Post on 31-May-2020
transcript
Mine Gold. Create Value.Presentation by Mr John Welborn, Managing Director & CEO
Diggers & Dealers Conference, Kalgoorlie, Monday 7 August, 2017
2
Cautionary Statement
This presentation includes certain statements, estimates and projections with respect to the future performances of Resolute. Such statements, estimates and
projections reflect various assumptions concerning anticipated results, which assumptions may prove not to be correct. The projections are merely estimates by
Resolute, of the anticipated future performance of Resolute’s business based on interpretations of existing circumstances, and factual information and certain
assumptions of economic results, which may prove to be incorrect. Such projections and estimates are not necessarily indicative of future performance, which may be
significantly less favourable than as reflected herein. Accordingly, no representations are made as to the fairness, accuracy, correctness or completeness of the
information contained in this presentation including estimates or projections and such statements, estimates and projections should not be relied upon as indicative of
future value, or as a guarantee of value of future results. This presentation does not constitute an offer, invitation or recommendation to subscribe for or purchase
securities in Resolute Mining Limited.
The information in this report that relates to the Exploration Results, Mineral Resources and Ore Reserves is based on information compiled by Mr Andrew Goode who
is a member of the Australasian Institute of Mining and Metallurgy and Mr Bruce Mowat, a member of The Australian Institute of Geoscientists. Mr Andrew Goode and
Mr Bruce Mowat both have more than 5 years’ experience relevant to the styles of mineralisation and type of deposit under consideration and to the activity which they
are undertaking to qualify as a Competent Person, as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources
and Ore Reserves”. Mr Andrew Goode and Mr Bruce Mowat are full time employees of Resolute Mining Limited Group and each hold equity securities in the Company.
They have consented to the inclusion of the matters in this report based on their information in the form and context in which it appears. This information was prepared
and disclosed under the JORC code 2012 except where otherwise noted. Particular Reserves and Resources remain 2004 JORC compliant and not updated to JORC
code 2012 on the basis that information has not materially changed since it was last reported.
In providing this presentation, Resolute has not considered the objectives, financial position or the needs of the recipient. The recipient should obtain and rely on its
own financial advice from its tax legal accounting and other professional advisers in respect of the recipients objectives financial position and needs. To the maximum
extent permitted by law neither Resolute nor its related corporations ,directors, employees or agents nor any other person accepts liability for any loss arising from the
use of this presentation or its contents or otherwise arising in connection with it. You represent and confirm by attending and or retaining this presentation that you
accept the above conditions.
3
Corporate Summary (ASX:RSG)
0
0.5
1
1.5
2
2.5
Aug 03,2017
Jun 22,2017
May10,
2017
Mar 24,2017
Feb 10,2017
Dec 28,2016
Nov 14,2016
Oct 03,2016
Aug 22,2016
Jul 11,2016
$A
UD
Share PriceShares on issue 736,982,768
Share Price A$1.07
Market Capitalisation A$792M (US$628M)
Cash, bullion, investments A$290M (US$223M) at 30 Jun 2017
Debt A$34M (US$26M) at 30 Jun 2017
FY18 Guidance300,000oz gold production
@ AISC A$1,280/oz (US$960/oz)
Dividend Policy2% of annual gold production
offered in gold or cash
Substantial
Shareholders
ICM Global Funds 20.43%
Van Eck 8.97%Analyst
Coverage
Argonaut
Baillieu Holst
Canaccord Genuity
Citigroup
Euroz
Global Mining Research
Hartleys
Macquarie
Morgan Stanley
RBC Capital Markets
James Wilson
Warren Edney
Patrick Chang
Trent Allen
Jon Bishop
David Cotterell
Paul Howard
Ben Crowley
Brendan Fitzpatrick
Paul Hissey
Institutional
Shareholders
Oppenheimer Funds
IFM Investors
Baker Steel Capital Managers
Average daily volume 8.0M Shares
4
Mine Gold. Create Value.
5
Mine Gold.
329,834ozTotal Gold Production
A$1,132/ozAll-In Sustaining Cost (AISC)
317,242ozTotal Gold Sold
A$1,717/ozAverage Price Received (A$/oz)
FY17
5
6
Create Value.
A$541MRevenue from gold and silver sales
A$136MNet
Profit before tax
A$177MGross profit from operations
Cash, Bullion & Listed Investments
$A290M
FY17
6
7
Three years running…Track record of strong operating performance
FY15 FY16 FY17
Production
(oz)
Original Guidance 315koz 315koz 300koz
Actual 329koz 315koz 330koz
Achieved ✔ ✔ ✔
AISC
(A$/oz)
Original Guidance A$1,280/oz A$1,280/oz A$1,280/oz
Actual A$1,094/oz A$1,200/oz A$1,132/oz
Achieved ✔ ✔ ✔
Price
(A$/oz)
Average Spot A$1,457/oz A$1,602/oz A$1,661/oz
Received A$1,467/oz A$1,624/oz A$1,717/oz
Achieved ✔ ✔ ✔
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ASX-listed peer group>300kozpa Australian producer peer group
Resolute
Mining(RSG)
Evolution
Mining
(EVN)
Northern Star
Resources (NST)
Regis
Resources(RRL)
St Barbara
Limited(SBM)
Saracen
Minerals(SAR)
Market Cap A$0.79B A$3.72B A$2.82B A$1.96B A$1.39B A$1.07B
Resources 12.1Moz 14.2Moz 10.2Moz 8.1Moz 9.1Moz 9.0Moz
Reserves 5.6Moz 7.0Moz 3.5Moz 2.2Moz 4.0Moz 2.1Moz
Annual Production 330kozpa 844kozpa 515kozpa 324kozpa 381kozpa 273kozpa
AISC A$1,132/oz A$905/oz A$1,013/oz A$945/oz A$907/oz A$1,348/oz
Achieved Price A$1,717/oz A$1,641/oz A$1,673/oz A$1,691/oz A$1,685/oz A$1,642/oz
EV / Resource Oz A$50/oz A$292/oz A$216/oz A$220/oz A$130/oz A$116/oz
EV / Reserve Oz A$109/oz A$592/oz A$629/oz A$811/oz A$297/oz A$494/oz
EV / Production Oz A$1,617/oz A$4,898/oz A$4,288/oz A$5,610/oz A$3,114/oz A$3,831/oz
EV / FY17 EBITDA 2.5x 5.9x 5.3x 7.2x 3.6x 8.9x
P / NAV 0.6x 1.5x 1.3x 1.3x 1.0x 0.9x
Source: Publicly available company documents, presentations and broker research. Market data as at 3 August 2017
9
0
2
4
6
8
10
12
14
16
Resolute Evolution Mining Northern Star Resources Regis Resources St Barbara Limited Saracen Minerals
Resources & Reserves
Resources Reserves
ASX-listed peer group>300kozpa Australian producer peer group
Resolute
Mining
Source: Publicly available company documents, presentations and broker research. Market data as at 3 August 2017
Mill
ion
Ou
nce
s
10
ASX-listed peer group>300kozpa Australian producer peer group
Source: Publicly available company documents, presentations and broker research. Market data as at 3 August 2017
0
100
200
300
400
500
600
700
800
900
Resolute Evolution Mining Northern Star Resources Regis Resources St Barbara Limited Saracen Minerals
Annual Production
Resolute
Mining
ko
zp
a
11
ASX-listed peer group>300kozpa Australian producer peer group
Source: Publicly available company documents, presentations and broker research. Market data as at 3 August 2017
A$
/oz
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
Resolute Evolution Mining Northern Star Resources Regis Resources St Barbara Limited Saracen Minerals
All-In Sustaining Costs (AISC)
Resolute
Mining
12
ASX-listed peer group>300kozpa Australian producer peer group
Source: Publicly available company documents, presentations and broker research. Market data as at 3 August 2017
A$
/oz
$1,600
$1,620
$1,640
$1,660
$1,680
$1,700
$1,720
$1,740
Resolute Evolution Mining Northern Star Resources Regis Resources St Barbara Limited Saracen Minerals
Average Price Received (FY17)
Resolute
Mining
13
ASX-listed peer group>300kozpa Australian producer peer group
Source: Publicly available company documents, presentations and broker research. Market data as at 3 August 2017
A$
Bill
ion
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
Resolute Evolution Mining Northern Star Resources Regis Resources St Barbara Limited Saracen Minerals
Market Capitalisation
Resolute
Mining
14
ASX-listed peer group>300kozpa Australian producer peer group
Source: Publicly available company documents, presentations and broker research. Market data as at 3 August 2017
P/N
AV
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
Resolute Evolution Mining Northern Star Resources Regis Resources St Barbara Limited Saracen Minerals
Price / Net Asset Value (P/NAV)
Resolute
Mining
15
13
12
11
9
7
4
6
2
6
6
6
6
6
2
7
8
6
- 2 4 6 8 10 12 14
Ravenswood
Syama
Cowal
Mt Rawdon
Mt Carlton
Mungari
Edna May
Cracow
Jundee
Kundana
Kanowna Belle
Garden Well
Rosemont
Moolart Well
Leonora – Gwalia
Thunderbox
Carosue Dam
Reserve life (years)
Reserve Life Benchmarking>300kozpa Australian producer peer group
Resolute
Evolution
Northern Star
Regis
St Barbara
Saracen
Source: Publicly available company documents, presentations and websites and broker research. Reserve life adjusted for recovery. 15
16
Ore Mined
(t)
Ore Milled
(t)
Head Grade
(g/t)
Recovery
(%)
Total Production
(Gold oz)
AISC
A$/oz
Syama Sulphide 1,215,153 2,106,371 2.59 69.8 136,000 1,001
Syama Oxide 1,319,596 1,340,097 2.84 83.2 101,830 960
Syama Total 2,534,749 3,446,468 2.68 75.3 237,830 984
Syama Gold MineOperation Highlights
Gold Production
(oz)
AISC
(A$/oz)
AISC
(US$/oz)
Syama Sulphide 130,000 1,050 788
Syama Oxide 90,000 1,260 945
Syama Total 220,000 1,140 855
FY17 Operating Performance
FY18 Production Guidance
16
1717
US$881/ozLOM AISC - Underground
12 YearUnderground Mine Life
6.0Moz TotalResource
3.1Moz TotalReserve
2.4Mtpa (170kozpa)
Sulphide
Production Rate
1.5Mtpa (70kozpa)
Oxide
Syama Gold MineOverview
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Syama UndergroundA world class sublevel cave in the making…
Syama
(8Moz)
Nafolo
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19
Automation & DevelopmentSyama Underground
• Automated drilling and longer
rounds delivering rapid
underground development
• Underground mine development
has advanced more than 3km
• First development ore has
commenced ramping up to
~500ktpa
• Pre-production underground ore of
~1.3Mt before first sublevel cave
production ore in December 2018
20
Depth of peer group undergroundPeer group mining at depths beyond 12 years at Syama
• Average depth of peer group
underground mines is 600m
below surface
• Peers are currently mining at
depths well beyond the next
12 years at Syama
• The 8Moz Syama orebody
has been drill tested to
~800m below surface
• Peers mining at up to twice
the depth of the current limit
of drilling at Syama
Nafolo
20
21
A major gold discovery at SyamaGame changing new discovery at Nafolo
• Adjacent to 8Moz
Syama Deposit
• Potential to transform
Syama operation
• Untested to the south
and at depth
• All drillholes to date
have intersected gold
mineralisation
• Remains open in all
directionsSyama long section – Nafolo discovery
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22
A world class opportunity10Moz and counting, 80km of strike untested below ~200m
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Scratching the surfaceNo deep drilling outside of the Syama deposit
All drilling
20,552holes
Drilling >100m
1,628holes
Drilling >200m
81holes
24
Syama’s high grade satellitesHigh grade underground satellite opportunities
• High grade (>5g/t Au) sulphide
extensions below satellite oxide
pits:
• 20m @ 18.28g/t Au from 117m
• 23m @ 9.61g/t Au from 140m
• 25m @ 8.06g/t Au from 160m
• 14m @ 16.65g/t Au from 89m
• High grade feed to supplement
base load Syama Underground
Sublevel Cave (2.8g/t Au)Tabakoroni long section – high grade sulphide at depth
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Syama Gold Mine One of Africa’s premier gold mines
Acacia
Bulyanhulu
18.7Moz
Newmont
Ahafo
10.4Moz
Randgold
Kibali
19.7Moz
Randgold
Loulo
9.9Moz
Centamin
Sukari
12.9Moz
AngloGold
Geita
7.3Moz
AngloGold
Iduapriem
5.6Moz
Goldfields
Tarkwa
9.1Moz
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Randgold
Gounkoto
4.8Moz
Goldfields
Damang
6.0Moz
Iamgold
Essakane
5.1Moz
Resolute
Syama
10.0Moz
26
Ravenswood Gold MineOperation Highlights
Mt Wright is one of Australia’s most successful underground mines, having
mined a ~2.5g/t Au orebody at an average cash cost of A$850/oz over the last
5 years, down to a depth of ~900m below surface
Ore Mined
(t)
Ore Milled
(t)
Head Grade
(g/t)
Recovery
(%)
Total Production
(Gold oz)
AISC
A$/oz
FY17 Actual 2,366,159 1,995,293 1.54 93.1 92,004 1,406
Gold Production
(oz)
AISC
(A$/oz)
AISC
(US$/oz)
FY18 Production Guidance 80,000 1,520 1,145
LOM Average Annual
Production123,500 1,166 872
FY17 Operating Performance
FY18 Production Guidance
26
2727
A$1,166/oz LOMAISC
13 YearMine Life
+130kozpa
ProductionRate Post 2020
4.3Moz TotalResource
1.8Moz TotalReserve
2.8MtpaProcess Capacity - Current
5.0MtpaNameplate Capacity
Ravenswood Gold MineOverview
28
Development HighlightsRavenswood Expansion Project
• Mt Wright underground to finish in late-FY18
• Open pit mining recommenced at Nolans East
• Processing capacity increased to 2.8Mtpa and
expanding to 5.0Mtpa
• Regulatory approvals tracking on schedule
• Buck Reef West open pit mining approvals
expected in mid-2018
• Beneficiation of low grade ore (0.3 - 0.7g/t Au)
• Staged development plan targeting up to
140kozpa at a Life of Mine AISC of A$1,166/oz
for 13 yearsRavenswood Expansion Project
29
Bibiani Gold MineOverview
29
US$858/oz LOMAISC
5 YearInitial Mine Life
1.8Moz TotalResource
0.6Moz TotalReserve
1.2MtpaMining Rate
>100kozProposed Annual Production
9 monthsTimeline to production
US$72M Pre-productioncapex
30
Bibiani Gold MinePhase 2 drilling success
• A substantial gold deposit:
• Production to date of >4Moz
• 1.8Moz Total Resource
• Phase 2 drilling underway to
upgrade inferred resources to an
indicated category
• Phase 2 drilling has intersected
mineralisation better than the
inferred resource predicted
• Currently drilling to extend mine life
beyond the initial five years
• Targeting 100kozpa, 10 year mine
life, 25% IRR Bibiani long section - Phase 2 drilling
31
Exploring
6,600km2
of prospective tenure across Australia & Africa
Active drilling programs in
Mali, Ghana, Côte d'Ivoire& Queensland
31
Exploration Exploring world class tenure in West Africa and Australia
32
Exploration for growthExploring to grow the business, not to stay in business
0
2
4
6
8
10
12
14
0
5
10
15
20
25
30
35
40
Resolute Northern Star Saracen Regis Resources St Barbara
Avera
ge M
ine L
ife
Explo
ration B
udget
FY
18e (
A$M
)
Exploration Budget vs Average Mine Life
Exploration Budget FY18e (A$M) Average Mine Life (years)
Resolute
33
8.9
x
7.2
x
5.9
x
5.7
x
5.5
x
5.3
x
4.7
x
3.6
x
2.5
x
Sa
racen
Regis
Evolu
tio
n
Oceana
Go
ld
Ala
cer
Nort
hern
Sta
r
Westg
old
St.
Barb
ara
Resolu
te
292
220
216
188
130
116
60
50
29
23
Evolu
tio
n
Regis
Nort
hern
Sta
r
Oceana
Go
ld
St.
Barb
ara
Sa
racen
Ala
cer
Resolu
te
Westg
old
Pe
rseus
811
629
592
494
378
297
158
109
105
60
Regis
Nort
hern
Sta
r
Evolu
tio
n
Sa
racen
Oceana
Go
ld
St.
Barb
ara
Westg
old
Resolu
te
Ala
cer
Pe
rseus
5,6
10
4,9
12
4,8
98
4,2
88
3,8
31
3,1
14
2,9
07
1,7
17
1,7
12
1,6
17
Regis
Oceana
Go
ld
Evolu
tio
n
Nort
hern
Sta
r
Sa
racen
St.
Barb
ara
Ala
cer
Pe
rseus
Westg
old
Resolu
te
ASX-listed peer groupA compelling value gap
Source: Publicly available company documents, presentations and broker research. Market data as at 3 August 2017.
Notes: (1) Resource inclusive of reserve.
(2) Based on broker consensus estimates calendarised to June year end.
EV / FY17E Production(2)(A$/oz)
Median: $3,472/oz
EV / Resource(1)(A$/oz)
Median: $123/oz
Median: 5.5x
EV / Reserve (A$/oz)
Median: $337/oz
EV / FY17E EBITDA(2)(x)
Re
so
lute
Re
so
lute
Res
olu
te
Res
olu
te
34
RSG OpportunityAnalyst 12 month price targets: 100% ‘BUY’
0.5
0.7
0.9
1.1
1.3
1.5
1.7
1.9
2.1
2.3
4/12/2016 4/01/2017 4/02/2017 4/03/2017 4/04/2017 4/05/2017 4/06/2017 4/07/2017
A$
Shareprice
34
35
Mine Gold. Create Value.
Scale
5.6MozReserves
Longevity
12yrs@ Syama
13yrs@ Ravenswood
Value
0.6xP/NAV
Balance sheet
$290MCash, Bullion & Listed Investments
Growth
NafoloBibiani
Tabakaroni
Track Record
28yrsproducing
8Moz& counting
35
3636
Your gold awaits
Mine gold. Create value.
ASX:RSG | www.rml.com.au