Post on 21-Jan-2018
transcript
TSX: GPR | NYSE MKT: GPL 2
This presentation contains forward-looking statements within the meaning of the United States Private SecuritiesLitigation Reform Act of 1995 and forward-looking information within the meaning of the Securities Act (Ontario)(together, "forward-looking statements"). Such forward-looking statements may include but are not limited to theCompany's plans for production at its Guanajuato Mine Complex (“GMC”) and Topia Mine in Mexico, the CoricanchaMine Complex (“CMC”) in Peru and exploring its other properties in Mexico, the overall economic potential of itsproperties, the timing and results of the Coricancha preliminary feasibility study (“PFS”), timing and cost to the Companyof reactivating the CMC, anticipated processing and production rates that may be achieved at the CMC uponreactivation, the ultimate cost of reclaiming legacy tailings facilities, results of exploration and potential changes to theCMC resource base, the availability of adequate financing, and involve known and unknown risks, uncertainties andother factors which may cause the actual results, performance or achievements expressed or implied by such forward-looking statements to be materially different. Such factors include, among others, risks and uncertainties relating topotential political risks involving the Company's operations in a foreign jurisdiction, technical and operational difficultiesthat may be encountered with reactivation of the CMC, uncertainty of production and cost estimates and thepotential for unexpected costs and expenses, uncertainty in mineral resource estimation, physical risks inherent in miningand reclamation operations, currency fluctuations, fluctuations in the price of silver, gold and base metals, completionof economic evaluations, changes in project parameters as plans continue to be refined, permitting risks, the inability orfailure to obtain adequate financing on a timely basis, and other risks and uncertainties, including those described inthe Company's Annual Information Form for the year ended December 31, 2016 and Material Change Reports filed withthe Canadian Securities Administrators available at www.sedar.com and reports on Form 40-F and Form 6-K filed withthe Securities and Exchange Commission and available at www.sec.gov.
Statements concerning mineral reserve and resource estimates may also be deemed to constitute forward-lookingstatements to the extent that they involve estimates of the mineralization that will be encountered if the property isdeveloped. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans,projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases suchas “expects”, “anticipates”, “plans”, “projects”, “estimates”, “assumes”, “intends”, “strategy”, “goals”, “objectives”,“potential” or variations thereof, or stating that certain actions, events or results “may”, “could”, “would”, “might” or“will” be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statementsof historical fact and may be forward-looking statements.
Robert Brown, P. Eng. is the Qualified Person under NI 43-101 for the projects discussed in this presentation.
Disclaimer
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1. Includes cash and short-term deposits2. US Dollars; As at June 30, 2017
Silver-Gold>90% precious metals Unhedged - No Royalties - No Streams
ProducerTwo 100% owned mining operations in Mexico; potential to restart one project in Peru
StrengthStrong balance sheet - No debt $57.1M cash1,2, $63.0M working capital2
Disciplined Low cost producer
GrowthOrganic growth potential within operating districts and perusing acquisitions
Building a Foundation for Growth
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3.8 – 3.9 Guidance
Costs Profile
$1.72 $3.30
$5.83
$3.54
$5.67
$0.00
$5.00
$10.00
$15.00
$20.00
$25.00
Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017
Total cash cost per Ag oz (USD)
Average realized silver price (USD)
$7.19
$11.97
$16.44
$19.55
$14.93
$0.00
$5.00
$10.00
$15.00
$20.00
$25.00
Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017
All-in sustaining cost per Ag oz (USD)
Average realized silver price (USD)
Cash cost per ounce increased in Q2 due to stronger MXN and increased production in Topia
AISC peaked in Q1 due to capital projects; Decline started in Q2
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Mexico & Peru
Top two silver producing countries in the world
Favourable political & mining jurisdictions
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Historically one of Mexico’s most prolific
mining districts with past production of
more than one billion Ag oz over 400 years
Expanded production at Guanajuato Mine
Complex (GMC), developing new mines
and exploring the district
Commercial production at San
Ignacio commenced June 2014, lifting GMC
throughput to950-1,050 tpd
Excellent infrastructure.
Other projects in the district have potential
to be satellite operations
Guanajuato District (Ag-Au)
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Q3 2017
Metal Production (Ag eq oz1,2) 724,630
Silver Production (Ag oz1) 341,626
Recoveries Ag/Au (%) 89.8 / 88.1
Average Grades Ag/Au (g/t) 155 / 2.54
Ore processed (tonnes) 80,535
Cash Cost/Ag oz 3,4 TBA
All-in Sustaining Cost/Ag oz 3,4 TBA
1. Includes mill feed from San Ignacio.2. Silver equivalent ounces for 2017 are calculated using a 70:1 Ag:Au ratio.3. Cash cost per silver payable ounce and all-in sustaining cost per silver payable ounce (“AISC”) are non-IFRS performance measures. Refer to
the “Non-IFRS Measures” section of the Company’s MD&A for an explanation of these measures and reconciliation to the Company’s reportedfinancial results in accordance with IFRS. As these are not standardized measures, they may not be directly comparable to similarly titledmeasures used by others.
4. To be announces on October 30, 2017
Guanajuato Mine Complex (Ag-Au)1
Accounted for 65% of total production in Q3 2017¹
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Ramp access from surface
Ore trucked 22 km to Cata Plant in Guanajuato
Accounted for 55% of the total ore
processed at the GMC in Q3 2017
Significant potential for resource expansion over 4km strike length
Currently producing at between 500 - 600 tpd
San Ignacio Mine (Ag-Au)
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San Ignacio Mine (Ag-Au)
Exploration drilling has recently
confirmed strike continuity of
mineralization, highlighted by
19.24 metres averaging
6.36g/t gold and 261g/t silver
Current mine workings
New drilling
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Property covers most of district – more than
6,500 hectares
High grade, narrow vein underground mining
with central plant
Operating 9 separate mines provides flexibility
Ability to expand production at profitable mines; Can temporarilyclose others as needed
Lead and zinc concentrates sold to
metal trader in Mexico
Plant upgraded & new tailings facility
construction in early 2017
Topia Mine (Ag-Pb-Zn-Au)
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1. Silver equivalent ounces for 2017 are calculated using a 70:1 Ag:Au ratio, and ratios of 1:0.0559 and 1:0.0676 for the price/ounce of silver to lead and zinc respectively.
2. Cash cost per silver payable ounce and all-in sustaining cost per silver payable ounce (“AISC”) are non-IFRS performance measures. Refer to the “Non-IFRS Measures” section of the Company’s MD&A for an explanation of these measures and reconciliation to the Company’s reported financial results inaccordance with IFRS. As these are not standardized measures, they may not be directly comparable to similarly titled measures used by others.
3. To be announced on October 30, 2017
Topia Mine (Ag-Pb-Zn-Au)
Accounted for 35% of total production in Q3 2017
Q3 2017
Metal Production (Ag eq oz1) 355,853
Silver Production (Ag oz) 191,167
RecoveriesAg / Au (%)Pb / Zn (%)
91.1 / 67,1 93.5 / 93.8
Average GradesAg / Au (g/t)Pb / Zn (%)
362 / 0.972.63 / 3.33
Ore processed (tonnes) 18,004
Cash Cost/Ag oz2,3 TBA
All-in Sustaining Cost/Ag oz2,3 TBA
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Production and cash cost guidanceNine Months Actual 2017 2017 Guidance
Total silver equivalent ounces1 2,912,959 4,000,000 – 4,100,000
Total payable silver ounces3 TBA 1,950,000 – 2,000,000
Cash Cost per silver payable ounce2,3 TBA US$ 5.00 – US$ 6.00
AISC2,3 TBA US$ 14.00 – US$ 16.00
1. Silver equivalent ounces for 2017 guidance have been calculated using a 70:1 Au:Ag ratio, and ratios of 1:0.0559 and 1:0.0676 for the US dollar price of silver ounces to the US dollar price for lead and zinc pounds, respectively.
2. “Cash cost” and “AISC” are non-IFRS measures. Refer to the “Non-IFRS measures” section of the Company’s MD&A for complete definitions and reconciliations to the company’s financial statements.
3. To be announced on October 30, 2017
2017 Outlook
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Early Stage Exploration
Santa Rosa
Advanced Stage Exploration
El Horcón
DevelopmentAdvanced Stage
Development
Coricancha
Production
Guanajuato Mine
San Ignacio Mine
Topia Mine
Project Pipeline
~ 10 Years 5-10 Years 3-5 Years 1-3 Years Present
Pipeline of projects at various stages of exploration & development provides growth opportunities
Fully financed to bring the Coricancha Mine Complex and El Horcón into production
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Growth Strategy
For the first 10 years, the Company has grown organically but operations are now close to capacity
The Coricancha Mine Complex represents the first step in a new phase of growth by acquisition
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Topia (actual) GMC (actual) Topia (est) GMC (est) Coricancha (est)
Organic growth
Acquisitive growth
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Pipeline to Production
Coricancha represents a near-term (~18-24 mo.) production opportunity that could provide a foundation for future growth in Peru
Acquisition finalized in Q2 2017, with exploration & development programs commencing immediately
Production history at Coricancha indicates potential for approx. 3 million Ag eq oz per year at full capacity – a 75% increase for GPR
Significant historical reserve & resource base, to be updated in Q4 2017, followed by prefeasibility study (“PFS”) in 2018
Looking for additional acquisition in the Americas, with a focus on Mexico and Peru
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Underground mine placed on care & maintenance in
August 2013
90 km east of Lima in prolific mining district
Operating history dating back to 1906
Permitted & operational 600 tpd processing plant and gold bio-leaching
facility
80% precious metals, 20% base metals by value
GPR to update Mineral Resource Estimate in Q4
2017 & conduct PFS in 2018
Coricancha Mine Complex (Au-Ag-Pb-Zn-Cu)
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CMC Acquisition Agreement
Great Panther Silver Peru (“GPS Peru”) acquired Nyrstar Coricancha, the owner of a 100% interest in the CMC – June 30, 2017
GPS Peru to pay US$100,000 cash upon completion of certain post-closing conditions
Nyrstar may be paid 15% of annual free cash flow, up to US$10 million, after GPS Peru has recouped its investment
Nyrstar will cover cost of reclamation of certain tailings facilities, up to US$20 million, and associated fines up to US$4 million
Nyrstar will maintain US$9.7 million closure bond for three years
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Shares issued1 167,885,535
Fully diluted1 185,298,602
Institutional ownership ~17%
Market capitalization C $267M / US $217
90-day daily average trading volume
~1.1M shares
52-week trading range: TSX
NYSE MKTC $1.48 - $2.95
US $1.11 - $2.28
Cash position1 US $57.1M (no debt)
Net working capital1 US $63.0M
1. As at June 30, 2017
Capital Structure
Updated on October 11, 2017
Analyst Coverage: Euro Pacific Capital Inc; H.C. Wainwright & Co; HallgartenCompany; Noble Financial & ROTH Capital Partners
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Two Year Stock Performance
NYSE MKT: GPL
Mining sector has seen strong volatility in the last 18 months
Sell-off earlier in the year was largely driven by GDXJ rebalancing
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12 Month Peer Comparison
-80%
-60%
-40%
-20%
0%
20%
40%
60%
80%
100%
120%
Much of the junior mining sector has been dragged down by GDXJ rebalancing and general market sentiment
Change
Americas Silver 55%
Excellon 19%
Great Panther -1%
Silver -2%
Avino -17%
Fortuna -28%
Endeavour -40%
Impact -50%
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Leveraged To Silver
-100%
100%
300%
500%
700%
900%
2009 2010 2011 2012 2013 2014 2015 2016 2017
Great Panther Silver
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Low cost producer with strong leverage to silver price
Strong balance sheet, no debt – seeking acquisitions
Successfully grown production while reducing unit costs
Expanding into Peru - potential to increase production by 75%
Excellent liquidity on NYSE MKT and TSX
Why Great Panther Silver?
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Board of DirectorsR.W. (Bob) Garnett, CPA, CA, ICD.D, Chair
James Bannantine PE, MBARobert Archer, P. Geo.
Ken Major, P. Eng.John Jennings, MBA, CFA
W. James Mullin, B.Sc.Elise Rees FCPA, FCA, ICD.D
Directors & Senior Management Team
Chief Operating OfficerAli Soltani
President & CEOJames Bannantine
PE, MBA
Chief Financial OfficerJim Zadra
CPA, CA, MBA
V.P. Corp. DevelopmentSamuel Mah
P. Eng.
V.P. ExplorationMatthew Wunder
P. Geo.
V.P. Operations, MexicoBrian Peer
BA.Sc
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Historic underground mine with two operating shafts & two ramps
Currently mining & developing to 600m depth on several zones over 4km strike length
Higher cut-off grades & improvements in grade control have lowered costs
Ag-Au concentrate shipped to smelters in Japan & Germany
Guanajuato Mine (Ag-Au)
* For details on Mineral Resource Estimates, refer to slide 33
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Awarded distinction as a “Socially
Responsible Company” by CEMEFI,
Centro Mexicano para la Filantropía, for
a seventh consecutive year in 2017
Social Principles
We are committed to:
Ensuring our employees and contractors return home safely every day
Fair and equitable employment conditions for our employees
Enhancing and benefiting the communities in which we live and operate
Minimizing and restoring any impact on our environment
Strong ethics and we abide by all rules and regulations that apply to our business
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1. The Company has included the non-IFRS performance measures cost per tonne milled, cash cost, AISC, mine operating earnings before non-cash items, costof sales before non-cash items and adjusted EBITDA throughout this document. Refer to the Non-IFRS Measures section of this MD&A for an explanation ofthese measures and reconciliation to the Company’s reported financial results in accordance with IFRS. As these are not standardized measures, they maynot be directly comparable to similarly titled measures used by others.
2. Average realized silver price is prior to smelting and refining charges.
in US$000s except amounts
per share and per ounce Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016
Revenue $ 15,731 $ 12,371 $ 12,515 $ 15,631 $ 19,596
Mine operating earnings before non-
cash items1 $ 5,418 $ 5,445 $ 4,476 $ 7,230 $ 10,087
Net income (loss) $ 833 $ 3,040 $ (1,498) $ 2,130 $ (1,332)
Adjusted EBITDA1 $ 1,489 $ 2,134 $ 1,376 $ 4,738 $ 7,545
Earnings (loss) per share – basic $ 0.00 $ 0.02 $ (0.01) $ 0.01 $ (0.01)
Earnings (loss) per share – diluted $ 0.00 $ 0.02 $ (0.01) $ 0.01 $ (0.01)
Total cash cost per Ag oz1 $ 5.67 $ 3.54 $ 5.83 $ 3.30 $ 1.72
All-in sustaining cost per Ag oz1 $ 11.47 $ 19.55 $ 16.44 $ 11.97 $ 7.19
Average realized silver price2 $ 16.01 $ 19.33 $ 14.99 $ 19.65 $ 17.82
Financial Summary
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Consolidated
Operations Q3 2017 Q2 2017 Q1 2017 Q4 2016 Q3 2016
Silver ounces 532,803 569,229 366,435 460,571 510,491
Gold ounces 5,848 5,543 5,178 5,206 5,423
Lead tonnes 442 405 - 213 248
Zinc tonnes 562 638 - 315 324
Tonnes Milled 94,080 98,576 82,656 92,869 95,282
Silver equivalent ounces1,2 1,080,483 1,102,290 730,186 883,772 953,632
1. Silver equivalent ounces for 2017 were calculated using a 70:1 Ag:Au ratio, and a ratio of 1:0.0559 and 1:0.0676 for the price/ounce of silver to price/pound of lead and zinc respectively.
2. Silver equivalent ounces for 2016 were calculated using a 70:1 Ag:Au ratio, and a ratio of 1:0.0504 for the price/ounce of silver to lead and zinc price/pound respectively.
Operational Summary
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2013 2014 2015 2016 2017
Guanajuato 26,237 m 13,270 m 13,025 m 9,670 m 10,975 m
Topia 2,162 m 1,903 m - - 2,500 m
San Ignacio 1,144 m 3,827 m 4,657 m 6,015 m 21,025 m
Coricancha - - 2,323 m 3,551 m 7,800 m
Santa Rosa - - - - 1,000 m
El Horcón 2,156 m - - - 1,500 m
Total 31,699 m 19,000 m 20,005 m 19,236 m 44,800 m
2017 drilling focused on increasing resources and exploring new zones
Drilling Summary
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NOTE: Mineral Resource Estimates use an effective date of August 31, 2016; and all used a metal price outlook of US$18.00/oz silver and US$1,300/oz gold..| Topia,November 2014 - US$1,200/oz Au, US$17.00/oz Ag, US$0.90/lb Pb, and US$0.95/lb Zn. Silver equivalent calculations used the same metal pricing. | San Ignacio,December 2015 - US$15.00/oz Ag; US$1100/oz Au. | Silver equivalent calculations for El Horcon include lead content but not zinc, as the zinc would not be recoveredin the Guanajuato plant. Robert Brown, P. Eng. is the Qualified Person under NI 43-101 for Guanajuato, Topia, San Ignacio and El Horcon.
Measured Tonnes Ag (g/t) Au (g/t) Pb (%) Zn (%) Ag (oz) Au (oz) Ag Eq Oz
San Ignacio 408,327 116 2.88 1,525,584 37,760 4,191,435
Guanajuato 114,695 364 1.53 - - 974,318 5,647 1,372,961
Topia 180,400 606 1.44 4.26 4.52 3,515,000 8,300 6,000,200
Total Measured 6,014,902 51,707 11,564,596
Indicated
San Ignacio 133,398 106 2.79 - - 453,762 10,987 1,229,462
Guanajuato 36,480 216 1.04 - - 253,876 1,393 352,218
Topia 165,800 644 1.17 4.75 3.82 3,433,000 6,200 5,570,000
Total Indicated 4,140,638 18,580 7,151,680
Total Measured & Indicated 10,155,540 70,287 18,716,274
Inferred
San Ignacio 645,318 121 2.76 - - 2,519,826 44,551 5,665,137
Guanajuato 147,327 129 2.30 - - 612,220 10,095 1,324,867
Topia 357,400 592 1.31 3.44 3.96 6,807,500 15,060 11,050,000
El Horcón 162,140 76 3.64 2.97 4.11 398,094 17,942 2,092,913
Total Inferred 10,337,640 87,648 20,132,917
Mineral Resources