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TSX:NMI OTCQX:NMKTF
Q1 2016 Financial Results
April 29, 2016
2
Forward Looking Statements
Certain information set forth in this presentation contains “forward-looking statements”, and “forward-looking information under applicable securities laws. Except for statements of historical fact, certain information contained herein constitutes forward-looking statements, which include the Company’s expectations about its business and operations, and are based on the Company’s current internal expectations, estimates, projections, assumptions and beliefs, which may prove to be incorrect. Some of the forward-looking statements may be identified by words such as “will”, “expects”, “anticipates”, “believes”, “projects”, “plans”, and similar expressions. These statements are not guarantees of future performance or outcomes and undue reliance should not be placed on them. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements or forward-looking information. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. The Company does not undertake to update any forward-looking statements or forward-looking information that are included in this presentation or incorporated by reference herein, except in accordance with applicable securities laws.
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Q1 2016 CEO Highlights Solid Q1 Gold Production of 58,057 ounces, up 9.2% over Q4 2015 and down 2.7% over Q1 2015
Record Quarterly Performance at flagship Fosterville Mine with record quarterly production of 33,138 ounces, record average grade of 7.34 g/t, up 28% year-over-year
Fosterville Achieves Low Operating Cash Costs1 of $473 and AISC1 of $723
Cosmo Production up 27% to 16,340 oz, over Q4 2015, 3.09 g/t average grade, 90.7% recovery
Strong Financial Position with $52.1 million cash balance at March 31, 2016
Essentially Debt-Free with only $1.6 million in long-term debt
Record Low consolidated AISC of $908 per ounce sold - 2016 guidance of $950 to $1,025
Operating Cash Costs of $701 per ounce sold - 2016 guidance of $650 to $725 $8.9 million Free Cash Flow based on operating cash flow less CAPEX of $9 million, after investing $3.8 million
into growth programs. Operating cash flow of $18.3 million or $0.13 per share based on basic weighted average number of shares outstanding (146.3 million), based on revenue of $66.1 million from 57,796 ounces sold
Net Income of $6.5 million or $0.04 EPS - Q1 2016 EPS reflects an increased weighted average number of shares outstanding as a result of the conversion and redemption of Debentures and the exercise of warrants in Q1
1) Operating Cash Costs and All-in sustaining costs (“AISC”) refer Non-IFRS Measures on slide 23
(All figures are in United States (“US”) dollars, unless otherwise stated)
4
Q1 2016 Strong Financial Position Cash Position and Working Capital As at March 31, 2016 Cash Position of $52.1 million, reflecting an
increase of $15.6 million from December 31, 2015
Reflecting net free cash flow from mine
operations, the receipt of proceeds on the exercise of share purchase warrants, and the reduction of current debt relating to the Debentures. With the full conversion and redemption of the convertible debentures
Essentially debt-free with only $1.6 million in
long-term debt
(All figures are in United States (“U.S.”) dollars, unless stated otherwise)
Cash Balance ($ million ) $52.1
Working Capital (incl. cash)($ million) $38.6
Debt ($ million) $1.6
TSX: NMI OTCQX: NMKTF
Balance Sheet
Issued and Outstanding (million) 175.6
Options (million) 10.7
Performance Share Units (million) 3.7
Warrants 0.5
Fully Diluted (million) 190.5
Luxor Capital Group LP 19.3%
Eric Sprott 17.9%
Management/Board (basic) 7.4%
Capital Structure & Ownership
5
Strong Base of Mineral Resources Consolidated Measured and Indicated (“M&I”)
Resources to 4.7 million ounces
Fosterville Mineral Reserves up 34% to 244,000 ozs. Mineral Reserve grade increased 25% to 6.95 g/t
Fosterville’s Phoenix and Lower Phoenix gold systems host M&I Mineral Resources containing 673,000 ozs grading 8.33 g/t(1)
Recent surface-based drilling programs confirm up-plunge and down-plunge potential to expand defined Mineral Resources in Lower Phoenix system. which has been traced for over 2 km and remains open for further expansion.
Stawell’s Aurora B resulted in a maiden Inferred Mineral Resource of 30,400 ounces grading 3.5 g/t. Aurora B Inferred Mineral Resource grade is 42% greater than underground Mineral Reserve grade.
Stawell Inferred Mineral Resources increased 55% to 116,400 ozs at December 31, 2015 including the Aurora B discovery within the East Flank of the Magdala System. (1) For updated Mineral Reserves and Mineral Resources refer to press release dated March 21, 2016. For detailed gold-bearing structures comprising the Phoenix and Lower Phoenix gold systems, see slide 19.
Eagle Fault Gold Zone Drill Core
Approximately $5-$10 million of
growth exploration in 2016 to support organic growth initiatives that add
quality ounces
(All figures are in United States (“U.S.”) dollars, unless stated otherwise)
6 6
Q1 2016 FINANCIAL RESULTS REVIEW
7
Financial Results (000’s US$) Q1 2016 Q1 2015 Q4 2015
Gold ounces produced 58,057 59,676 53,179
Gold ounces sold 57,796 61,294 52,290
Revenue 66,055 72,897 58,383
Cost of operations, including depletion and depreciation (48,502) (53,135) (49,669)
Mine operating income 17,553 19,762 8,714
Net income (loss) 6,463 15,703 (20,238)
Net income (loss) per share($/share) basic & diluted1 0.04 0.13 (0.15)
Operating Cash Flow 18,299 27,486 10,594
Capital Expenditures 9,434 13,460 10,870
Gold Price and Costs (US$) Q1 2016 Q1 2015 Q4 2015
Average realized gold price 1,139 1,185 1,117
Operating cash costs per ounce sold2 701 683 742
All-in sustaining cash costs per ounce sold2,3 908 938 995
Financial Results Q1 2016
1. Higher weighted avg number of shares outstanding during Q1/16 of 146.3M as a result of the redemption of 34.5 million debentures and exercise of warrants 2. See Non-IFRS Disclosures 3. All-In Sustaining Cash Costs per Ounce ("AISC") Includes Corporate General and Administrative Expenses. 4. (All figures are in United States (“U.S.”) dollars, unless stated otherwise)
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Q1 2016 OPERATING RESULTS REVIEW
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Fosterville Gold Mine Q1 2016
2016 Goals
Follow up exploration and development on the newly discovered East Dipping, Kestral and Eagle structures and additional target zones up and down plunge
Complete gravity installation 2016 Production Guidance: 110,000 – 120,000 ounces 2016 Cost Guidance: $525 - $575 operating cash costs*
Q1 2016 Highlights
Gold production of 33,198, 13.8% year over year increase
Mill feed grade of 7.34 g/t Au from 161,868 milled tonnes
Quarterly recovery of 86.8%
Increased grade as a result of the new Eagle and East dippers Gold Zones
Installation of gravity circuit on time and on budget
Q1 2016 Operating cash costs* of $473 and AISC* of $723
Highlight Lower Phoenix gold system drill result include 500.7g/t Au over 12.5 metres (ETW 4.5m UDH1501)
29,135 29,648 32,793 31,519 33,138
Q1/15 Q2/15 Q3/15 Q4/15 Q1/16
Gold Production (oz)
Commissioning of the Fosterville Gravity Circuit
*See Non-IFRS Disclosures, Operating Cash Costs per ounce and AISC per ounce reflects an average FX rate of $0.75 (All figures are in United States (“U.S.”) dollars, unless stated otherwise)
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Fosterville Mine (Longitudinal Projection)
Harrier Drill Drive
12.5 g/t Au over 3.3m
12.75 g/t Au over 5.9m
Lower Phoenix
Phoenix
7850
mN
Drill Targets
1km step-out drilling H2/2016 drill results
NORTH SOUTH
Mineral Resources, Reserves and mining as at December 31, 2015
Harrier Decline Harrier
Proven & Probable Mineral Reserves of 244,000 ounces grading 6.95 g/t gold
Fosterville Global Measured and Indicated Mineral Resources of 2.1 million ounces grading 4.39 g/t gold
6200
mN
4.4 g/t Au over 8.0m
6.5 g/t Au over 6.0m
9.3 g/t Au over 3.3m
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Cosmo Gold Mine Q1 2016
20,612
17,073
12,672 12,898
16,340
Q1/15 Q2/15 Q3/15 Q4/15 Q1/16
2016 Goals
Continue improved contractor performance with operations now underway in Mining Block 8. Sustainable production in Mining Block 8 with greater continuity and drill data Continue to review Western Lodes and Eastern Deeps discoveries 2016 Production Guidance: 60,000-65,000 ounces 2016 Cost Guidance: $720 - $795 operating cash costs*
Q1 2016
27% improvement in gold production over Q4 2015 to 16,340
Q1 2016 grade of 3.09g/t gold improved over Q4 2015 grade of 2.56g/t gold, March record monthly mined grade of 4.18g/t gold.
Q1 2016 recovery increase to 90.7% over Q4 2015 of 86.9%
Improvement over previous quarter due to higher grade, reflecting a combination of mine sequencing, improvements in grade control and mill recovery
Cosmo Access Portal
Gold Production (oz)
*See Non-IFRS Disclosures, Operating Cash Costs per ounce and AISC per ounce reflects an average FX rate of $0.75 (All figures are in United States (“U.S.”) dollars, unless stated otherwise)
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9,929 9,277
8,352 8,762 8,579
Q1/15 Q2/15 Q3/15 Q4/15 Q1/16
Stawell Gold Mines Q1 2016
2016 Goals
Continue to operate in a sustainable way, further streamline operations, and continue cost reduction
Advance Aurora B Discovery, mineralization remains open for potential expansion
2016 Production Guidance ~35,000 ounces 2016 Cost Guidance $900 - $975 operating cash costs*
Q1 2016
Q1 2016 8,579 ounces of gold produced
229,558 milled tonnes with an average grade of 1.43g/t gold and recoveries of 79.9%
Continues to operate sustainability on streamlined operating activities from the upper levels in the underground mine and supplemented oxide stockpiles, with reduced manpower
Stawell’s new Aurora B discovery resulted in a maiden inferred Mineral Resource of 30,400 ounces grading 3.5g/t gold following three successful exploration programs completed during 2015
Stawell Gold Mine
Gold Production (oz)
*See Non-IFRS Disclosures, Operating Cash Costs per ounce per ounce reflect san average FX rate of $0.75 (All figures are in United States (“U.S.”) dollars, unless stated otherwise)
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Q&A
Visual Gold Fosterville Gold Mine
14
Douglas Forster President & CEO, Director
T: 604-559-8040 E: [email protected]
TSX: NMI www.newmarketgoldinc.com
Contact Us
Ryan King Vice President, Corporate Communications
T: 778-998-3700 E: [email protected]
Laura Lepore Director, Investor Relations
T: 416-728-3707 E: [email protected]
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APPENDIX
16
Focus on Shareholder Value Share Price Performance
Notes: Peers: Alamos, Kirkland, Lake Shore, Primero, Richmont, Regis, Saracen Daily Trading Volume reflects Canada-wide composite across all exchanges Source: FactSet, Bloomberg
43%
175%
64%
9%
0.02.04.06.08.010.012.014.016.018.020.022.024.026.028.030.032.034.036.038.040.042.044.046.048.050.0
(60%)
(40%)
(20%)
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
200%
15-Jul-15 15-Aug-15 15-Sep-15 15-Oct-15 15-Nov-15 15-Dec-15 15-Jan-16 15-Feb-16 15-Mar-16 15-Apr-16
Dai
ly T
rad
ing
Vo
lum
e -
Can
ada
Co
mp
osi
te (M
)
Rel
ativ
e P
erfo
rman
ce (%
)
NMI Volume GDX Index Newmarket Peer Producers Spot GoldQ1/16 Total shares traded 85.2 Million 30 Day Avg Volume 1.75M (as of April 20, 2016)
Research Coverage by: RBC Capital Markets GMP Securities Raymond James BMO Capital Markets Laurentian Bank Cormark Securities Rodman & Renshaw Beacon Securities M Partners PI Financial Corp.
Firm GMP Securities Anonymous TD Beacon CIBC Raymond J.
Merrill L. Barclays Instinet
Shares Traded
21.3 Million 20.3 Million 10.2 Million 9.4 Million 7.8 Million 5.0 Million 5.1 Million 2.7 Million 3.0 Million
17
Operating Results Q1 2016 Q1 2016 Q1 2015 Q4 2015
Consolidated Ore Milled (Tonnes) 572,451 585,720 586,940
Consolidated Gold Grades (g/t) 3.63 3.58 3.30
Consolidated Recoveries (%) 86.8% 86.4% 84.0%
Consolidated Gold Produced (oz) 58,057 59,676 53,179
Fosterville Gold Mine
Ore Milled (Tonnes) 161,868 175,327 179,450 Average Grade (g/t Au) 7.34 5.75 6.33 Recovery (%) 86.8% 89.2% 86.3% Gold Produced (oz) 33,138 29,135 31,519 Cosmo Gold Mine
Ore Milled (Tonnes) 181,025 190,306 180,261 Average Grade (g/t Au) 3.09 3.70 2.56 Recovery (%) 90.7% 91.0% 86.9% Gold Produced (oz) 16,340 20,612 12,898 Stawell Gold Mines
Ore Milled (Tonnes) 229,558 220,087 227,229 Average Grade (g/t Au) 1.43 1.75 1.50 Recovery (%) 79.9% 80.2% 80.0% Gold Produced (oz) 8,579 9,929 8,762
18 TSX:NMI
Classification Structure Measured Indicated Inferred
Tonnes Grade In situ Gold Tonnes Grade In situ Gold Tonnes Grade In situ Gold (kt) g/t Au (kOz) (kt) g/t Au (kOz) (kt) g/t Au (kOz)
Allwood* Lower Phoenix 5 5.59 1 110 6.30 22 170 6.48 36 Eagle* Lower Phoenix 23 16.76 12 178 10.97 63 43 27.21 37
East Dippers* Lower Phoenix 1 6.85 0 544 9.79 166 27 16.12 14
Ellesmere - - - 331 5.73 61 20 3.39 2 Harrier - - - 48 3.96 6 25 3.62 3 Kestrel 6 6.69 1 960 4.70 145 175 5.13 29
Lower Phoenix* Lower Phoenix 64 7.68 16 495 8.75 139 - - - Lower Phoenix* FW Lower Phoenix 37 10.38 12 278 8.16 73 34 4.89 5
Phoenix* Phoenix 151 7.58 37 627 6.54 132 59 4.89 9 Raven - - - 119 8.12 31 - - - Robin - - - 68 8.39 18 - - - Splays - - - 912 5.74 169 298 3.98 38
Vulture - - - 517 5.04 84 635 4.56 93 Stockpile# 27 4.65 4 - - - - - -
Total Sulphide 315 8.29 84 5,188 6.65 1,109 1,488 5.58 267 Notes: *Fosterville’s underground Measured and Indicated Mineral Resources include resources in the existing mining fronts in the Phoenix and Lower Phoenix gold system of 673,000 ounces grading 8.33 g/t Au. For the Mineral Resource estimate, the Qualified Person is Troy Fuller, MAIG, Geology Manager for Newmarket
The Mineral Resources reported are inclusive of the Mineral Reserves for the same area.
Lower cut-off grade of 3.0 g/t is applied to Lower Sulphide Mineral Resources below 5050mRL.
Mineral Resources are rounded to 1,000 tonnes, 0.01 g/t Au and 1,000 ounces. Minor discrepancies in summation may occur due to rounding. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
The Mineral Resource estimate used a gold price of A$1,500 per ounce.
#Stockpile Inventory includes Lower Central Area Mineral Resources contained within the Run of Mine Stockpile and Coarse Ore Stockpile as at 31st December 2015
Appendix: Mineral Resources (Dec 31. 2015)
Fosterville Central Area Lower Sulphide Mineral Resources (Inclusive of Mineral Reserves) below 5050mRL – as at Dec. 31, 2015
19 TSX:NMI
Appendix: Mineral Resources (Dec 31. 2015)
Source: Newmarket Gold March 21, 2016 press release announcing 2015 year-end mineral reserves and mineral resources Note: Mineral Resources are inclusive of Mineral Reserves. Mineral Resources have been rounded to 1,000 tonnes, 0.01 g/t Au and 1,000 ounces. Minor discrepancies in summation may occur due to rounding. Mineral Resources are stated as of Dec 31, 2015. Gold Price A$ 1,500/oz used.
Measured Tonnes (kt) Gold Grade (g/t) Oz Gold (kOz)
Fosterville UG 2,086 3.25 218 Fosterville Tailings 571 7.83 144 Cosmo 1,650 3.63 193 Stawell UG 56 2.56 5 Maud Creek 1,067 5.59 192
Total Measured 5,430 4.29 752
Indicated Tonnes (kt) Gold Grade (g/t) Oz Gold (kOz)
Fosterville UG 12,950 4.57 1,904 Cosmo 2,987 2.99 288 Stawell UG 669 3.49 75 Stawell Op 3,394 1.52 166 Burnside 7,358 1.36 322 Union Reefs 3,579 2.38 273 Pine Creek 8,393 1.41 379 Maud Creek 5,426 3.04 532
Total Indicated 44,756 2.74 3,939
Total (M&I only) 50,193 2.91 4,691
Inferred Tonnes (kt) Gold Grade (g/t) Oz Gold (kOz)
Fosterville UGa 5,073 4.08 665 CosmoC 678 2.76 60 Stawell UGd 1118 3.24 116 Stawell Opf 46 1.15 2 Burnsideg 6,820 1.46 321 Union Reefsh 3,342 2.3 247 Pine Creeki 2,540 2.34 191 Maud Creeke 1,980 2.32 149
Total Inferred 21,597 2.52 1,751
20 TSX:NMI
Appendix: Mineral Reserves (Dec 31. 2015)
2P Reserves Tonnes (Mt) Grade Au (g/t) Au (kozs)
Fosterville (Under Ground) 1.09 6.95 244
Fosterville (Tailings) 0.57 7.83 144
Cosmo 0.93 3.38 101
Stawell (Under Ground) 0.35 2.45 28
Stawell (Open Pit) Big Hill 3.12 1.36 138
Union Reefs (Under Ground) 0.27 4.42 39
Union Reefs (Open Pit) 0.24 1.61 12
Pine Creek 1.3 1.55 62
Total Proven & Probably Reserves 7.8 3.05 769
Source: Newmarket Gold March 21, 2016 press release announcing 2015 year-end mineral reserves and mineral resources Note: Mineral Resources have been rounded to 1,000 tonnes, 0.01 g/t Au and 1,000 ounces. Minor discrepancies in summation may occur due to rounding. Mineral Reserves have demonstrated economic viability. Processing Recoveries range between 88% and 93%, excluding Fosterville Tailings which expects recoveries of 25% (see reports for details). Mining Recoveries range from 85% and 95% (see reports for details). Gold Price of $A1,450/Oz used. Mineral Reserves as of December 31, 2015. Mining Dilution ranges from 5% to 20% (see reports for details).
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Stawell Mine Aurora B Discovery Section
East Flank Target Aurora B
East Flank Target Aurora A
Traditionally mined West Flank
Total production to date 2.3 million ounces
8.03 g/t gold over 8.8 m
7.06 g/t gold over 17.80 m
Magdala
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Cosmo Mine Discovery (Close to Infrastructure)
0 100
metres
Western Lode Target
Sliver Target
7.42 g/t gold over 4.3 m
6.59 g/t gold over 6.4 m
Cosmo Long Section
14.79 g/t gold over 11.4 m, 14.07 g/t gold over 6.4 m
5.85g/t gold over 5.7 m
10.25 g/t gold over 2.8 m Inc. 6.4 g/t gold over 3.1 m
The Cosmo Eastern Deeps drilling has identified mineralization approximately 200 m down plunge from the base of current resources
WESTERN LODE PLAN MAP
EASTERN DEEPS SECTION
Union Reefs mill has 1.2Mt of excess capacity to treat additional ore
A B
23
Non-IFRS and Additional Information Non-IFRS Measures Crocodile Gold believes that investors use certain indicators to assess gold mining companies. The indicators are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance in accordance with the International Financial Reporting Standards. “Operational Cash Costs per Ounce” is a non-IFRS performance measure which could provide an indication of the mining and processing efficiency at the operations. The Company calculates operating cash costs per ounce by deducting silver sales revenue as a by-product from operating expenses per the consolidated statement of operations, then dividing by the gold ounces sold during the applicable period. Operating expenses include mine site operating costs such as mining, processing and administration as well as royalties, however excludes depletion and depreciation, share-based payments and rehabilitation costs. There are variations in the method of computation of “operational cash costs per ounce” as determined by the Company compared with other mining companies. For more detail on the operational cash costs per ounce determination for Crocodile Gold, please visit www.sedar.com or www.newmarketgoldinc.com and review the latest Annual Financial Statements issued on March 19, 2014. “All-In Sustaining Costs per Ounce of Gold (“AISC”)” Effective December 31, 2013, the Company has adopted an all-in sustaining cost (“AISC”) performance measure that reflects all of the expenditures that are required to produce an ounce of gold from current operations. While there is no standardized meaning of the measure across the industry, the Company’s definition conforms to the AISC definition as set out by the World Gold Council in its guidance dated June 27, 2013. The World Gold Council is a non-regulatory, non-profit organization established in 1987 whose members include global senior mining companies. The Company believes that this measure will be useful to external users in assessing operating performance and the ability to generate free cash flow from current operations. The Company defines AISC as the sum of operating cash costs (per above), sustaining capital (capital required to maintain current operations at existing levels), capital lease repayments, corporate general and administrative expenses, in-mine exploration expenses and rehabilitation accretion and amortization related to current operations. AISC excludes capital expenditures for significant improvements at existing operations deemed to be expansionary in nature, exploration and evaluation related to growth projects, rehabilitation accretion and amortization not related to current operations, financing costs, debt repayments, share-based compensation not related to operations, and taxes. Additional Information For information regarding mineral resource and reserve estimates, including parameters used to generate the estimates and depletion, please see the technical reports titled: NI43-101 TECHNICAL REPORT FOSTERVILLE GOLD MINE, VICTORIA, AUSTRALIA PREPARED FOR NEWMARKET GOLD dated March 31, 2016 and; NI43-101 TECHNICAL REPORT – BIG HILL ENHANCED DEVELOPMENT PROJECT AT STAWELL GOLD MINE MINERAL RESOURCES & RESERVES PREPARED FOR CROCODILE GOLD CORP dated June 6, 2014. For the Northern Territory Mineral Reserve Estimates please refer to the technical reports titled: REPORT ON THE MINERAL RESOURCES & MINERAL RESERVES OF THE COSMO DEEPS GOLD PROJECT dated March 31, 2015; NI43-101 TECHNICAL REPORT STAWELL GOLD MINE, VICTORIA, AUSTRALIA PREPARED FOR CROCODILE GOLD CORP dated March 31, 2015; REPORT ON THE MINERAL RESOURCES & MINERAL RESERVES OF THE UNION REEFS GOLD PROJECT dated December 31, 2012; REPORT ON THE MINERAL RESOURCES & MINERAL RESERVES OF THE PINE CREEK GOLD PROJECT dated December 31, 2012; REPORT ON THE MINERAL RESOURCES & MINERAL RESERVES OF THE MAUD CREEK GOLD PROJECT dated December 31, 2012 and; REPORT ON THE MINERAL RESOURCES & MINERAL RESERVES OF THE BURNSIDE GOLD AND BASE METAL PROJECT dated December 12, 2013. Mineral resources that are not mineral reserves do not have demonstrated economic viability.