoted JORC-compliant statements.
22 January 2013
Minera Nueva Vista - Acquisition complete
Amayapampa Project Amayapampa Gold Project, Bolivia
Resources of 1.28m oz, inclusive of 787,000 Reserves
- NI 43-101 compliant
Owns the rights to 38 overlapping concessions totaling
34 km2, located 290 km southeast of La Paz
Options for an open pit facility under review
Foothold in Latin America
Amayapampa
Category Gold
(ounces) Tonnage (tonnes)
Grade (g/t)
Reserves
Probable 787,300 18,900,000 1.3
Resources
Indicated 979,637 26,160,000 1.2
Inferred 300,363 8,750,000 1.1
Total Resources 1,280,000 34,910,000 1.2
100% owned by LionGold from December 2012.
Resource is inclusive of Ore Reserves. Figures based on previously quoted NI 43-101-compliant statements
23 January 2013
Brimstone Resources Ltd - Early to open pit production
Prospective tenements in Western Australia
and near Castlemaine in Victoria
Penny’s Find Project (aka “Golden Feather”)
- Near mining town of Kalgoorlie
- 36 mining leases covering 59 km2
- Resources of 52,300 oz based on prelim drilling
Scope to initiate open pit operations
- Contract mining
- Third party processing of ore concentrate
Stawell East, Central Victoria
- Within proximity to Castlemaine’s processing
facility at Ballarat
Brimstone Projects
Stawell East
Penny’s Find
Penny’s
Find
Resources Gold
(ounces) Tonnage (tonnes)
Grade (g/t)
Measured 11,200 79,000 4.4
Indicated 16,900 132,000 4.0
Inferred 24,200 103,000 7.3
Total 52,300 314,000 5.2
100% owned by LionGold from October 2012
Figures shown are based on previously quoted JORC-compliant statements
24 January 2013
Citigold Corporation Ltd - 17.69% strategic investment
Charters Towers Project Charters Towers tenements near
Townsville, Queensland
“Australia’s highest grade gold field” - 56 mineral holdings spanning >1,500 km2
- Significant Life of Mine potential, >10 years
Ore processing capacity of 340,000 tonnes
Ripe for review, revamp
ASX-listed, 17.69% owned by LionGold from December 2012.
Refer to www.citigold.com for JORC-compliant statements.
Indicated Resources includes Probable Reserves, and Inferred Resources includes Indicated Resources.
Charters
Towers
Category Gold
(ounces) Tonnage (tonnes)
Grade (g/t)
Reserves
Probable 620,000 2,500,000 7.7
Resources
Indicated 780,000 3,200,000 7.6
Inferred 11,000,000 25,000,000 14
Charters Towers
25 January 2013
LionGold Corp Ltd 59 Mohamed Sultan Road
Sultan Link 02-08
Singapore 238999
T: +65 6690 6860
F: +65 6690 6844
www.liongoldcorp.com
Thank you
w w w . l i o n g o l d c o r p . c o m