Third Quarter 2009 Conference Call & Webcast November 3, 2009

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Transcription:

Delivering Delivering Disciplined Disciplined Growth Growth Third Quarter 2009 Conference Call & Webcast November 3, 2009

Speakers Tye Burt Thom Boehlert Tim Baker President & CEO Executive Vice-President & CFO Executive Vice-President & COO 2

Cautionary Statement on Forward-Looking Information All statements, other than statements of historical fact, contained or incorporated by reference in this presentation, including any information as to the future financial or operating performance of Kinross, constitute forward-looking information or forward-looking statements within the meaning of certain securities laws, including the provisions of the Securities Act (Ontario) and the provisions for safe harbour under the United States Private Securities Litigation Reform Act of 1995 and are, unless otherwise stated, based on expectations, estimates and projections as of the date of this presentation. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Kinross as of the date of such statements, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Statements representing management s financial and other outlook have been prepared solely for purposes of expressing their current views regarding the Company s financial and other outlook and may not be appropriate for any other purpose. The forward-looking information set forth in this presentation is subject to various risks and other factors which could cause actually results to materially differ from those expressed or implied in the forward-looking information. The forward-looking information also reflects various estimates t and assumptions of Kinross management. These risks, factors, estimates t and assumptions are described d in more detail in Kinross most recently filed Annual Information Form in the section entitled Risk Factors, the Risk Analysis section of our most recently filed Management s Discussion and the Cautionary Statement on Forward-Looking Information in our news release dated May 5, 2009, to which readers are referred and which are incorporated by reference in this presentation. In addition, all forward-looking statements made in this presentation are qualified by the full Cautionary Statement on Forward-Looking Information in such news release. Kinross disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, or to explain any material difference between subsequent actual events and such forward-looking statements, except to the extent required by applicable law. Other information Where we say we, us, our, the Company, or Kinross in this presentation, we mean Kinross Gold Corporation and/or one or more or all of its subsidiaries, as may be applicable. The technical information about the Company s material mineral properties contained in this presentation has been prepared under the supervision of Mr. Rob Henderson, an officer of the Company who is a qualified person within the meaning of National Instrument 43-101. For more information on the Company s Mineral Reserves and Mineral Resources described in this presentation, we refer the reader to Kinross Mineral Reserve and Mineral Resource Statement at December 31, 2008, contained in our news release dated February 18, 2009, which is available on our website at www.kinross.com. For historical Mineral Reserve and Mineral Resource information, refer to Kinross public filings, available on our website. 3

Q3 2009 Results (in millions, except ounces and per share amounts) Gold equivalent production (1) (ounces) Gold equivalent sales (1) (ounces) Q3'09 Q3'08 % Change 537,440 551,510-3% 554,232 533,614 4% Revenue $582.3 $503.7 16% Cash Flow from Operations (before changes in working capital) $203.0 $183.2 11% per share $0.29 $0.29 (1,2) (1,2) Adjusted net earnings $1.7 $83.4 per share 0.00 0.13 YTD cash flow from operations per share increased 45% Margin growth continued Earnings negatively impacted by tax expense relating to foreign exchange gains on USD debt (1) Refer to endnote #1. (2) Refer to endnote #2. (3) Refer to endnote #3. 4

Growing margins and cash flow per share Cash flow per share (before changes in working capital) (2,3) Cost of sales margin ($/oz.) (4) $0.93 $451 $492 $447 $487 $0.64 $0.29 $0.29 2008 2009 2008 2009 2008 2009 Three months ended September 30 2008 2009 Nine months ended Three months ended Nine months ended September 30 September 30 September 30 (2) Refer to endnote #2. (3) Refer to endnote #3. (4) Refer to endnote #4. 5

Kinross Margins Expanding 2002 Q3 09: Average realized gold price: +203% Kinross attributable cost of sales margin (4) : +360% $478 $481 $492 Cost of Sa ales Margin ($/oz.) $107 $135 $161 $170 $279 $329 $436 Up 360% 2002 2003 2004 2005 2006 2007 2008 Q1'09 Q2'09 Q3'09 (4) Refer to endnote #4. 6

Organic Growth Opportunities Maricunga, Chile - Expansion o Scoping study completed late 2008 o Feasibility study expected in first half of 2010 o Concept is to increase capacity of existing crushing plant and construction of new primary crusher o Potential to increase ore processed by 50% Round Mountain, Nevada - Expansion o Exploring plans to expand pit and heap leach facilities o Feasibility study for Gold Hill is scheduled for Q2 2010 o Proceeding with state and local permitting process o Enables potential mining through 2017 7 7

Current mines: expansion projects Lobo-Marte, Chile Fruta del Norte, Ecuador Cerro Casale, Chile Pre- feasibility expected to be completed by year end Drill program 80% complete EIA in progress Environmental studies, infrastructure and training programs ongoing Working to obtain final authorization to recommence drilling Draft feasibility study being reviewed and optimized Details to be released in Q1 2010 8

Thom Boehlert Executive Vice-President and Chief Financial Officer 9

Ounces Sold & Cost of Sales Average realized price up 12% - $956/oz. Ounces Sold 590,522 608,574 533,614 554,232 $406 Cost of Sales (US$/oz.) (5) $464 Q3'08 Q3'09 Q3'08 Q3'09 Category 2 (5) Refer to endnote #5. 10

Q3 09 Financial Results (in US$ millions, except per share items) Net earnings (loss) $ (21.5) / ($0.03)/sh Adjusting non-operating operating items: Foreign exchange losses $ 35.0 Non-hedged derivatives losses(gains) $ 1.5 Losses (gains) on sle of assets and investments - net $ 1.0 Litigation reserve adjustment $ (18.5) Impairment $ - Taxes in respect of prior years $ 4.2 Adjusted net earnings (3) $ 17 1.7 / ($0.0)/sh 0)/ Cash flow from operating activities $ 141.9 Cash flow from operating activities iti (before changes in working capital) (2,3) $ 203.0 / $0.29/sh Capital expenditures $ 140.5 (2) Refer to endnote #2. (3) Refer to endnote #3. 11

Tax Provision Earnings before taxes and other items $ 89.1 Income and mining taxes expense - net $ 89.1 Tax expense on foreign exchange gain $ (58.6) $ 30.5 Adjusted effective tax rate in Q3'09 34.3% 12

Q3 2009 Results (in millions, except ounces and per share amounts) Gold equivalent production (1) (ounces) Gold equivalent sales (1) (ounces) Q3'09 Q3'08 % Change 537,440 551,510-3% 554,232 533,614 4% Revenue $582.3 $503.7 16% Cash Flow from Operations (before changes in working capital) $203.0 $183.2 11% per share $0.29 $0.29 (1,2) (1,2) Adjusted net earnings $1.7 $83.4 per share 0.00 0.13 Debt reduced d by $95.6 mm in Q3 Net debt - $224.6 mm Cash: $533.6 mm Capital expenditures: $140.5 mm (1) Refer to endnote #1. (2) Refer to endnote #2. (3) Refer to endnote #3. 13

2009 Guidance Production and Costs (6) Other Country Ounces (000s) 2009e Production % of 2009e Cost of Sales (US$/oz.) Chile 450-500 23% $425 - $460 Brazil 420-440 20% $645 - $670 Russia 675 725 33% $265 - $290 USA 625 680 31% $440 - $490 Total : 2.2 mm ounces $435 - $450 2009e (mm) Capital expenditures $500 Exploration & business development $75 Key Sensitivities: Approximately 55% -60% of the Company s costs are denominated in US dollars. A 10% change in foreign exchange could result in an approximate $7 impact on cost of sales per ounce. A $10 change in the price of oil could result in an approximate $2 impact on cost of sales per ounce. The impact of royalties of a $100 change in the gold price could result in an approximate $5 impact on cost of sales per ounce. (6) Refer to endnote #5. 14

Tim Baker Executive Vice-President and Chief Operating Officer 15

Q3 2009 Operating Results USA Chile il Braz Rus ssia Gold equivalent production Cost of Sales Ounces (US$/oz.) (5) Fort Knox 60,629 $591 Round Mountain 59,375 $529 Kettle River 49,486 $313 Subtotal 169,490 $480 La Coipa 43,662 $453 Maricunga 57,253 $518 Subtotal 100,915 $487 Paracatu 85,772 $764 Crixas 20,383 $437 Subtotal 106,155 $696 (1) Kupol 160,880 $278 Subtotal 160,880 $278 Total Kinross: 537,440 $464 (1) Refer to endnote #1. (5) Refer to endnote #5. 16

Paracatu Expansion Update Availability, efficiency and recovery showed improvement Challenges achieving concurrent recovery and throughput at expected levels Throughput in excess of 70% results in coarser grind orecoveries are currently at 74% compared to a design target of 80% Solutions: oimproving flotation through use of new reagents oblending mill feed oincreasing grinding capacity; additional ball mill 17

Kinross Key Objectives for 2009 Complete Aurelian integration Close Lobo-Marte acquisition from Teck Lock-in significant ifi share of input costs Strengthened liquidity: close $415 mm equity issue Replace Operations reserves Add tax-effective cash flow in Canada: Diavik Declare next dividend of $0.05 per share a 25% increase from previous dividend Complete Fort Knox expansion Paracatu expansion operating at 100% Advance Fruta del Norte project towards pre-feasibility Advance Lobo-Marte project towards pre-feasibility Complete feasibility / decision on Cerro Casale Assess bolt-on JVs / acquisitions 19

Endnotes 1) Unless otherwise stated, gold equivalent production, gold equivalent ounces sold and cost of sales figures in this presentation are based on Kinross share of Kupol production (75%). 2) Unless otherwise stated, all cash flow and cash flow per share figures in this presentation are before changes in working capital. Cash flow before changes in working capital is a non-gaap measure and is defined as cash flow provided from operating activities before changes in operating assets and liabilities. 3) For a reconciliation of non-gaap measures, please refer to pages 7 and 8 of Kinross news release dated November 2, 2009, available on our website at www.kinross.com. 4) Cost of sales margin is defined as the average realized price of gold less attributable cost of sales per ounce. 5) Cost of sales per ounce is defined as cost of sales as per the financial statements divided by the number of gold equivalent ounces sold, both reduced for Kupol sales attributable to a third-party 25% shareholder. 6) For more information regarding Kinross production and cost of sales outlook for 2009, please refer to the news release dated November 2, 2009, available on our website at www.kinross.com. 20

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