Going for Gold August 2013

Transcription

1 Going for Gold 3

2 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 NI 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. 4

3 Asia s Own - Global Gold Company LionGold Corp Ltd Mid Cap Liquid Market Capitalisation: S$1.1 billion / US$900 million Average Daily Trading Value: S$20-25 million / US$16-20 million Share price : S$ wk high/low : S$1.28/1.035 Shares in issue : 921.9m Bloomberg : LIGO SP 36% shareholder return in 2012 Warrant price : S$0.178 Warrants in issue : 269.9m Bloomberg : R5UW SP New Inst l Shareholders Business Integration Index Inclusion SGX-listed MSCI Small Cap, Global + Singapore FTSE ST Mid Cap Market Vector Global Junior Gold Miners Supportive of global listings New focus on resource stocks, gold -- still a unique investment option Active, diversifying investor base Board, Shareholder Changes Gold Investments Prioritising Business Index Inclusion Key Acquisitions 12% return ytd SGX s first Main Board-listed gold company Source: ShareInvestor 12 5

4 Key Mining Assets Today million ounces Gold Resources since March Projects in the Americas, Africa, Australia Acquisition pending Acadian Mining Corporation Nova Scotia Goldfields Canada Castlemaine Goldfields, Ballarat Mine Victoria, Australia 1.33 million ounce Gold Resource at Fifteen Mile Stream & Beaver Dam, takeover pending 757,700 ounce Gold Resource at 2 tenements, 40-50,000 oz production target, 100%-owned Minera Nueva Vista, 1.47 million Amayapampa, ounce Bolivia Gold Resource, 76%-owned Citigold Corporation, Charters Towers, Queensland, Australia 1.28 million ounce Gold Resource including 787,300 Reserves, 100% owned Signature Metals, Owere Mines, Konongo Ashanti Gold Belt, Ghana Unity Mining Tasmania & NSW, Australia 11 million ounce Gold Resource, incl 620,000 Reserves, 18%-owned 1 - Assumes takeover of 100% of Acadian Mining Corporation million ounce Gold Resource, 77%-owned 704,000 oz Gold Resource at 3 tenements, incl 266,000 Reserves, 50,000 oz production, 13% owned 6

5 LionGold Corp - Going for Gold Dynamic, Expanding Operations Differentiated Business Platform Initial growth acquisition-led, value accretive 6.8 million oz acquired from FY Seven total, two in production - S$165 million value, <US$20 per oz Focused investment strategy Acquire scalable miners at attractive discounts Augment shareholder returns Production focus going forward - Target raised to 200,000 vs 120,000 oz Proactively managed project portfolio Resource & Reserves (million ounces) FY2011 FY2011 Production ( 000 ounces annualised) Growth acquisitions pa - Financial backing - Operational support FY2012 FY2013 FY2012 FY2013 Financial flexibility Current Target end Reserve Resource Current Target end acquisitions IPO pa - 1 Funding IPO partners - Low Funding debt, partners dilution Value 7

6 Group Structure - As at Board of Directors 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. 100% 77% Operations Castlemaine Goldfields Signature Metals LionGold Corp Ltd Investment Citigold Corporation Unity Mining 18% 13% 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 Former CEO of DMG Partners and MD of Citicorp Investment Bank, Singapore. 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. 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. 100% 100% 100% 70% Owere Mines Brimstone Resources Minera Nueva Vista Acadian Mining Corporation Technical Committee Audit Committee Remuneration Committee Nomination Committee Dr Denis Clarke Independent Non-Executive Director Gary Scanlan Independent Non-Executive Director Lynne Ng Su Ling Independent Non-Executive Director 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. LionGold Corp currently holds 9% of Acadian Mining Corporation. A takeover offer for the remaining shares was made on 29 July Bernard Soo Independent Non-Executive Director Accountant with extensive experience in project development, finance and business development throughout Asia. 8

7 New Leadership Team - Seasoned financial, legal & technical expertise Board of Directors CEO & MD Nicholas Ng 29 years in financial markets. Former CEO of DMG Partners, and MD of Citicorp Investment Bank, Singapore. Previous Head of Asia Investment Banking at Rabobank. Concluded numerous IPO, M&A, privatisations and other financial transactions in Asia-Pacific. Audit Committee Remuneration Committee Nomination Committee Technical Committee Corporate Finance and Legal Teams now in-house Global Technical Team Matthew Gill Australia Andrew Lawry Global Projects Chris Gbyl Ghana Mike Clarke Bolivia Pending Canada General Counsel Raymond Tan CFO Brendan Goh Corporate & Business Development Director Peter Chen COO Matthew Gill Also Executive Director and Company Secretary. Provided legal advisory to LionGold since 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 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. 17 years as a corporate lawyer, including acting as general legal counsel for public listed companies. 8 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. 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 consecutive years. 9

8 Shareholding Structure - Local HNW + Retail, Growing Institutional Broadening Investor Base 11.6% Directors & Management % 6.0% Asiasons Capital Ltd Market Vector Junior Gold Miners ETF SGX-listed private equity group Van Eck Institutional funds joined the shareholder roster following inclusion in various indices and via acquisitions, private placement, investment proxy to junior gold miners Asian Institutional Investors - Pension, mutual, sovereign Global Institutional Investors - Boutique, Private Equity Retail Investors - Singapore, Malaysia, HK/China Dedicated Singapore, Malaysia, ASEAN + commodity-focused funds Few investable metals / gold stocks, in Southeast Asia Diminished selection of mid-cap gold companies Few Asian-listed options Gold Bugs, news flow sensitive Limited investment options vs US, UK, Australia, Canada Private Equity vehicles: largely available only to HNW investors 10

9 Balance Sheet Transformation - As at 30 June 2013 Assets Current assets Non-current assets Total Assets Current liabilities Non-current Total Liabilities NET ASSETS S$m Financial Highlights FY2013 Nearly 10-fold rise in Net Assets to S$276m - Consolidation of four gold mining subsidiaries Nearly 10-fold rise in Shareholder Equity - Fund raising + shares issued for acquisition 1Q FY2014 Results Gold revenue of S$13.5m - 9,431 ounces of gold produced at a cash cost of A$807 per ounce, production cost of A$1,210 per ounce Gross profit of S$1.8m - Net loss reduced to S$0.5m vs S$7.9m Debt gearing at 12% Cash and equivalents of S$23m Austere budgeting, rigorous cost controls, standardised reporting 11

10 Fast-tracking growth - Improving acquisition opportunities Production Ouncesin-the-Ground FY2013 FY2014 Unity Mining 13% Today Resources 6.8m oz Reserves 0.9m oz Signature Metals Castlemaine Goldfields Acadian Mining 100% Production 40-50,000 oz Exploration Brimstone Resources FY2012 Citigold Corp Minera Nueva Vista 18% FY2011 Acadian Mining 9% New shareholders Business review Proposed change of core business to precious metals Non-core business divestment begins Indices inclusion Fund-raising for gold business S$100m Institutionalisation of shareholder base Team-building Business integration Capital allocation 12

11 Only Global Gold Co listed in SE Asia - vs single-project / country focus Company LionGold Corp CNMC Goldmine Bourse SGX Main Board SGX Catalist Market Cap Ave Dly Trading Volume US$900m US$15m Resource 6.8m oz 7 Projects: Operations US$90m US$0.3m 0.5m oz Malaysia, Sokor project Australia, Ghana, Bolivia, Canada G-Resources HSE US$650m US$1.7m 9m oz Indonesia, Martabe project Zhaojin Mining HSE H-Share US$2.1b US$10m 22m oz Projects in China, in production China Gold Zijin Mining Lingbao Gold China Precious Metals,,, HSE US$1.1b US$0.4m 8m oz Projects in China, in production HSE H-Share HSE H-Share US$8b US$17m 34m oz Projects in China, in production US$164m US$0.3m 15m oz Projects in China, in production HSE US$137m US$1.3m 7.5m oz Projects in China, Mongolia, in production Market cap and average daily trading volume has been approximated for the past 6 months based on Bloomberg data LionGold gold resource includes 100% of Acadian Mining Corporation, the acquisition for which is pending 13

12 On track for 2014 target million gold ounces acquired in 18 months Company LGC Interest Country Project Resources (ounces) Reserves (ounces) Production Target (ounces annualised) Castlemaine Goldfields 100% Australia Castlemaine 686,000 Exploration Ballarat 71, ,000 Signature Metals 77% Ghana Konongo 1,470,000 Scoping study Minera Nueva Vista 100% Bolivia Amayapampa 1,280, ,300 Development Acadian Mining Corporation 100% Canada Beaver Dam 950,000 Scoping study Fifteen Mile Stream 383,000 Scoping study Brimstone Resources 100% Australia Penny s Find 52,300 Exploration Citigold Corporation 18% Australia Charters Towers 1,946, ,000 Late-stage Development Current 6,839, , ,000 TARGET ,000,000 2,000, ,000 Significant Shareholder Unity Mining 13% Australia Henty Mine 338, ,000 50,000 Lakeside 66,000 Darques Reef 327, ,000 Development Figures are extracted from previous JORC- and NI 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 18% equitable holding of the Charters Towers Project s 11 million ounces of gold Resources, inclusive of 620,000 ounces of Reserves. For Acadian Mining Corporation, LionGold currently holds 9% of the company. A takeover offer for the balance of the shares was made on 29 July

13 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Percentage Increase LionGold s expansion opportunity - Consolidation of a highly fragmented sector FY2014 Prospects Gold price volatility has created a window of opportunity to access to gold mining assets, including producing mines, at substantial discounts, as this sector consolidates Gold prices - 26% 450% Gold Prices vs Junior Gold Miner Index 27 July July 2013 Junior miners - 41% % 350% Dow Jones North American Select Junior Miner Gold Total Return Index Spot Price of Gold % 250% 200% 150% 100% 50% BOOM Rising gold prices Easy credit CONSOLIDATE Gold price volatility Credit constraints US$ per ounce 0% % -100%

14 Tonnes Tonnes Tonnes Gold supply / demand dynamics - Driven by emerging market consumption World Gold Market 2012: 4,405 tonnes 600 Net Seller Central Banks Net Buyers from 2008 Net Buyer Gold Demand Jewellery Demand 0 7% 9% 12% 72% India 400 Greater China 300 Far East Middle East/ Turkey (600) E Source: CPM Group ETF Tech Central Bank Consumer Rest of World US Europe ex CIS Central Bank Reserves Source: Thomson Reuters GFMS, World Gold Council 0 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 China India Japan South Korea Taiwan Indonesia Thailand USA Germany Italy France Netherlands Switzerland United Kingdom Emerging & Japan 3,401 tonnes 2.6% of total reserves US & EU 18,384 tonnes 59% of total reserves Gold Supply 36% Recycled Mined 64% Bar & Coin Demand India 300 Greater China 250 Far East 200 Middle East/ Turkey 150 Rest of World 100 US 50 Europe ex CIS Source: Thomson Reuters GFMS, World Gold Council 0 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Source: World Gold Council Source: World Gold Council 16

15 Acquisition Strategy: Tweaked - Targeting scalable production SCREENING Gold producers globally Gold production ,000 oz pa - or clear path to ramp-up, 6-12mos > 1 million oz gold Resource - inclusive of established reserve base - 5 years+ life-of-mine Organic cashflow growth - < US$1200 per ounce production cost - Strong working capital position Up to US$100 million investment LGC ALLURE Shares cash SGX-listed De-risking of assets - Geographic - Funding access - Lower dilution risk Broader opportunities - Bigger, global group Better opportunities from April 2013 Accelerated streamlining by gold majors - Divestment of non-core assets Realistic valuation expectations by juniors More favourable environment for negotiation, cost-cutting, capital discipline 17

16 Value Targeting the Sweet Spot - Producing / near-producing assets Indicative Capital Allocation 5-10% 10-20% 70-85% End Production Extension Development Feasibility Study Pre- Feasibility Scoping Study Production Maximise Value, Mitigate Risk Risk Exploration Greenfields Brownfields Mining Project Life Cycle 18

17 Geographically diversified - Risk management Developed De-risking Resource & Investment 10% BMT CTO Developed 60% Stable business environment Infrastructure, skilled labour, funding Can be high-cost Australia, Canada Established global mining industry Excellent skills-base Many junior miners Canada 19% Friendly Emerging Ghana 21% Australia 41% Bolivia 19% CGT Challenging Friendly Emerging 21% Bigger opportunities Lower entry cost Ghana, Ashanti Gold Belt Stable, foreign-friendly Established gold industry Highly prospective, scalable Challenging 19% Good value Bolivia Relationships key 19

18 Operating Objectives - Balance & Prioritise Mine Profile Resource expansion Reserve replacement Production rising, reliable Increasing Life 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 20

19 Project Funding Objectives - Maximise Growth, Protect Shareholders + Balance Sheet Grow market cap Grow Bankable assets Gold production Fee income Execution of 100 day + 2 year business plans Self-fund LGC Market cap ~ US$900m Project Development Strategy Fund Listing of subsidiaries Project financing / alliances Venture capital Structured options Mitigate equity dilution Maintain strong balance sheet Invest Undervalued gold interests List cos Private Companies Assets Issue of up to 20% of share capital per annum 2-3 acquisitions yearly 21

20 Results delivered - Going forward the next 12-18mos FY2013 FY2014 Dec 2014 Acquire Gold in the Ground Acquire Producing Assets 10 million oz Resource 2 million oz Reserve 200,000 oz pa Production 5 year Life of Mine Project Acquired Castlemaine Goldfields (100%) Signature Metals (77%) Minera Nueva Vista (100%) Brimstone Resources (100%) Acadian Mining (100% now pending) Strategic Investments Citigold Corporation (18%) Unity Mining (13%) Divest Green Businesses 36% Shareholder Return Junior Miners -16%, Gold +7% US$ New market opportunities Organic production growth Integrate resources Fortify team, alliances Expanded Funding Options Divest China Business 13% Shareholder Return Junior Miners -43%, Gold -20% US$ year-to-date Global Gold Co Ongoing Initiatives Shareholder Return Minimise Volatility Raise Transparency Mitigate Balance Sheet Risk 22

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22 LionGold Project Pipeline - Progressing existing projects Company Project Resources (ounces) Reserves (ounces) Early Stage Exploration Advanced Exploration Feasibility Development Production Castlemaine Goldfields 100% Ballarat Castlemaine 71, ,000 - Production 40-50,000 oz pa Exploration on-going Minera Nueva Vista 100% Acadian Mining 100% Signature Metals 77% Citigold Corporation 18% Unity Mining 13% Amayapampa 1,280, ,300 Beaver Dam 950,000 - Fifteen Mile Stream 383,000 - Konongo 1,470,000 - Charters Towers 1,946, ,000 Henty 338, ,000 Lakeside 66,000 Darques Reef 327, ,000 Infrastructure & mine development Production 2015: 19,000 oz pa 2018: 85,000 oz pa Scoping study end 2013 Production potential 2017 Scoping study end 2013 Exploration on-going New operations management in place Production 50,000 oz pa Production 2015: 50,000 oz pa Production figures represent annualised targets. Takeover of 100% of Acadian Mining is pending 24

23 Castlemaine Goldfields Limited - High grade nuggety ore Excellent facilities in established gold region, Central Victoria, Australia Castlemaine Goldfields Tenements Five concessions in total with JORC Resources in Ballarat (producing) and Castlemaine Ballarat Mine production target 40-50,000 oz - Ramped up from mid q FY2013 gold production 9,431 oz and 27,512 oz for calendar Q FY2013 cash cost of S$807 per oz, production cost of A$1,210 per oz Life of mine + production enhancement through ongoing extension and exploration Resource Gold (ounces) Tonnage (tonnes) Grade (g/t) Castlemaine 686,000 2,760, Ballarat 71, , Total 757, % owned by LionGold from October 2012 Figures shown are based on previously quoted JORC-compliant statements Ore processing capacity of 600,000 tpa Figures indicate historical gold production at Castlemaine Goldfields five tenements 25

24 Signature Metals Limited - Prioritising exploration targets Flagship Owere Mines (70% owned) holds the Konongo Gold Project, Ghana Konongo Gold Project 192 km 2 concession in Ashanti Gold Belt - 16 known gold deposits, 12 km strike - 80 km along strike from Ashanti AngloGold s >200,000 ounce pa, 30 million ounce Obuasi mine Substantial untapped high-grade UG potential - Historic production of 1.6 million ounces at 11.8 grams per tonne, mostly from UG Scoping study completion planned end Exploration on-going, ramped up in Feb 2013 Konongo Gold Project Resources 1 Gold (ounces) Tonnage (tonnes) Grade (g/t) Measured & Indicated 779,600 13,100, Inferred 687,100 10,500, Total 1,466,700 77% owned by LionGold as at April 2012 and listed on the ASX. Figures shown are based on previously quoted JORC-compliant statements. 26

25 Minera Nueva Vista S.A. - Infrastructure development underway Bustillo Province, Bolivia Resources of 1.28m oz, inclusive of 787,000 Reserves - NI compliant Amayapampa Project Owns the rights to overlapping concessions totaling 34 km 2, located 290 km southeast of La Paz Excellent management team in place Starter pit phase 1, 19,000 ounces annualised Review phase 2 for 95,000 ounce open pit mine Amayapampa Category Gold (ounces) Tonnage (tonnes) Grade (g/t) Reserves Probable 787,300 18,900, Resources Indicated 979,637 26,160, Inferred 300,363 8,750, Total Resources 1,280, % owned by LionGold from December Resource is inclusive of Ore Reserves. Figures based on previously quoted NI compliant statements 27

26 Acadian Mining Corporation Limited - 9% strategic stake; takeover offer pending Canadian tenements in Nova Scotia Under-explored gold-bearing province - Limited modern exploration Scoping study for open pit underway - Completion due end Potential production 3 years thereafter - Test mining options under consideration Attractive royalty portfolio Regional consolidation potential Nova Scotia Projects Property Gold (ounces) Tonnage (tonnes) Grade (g/t) Beaver Dam Indicated 446, , Inferred 504, , Fifteen Mile Stream Indicated 383, , TOTAL 1,333,000 TSX Venture-listed. Refer to for NI compliant statements. 28

27 Citigold Corporation Limited - 18% strategic investment, single largest shareholder Charters Towers tenements near Townsville, Queensland Charters Towers Project Australia s highest grade gold field - 56 mineral holdings spanning >1,500 km 2 - Significant Life of Mine potential, >10 years LionGold now with two board seats Ripe for review, revamp - Secured A$100 million in funding mid New operations management Charters Towers Category Gold (ounces) Tonnage (tonnes) Grade (g/t) Reserves Probable 620,000 2,500, Resources Indicated 780,000 3,200, Inferred 11,000,000 25,000, Ore processing capacity of 340,000 tpa ASX-listed, 18% owned by LionGold from December Refer to for JORC-compliant statements. Indicated Resources includes Probable Reserves, and Inferred Resources includes Indicated Resources. 29

28 Unity Mining Limited % strategic stake, single largest shareholder Unity Mining, ASX-listed Australian gold resources totaling 731,000 oz Annualised production targeted to double by year-end to 100,000 oz Cash of A$27.5 million as at 30 June 2013, no debt - A$23 million revenue from the sale of 16,860 ounces of gold in 3Q FY2013 Unity s Primary Projects Henty Mine, northwest Tasmania 100% - Established mine, producing 50,000 oz per year - Cash cost of A$979 per ounce, 5 year+ LOM Dargues Reef, NSW 100% - On target to produce 50,000 oz per year annualised by early 2014, based on recent announcements. GoldStone Resources 35% - 3 West African exploration project, including a 602,000 ounce Ghanaian gold project locate near LionGold s Owere Mine - London-listed Project Henty Lakeside Dargues Reef Category Gold (ounces) Tonnage (tonnes) Grade (g/t) Reserves 133, , Resources 338,000 2,060, Reserves Resources 66, , Reserves 233,000 1,390, Resources 366,000 2,170, % owned by LionGold from May 2013, single largest shareholder Figures shown are based on previously quoted JORC-compliant statements 30

29 LionGold Corp Ltd 59 Mohamed Sultan Road Sultan Link Singapore T: F: E: Thank you w w w. l i o n g o l d c o r p. c o m 31