MANAGING DIRECTOR S PRESENTATION. Annual General Meeting 19 May 2014

Transcription

1 MANAGING DIRECTOR S PRESENTATION Annual General Meeting 19 May 2014

2 DISCLAIMER Forward Looking Statements These materials include forward looking statements. Forward looking statements inherently involve subjective judgement and analysis and are subject to significant uncertainties, risks and contingencies, many of which are outside the control of, and may be unknown to, the company. Actual results and developments may vary materially from that expressed in these materials. The types of uncertainties which are relevant to the company may include, but are not limited to, commodity prices, political uncertainty, changes to the regulatory framework which applies to the business of the company and general economic conditions. Given these uncertainties, readers are cautioned not to place undue reliance on forward looking statements. Forward looking statements in these materials speak only at the date of issue. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, the company undertakes any obligation to publicly update or revise any of the forward looking statements, changes in events, conditions or circumstances on which any such statement is based. Competency statement The information in this report relating to Open Pit Ore Reserves is based on information compiled by Mr Mark Jewell who is a member of the Australasian Institute of Mining and Metallurgy and who has sufficient experience which is relevant to the styles of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Jewell is a consultant to the Beadell Group and consents to the inclusion in the report of the matters based on his information in the form and context in which it 4 appears. The information in this report relating to Mineral Resources is based on information compiled by Mr Paul Tan who is a member of the Australasian Institute of Mining and Metallurgy and has sufficient exploration experience which is relevant to the various styles of mineralisation under consideration to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Tan is a full time employee of the Beadell Group and consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. The information in this report relating to Exploration Results is based on information compiled by Mr Robert Watkins who is a member of the Australasian Institute of Mining and Metallurgy and has sufficient exploration experience which is relevant to the various styles of mineralisation under consideration to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Watkins is a full time employee of Beadell Resources Limited. Mr Watkins consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. The information is extracted from the reports entitled September Quarterly Activities and Cashflow Report created on 24 October 2013, 2014 Guidance Upgrade and Production Update created on 25 March 2014, Drilling Update created on 11 April 2014 and Annual Mineral Resource and Ore Reserve update created on 17 April 2014 and are available to view on The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and, in the case of estimates of Mineral Resources or Ore Reserves, that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed. The Company confirms that the form and context in which the Competent Person s findings are presented have not been materially modified from the original market announcement.

3 CORPORATE OVERVIEW CORPORATE INFORMATION DIRECTORS AND SENIOR MANAGEMENT ASX Code Shares on issue Options Share Price (16May14) Market Cap Monthly Volume (shares) Included in the ASX 200 Index Project Debt (31Mar14) Cash + Bullion (31Mar14) BDR 790.8M 15.3M A$0.665 A$526M ~125M US$54.5M A$12.5M Craig Readhead Ross Kestel Mike Donaldson Peter Bowler Rob Watkins Greg Barrett Boyd Timler Luis Abadi Ind Non-Exec Chairman Ind Non-Exec Director Ind Non-Exec Director Managing Director Executive Director Geology CFO/Company Secretary Chief Operating Officer General Manager Brazil PROJECTS Brazil Australia 3

4 CORPORATE OVERVIEW YEAR SHARE PRICE MOVEMENT 6 months Share Price Movement Relative performance rebased to BDR = $0.625 BDR = $ m = (25.7%) 1y = +6.4% TSX:XGD 6m = +2.2% 1y = (5.0%) ASX:XGD 6m = +1.5% 1y = (24.9%) /5/13 16/6/13 16/7/13 16/8/13 16/9/13 16/10/13 16/11/13 16/12/13 16/1/14 16/2/14 16/3/14 16/4/14 16/5/14 BDR:ASX XGD:S&P/ASX All Ordinaries Gold Index XGD:S&P/TSX Global Gold Index SHAREHOLDING BASE BY LOCATION March 2014 Australia 37% North America 30% Europe & UK 17% Asia 4% Unknown 12% SHAREHOLDINGS March 2014 Columbia Wanger Asset Mgt 12% Van Eck Global 9% Coupland Cardiff Asset Mgt 6% Directors, Employees & Related Parties ~5% Institutional Shareholders 65% 4

5 HIGHLIGHTS OF THE LAST TWELVE MONTHS April 2013 Commencement of commercial gold production May 2013 Completion of the construction of the iron ore concentrate plant August 2013 Commencement of mining at the ultra-high grade Duckhead gold deposit December 2013 Upgrade of the gold elution circuit at the Tucano Gold Mine October 2013 Exceptional drill results continued to be received from the very high grade Duckhead deposit including discovery of the new Wing Lode October 2013 Total inferred resource at Tartaruga increased to 6.45 million 1.63 g/t for 337,000 ounces March 2014 Appointment of Boyd Timler as Chief Operating Officer April 2014 Updated Tucano Mineral Resources total million 1.39 g/t gold for 5.0 million ounces. Updated Tucano Ore Reserves total 36.1 million 1.44 g/t gold for 1.7 million ounces 5

6 CY2013 FINANCIAL SUMMARY Financial results A$ millions Gold sales revenue Costs of production (104.6) Underlying EBITDA Depreciation and amortisation (20.7) Profit before tax 93.1 Reported profit after tax* Other financial information A$ millions Net Cash flow from operating activities 86.9 Cash and cash equivalents 9.8 Net assets Basic earnings per share A$0.15/share Note: * Profit after tax includes income tax expense of $3.0 million and deferred tax benefit of $23.4 million. Deferred tax benefit recognised relates to the recognition of deferred tax assets and tax effect carry forward losses. 6

7 OUTLOOK Brazil Incremental CIL Plant optimisation and improvements will be ongoing throughout the year. CY2014 Guidance: for gold recovered for the CY2014 is forecast at ~200, ,000 ounces. Cash costs of US$535 US$585 per ounce and expects full year AISC to be in the range of US$725 US$775 per ounce. Work on improving the guidance is ongoing via: Re-optimisation of the current Duckhead open pit; Increasing throughput to an annualised rate of 5 Mtpa by utilising the recently commissioned Spent Ore Feeder; and Finding extensions or repetitions to the Duckhead ore body. Iron ore credits are expected to increase as the permanent port to ship iron ore concentrates at Santana is operational again in the third quarter. Sustaining capital for CY2014 is forecast to be ~US$20 million. Exploration expenditures of between US$10 US$15 million is anticipated for CY2014, dependant on success. CY2015 Outlook: Prevailing plant throughput levels, which are approaching 5 Mtpa will permit a production target of approximately 200,000 ounces to be maintained into 2015 with low cash costs. Australia Tropicana East A major relogging program will be completed prior to any further drilling. Albany Fraser Belt - First pass reconnaissance drilling program planned 7

8 BRAZIL: HIGH NET RETURN REGIME Monetary Policy favouring exporters One year to 13 May 2014: BRL gold price increased 3% while USD gold price decreased 5%. Tax policy encourages investment in Amapa, i.e. SUDAM incentive scheme 15.75% Corporate Tax Rate. Low gold royalty of 1% At Tucano, from 2015, full hydro power is expected at US$ per kwh. Currently, 25% is hydro power. Low wages linked to CPI. 2-year Collective Bargaining Agreement signed in November

9 TUCANO LOW RISK, LONG LIFE, LOW COST 5.0 million ounces resource, 1.5 million ounces open pit reserve 9 year mine life from open pits Iron Ore Agreements signed with Zamin By product Iron Ore Concentrate Plant operational Owner Mining, mining fleet renewed Production Summary Unit 1Q2014 Gold ore mined t 308,681 Gold ore milled t 1,018,840 Head grade g/t 1.10 Recovery % 90.0 Gold produced oz 32,507 Gold sold oz 38,757 Average gold price achieved US$/oz 1,279 Cash costs 1 US$/oz Cash costs after royalties and iron ore credits. Cash costs calculations are using gold sold as the denominator in the cost per ounce equations as per World Gold Council guidelines. Top 10 Brazilian Gold Mines CY2013 Gold Production (oz) Rank Company Mine Production 1 Kinross Gold Paracatu 500,380 2 AngloGold Ashanti Córrego do Sítio 375,000 3 Beadell Resources Tucano 182,547 4 AngloGold Ashanti Serra Grande 138,000 5 Yamana Gold Chapada 110,618 6 Aura Minerals São Francisco 105,541 7 Luna Gold Aurizona 79,229 8 Vale Sossego 78,000 9 Yamana Gold Jacobina 73, Yamana Gold Fazenda Brasileiro 70,079 9

10 TUCANO AERIAL VIEW Air Strip 7Mt Low Grade Stockpile Accommodation Workshop and Administration Crushing and Grinding Circuit CIL and Gold Elution Circuit 10

11 GOLD RESERVE EXPANSION FOCUS Duckhead: focus on extension and repetition of the high grade oxide open pit deposit Urucum Deeps: resource to reserve conversion Mutum: exciting baseline exploration, located 20 km east of Tucano gold mine Mining Concession Plan Showing Exploration Targets 11

12 DUCKHEAD HIGH GRADE OXIDE PIT Total Duckhead remaining resources: 794, g/t gold for 93,000 ounces Total remaining open pit JORC reserves: 269, g/t gold for 55,000 ounces Extension and Step Out Drilling: Commencing with two drill rigs Mining Concession Plan Duckhead plan showing near pit targets and planned drilling 12

13 DUCKHEAD HIGH GRADE OXIDE PIT FVM g/t gold Including 6 2,491.2 g/t gold Including 1 14,018.6 g/t gold Duckhead Longsection showing location of new results Duckhead Main Lode Longsection showing location of new drill results and drill target area 13

14 URUCUM DEEPS FUTURE U/G RESERVES Potential underground expansion to take forecast future steady state annual production over 200,000 oz pa Early success at Urucum Deeps, g/t gold and g/t gold Width and geometries favorable for underground mining, ~2,000 ounces per vertical metre Mining Concession Plan Urucum Deeps Cross Section 99840N Looking North Tucano Long Section 14

15 TUCANO REGIONAL EXPLORATION POTENTIAL Mostly contiguous tenure covering 2,500 km² Regional exploration with fly camp has commenced at Mutum target located 20 km east of Tucano gold mine in Brazil Advanced satellite gold project located at Tartaruga, 120 km north east of Tucano Tucano and Tartaruga regional geological plan Existing JORC compliant Inferred Resource at Tartaruga of g/t gold for 337,000 oz from the Mineiro and Mandiocal deposits Rio de Ouro discovery at Tartaruga, recent RC results include g/t gold and g/t gold Mutum Exploration Camp, 15km East of Tucano 15

16 IRON ORE CONCENTRATE PLANT Iron Ore Concentrate plant at the back end of CIL Gold plant to extract high grade iron ore from the CIL tailings Increased attention and expertise will now be focused onto this circuit Off-take agreement signed Sales of concentrate are expected to commence in the third quarter of 2014 Iron Ore Concentrate Plant Iron Ore Concentrate Stockpile (67.5% Fe) 16

17 IN AUSTRALIA, TROPICANA EAST CONTINUES TO EXCITE 15 km gold trend discovered 60 km along strike from 7.9 Moz Tropicana Deposit Hercules and Atlantis gold prospects, early stage gold discoveries A major relogging exercise will be completed prior to any further drilling programs in the latter part of 2014 Large land holding in the highly prospective Albany Fraser Belt increased to 2,500 Sq km Tropicana East, Hercules Longsection Tropicana East project showing location on aeromagnetics 17

18 COMMUNITY AND ENVIRONMENT Community Long and successful history of social development and support programs Numerous employment opportunities at Tucano for the local community Two new social programs were implemented in 2013: Open Doors Program; and Integration Program. Beadell s Christmas Charity Day Environment Beadell has designed programs to minimise the environmental impact of its operation, such as: Water Management; Managing Cyanide Responsibly; Waste and Tailings Dam Management; Mineral and Non-Mineral Wastes Management; Tailings Management; and Waste Rock Management. Beadell s employees working in the onsite nursery 18

19 STRATEGY Efficiency improvements and ongoing safety initiatives Minimise all-in sustaining costs to maximise profitability and cash flow Implement a dividend plan in CY2014 Consolidate our position within the lowest quartile of the industry cost curve Become debt and hedge free in CY2014 Sustainable gold production of ~200,000 ounces per annum over the life of mine Search for a replication of the Duckhead deposit with determination Initiate a long term sustainable underground mine plan for Urucum Deeps Evaluate an extension of the current open pit reserve Build on the existing strong relationship with all stakeholders T685 Schramm RC Drill Rig Focus on maintaining costs within the lowest quartile with sustainable gold production of ~200,000 ounces 19

20 Peter Bowler Managing Director Telephone:

21 DEBT AND HEDGING The outstanding balance of the project finance facility as at 31 March 2014 = US$54.5 million, to be repaid in full in CY2014 Gold and currency hedging: As at 31 March 2014, 90,200 ounces hedged at flat forward price at US$1,600 per ounce to be settled quarterly to the end of CY2014 As at 1 March 2014, an additional 55,000 ounces hedged at flat forward price at US$1,313 per ounce to be settled by early CY2015 US$72.9 million of Brazilian Reals (BRL) hedged at an average forward rate of USD1:BRL1.96 settled quarterly to the end of CY2014 Call options sold over 48,485 ounces of gold at a strike price of US$1,700 per ounce and an expiry date of 31 December 2014 Machinery lease facility of US$17.7 million as at 31 March

22 RESOURCE STATEMENT As at 31 December 2013 Tonnes Measured Indicated Inferred Total Grade g/t Au Ounces Tonnes Grade g/t Au Ounces Tonnes Grade g/t Au Ounces Tonnes Grade g/t Au Ounces Urucum Oxide , , , Tap AB Oxide 2, , , , Tap C Oxide , Tap D Oxide , Duckhead Oxide Total Oxide 4, , , , ,074 Urucum Primary 1, , ,382 19, , ,306 Tap AB Primary 1, , , , Tap C Primary , , , Tap D Primary , Duckhead Primary Total Primary 2, , ,804 30, ,412 66, ,360 Urucum Total 1, , ,512 31, ,139 61, ,765 Tap AB Total 3, , , , ,296 Tap C Total 1, , , , Tap D Total , , Duckhead Total Total Oxide and Primary 6, , ,207 47, ,816 96, ,434 Total Stockpiles 7, , Tartaruga , , Total 14, , ,207 53, , , ,967 22

23 RESERVE STATEMENT As at 31 December 2013 Tonnes Proved Reserve Probable Reserve Total Mineral Inventory Grade g/t Au Ounces Tonnes Grade g/t Au Ounces Tonnes Grade g/t Au Ounces Urucum Oxide , , Tap AB Oxide 2, , , Tap C Oxide Duckhead Oxide Total Oxide 3, , , Urucum Primary , , Tap AB Primary , , Tap C Primary Duckhead Primary Total Primary 1, , , Urucum Total 1, , , Tap AB Total 3, , , Tap C Total Duckhead Total Total Oxide and Primary 5, , ,150 29, ,487 Stockpile 1, , Spent Ore Stockpile 5, , Total Stockpiles 6, , Total 12, , ,150 36, ,668 Cut off g/t 23