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24
CORPORATE PRESENTATION
Transcript
Page 1: Egd apr-2013-with-ye2

CORPORATE PRESENTATION

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This presentation contains certain forward-looking statements and information relating to

Energold that are based on the beliefs of its management as well as assumptions made by and

information currently available to Energold. When used in this document, the words “anticipate”,

“believe”, “estimate”, “expect” and similar expressions, as they relate to the Company or its

management, are intended to identify forward-looking statements.

This presentation contains forward looking statements relating to, among other things, regulatory

compliance, the sufficiency of current working capital, the estimated cost and availability of funding

for the continued exploration and development of the Company’s exploration properties. Such

statements reflect the current views of the Company with respect to future events and are subject

to certain risks, uncertainties and assumptions. Many factors could cause the actual results,

performance or achievements of the Company to be materially different from any future results,

performance or achievements that may be expressed or implied by such forward-looking

statements.

George Gorzynski, P.Eng., a Qualified Person under the meaning of Canadian National Instrument

43-101,is responsible for the IMPACT Silver Corp. technical information in this presentation.

2

FORWARD LOOKING STATEMENTS

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• Global Specialty Drilling Contractor

Providing socially & environmentally sensitive drilling

services to the international mining & energy sector.

• Market Leaders in ‘Frontier Drilling’

Proprietary mineral drilling rig platform designed for

drilling in remote and diverse sub-terrain locations with

limited infrastructure as well as sensitive environmental

and social issues.

• Global Footprint

Operating 234 rigs in 22 countries across all metal and

mineral targets.

• Proven Track Record of Performance

Compounded annual growth in revenues of >25% over

the last 6 years.

Energold’s Highly Mobile Surface Rig in Operation

Durango, Mexico

3

OUR BUSINESS

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4

Mining

Energold Drilling’s

original and primary line of

business. Market leader in

frontier drilling services,

operating 133 rigs in 22

countries spanning broad

spectrum of minerals.

Minimizes environmental and

social impact with proprietary

man-portable drills.

Energy

Significant presence in

the Canadian oil sands

coring market

Acquisition in 2011 added

129 rigs to Energold and

paved way into energy

drilling market.

Energy market peaks when

mineral exploration slows

Tremendous new growth

market with oil sands boom

Manufacturing

With over 150 years of

history, Dando designs,

manufactures, and maintain

rigs for global clients

Capabilities across all drill

types, with specialty focus

on water well drilling

Vertical integration of rig

sourcing for EGD

Stable revenue in

maintenance and parts

OUR BUSINESS SEGMENTS

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• Modular Component Design

– Easy to transport within country, across challenging terrain as well as rapid mobilization globally to reduce downtime

• Proprietary Technology

– Depth capabilities of over 1,000m with ¼ inch greater core diameter using Thin Wall rod system

– Competitive portable rigs only reach depths between 200–300m BTW

• Rigs Built In-House

– Ensures proprietary nature of rig designs

– Continual upgrades are implemented from input of field personnel

5

OUR TECHNOLOGY

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6

WORLD WIDE OPERATIONS

World-Wide Operations Energold has offices and/or operations in 22 countries with complete jurisdictional compliance

and logistical support.

Contractor Of Choice Commence relationships with frontier drilling programs that historically continue through to downstream

stages of development. Current & historic client list includes many of the leading global mining companies.

Rig Fleet Energold has increased its fleet size in response to demand by an average of 70% per year over the last 6 years with

a current rig count of 234 (including diamond and energy drilling). Mobile rig platforms can be re-deployed more efficiently and

cheaper than conventional rigs.

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Dominican Republic

Peru

Albania

Guinea

7

GLOBAL PROJECT EXAMPLES

Frontier Drilling Specialists

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Energold’s clientele

includes many of the world’s

largest mining companies.

Existing clientele range

from early-stage junior

explorers to well known,

mature producers spanning all

base and precious metals, as

well as industrial commodities.

MAJORS

• Barrick Gold

• BHP Billiton

• Goldcorp

• Grupo Mexico

• Rio Tinto

• Newmont Mining

• Penoles

• Vale

• AngloGold

• Fresnillo

• El Dorado Gold

• Codelco

JUNIORS

• Grayd Resources (now Agnico-Eagle)

• US Gold (now McEwan Mining)

• Great Panther Silver

• First Majestic Silver

• Olympus Pacific Resources (now Besra Gold)

• Magellan

• GoldQuest Mining Corp. 8

CUSTOMER PROFILE

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CDN$ (000’s) 2009 2010 Dec 31, 2011 Dec 31, 2012

Revenue $23,719 $54,591 $133,482 $141,514

Net Earnings ($1,951) $1,449 $26,428 ($8,650)*

Cash $18,460 $28,225 $22,782 $28,493

Working Capital $46,319 $61,461 $69,341 $91,249

Adjusted Earnings* $305 $1,505 $14,143 $2,339

Adjusted EPS* $0.01 $0.04 $0.35 $0.05

• 9 Months Ended Sept 30, 2012 Q3 continue to be challenging for juniors and overall cautious

capital markets. Mineral operations still profitable. Manufacturing growing and building rigs.

• Energy division mobilizing and has seen record quarterly revenues, Q4/Q1 peak coming.

• Maintaining average revenue per meters of over $190/metre+

9

FINANCIAL HIGHLIGHTS

Note Bonus Payment to Energold Energy of $7.4 million on Dec 2012 on meeting EBITDA targets of over $5 million. Annual payment capped at $10,500,000 with

additional amortization expense due to IFRS gain on acquisition.

* Adjusted Earnings - Excludes earnout payment and non-cash items which include accretion expense on debenture, finance cost related to sales-leaseback

finance lease, share-based payments, foreign exchange, dilution and equity gain/loss on IMPACT, impairment/write-down of assets, gain on acquisition.

Year End 2011 Year End 2012 % Change

Revenue

Mineral 105,783 80,439 (24)% Energy 13,473 47,148 250% Manufacturing 14,227 13,927 (2%)

Total Revenue $133,483 $141,514 6%

Continued growth despite challenging markets

Poised to outperform the sector with diversified commodity business

Page 10: Egd apr-2013-with-ye2

10

FINANCIAL REFLECTS GROWTH

EPS Growth* Rig Count

Meters Drilled Revenue

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Rig Count Growth (2010-2012)

Revenue Growth (2009-2012)

11

DIVERSIFIED GLOBAL GROWTH

AND VALUE PRICED VS PEERS

Market Cap & Average Volume

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12

MANAGEMENT & CORPORATE SUMMARY

Fred Davidson CA MBA President, CEO and Director

James Coleman LLB Chairman and Director

Steven Gold CFA Chief Financial Officer

Craig Geier HBA Managing Director (Dando Drilling Services)

H. Walter Sellmer Director

Michael J. Beley Director

Wayne Lenton Director

Trading Symbol EGD:TSXV

Share Price (April 2013) $2.10

Shares Outstanding 46.2 Million

Shares Fully Diluted 47.1 Million

Market Cap $97.2 Million

Institutional Ownership 25%

Insider Ownership 10%

Cash $28.5 Million

Debt $12.4 Million

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STRONG INDUSTRY

FUNDAMENTALS

• Raw material prices vs. production

cost favors continued exploration

• New sizable discoveries are

increasingly difficult to find,

forcing traditional miners to seek

assets in frontier regions that

require specialized equipment

• Producers with record cash levels

seeking to replenish reserves

(evident by recent M&A activities

in market)

• GDP Growth 2011-2025 forecast by

BHP is +6% for China and +2% for

US driving by urbanization

Source: MEG, PriceWaterhouseCoopers

13

MINING INDUSTRY

– POSITIVE OUTLOOK

World needs new

discoveries = more

frontier drilling

Source: BHP Biliton Dec 2012 Macquarie Conference

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• Proven player in sizable oil sands

market dating back to 1963

• Niche, high-margin market with

short and long-term growth

• Oil Sands coring – smooth out

Energold traditional slow mineral

seasons (Q4/Q1)

• Re-allocation under-utilized drill

fleet (seismic and specialty) within

Energold’s global network

• Synergy from people – trained

drillers in coring can transition to

mineral drilling and vice-versa

Bertram TH60

Coring Rig

14

ENERGOLD ENERGY

BERTRAM INTERNATIONAL CORP.

LIS GT1

Seismic Drilling Rig

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World Class Resources

• Oil sands represent

97% Canada’s oil reserves1

Sizable expenditures expected

• About $84 billion per year

investment for next 25 years

Oil Sands project are long-term

• Less susceptible to short term

pricing fluctuations as compared to

metal markets

1. Environmental Canada May 2011 Oil Sands Report

2. CAPP http://www.capp.ca/getdoc.aspx?DocId=191939&DT=NTV

3. Canada National Energy Board – Energy Oil Sands Assessment 2006 15

ENERGY INDUSTRY

(OIL SANDS) OUTLOOK

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• Over 150 years of

experience in designing

and manufacturing

of larger rigs in the UK

• Maintenance, servicing,

and sales of rigs and

parts to third parties

• Expertise in water well

drilling

• Building a new services

division that can leverage

the existing Energold

logistics network

Mineral Multipurpose

Geotechnical

16

ENERGOLD MANUFACTURING

DANDO INTERNATIONAL LTD.

Waterwell

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• Growth: The manufacturing

and equipment demand for

resource industry is growing,

13% YOY for Caterpillar.

Tepid 2012 with

improvements in 2013 in US,

China, and most of developing

world. 1

• Potential: Global mining

equipment market is $61

billion. At $12.2 million (2012

YTD), Energold is just 0.01%

of the market. 3

1. Caterpillar Q3 2012 Earnings http://www.caterpillar.com/investors/events-and-presentations/presentations

2. Boart Longyear 2012 Full Year Earnings – February 18, 2013

3. Standard & Poors – Credit Week Feb 2012

17

MANUFACTURING

INDUSTRY DEMAND CONTINUES

2

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Positive Social Impact

– Provide jobs for locals

– Training in work-safety and mechanical experience

Minimal Environmental Impact

– Portable rigs leave a small environmental footprint

– Avoid tree clearcuts and save cost on road building

Third Party Recognition

– PDAC Environmental Excellence in Exploration Case Study (E3 Initiative)\

– BC Business Innovators of Year 2012

Energold’s approach is win-win

for clients and local communities

18

SOCIAL & ENVIRONMENTAL

Haiti Bridge

Infrastructure Project

Donated Waterwell

in Chihuahua, Mexico

Donated backpacks and

textbooks to local schools in

Dominican Republic

Donated shoes,

clothing, soccer

balls, mosquito

netting to Guinea

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• IMPACT Silver Corp is a profitable

silver producer in Mexico

• ENERGOLD DRILLING CORP

owns 6.87 million shares (11%~)

• OPERATIONS

Three profitable, operating mines

at the Royal Mines of Zacualpan

• EXPLORATION

Huge exploration potential in

623 sq. km composed of two

under-explored Silver districts

• DEVELOPMENT

Capire open pit mine currently in

production with ramp up

throughout 2013

Zacualpan Processing Plant

SYMBOL IPT-TSX.V

SHARE PRICE $0.82

MARKET CAP $57 M

CASH $16 M

DEBT $0

19

INVESTMENT HOLDINGS:

IMPACT SILVER CORP.

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-5,000

0

5,000

10,000

15,000

20,000

25,000

30,000

2008 2009 2010 2011 2012

Revenues

Net Earnings

Operating Cash Flow

CD

N$ 0

00

’s

Year 20

IMPACT SILVER CORP.

PROFITABLE GROWING PRODUCER

2012 2011 2010 2009 2008 CAGR

2008-2012

Total tonnes processed (t) 168,826 154,289 131,348 114,340 102,426 +10.5%

Tonnes processed per day (t) 463 424 360 313 280 +10.5%

Silver (oz) Production 620,515 833,607 750,259* 823,571 645,668

Lead (t) Production 463 731 734 969 813

Zinc (t) Production 710 1,248 1,212 1,098 1,053

Revenue per tonne sold $94 $171 $123 $110 $90

Direct cost per tonne sold $65 $70 $63 $60 $55

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21

EXPANSION OF “CORE BUSINESS” MINERAL

DRILL FLEET

• Grow mineral drilling rig fleet

to solidify existing markets

• Continued growth of frontier

drilling and transitioning with

clients to mature projects with

larger conventional drills

• Organic growth and search

for acquisitions in existing

and new markets

• Continue technological

advancements in rig design

and capabilities.

SEED AND EXPAND INTO NEW MARKETS

• Capitalize on high growth frontier regions such as South/Central America, Southeast Asia & Africa.

• Pursue additional ‘bolt-on’ acquisitions in target regions.

• Grow underground drilling services.

• Grow water well drilling business

• Expand drilling services and multi-purpose and reverse circulation (RC)

GROW ENERGY AND MANUFACTURING

DIVISIONS

• Energold Energy division continues to benefit from niche market expertise in unconventional and conventional markets

• Grow manufacturing services and utilize capabilities to build larger rigs over time

• Grow new business divisions including the historical Dando footprint in water well activity

21

CONTINUED GROWTH STRATEGY

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Analyst Company Contacts

Michael Mills CFA MBA Beacon Securities 416-643-3871

Maggie MacDougall BBA Cormark Securities 416-362-7485

Mona Nazir Fraser Mackenzie 416-682-4208

Russell Stanley CFA MBA Haywood Securities 416-507-2328

Ben Jekic CFA Industrial Alliance 416-203-5826

Kam Mangat CFA Salman Partners 416-861-1270

Neil Forster CFA Scotiabank 416-863-2899

Steve Green CFA Toronto Dominion (TD) 416-983-3276

22

ANALYST COVERAGE

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• Energold presents a compelling opportunity to invest in a broad range of commodities

and projects worldwide

• Catalysts for growth – commodities remain strong and significant potential in energy

• Favorable balance sheet allows EGD to capitalize on opportunities

• Value play on commodities – trading at 52 week low despite continued growth 23

INVEST IN ENERGOLD TODAY

5 Year Chart on EGD:TSXV

Page 24: Egd apr-2013-with-ye2

Contact info

Jerry Huang MBA

Manager Investor Relations

jhuang@ energold.com 604-681-9501


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