Q Conference Call

Transcription

1 VALUE THROUGH GOLD Q Conference Call Brucejack Mine Delivers Profitability; Significant Cash Build November 9,

2 Cautionary Statement Forward-Looking Information This Presentation contains forward-looking information and forward looking statements future oriented financial information and/or financial outlooks within the meaning of applicable Canadian and United States securities legislation (collectively herein referred to as forwardlooking statements or forward-looking information ). The purpose of disclosing future oriented financial information and financial outlooks is to provide a general overview of management s expectations regarding the anticipated results of operations and costs thereof and readers are cautioned that future oriented financial information and financial outlook may not be appropriate for other purposes. Wherever possible, words such as plans, expects, guidance, projects, assumes, budget, strategy, scheduled, estimates, forecasts, anticipates, believes, intends, modeled, targets and similar expressions or statements that certain actions, events or results may, could, would, might or will be taken, occur or be achieved, or the negative forms of any of these terms and similar expressions, have been used to identify forwardlooking statements and information. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance are not statements of historical fact and may be forward-looking statements. Forward-looking information may include, but is not limited to, information with respect to: production and cost guidance; the refinancing of the Company s construction debt facility; the repurchase of the Company s precious metals stream; anticipated results of our operations; source of funds for future operating and debt settlement requirements; our planned mining, exploration and development activities; our operational grade control program, including plans with respect to our infill drill program and our local grade control model; capital and operating cost estimates; production and processing estimates; the future price of gold and silver; our liquidity and the adequacy of our financial resources; our intentions with respect to our capital resources; our financing activities, including plans for the use of proceeds thereof; the estimation of mineral reserves and resources including the 2016 Valley of the Kings Mineral Resource estimate and the Brucejack Mineral Reserve estimate; realization of mineral reserve and resource estimates; timing of further development of our Brucejack Mine; costs and timing of future exploration and development; results of future exploration and drilling; statements relating to the economic viability of the Brucejack Mine, including mine life, total tonnes mined and processed and mining operations; timing, receipt, and anticipated effects of, and anticipated capital costs in connection with approvals, consents and permits under applicable legislation; our executive compensation approach and practice; our relationship with community stakeholders; litigation matters; environmental matters; our effective tax rate and the recognition of our previously unrecognized income tax attributes; new accounting standards applicable to the Company, including the effects of adoption of such standards; and statements regarding USD cash flows, currency fluctuations and the recurrence of foreign currency translation adjustments. Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to materially differ from those expressed or implied by the forward-looking statements, including, without limitation, those related to: the accuracy of our mineral resource and reserve estimates (including with respect to size, grade and recoverability) and the geological, operational and price assumptions on which they are based; uncertainties relating to inferred mineral resources being converted into measured or indicated mineral resources; commodity price fluctuations, including gold price volatility; general economic conditions; the inherent risk in the mining industry; significant governmental regulations, and such other risks uncertainties and factors as are identified in Pretivm s Annual Information Form dated March 28, 2018, Form 40-F dated March 28, 2018, MD&A and other disclosure documents as filed in Canada on SEDAR at and in the United States through EDGAR at the SEC s website at (collectively, the Pretivm Disclosure Documents ). Our forward-looking statements are based on the assumptions, beliefs, expectations and opinions of management on the date the statements are made, including those set out in the Pretivm Disclosure Documents, many of which may be difficult to predict and beyond our control. Although we believe that the assumptions inherent in the forward-looking statements are reasonable as of the date the statements are made, forward-looking statements are not guarantees of future performance and, accordingly, undue reliance should not be put on such statements due to the inherent uncertainty therein. We do not assume any obligation to update forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by applicable law. For the reasons set forth above, prospective investors should not place undue reliance on forward-looking statements. 2

3 Notes to Investors 3 National Instrument Technical and scientific information contained herein relating to the Projects is derived from National Instrument ( NI ) compliant technical reports ( Reports ), Measured, Indicated, and Inferred Mineral Resource Update dated July 21, 2016, Feasibility Study and Technical Report on the Brucejack Project, Stewart, BC dated June 19, 2014, Mineral Reserve Update dated December 15, 2016, and capital cost update dated February 3, We have filed the Reports and Update under our profile at Technical and scientific information not contained within the Reports for the Projects have been prepared under the supervision of Mr. Ivor W.O. Jones, M.S.c., FAusIMM, Cpgeo, Mr. Kenneth C. McNaughton, P.Eng., Ian Chang, P.Eng., Mr. Russell Pennel, B.A.S.c., P.Eng., Warwick Board, Ph.D., P.Geo, Pr.Sci.Nat., and Mr. Lyle Morgenthaler, B.A.S.c., P.Eng. each of whom is an independent qualified person under NI This presentation uses the terms measured resources, indicated resources (together M&I ) and inferred resources. Although these terms are recognized and required by Canadian regulations (under NI ), the United States Securities and Exchange Commission does not recognize them. Mineral resources which are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues. There is no guarantee that all or any part of the mineral resource will be converted into mineral reserves. In addition, inferred resources have a great amount of uncertainty as to their existence, and economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre feasibility studies, or economic studies, except for a Preliminary Assessment as defined under NI Investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable. Non-IFRS Financial Performance Measures The Company has included certain non-ifrs measures in this new release. Refer to the Company s MD&A for an explanation and discussion of non-ifrs measures. The Company believes that these measures, in addition to measures prepared in accordance with IFRS, provide investors an improved ability to evaluate the underlying performance of the Company and to compare it to information reported by other companies. The non- IFRS measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with International Financial Reporting IFRS. These measures do not have any standardized meaning prescribed under IFRS, and therefore may not be comparable to similar measures presented by other issuers. The non-ifrs financial measures included in this presentation include: total cash costs and total cash costs per ounce of gold sold, all-in sustaining cost ( AISC ) and AISC per ounce of gold sold, adjusted earnings or loss, adjusted earnings or loss per share, earnings from mine operations, and average realized price per ounce of gold sold. Please refer to the Non-IFRS Performance Measures section of the Company s MD&A filed on SEDAR at and in the United States through EDGAR at the SEC s website at for a detailed discussion and reconciliation of the non-ifrs measures to the most directly comparable IFRS measures. The Company believes that in addition to conventional measures prepared in accordance with IFRS, the Company and certain investors and analysts use this information to evaluate the Company s performance. In particular, management uses these measures for internal valuation for the period and to assist with planning and forecasting of future operations. The presentation of non-ifrs measures is not meant to be a substitute for the information presented in accordance with IFRS. Currency Unless otherwise indicated, all dollar values herein are in US $.

4 Brucejack Mine Delivers Profitability; Significant Cash Build Source: See News Releases dated November 8, 2018 and refer to Company s Financial Statements and MD&A. (1) Non-IFRS performance measure. For reconciliation to IFRS measures refer to the Company s MD&A. 4 Q3 Summary 92,641 ounces gold produced $110.1 million in revenue $709 per ounce sold AISC 1 $26.3 million adjusted earnings 1 $190.3 million cash at September 30, 2018 Repurchase of Stream Agreement Refinance Credit Facility

5 Production Profile Brucejack Quarterly Gold Production 1 Q Q , Gold Ounces Produced 100,000 80,000 60,000 40,000 20,000 0 Q Q Q Q Q Gold Grade (g/t) Gold Ounces Gold Grade (g/t) (1) See News Release dated Oct 11, 2017, Mar 8, 2018, Apr 11, 2018, July 9, 2018 & Oct 9, 2018 and refer to Company s Financial Statements and MD&A. 5

6 On Track to Reach H2 Guidance 450, Gold Production Guidance (oz) All-in Sustaining Cost ($ per oz sold) 1 400, , , , , , ,000 FY 2018 Guidance 92,641 oz Q Production 187,029 oz H Production 407, ,000 H Guidance 200, ,000 oz H Guidance Q AISC $709/oz ,000 0 Source: See News Release dated Nov 10, 2017, Mar 8, 2018, May 10, 2018, Aug 9, 2018 & Nov 8, 2018 and refer to Company s Financial Statements and MD&A. (1) Non-IFRS performance measure. For reconciliation to IFRS measures refer to the Company s MD&A 6

7 Source: See News Releases dated Nov 10, 2017, Mar 8, 2018, May 10, 2018, Aug 9, 2018 & Nov 8, 2018 and refer to Company s Financial Statements and MD&A. 7 Consistently Profitable 240% Increase in Cash $200.0 Cash Build Q Q $190.3 M Balance 120,000 Millions USD $150.0 $100.0 $ ,000 80,000 60,000 40,000 20,000 Gold Ounces Produced $0.0 Q Q Q Q Q Gold Ounces Produced Cash Balance

8 Financial Performance 8

9 Financial Performance Revenue Q Q ,000 $150.0 Millions USD $100.0 $50.0 $110.1 M 100,000 50,000 Gold Ounces Sold $0.0 Q Q Q Q Q Gold Ounces Sold Revenue Q Q Q Gold Ounces Produced 82,203 oz 111,340 oz 92,641 oz Gold Ounces Sold 55,413 oz 115,309 oz 94,458 oz Average Realized Price 1 $1,281/oz $1,278/oz $1,169/oz Revenue $70.9 M $146.5 M $110.1 M Source: See News Release dated Nov 10, 2017, Mar 8, 2018, May 10, 2018, Aug 9, 2018 & Nov 8, 2018 and refer to Company s Financial Statements and MD&A. (1) Non-IFRS performance measure. For reconciliation to IFRS measures refer to the Company s MD&A 9

10 Source: See News Release dated Nov 10, 2017, Mar 8, 2018, May 10, 2018, Aug 9, 2018 & Nov 8, 2018 and refer to Company s Financial Statements and MD&A. (1) Non-IFRS performance measure. For reconciliation to IFRS measures refer to the Company s MD&A 10 Financial Performance $150.0 Cost of Sales Q Q ,000 Millions USD $100.0 $ ,000 $72.5 M 50,000 Gold Ounces Sold $0.0 Q Q Q Q Q Gold Ounces Sold Revenue Cost of Sales 0 Q Q Q Total Cash Costs 1 $36.4 M $63.2 M $53.7 M Per Ounce Sold $656/oz $548/oz $568/oz Cost of Sales $44.9M $86.4 M $72.5 M Per Ounce Sold $810/oz $749/oz $767/oz

11 Financial Performance Net Earnings Q Q Q Earnings from Mine Operations 1 $26.0 M $60.1 M $37.6 M Corporate Administrative Costs ($2.5 M) ($3.4 M) ($3.1M) Operating Earnings $23.4 M $56.7 M $34.5 M Interest and Finance Expense Financial Instruments at Fair Value ($14.8 M) ($16.0 M) ($16.0 M) ($14.2 M) $3.6 M ($7.3 M) Taxes ($0.3 M) ($13.2 M) ($0.8 M) Net Earnings (loss) ($7.0 M) $31.1 M $10.7M Source: See News Releases dated Aug 9, 2018 & Nov 8, 2018 and refer to Company s Financial Statements and MD&A. (1) Non-IFRS performance measure. For reconciliation to IFRS measures refer to the Company s MD&A. 11

12 Financial Performance Net and Adjusted Earnings Q Q ,000 $ ,000 Millions USD $25.0 $0 $26.3M $10.7M 100,000 75,000 v 50,000 25,000 v 0 Gold Ounces Sold -$10.0 Q Q Q Q Q ,000 v Gold Ounces Sold Adjusted Net Earnings Net Earnings Q Q Q Net Earnings ($7.0 M) $31.1 M $10.7M Per Share ($0.04) $0.17 $0.06 Adjusted Earnings 1 $14.0 M $47.0 M $26.3 M Per Share 1 $0.08 $0.26 $0.14 Source: See News Release dated Nov 10, 2017, Mar 8, 2018, May 10, 2018, Aug 9, 2018 & Nov 8, 2018 and refer to Company s Financial Statements and MD&A. (1) Non-IFRS performance measure. For reconciliation to IFRS measures refer to the Company s MD&A 12

13 All-In Sustaining Cost (AISC 1 ) Q Q Q Gold Ounces Sold 55,413 oz 115,309 oz 94,458 oz Total Cash Costs 1 $36.4 M $63.2 M $53.7 M Sustaining Capital Expenditures Treatment and Refinery Charges Accretion on DRP and Site Share Based Compensation Corporate and Administrative AISC Components $3.5 M $3.2 M $5.2 M $1.0 M $4.2 M $4.3 M $0.3 M $0.8 M $0.7 M $2.5 M $3.4 M $3.1 M Total AISC 1 $43.7 M $74.7 M $67.0 M Per Ounce Sold $788/oz $648/oz $709/oz Source: See News Releases dated Aug 9, 2018 & Nov 8, 2018 and refer to Company s Financial Statements and MD&A. (1) Non-IFRS performance measure. For reconciliation to IFRS measures refer to the Company s MD&A. (2) May not add due to rounding. 13

14 Liquidity Q Cash Balance Cash on Hand (June 30, 2018) $142.5 M Cash Generated from Operations $52.4 M Capital Expenditures ($10.8 M) Other Investing & Financing Activity Cash on Hand (Sept 30, 2018) $6.2 M $47.8 M $190.3 M Source: See News Releases dated Aug 9, 2018 & Nov 8, 2018 and refer to Company s Financial Statements and MD&A. 14

15 Organic Growth Opportunities 15

16 Mill Throughput Increase to 3,800 tpd Low Capital Investment of ~US$25M : 40% Increase in Production Rate (1) One Third of Total Gold Production Two Thirds of Total Gold Production 96.7% GOLD RECOVERY (LOM) (1) Increase production rate to 3,800 t/d from 2,700 t/d. Pending permit application approval; see News Release dated Dec 21,

17 Bowser Regional Exploration Brucejack Boulder Zone N 30 km Koopa Zone Pretivm Claim Outline Surface Sampling /135km Pre 2011 Bluffy Zone Regional exploration program; see News Release dated Dec 5, 2017 American Creek Zone 5 km 17

18 Low Cost Producer Positioning Relative to Peers 1300 ) Pretivm vs Peers YTD 9 Month Gold Production and AISC (1) 1200 Tahoe Detour AISC 2 (US$) Guyana Argonaut Asanko Semafo Torex Pretivm Eldorado Alamos Oceana Endeavor Kirkland IAM Gold B2 Gold Yamana Randgold 700 Alacer Gold Production (000 s oz) (1) Source: Company websites Nine Months YTD 2018 AISC and gold production. (2) All-in Sustaining Cost (AISC) is non-ifrs performance measure. For reconciliation to IFRS measures refer to the Company s MD&A. 18

19 2018 Catalysts for Success 19 Repurchase Stream Notice given to repurchase precious metals stream No need to raise equity Refinance Credit Facility Commitment letter secured for $480M Expected to close this quarter Deliver on Guidance On track to meet H2/18 guidance

20 Appendix pretivm.com PVG : TSX/NYSE 20

21 Shareholding & Analyst Coverage 21 Equity Structure (1) (shares in millions) Issued & Outstanding Market Cap (Nov 8, 2018) Analyst Coverage BMO Canaccord Genuity CIBC Citi Cormark Securities Global Mining Research H.C. Wainwright Numis RBC Roth Capital Partners Scotiabank Fully Diluted (1) As of November 8, 2018; ownership calculated on an undiluted basis. (2) As of November 8, Source: IPREO, Morningstar Inc. & SEDAR. US$1.33 B Andrew Kaip Rahul Paul David Haughton Alexander Hacking Richard Gray David Radclyffe Heiko F. Ihle Jonathan Guy Dan Rollins Joseph Reagor Ovais Habib Top Shareholders (2)` (% S/O) Van Eck Associates 12.5 Black Rock Asset Management 12.2 Letko, Brosseau & Associates 4.7 BMO Asset Management 3.9 Rothschild Asset Management 3.7 Wellington Management 3.4 JP Morgan Securities 2.9 Orion Mine Finance 2.5 Sun Valley Gold 2.2 Pretivm Management 1.8

22 Third Quarter 2018 Select Operating Results Three months ended September 30, Nine months ended September 30, (1) Ore mined t 255, , , ,534 Mining rate tpd 2,774 2,951 2,828 2,951 Ore milled t 240, , , ,262 Head grade g/t Au Recovery % Mill throughput tpd 2,610 2,840 2,705 2,840 Gold ounces produced oz 92,641 82, ,670 82,203 Silver ounces produced oz 95,741 83, ,676 83,233 Gold ounces sold oz 94,458 55, ,417 55,413 Silver ounces sold oz 87,110 19, ,710 19,846 The following abbreviations were used above: t (tonnes), tpd (tonnes per day), g/t (grams per tonne), Au (gold) and oz (ounces). (1) Data for the nine months ended September 30, 2017 covers the period commencing from July 1, 2017, the date the Brucejack Mine achieved commercial production,to September30, Source: See News Releases dated Nov 8, 2018 and refer to Company s Financial Statements and MD&A. 22

23 Third Quarter 2018 Select Financial Results In thousands of USD, Three months ended September 30, Nine months ended September 30, except for per ounce data (1) Revenue $ 110,060 70, ,960 70,875 Earnings from mine operations (2) $ 37,608 25, ,512 25,963 Net earnings (loss) for the period $ 10,734 (6,975) 33,773 (13,733) Per share - basic $/share 0.06 (0.04) 0.19 (0.08) Per share - diluted $/share 0.06 (0.04) 0.19 (0.08) Adjusted earnings (2) $ 26,327 13,951 79,172 4,684 Per share - basic (2) $/share Total cash and cash equivalents $ 190,318 53, ,318 53,774 Cash generated from operating activities 52,364 47, ,358 39,913 Total assets $ 1,771,543 1,673,601 1,771,543 1,673,601 Long-term debt (3) $ 59, ,975 59, ,975 Total cash costs (2) $/oz All-in sustaining costs (2) $/oz Average realized price (2) $/oz 1,169 1,281 1,239 1,281 Average realized cash margin (2) $/oz (1) Data for the nine months ended September 30, 2017 covers the period commencing from July 1, 2017, the date the Brucejack Mine achieved commercial production, to September 30, (2) Refer to the "Non-IFRS Financial Performance Measures" section for a reconciliation of these amounts. (3) Long-term debt does not include the current portion of the Company s senior secured Credit Facility and the Stream Obligation in the amount of $641,468 as at September 30, Source: See News Releases dated Nov 8, 2018 and refer to Company s Financial Statements and MD&A. 23

24 Brucejack Mine pretivm.com Phone: Fax: Toll-free: Pretium Resources Inc. Suite Dunsmuir St. Four Bentall Centre PO Box Vancouver, BC, Canada V7X 1L4 PVG : TSX/NYSE 24