New Management Optimising Production Reducing Costs. Doray Minerals Limited

Transcription

1 New Management Optimising Production Reducing Costs Doray Minerals Limited Investor Update - February 2017

2 Disclaimer This presentation has been prepared by Doray Minerals Limited ( Doray ) to provide an update regarding the company to investors. Presentation information: This presentation is for information purposes only and does not constitute a prospectus or prospectus equivalent document. The information in this presentation is provided in summary form, has not been independently verified, and should not be considered to be comprehensive or complete. It is not intended to and does not constitute, or form part of, an offer, invitation or the solicitation of an offer to purchase or otherwise acquire, subscribe for, sell or otherwise dispose of any securities, or the solicitation of any vote or approval in any jurisdiction, nor shall there be any offer, sale, issuance or transfer of securities in any jurisdiction in contravention of any applicable law. Not financial product advice: This presentation is not financial product or investment advice, nor a recommendation to acquire Doray securities. It has been prepared without taking into account the objectives, financial situation or needs of individuals and is not intended to be relied upon as advice to investors or potential investors. Before making an investment decision, investors or prospective investors should consider the appropriateness of the information having regard to their own objectives, financial situation and needs and seek legal and taxation advice appropriate to their jurisdiction. Doray is not licensed to provide financial product advice in respect of its securities or any other financial products. Cooling off rights do not apply to the acquisition of Doray securities. Doray assumes that the recipient is capable of making its own independent assessment, without reliance on this document, of the information and any potential investment and will conduct its own investigation. Disclaimer: Doray and its related bodies corporate and each of their respective directors, officers, employees, agents and contractors disclaims, to the maximum extent permitted by law, all liability and responsibility for any direct or indirect loss or damage which may be suffered by any person (including because of fault or negligence or otherwise) through use or reliance on anything contained in or omitted from this presentation. In particular, this presentation does not constitute, and shall not be relied upon as, a promise, representation, warranty or guarantee as to the past, present or the future performance of Doray. Forward looking statements: This presentation contains forward looking statements. Forward looking statements are often, but not always, identified by the use of words such as "seek", target, "anticipate", forecast, "believe", "plan", "estimate", "expect" and "intend" and statements that an event or result "may", "will", "should", "could" or "might" occur or be achieved and other similar expressions. Indications of, and guidance on, future expected production or earnings and financial position and performance are also forward looking statements. The forward looking statements in this presentation are based on current expectations, estimates, assumptions, forecasts and projections about Doray and the industry in which it operates as well as other factors that management believes to be relevant and reasonable in the circumstances at the date such statements are made, but which may prove to be incorrect. The forward looking statements relate to future matters and are subject to various inherent risks and uncertainties. Many known and unknown factors could cause actual events or results to differ materially from the estimated or anticipated events or results expressed or implied by any forward looking statements. Such factors include, among others, changes in market conditions, future prices of gold and exchange rate movements, the actual results of production, development and/or exploration activities, variations in grade or recovery rates, plant and/or equipment failure and the possibility of cost overruns. Neither Doray, its related bodies corporate nor any of their directors, officers, employees, agents or contractors makes any representation or warranty (either express or implied) as to the accuracy, correctness, completeness, adequacy, reliability or likelihood of fulfilment of any forward looking statement, or any events or results expressed or implied in any forward looking statement, except to the extent required by law. You are cautioned not to place undue reliance on any forward looking statement. The forward looking statements in this presentation reflect views held only as at the date of this presentation. Other than as required by law and the ASX Listing Rules, Doray disclaims any duty to update forward looking statements to reflect new developments. Reserve and LOM : This presentation refers to both Reserve and LOM (Life of Mine) Inventory in reference to Mutiny. LOM metrics include inferred resources. Unless otherwise stated the metrics presented in this presentation refer to LOM Inventory. The financial metrics quoted in this presentation are those determined before any hedging, gold streaming, gearing or taxation. Gold Equivalent Ounces: This presentation also refers to Gold Equivalent Ounces (AuEq). The Resource oz (AuEq) shows estimated AuEq ounces which relates specifically to the time the resource estimate was done and the metal prices quoted in those estimates. Slide 30 and slide 31 of this presentation shows a graph of Mine Peers, Reserve Grade and Production. This graph uses AuEq oz for comparative purposes only against gold only mines. Doray advises that the use of metal equivalents is not recommended for detailed financial analysis. Competent Person s Statement The information in this presentation regarding Exploration Results, Mineral Resources or Ore Reserves has been extracted from various Doray ASX announcements and are available on the Doray website at or through the ASX website at (using ticker code DRM ). Doray confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and that all material assumptions and technical parameters underpinning the estimates in that market announcement continue to apply and have not materially changed. Doray 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. 2

3 Doray Minerals Ltd - Investment Highlights Successful Australian Gold Producer Record Quarterly Production Doray Minerals achieved record quarterly production of 29779oz* for Dec 2016 and revenue of A$45.6M from two WA gold mines New Managing Director and Chairman to lead restructuring Mr Leigh Junk appointed Managing Director in January 2017 Mr Julius Matthys appointed Non-Executive Chairman in February 2017 Near-term share price catalysts The Deflector Gold Copper Mine produces oz* and 1308 tonnes copper from transitional ore for December Quarter Scoping study to begin at the oz resource Gnaweeda Project 15kms from Andy Well processing plant Major cost reduction initiatives underway Doray Minerals Limited Mineral Resource Inventory as at 30 June 2016 Gold Measured Indicated Inferred Total Gold Inventory Tonnes g/t Ounces Tonnes g/t Ounces Tonnes g/t Ounces Tonnes g/t Ounces Andy Well 164, ,000 1,020, ,000 5,337, ,000 6,521, ,000 Deflector 1,164, ,000 1,043, , , ,000 2,865, ,000 TOTAL 1,328, ,000 2,063, ,000 5,995, ,000 9,386, ,377,000 * Includes estimated 6677 ounces in middlings product * See ASX Release dated 28 September

4 Corporate Snapshot ASX Code DRM Shares on Issue 356.9M Market Cap December Quarterly Revenue Full Year Production Forecast for FY2017 Cash/Gold Bullion (31 Dec 2016) Additional Gold Ounces Held in Middlings (est oz*) Debt (31 Dec 2016) Hedging (31 Dec 2016) A$150M A$45.6M oz oz A$27.5M A$15.8M A$ A$1,614/oz Non-Cash Impairment $40M $45M Board/Management Julius Matthys Leigh Junk Peter Alexander Jay Stephenson Non-Executive Chairman Managing Director Non-Executive Director Non-Executive Director * Estimated Ounces contained in Copper/Gold Middlings Product 4

5 Deflector Into Primary Ore Mining primary ore in February 2017 Project Summary: Produced oz* of gold and 1318 tonnes of copper in quarter to Dec 2016 Cash flow positive for HY to Dec 2016 Mine life of 5.5 years Open at depth with substantial near-mine exploration upside Deflector Gold Project Ore Reserve Inventory as at 30 June 2016 Gold Copper Tonnes Au Grade (g/t) Au Ounces Cu Grade (%) Cu Tonnes Proved 908, , ,000 Probable 873, , ,000 TOTAL 1,781, , ,000 * Includes estimated 6677 ounces in middlings product * See ASX Release dated 28 September

6 Deflector - High-Grade Primary Sulphide Ore Basalt Footwall and Hanging Wall - Ideal Mining conditions 1.8m wide ore - grade 38g/t Au, 5.5% Cu Concentrate in circuit Mine Life Mineralogy Gold Recovery Copper Recovery Primary Ore 5.5 years Chalcopyrite, Pyrite, Au 89% 93% 6

7 Deflector Long Section Drilling to Increase Reserves 7

8 Deflector - Substantial Exploration Upside Gold-Copper targets Airborne-EM surveying of Deflector corridor completed Planned WA Government EIS funded stratigraphic drilling to refine target model Deflector structural mapping driving near-mine targeting Gold targets Extensive historic gold mining Large areas under cover Average drill hole depth <40m High-quality magnetic data Drilling under historic high-grade King Solomon/New Phoenix underground gold mine completed 8

9 Andy Well - Entering a New Phase For the 2HY ended 31 December 2016 Andy Well produced oz at an AISC of $1509 New management restructuring the project with a focus on reducing costs while optimising cash flow during Gnaweeda study Costs at Andy Well expected to be high in March Quarter as structural changes are implemented Large Gnaweeda open pit resource has potential to reconfigure production and cost profile Andy Well Gold Project Mineral Resource Inventory as at 30 June 2016 Gold Measured Indicated Inferred Total Tonnes g/t Ounces Tonnes g/t Ounces Tonnes g/t Ounces Tonnes g/t Ounces Andy Well 164, ,000 1,020, , , ,000 1,921, ,000 Gnaweeda 4,600, ,000 4,600, ,000 Total 164, ,000 1,020, ,000 5,337, ,000 6,521, ,000 See ASX release dated 28 Sept

10 Gnaweeda - Emerging as a Potential Satellite Operation 15km from Andy Well processing plant Maiden Inferred Resource for Turnberry - open at depth and along strike: 1.8g/t Au for 266,000 oz * High-grade intersections beneath shallow depletion zone: 18.9g/t 41.6g/t 4.8g/t 58.2g/t 4.7g/t Fast-tracking to mid 2017 development decision RC drilling ongoing to extend Resource Metallurgical test work commenced Baseline environment studies and heritage surveys underway Turnberry Mining Lease pegged Haulage routes to Andy Well identified * Refer ASX Announcement dated 20 July

11 New Chairman and Managing Director Chairman Mr Julius Matthys Bcom Mr Matthys was appointed the Chairman of Doray Minerals on February 2 nd He has 35 years experience in the global minerals and mining industry and 5 years experience as an ASX listed company director. Mr Matthys has held senior executive positions within the BHP Billiton Group, including Operations President Worsley Alumina JV, Marketing Director Alumina, Aluminium and Iron Ore and Vice President Corporate Affairs W.A. Mr Matthys is currently a Non-Executive Director of ASX listed TFS Corporation Ltd, Chair of Council at John XXIII College, Perth and a Board Member at Celebrate WA. Managing Director Mr Leigh Junk Dip Surv, Grad Dip Min Eng, MSc Min Econ Mr Junk is a Mining Engineer with 25 years experience and has held senior positions in several Western Australian mining companies. In 2000 Mr Junk co founded the private mining company Donegal Resources Pty Ltd, which was successful in purchasing and re commissioning several Nickel operations around Kambalda W.A. Donegal was later sold to Canadian company Brilliant Mining Corp during the Nickel boom in late Over the last 10 years Mr Junk has been a Director of several public companies in the Mining and Financial sectors in Australia and Canada. Mr Junk was appointed Managing Director of Doray Minerals in December Mr Junk was the recipient of the 2003 Ernst & Young Young Entrepreneur of the Year Award and the 2007 W.A Business News 40 Under 40 Award. 11

12 Regional Exploration Projects Mt Fisher JV (Doray earning in) JV with Rox Resources (ASX:RXL) Under-explored prospective geology under cover Extensive mineralisation previously identified Maiden AC drilling campaign to commence Horse Well JV (Doray 60%) JV with Alloy Resources (ASX:AYR) Geology similar to Yandal Belt Recent AC drilling outlined extensive +50ppb Au anomaly over 7km long West Gawler JV (Doray earning in) JV with Iluka Resources (ASX:ILU) 20,000sqkm of under-explored terrane Extensive drill/geochemical database Regional targeting ongoing 12

13 Summary New Management driving restructure of company The Deflector Mine commencing production in primary ore with a 5.5 year mine life The Deflector orebody is open in all directions with significant near mine exploration upside Andy Well undergoing restructuring to coincide with the nearby Gnaweeda Project feasibility Gnaweeda has the potential to be a long life ore source for the Andy Well Project New management team focussed on optimising production and near mine opportunities 13

14 New Manageme nt Driving Production and Cost Reductions Competent Person Statements The information in this announcement regarding Exploration Results, Mineral Resources or Ore Reserves has been extracted from various Doray ASX announcements and are available on the Doray website at or through the ASX website at (using tickercode DRM ). Doray confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and that all material assumptions and technical parameters underpinning the estimates in that market announcement continue to apply and have not materially changed. Doray 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. For further information contact: Mark Hepburn Corporate Development Manager Investorrelations@dorayminerals.com.au