Third Quarter November 1 st, asdfasdf

Transcription

1 Third Quarter 2012 November 1 st, 2012 asdfasdf

2 FORWARD LOOKING INFORMATION Both these slides and the accompanying oral presentation contain certain forward-looking statements and forward-looking information within the meaning of applicable securities laws. The forward looking statements include estimates, forecasts and statements as to the Company s expectations of production and sales volumes, expected timing of completion of project development at Kansanshi, Kevitsa and Sentinel, the impact of ore grades on future production, the potential of production disruptions, capital expenditure and mine production costs, the outcome of mine permitting, the outcome of legal proceedings which involve the Company in the RDC and other countries, information with respect to the future price of copper, gold, cobalt, nickel, PGE, and sulphuric acid, estimated mineral reserves and mineral resources, our exploration and development program, estimated future expenses, exploration and development capital requirements, the Company s hedging policy, and our goals and strategies. Often, but not always, forward-looking statements or information can be identified by the use of words such as plans, expects or does not expect, is expected, budget, scheduled, estimates, forecasts, intends, anticipates or does not anticipate or believes or variations of such words and phrases or statements that certain actions, events or results may, could, would, might or will be taken, occur or be achieved. With respect to forward-looking statements and information contained herein, we have made numerous assumptions including among other things, assumptions about the price of copper, gold, nickel, PGE, cobalt and sulphuric acid, anticipated costs and expenditures and our ability to achieve our goals. Although our management believes that the assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that a forward-looking statement or information herein will prove to be accurate. Forward-looking statements and information by their nature are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or information. These factors include, but are not limited to, future production volumes and costs, costs for inputs such as oil, power and sulphur, political stability in Zambia, Peru, Mauritania, Finland and Australia, adverse weather conditions in Zambia, Finland and Mauritania, labour disruptions, mechanical failures, water supply, procurement and delivery of parts and supplies to the operations, the production of off-spec material. See our Annual Information Form for additional information on risks, uncertainties and other factors relating to the forward-looking statements and information. Although we have attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements or information, there may be other factors that cause actual results, performances, achievements or events not to be anticipated, estimated or intended. Also, many of these factors are beyond our control. Accordingly, readers should not place undue reliance on forward-looking statements or information. We undertake no obligation to reissue or update forward-looking statements or information as a result of new information or events after the date hereof except as may be required by law. All forward-looking statements and information made herein are qualified by this cautionary statement. 2

3 Q HIGHLIGHTS Strong production against Q Revenue $725 million (up 12%) Copper production 84.1k tonnes (up 43%) Gold production 50.8k ounces (up 22%) Nickel production 9.9k tonnes including 1.9k tonnes from Kevitsa C1 Copper $1.44/lb for the Quarter; Year to Date $1.51/lb Gross Profit lower due principally to lower commodity prices and increased royalty rates Production base expansion & rapid ramp up to commercial production Kevitsa commercial production declared August 18, 2012 Kevitsa contributed $18 million to Q3 Gross Profit Includes Kevitsa Cu production 4.6k tonnes, Au production 2.7k ounces 3

4 PRODUCTION & SALES VOLUME Production Q Q Q Sales Volume Q Q Q Copper ( 000 tonnes) Nickel ( 000 tonnes) Gold ( 000 ounces) Record quarter production at Kansanshi driven by higher oxide grade Kevitsa plant continuing to ramp up with weathered ore temporarily reducing recoveries Higher Gold production attributable to improved grade processed Build up of Copper finished goods stockpiles; benefit to be seen in future Copper and Gold production higher than Q & Q Copper Production Copper ( 000 tonnes) Nickel ( 000 tonnes) Gold ( 000 ounces) Nickel Production Gold Production 4

5 FINANCIAL OVERVIEW $ millions Q Q Q Revenue Gross Profit Operating Profit Comparative EBITDA Comparative Earnings Comparative EPS (Basic) ($) Closing Cash Copper C1 Cost ($/lb) Nickel C1 Cost ($/lb) 6.24 N/A 5.70 Comparative Effective Tax Rate% Performance against Q2 2012: Performance against Q3 2011: Gross profit impacted by planned increase in mining activity at Ravensthorpe, higher depreciation charge and marginally lower prices partially offset by increased sales volume and benefit of Kevitsa commercial production Q Effective Tax Rate lower with Q more in line with last year and full year expectations Gross profit impacted by lower commodity prices and increased Zambian royalty rates partially offset by stronger Copper sales volumes Kevitsa commercial production contributing $18m Gross Profit 5

6 $m OPERATING PROFIT Q VS Q (62) (18) Q Price FX Convertible New Bond Costs Operations Subtotal 9 Sales Volume (16) (6) Zambia Royalties Other Cash Costs (2) Exploration Non-Cash Costs Q Price Bond Cost New Operations Lower Copper prices (Q LME average $3.50/lb vs Q $4.02/lb) Early convertible bond conversion payment Ravensthorpe commercial production - Jan 2012 Kevitsa commercial production - Aug 2012 Sales Volume Royalties Profit margin attributable to higher Copper sales (3kt - excl Kevitsa) using prior period profit margin. Increase in Zambian royalty rates on Copper gross revenue to 6% from 3% and Gold gross revenue to 6% from 5% Conversion incentive payment and other transaction costs of $48.4m in relation to $500 million 6% convertible bonds on conversion July

7 C1 COSTS Group Copper C1 within market guidance $/lb Q Q Q Group Kansanshi Guelb Moghrein Kevitsa 0.11 N/A N/A Record Kansanshi production driving C1 Cost lower partially offset by higher sulphuric acid consumption to process high acid consuming ore Kevitsa Copper C1 Cost is net of by-product credits of $1.41/lb Ravensthorpe Nickel C1 within market guidance $/lb Q Q Q Group 6.24 N/A 5.70 Ravensthorpe 6.43 N/A 5.70 Kevitsa 3.79 N/A N/A Ravensthorpe C1 Cost increased as forecast with increased mining and ore development activities Kevitsa Nickel C1 Cost is net of by-product credits of $2.50/lb 7

8 QUARTERLY NET CASH FLOW MOVEMENT Opening Net Cash at start of Quarter 817 EBITDA 276 Working Capital Movements (198) Tax paid (184) Capital Expenditure (366) Dividends (30) Other 5 Net Cash Movement (497) Net Cash at end of Quarter 320 Comprising: Closing Cash 375 Closing Debt (55) $m Available debt facilities 1,250 (2) Senior Notes issue Q1 instalment ($85m), additional Kansanshi 2011 final tax payment ($99m) (2) $350m Senior Notes issue completed on October 10, 2012 NB* An additional $500m ENRC receivable due March