African Barrick Gold. Q Results Presentation 23 rd October 2014

Transcription

1 African Barrick Gold Q Results Presentation 23 rd October 2014

2 Disclaimer Important Notice This presentation and the information contained herein is for information purposes only and does not constitute an invitation or offer to underwrite, subscribe for or otherwise acquire or dispose of any securities of ABG in any jurisdiction. This presentation includes forward-looking statements that express or imply expectations of future events or results. Forward-looking statements are statements that are not historical facts. These statements include, without limitation, financial projections and estimates and their underlying assumptions, statements and information regarding plans, objectives and expectations with respect to future production, projects, operations, costs, products, services and the Operational Review, and statements regarding future performance. Forward-looking statements are generally identified by the words plans, expects, anticipates, believes, intends, estimates, will and other similar expressions. All forward-looking statements involve a number of risks, uncertainties and other factors, many of which are beyond the control of ABG, which could cause actual results and developments to differ materially from those expressed in, or implied by, the forward-looking statements contained in this presentation. Factors that could cause or contribute to differences between the actual results, performance and achievements of ABG include, but are not limited to, changes or developments in political, economic or business conditions or national or local legislation or regulation in countries in which ABG conducts or may in the future conduct business, industry trends and developments, competition, fluctuations in the spot and forward price of gold and copper or certain other commodities (such as diesel fuel and electricity), currency fluctuations (including the US dollar, South African rand, Kenyan shilling and Tanzanian shilling exchange rates), ABG s ability to successfully integrate acquisitions, ABG s ability to recover its reserves or develop new reserves, including its ability to convert its resources into reserves and its mineral potential into resources or reserves and to process its mineral reserves successfully and in a timely manner, ABG s ability to complete land acquisitions required to support its mining activities, operational or technical difficulties which may occur in the context of mining activities, delays and technical challenges associated with the completion of projects, risk of trespass, theft and vandalism, changes in ABG s business strategy including, without limitation, ABG s successful implementation of the Operational Review, as well as risks and hazards associated with the business of mineral exploration, development, mining and production and risks and factors affecting the gold mining industry generally. Although ABG s management believes that the expectations reflected in such forward-looking statements are reasonable, ABG cannot give assurances that such statements will prove to be correct. Accordingly, investors should not place reliance on forward-looking statements contained in this presentation. Any forward-looking statements in this presentation only reflect information available at the time of preparation. Subject to the requirements of the Disclosure and Transparency Rules and the Listing Rules or applicable law, ABG explicitly disclaims any obligation or undertaking publicly to update or revise any forward-looking statements in this presentation, whether as a result of new information, future events, changes in expectations or circumstances, or otherwise. Nothing in this presentation should be construed as a profit forecast or estimate and no statement made should be interpreted to mean that ABG s profits or earnings per share for any future period will necessarily match or exceed the historical published profits or earnings per share of ABG. You are reminded that you have received this presentation subject to the disclaimer and important notices contained herein and on the basis that you are a person to whom this presentation may be lawfully made and delivered in accordance with the laws of the jurisdiction in which you are located. You may not and are not authorised to: (i) reproduce or publish this presentation; or (ii) distribute, disclose or pass on this presentation to any other person, in whole or in part, by any medium or in any form, whether electronically or otherwise. ANY FORWARDING, DISTRIBUTION OR REPRODUCTION OF THIS PRESENTATION IN WHOLE OR IN PART IS UNAUTHORISED. FAILURE TO COMPLY WITH THIS NOTICE MAY RESULT IN A VIOLATION OF APPLICABLE SECURITIES LAWS. BY ACCEPTING THIS PRESENTATION, YOU AGREE TO BE BOUND BY THE FOREGOING LIMITATIONS. 1

3 Q Continued Delivery on Targets Gold production of 190,986 ounces, up 16% on Q3 2013, sales of 178,490 ounces AISC of US$1,098 per ounce sold, 14% lower than Q and 1% lower than Q Cash costs of US$679 per ounce, 7% lower than both Q and Q Cash position increased by US$17 million to stand at US$287 million at 30 September 2014 EBITDA of US$76 million, 17% higher than Q Net earnings of US$28 million (US6.9 cents per share), 60% higher than Q

4 Key Metrics Q Q % change YTD 2014 YTD 2013 % change Gold Production (ounces) 190, ,429 16% 537, ,627 14% Gold Sold (ounces) 178, ,061 11% 509, ,430 7% Cash cost (US$/ounce) (7%) (12%) AISC (US$/ounce) 1 1,098 1,270 (14%) 1,111 1,411 (21%) Average realised gold price (US$/ounce) 1 1,268 1,309 (3%) 1,282 1,421 (10%) Revenue (US$ 000) 240, ,042 9% 686, ,402 (3%) EBITDA 1,3 (US$ 000) 75,835 64,769 17% 207, ,541 6% Net earnings/(loss) 3 (US$ 000) 28,444 17,830 60% 69,266 (683,400) nm Earnings/(loss) per share (EPS) (cents) % 16.9 (166.6) nm Cash from operating activities (US$ 000) 101,428 39, % 228, ,922 65% Capital expenditure 4 (US$ 000) 81,251 81, , ,100 (20%) 1 These are non-ifrs measures. Refer to page 10 of the Q results for definitions comparative amounts have been restated to exclude Tulawaka 3 EBITDA and net earnings consist of earnings from both continuing and discontinued operations 4 Excludes non-cash reclamation asset adjustments and includes finance lease purchases 3

5 (US$/oz) Continued Consistent Reduction in Costs Evolution of Cash Cost and All In Sustaining Cost (US$/ounce sold) 2,000 Cash cost / ounce 1,600 1,709 1,675 1,577 AISC / ounce 1,404 1,200 1,270 1,162 1,131 1,105 1,098 1, , Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 FY14e 4

6 Key Market Focus Areas Milestone Quarter on quarter reduction in AISC Quarter on quarter grade improvement at Bulyanhulu CIL Expansion moved into commissioning phase Board approval of Upper East Project Progress on Gokona Underground Reduction in outstanding indirect tax receivables First production from CIL Expansion Group free cash generation Step up in Bulyanhulu development rates Achieved Board approval of Gokona Underground Q Achievement of US$185 million of cost savings Q First ore from Bulyanhulu Upper East Project Q First ore from Gokona Underground H Continued delivery on targets vital to achieving improved recognition in the market 5

7 Q Mine Site Operating Metrics Bulyanhulu North Mara Buzwagi Group Three Months ended 30 Sept Q Q Q Q Q Q Q Q Tonnes Mined Kt n/a n/a 4,494 5,528 6,286 7,628 11,016 13,388 Ore tonnes hoisted / Mined Kt ,090 1,001 1,981 1,697 Ore milled Kt ,054 1,165 2,238 2,114 Head grade g/t Mill recovery % 87.1% 90.5% 87.2% 86.9% 94.8% 87.3% 87.9% 88.3% Ounces produced oz 63,333 52,126 64,332 67,895 63,321 44, , ,429 Ounces sold oz 51,409 50,767 61,440 69,695 65,641 40, , ,061 Cash cost $/oz , All-in sustaining cost $/oz 1,350 1,183 1,015 1, ,436 1,098 1,270 Copper production Klbs 1,488 1,269 n/a n/a 3,043 1,569 4,531 2,838 Copper sold Klbs 1,153 1,169 n/a n/a 3,089 1,279 4,242 2,448 Capital Expenditure $m 42,404 36,800 22,372 33,888 16,257 14,609 81,251 81,291 6

8 US/$ million AIS C per Ounce Sold (US$/oz) Ounces (000 s) Cash Costs per Ounce Sold (US$/oz) Outlook Production (koz) 750 Cash Costs (US$ per ounce sold) 1, ~ E E Capital Expenditures (US$ Million) All In Sustaining Cost (US$ per ounce sold) Expansion, 50 Cap Dev't, 120 Expansion, 117 Sustaining, 186 Sustaining, 112 Expansion, 50 Cap Dev't, 172 Cap Dev t Sustaining, E 1,750 1,500 1,250 1, ,585 1,362 ~1, E 7

9 Investment Proposition Where we stand today... Where we are heading... Operational stability throughout the group Production guidance of over 700koz Cost discipline embedded across business Eight successive quarterly reductions in AISC Operating and capital controls enforced Continued positive cash flow generation Prioritising allocating capital to shareholders Consistent dividend payout Re-engineering the mines Bulyanhulu performing to its potential Re-designing structures and roles Right sizing the workforce Cultural transformation Driving accountability and performance Proactive stakeholder engagement Building strong relationships We have created a strong base to leverage future operational transformation 8