A Leading High-Grade Underground Gold Producer Q4 & Full Year 2018 Results

Transcription

1 A Leading High-Grade Underground Gold Producer Q4 & Full Year 2018 Results Lombardo Paredes, CEO Mike Davies, CFO TSX: GCM OTCQX: TPRFF 1

2 DISCLAIMER Forward-Looking Statements This presentation contains "forward-looking information", which may include, but is not limited to, statements with respect to the future financial or operating performance of the Company and its projects, and, specifically, statements concerning anticipated growth in annual gold production, future cash costs and AISC, future G&A and capex, excess cash flow and future repayments of its gold-linked notes. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Gran Colombia to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements are described under the caption "Risk Factors" in the Company's Annual Information Form dated as of March 27, 2019 which is available for view on SEDAR at Forward-looking statements contained herein are made as of the date of this presentation and Gran Colombia disclaims, other than as required by law, any obligation to update any forwardlooking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements. All amounts are denominated in U.S. dollars, unless indicated otherwise. 2

3 MID-TIER GOLD MINER Surpassed 2018 Guidance Surpassed $100M annual adjusted EBITDA level Operating Cash Flow up 58% to ~$80M Free Cash Flow up 72% to $44M Cash cost of $680/oz AISC of $907/oz Adjusted net income up 85% to $42M or $1.22/share 2018 Gold Production 218,000 ozs We have produced more than 1 million ounces of gold since inception in 2010 Strengthened balance sheet Reduced debt by 37% Increased cash to $36M Simplified capital structure Eliminated dilution overhang Listed new Gold Notes and Warrants on TSX OTCQX upgrade 3

4 CAPITAL STRUCTURE Simplified Common Shares 48.3 million Market Capitalization (as of March 27, 2019) CA$185 million Major Shareholders Common shares Founders/Management - 5% None > 10% Gold Notes Founders/Management - 10% No others > 10% Warrants GCM.WT.B: 12.2 CA$2.21 (2024 expiry) Stock Options 1.4 CA$2.55 ( expiry) 1.2 CA$3.16 (2023 expiry) Fully Diluted = ~63 million common shares Outperforming TSX Global Gold Index 4

5 BALANCE SHEET Strengthened $3M $3M $36M December 2015 December 2017 Cash & Cash Equivalents December 2018 $179M $141M $83M December 2015 December 2017 Aggregate Principal Amount of Total Debt January 2019 Upgraded to B (Outlook Stable) in October

6 RESULTS Highlights 4 th Quarter Year ,260 51,699 Gold production (ozs) 218, ,821 56,360 56,100 Gold sales (ozs) 214, ,645 $1,198 $1,252 Realized gold price ($/oz) $1,239 $1,226 $698 $719 Cash cost ($/oz) (1) $680 $720 $929 $899 AISC ($/oz) (1) $907 $918 $68.2M $70.9M Revenue $268.5M $215.4 $23.7M $26.8M Adjusted EBITDA (1) $102.4M $75.5M $8.0M $4.9M Net income ($3.4M) $36.8M $0.17 $0.23 Per share ($0.10) $1.81 $14.3M $9.1M Adjusted net income (1) $42.3M $22.9M Mine development $0.30 at Sandra K July $ , 2014 Per share $1.22 $1.13 $23.6M $18.0M Operating Cash Flow $79.4M $50.5M $14.4M $10.9M Free Cash Flow (1) $44.0M $25.6M (1) Refer to Company s MD&A for computation. 6

7 RESULTS Gold Production 225 Segovia Marmato 218k 000 s ozs AISC (-23%) Growth in Gran Colombia s total gold production has been driven by the high-grade Segovia Operations. Marmato has been steady Annual production guidance of 210, ,000 ounces of gold. 7

8 RESULTS Production 4 th Quarter Year Gold (ozs) Segovia Company mines 20,687 23,709 El Silencio 84,701 80,959 22,872 17,919 Providencia 88,226 52,029 1,901 1,856 Sandra K 8,904 4,351 45,460 43,484 Total Company mines 181, ,339 3,349 2,104 Other contract mines 11,219 11,320 48,809 45,588 Total Segovia Operations 193, ,659 6,451 6,111 Marmato 24,951 25,162 55,260 51,699 Total Company 218, ,821 52,431 45,491 Silver (ozs) 198, ,996 Segovia Our primary focus is our Company mines which provided 94% of Segovia s total 2018 gold production. Improvement in head grades and tonnes mined in the Providencia mine has been the key catalyst for Segovia s production growth in Marmato Continues to be a steady producer. evaluating expansion options to incorporate the Deeps mineralization. 8

9 SEGOVIA OPERATIONS Driving Cash Flow Top 5 Highest-Grade Underground Gold Operations in 2018 Mine Owner Au Grade in Milled Ore 2018 (1) (g/t) Fosterville Kirkland Lake Segovia Gran Colombia Turquoise Ridge Barrick Gold Cerro Negro Goldcorp Yaramoko Roxgold Mine Au Grade in Milled Ore Q (2) (g/t) Fosterville Yaramoko Segovia Cerro Negro Turquoise Ridge (1) Source: Company filings (2) Source: IMARC (miningintelligence.com Whitepaper, July 2018) 9

10 SEGOVIA OPERATIONS Reserves & Resources Resources Measured & Indicated Inferred Tonnes (kt) Grade (g/t) Au (koz) Tonnes (kt) Grade (g/t) Au (koz) December 31, 2018 (1) 3, ,327 3, ,157 December 31, 2017 (2) 3, ,245 3, ,107 Change Reserves Tonnes (kt) Proven & Probable Grade (g/t) Au (koz) +82 7% 26,800 meters drilled in % 2018 update reaffirms confidence in high grade nature of the Segovia gold deposits December 31, 2018 (1) 1, December 31, 2017 (1) 1, Change +28 4% Added over 300,000 ozs of total resources in 2018; replaced more than what we mined Largest resource increases came at El Silencio and Providencia (1) Source: Company press release dated March 11, (2) Source: Company press release dated March 27,

11 RESULTS Total Cash Cost Per Ounce (1) US$/oz sold $1,200 Segovia 89% of 2018 gold sales 117 Marmato 11% of 2018 gold sales $1,132 $1,000 $800 $600 $623 $ The Company s Total Cash Cost average decreased to $680/oz in 2018 from $720/oz last year due to: Greater proportion of total gold sales coming from the lower cost Segovia Operations, and Segovia s cash cost/oz decreased 6% from 2017 aided by increase in production. Expecting 2019 s annual average Total Cash Cost will remain below $720/oz. (1) By-product credit basis. Refer to Company s MD&A for computation. 11

12 RESULTS All-In Sustaining Costs (1) US$/oz sold $1,400 $1,200 $1,000 G&A,Sustaining Capex and Other Total Cash Cost $907 AISC (-23%) $800 $600 $ s AISC was below guidance and reflected continuing emphasis on capital programs at the Segovia Operations average AISC is expected to remain below $950/oz. (1) All-In Sustaining cash cost per ounce includes total cash costs per ounce and adds the sum of G&A, sustaining capital and certain E&E costs and provision for environmental discharge fees. Refer to the Company s MD&A for computation. 12

13 RESULTS Sustaining Capex Segovia Marmato Mine Marmato Project $35.7M in Total = $167/oz sold $26.0M in Total = $150/oz sold 2018 saw a ~$7M increase in capex at Segovia related to exploration and development and construction of new tailings storage facilities and a filter press. At the Marmato Project, the 8,200m drilling program added ~$2M to 2018 s capex. 13

14 RESULTS All-In Sustaining Costs Kirkland Lake Gold Barrick Gold Yamana Gold Centerra Gold Gran Colombia Gold Argonaut Gold Teranga Gold New Gold Kinross Gold Leagold Alamos Gold IamGold Asanko Gold Guyana Goldfields Golden Star Detour Gold Alio Gold I. Source: Issuer filings for FY 2018 II. Full Year 2018 Results US$/oz sold AISC is a common performance measure but does not have any standardized meaning within the industry and therefore its computations may vary between companies. $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 Cash AISC Gran Colombia s AISC continues to be well positioned amongst industry peers

15 RESULTS Adjusted EBITDA (1) $120 $100 $102.4M US$M $80 $60 $40 $20 $ Increase in EBITDA has been driven by production growth, improved gold prices and relatively stable total cash costs. (1) Refer to Company s MD&A for computation. 15

16 RESULTS Cash Flow Metrics $M Operating Cash Flow Free Cash Flow (1) Operating Cash Flow increased by 58% in 2018 to almost $80M. Free Cash Flow increased by 72% to $44M in (1) Refer to Company s MD&A for computation. 16

17 2019 OUTLOOK Guidance Priorities 1. Complete CA$20M bought deal private placement of convertible debentures. 2. Continue implementation of optimized mine plan at Segovia: Expand infrastructure to access deep levels at El Silencio and Providencia. Continue ventilation improvements at El Silencio and commence Sandra K. Continue El Chocho tailings storage construction and commission filter press. 3. Expand planned 20,000m drilling program at Segovia with bought deal proceeds to accelerate step-out and brownfield drilling to increase reserves for production growth and mine life extension. 4. Complete technical studies for underground expansion project at Marmato. 5. Provide technical support to Sandspring; monitor opportunity in Venezuela Targets 2018 Actual 2019 Guidance Gold production 218,001 ozs 210, ,000 ozs Cash cost/oz sold $680 < $720/oz AISC/oz sold $907 < $950/ oz 17

18 For Further Information, Contact: Mike Davies Chief Financial Officer (416) Town of Segovia 18