Stillwater Mining Company A PGM Business

Transcription

1 Stillwater Mining Company A PGM Business

2 STILLWATER MINING COMPANY Mining Investment Forum 2004 Denver, CO September 27, 2004 Gregory A. Wing Vice President and Chief Financial Officer

3 THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 Some statements contained in this presentation are forward-looking within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and, therefore, involve uncertainties or risks that could cause actual results to differ materially. Additional information regarding factors which could cause results to differ materially is found in the section entitled Risk Factors in the Company s Annual Report on Form 10-K. The Company intends that the forward-looking statements contained herein be subjected to the above-mentioned statutory safe harbors. Investors are cautioned not to put undue reliance on forward-looking statements. The Company disclaims any obligation to update forwardlooking statements.

4 Operations

5 Location

6 2004 Operating Plan PGM production - 595,000 oz. 430,000 oz - Stillwater Mine avg. 1,970 tons/day 165,000 oz - East Boulder Mine avg. 1,300 tons/day Total cash costs - $275 - $290 per oz Stillwater Mine - $265 per oz East Boulder Mine - $310 per oz Capital expenditures - $81 m $52 m - Stillwater Mine $22 m - East Boulder Mine $ 6 m - Smelter and Refinery

7 1H 2004 Operating Performance Net income $32.2 million or $0.36 per share Combined avg. realized price for mine production increases 21% to $486 per oz. PGM production - 295,000 oz at $274 per ounce 228,000 oz palladium 67,000 oz platinum Stillwater Mine production flat at 214,000 oz; cash costs flat East Boulder Mine production up 7% at 81,000 oz; cash costs down 9% Continue Selling Palladium Inventory Expanded Secondary Metals Business

8 PGM Production 000 oz 1, e e 1H04 Stillwater Mine East Boulder Mine

9 Income $ millions $362 $ $649 $ $586 $ $384 $ * H Combined Pd Pt average market price $/oz Combined Realized Pd Pt price $/oz $408 $ $486 $ * before impairment charge and other non-cash charges -332

10 Financial Performance EBITDA $ millions 200 $649 $ $ $ $541 $ $384 $ $408 $486 $380 $315 * * 1H04 Combined Pd Pt average market price $/oz Combined Realized Pd Pt price $/oz -5 0 * before impairment charge and other non-cash and transaction expenses

11 Financial Capacity At June 30, 2004 Cash on hand - $53.8 million Drawn from Credit Facility - $127.8 million Access to undrawn revolving credit - $1.6 million Entered into hedges covering 20% of expected platinum mine production over next 18 months at an average price of $784 per ounce Pd Inventory Sold 156,000 ounces out of 877,000 ounces at close to market prices Credit Facility Replaced credit facility, beginning of third quarter New credit facility consists of a $140 million six-year term loan and a $40 million five-year revolving credit facility

12 Capital Spending $ millions e e 1H Stillwater Mine East Boulder Mine Other Capital

13 Sales Contracts $ per oz $500 $450 $400 $350 $ Floor Realized Price based on $350 (pd $230, pt $745) Realized Price based on $347 (pd $200, pt $830) Realized Price based on $370 (pd $230, pt $830) Realized Price based on $423 (pd $300, pt $830)

14 Palladium and Platinum Prices Jan to Sept. 15, 2004 $ per oz Pal l adium Pl atinum 1,100 1, Jan Jan. 31, 2001 Sept. 15, 2004

15 Existing Palladium Usage

16 European Car Emissions Regulations Source: Johnson Matthey Platinum 2002

17 China Domestic Light Vehicle Demand CAGR = Compound Annual Growth Rate Source: CSM Worldwide

18 Existing Palladium Usage

19 New Uses For Palladium

20 European Diesel Car Sales

21 Fuel Cells Ford s Focus Fuel Cell Vehicle

22 2003 Palladium Usage Autocatalyst Electronic Dental Chemical Jewelry Other Source: Johnson Matthey Platinum 2004

23 Palladium Present and Future Current price firming - Shifting back to palladium - Visible inventories - Norilsk-Stillwater transaction completed Supply fundamentals - Supply to demand deficit of the 90 s - Expansions - Inventory wild card Demand fundamentals - Restore confidence in Palladium supply - Increase demand for Palladium - Tighter emission standards - Fuel cell technology - Safe hydrogen storage medium

24 Stillwater Mining Company Investment Highlights Highest grade PGM deposit in western world Only U.S. producer Substantial palladium source Controlling shareholder in PGM business Significant upside potential Increase secondary business Expand operations Strong sales contract position Experienced management team Focused environmental/safety position

25

26 Appendix

27 Existing Sales Contract 3 primary customers Ford, GM, Mitsubishi Floor Palladium Platinum % Production Average Price % Production Average Price % $371-$339 80% $ % $357 80% $ % $385-$375 70% $425 Ceiling %-25% $644-$783 16% $ % $975 14% $ % $975 14% $850

28 Consolidated Costs Costs per Ton H2004 Cash Operating Cost $119 $115 $108 Royalties, Taxes Total Cash Costs $133 $130 $126 Depreciation and Amortization Total Production Cost $163 $163 $159 Costs per Ounce Cash Operating Cost $256 $249 $235 Royalties, Taxes Total Cash Costs $287 $283 $274 Depreciation and Amortization Total Production Cost $351 $354 $347

29 1H 2004 Operating Performance PGM production - 295,000 oz. 228,000 oz palladium 67,000 oz platinum Milled 642,000 tons Stillwater Mine 2,050 tons/day East Boulder Mine 1,300 tons/day Total Cash Costs $274 per ounce Total Production Costs $347 per ounce Continue Selling Palladium Inventory Expand Secondary Metals Business