Investor Presentation
February 2011
African Barrick Gold Investor Presentation Company Presentation - - PowerPoint PPT Presentation
African Barrick Gold Investor Presentation Company Presentation February 2011 Disclaimer Important Notice This presentation has been provided to you for information purposes only. It does not constitute an offer, solicitation, invitation or
February 2011
Disclaimer
Important Notice This presentation has been provided to you for information purposes only. It does not constitute an offer, solicitation, invitation or inducement to purchase, subscribe or otherwise acquire or to sell or otherwise dispose of any securities of African Barrick Gold plc ("ABG") or engage in any investment activity in connection with the capital of ABG in any jurisdiction. The information
decision whatsoever in connection with ABG. The information and opinions contained in this presentation are provided as of the date of this presentation and are subject to change without notice. ABG explicitly disclaims any responsibility, obligation or undertaking to update or revise any information contained in this presentation after its date, whether as a result of new information, future events or otherwise. No reliance may be placed for any purpose whatsoever on the information or opinions contained in this presentation or on its completeness and no liability whatsoever is accepted for any loss howsoever arising from any use of this presentation or its contents. Certain information, statements, beliefs and opinions in this presentation are forward looking. Forward-looking statements are statements that are not historical facts. These statements include, without limitation, financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future production,
"believes," "intends," "estimates" and other similar expressions. All forward-looking statements involve a number of risks, uncertainties and other factors. Although ABG’s management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of ABG, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, forward-looking information and statements contained in this presentation. Factors that could cause or contribute to differences between the actual results, performance and achievements of ABG include, but are not limited to, political, economic and business conditions, industry trends, competition, fluctuations in the spot and forward price of gold or certain other commodity prices, changes in regulation, currency fluctuations (including the US dollar, South African rand and Tanzanian shilling exchange rates), ABG’s ability to successfully integrate future acquisitions, to recover its reserves or develop new reserves, including its ability to convert its resources into reserves and its mineral potential into resources
business of mineral exploration, development, mining and production. Accordingly, investors should not place reliance on forward-looking statements contained in this presentation. Any forward-looking statements in this presentation speak only as of the date of this presentation and only reflect information available at the time of preparation. Subject to the requirements of the Disclosure and Transparency Rules and the Listing Rules or applicable law, ABG explicitly disclaims any obligation or undertaking publicly to update or revise any forward-looking statements contained in this presentation, whether as a result of new information, future events or otherwise. No statements made in this presentation regarding expectations of future profits are profit forecasts or estimates, and no statements made in this presentation should be interpreted to mean that ABG’s profits or earnings per share for any future period will necessarily match or exceed the historical published profits or earnings per share of ABG or any other level. You are reminded that you have received this presentation subject to the disclaimer and important notices contained herein and on the basis that you are a person to whom this presentation may be lawfully made and delivered in accordance with the laws of the jurisdiction in which you are located. You may not and are not authorised to: (i) reproduce or publish this presentation; or (ii) distribute, disclose or pass on this presentation to any other person, in whole or in part, by any medium or in any form, whether electronically or otherwise. ANY FORWARDING, DISTRIBUTION OR REPRODUCTION OF THIS PRESENTATION IN WHOLE OR IN PART IS UNAUTHORISED. FAILURE TO COMPLY WITH THIS NOTICE MAY RESULT IN A VIOLATION OF APPLICABLE SECURITIES LAWS.
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Overview of ABG
production and reserve base – 2010 production of 701 koz – Reserves and resources of 26 Moz1
land holdings
African consolidation opportunities – Targeting 1 Moz production by 2014 – Aiming to double production over 10 years
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Location of assets
Significant production and reserve base to drive growth
Dar es Salaam Buzwagi Bulyanhulu North Mara Tulawaka
Mining operations
1 Figure as at 31 December 2009
Operational Highlights to 31 December 2010
year-on-year
– Operational improvement initiatives on track – Planned monthly production reached in December
equipment commissioning and lower grades year-
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Strong platform with further growth expected as Buzwagi production ramps up
Year ended 31 December % change Y-o-Y 2010 2009 Operating results Tonnes mined (kt) 40,016 36,781 9% Ore tonnes processed (kt) 7,706 6,546 18% Recovery rate (percent) 86.1% 87.0%
Average grade (grams per ton) 3.3 3.9
Attributable gold production (koz) 701 716
Attributable gold sold (koz) 724 684 6% Average realised gold price ($/oz) 1,240 974 27% Copper production (‘000 pounds) 7,958 6,788 17%
Financial Highlights to 30 September 20101
date
year to date
– 87% higher year on year and greater than the FY 2009 result
as at 31 December 2010)
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Strong financial performance provides significant strategic flexibility
Nine months ended 30 September % change Y-o-Y $’000s (Unaudited) 2010 2009 Revenue 632,602 469,910 35% Cost of sales (380,875) (310,601) 23% Gross profit 251,727 159,309 58% Corporate administration (26,353) (27,804)
Other charges (12,286) (2,681) 358% Profit before net finance costs 204,478 121,835 68% Net finance expense (301) (5,867)
Net profit before taxation 204,177 115,968 76% Taxation expense (63,042) (34,763) 81% Net profit attributable to equity shareholders 139,098 74,557 87% EPS (cents) 33.9 18.2 87%
1 Full year 2010 financial results due to be released 16 February 20112
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Operational Details – Bulyanhulu
year
the year
improvements and operating efficiencies
Year ended 31 December (Reviewed) 2010 2009 Underground ore tonnes hoisted (ktpa) 958 967 Ore milled (ktpa) 954 959 Head grade (g/t) 9.2 8.7 Mill recovery (%) 92.2% 92.1% Ounces produced (oz) 260 249 Ounces sold (oz) 262 255 Cash costs/ounces sold ($/oz)1 Cash costs/tonne milled ($/t) 1 544 142 644 169 Capital expenditure ($’000s) 1 57,127 35,304
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Key operating statistics
1 Figures to 30 September 2010Operational Details – North Mara
expected processing of low grade stockpiles
plant optimization and ore feed blend
Gokona pit
plant and tailings storage facility
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Key operating statistics
Year ended 31 December (Reviewed) 2010 2009 Tonnes mined (ktpa) 20,106 15,888 Ore tonnes mined (ktpa) 2,624 4,933 Ore milled (ktpa) 2,860 2,605 Head grade (g/t) 2.8 3.2 Mill recovery (%) 82.9% 79.7% Ounces produced (oz) 213 212 Ounces sold (oz) 219 209 Cash costs/ounces sold ($/oz) 1 Cash costs/tonne milled ($/t) 1 476 37 485 38 Capital expenditure ($’000s) 1 59,936 20,076
1 Figures to 30 September 2010Operational Details – Buzwagi
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Key operating statistics
Year ended 31 December (Reviewed) 2010 2009 Tonnes mined (ktpa) 18,848 19,843 Ore tonnes mined (ktpa) 4,285 5,034 Ore milled (ktpa) 3,553 2,671 Head grade (g/t) 2.0 2.5 Mill recovery (%) 81.0% 87.4% Ounces produced (oz) 186 189 Ounces sold (oz) 198 154 Cash costs/ounces sold ($/oz)1 Cash costs/tonne milled ($/t)1 630 36 323 19 Capital expenditure ($’000s) 1 17,140 103,343
the mine started operations in Q2
delays in production ramp up and impacted process plant performance
impacted production in late Q3 and Q4
– New GM and senior team in place – Additional investment in process plant and mining fleet – Pit scheduling revised, including drill and blast and grade control programmes – Additional security measures
reached targeted year end production run rates by the end
Operational Details – Tulawaka
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Key operating statistics
Reflected as 70% Year ended 31 December (Reviewed) 2010 2009 Underground ore tonnes hoisted (ktpa) 103 83 Ore milled (ktpa) 340 312 Head grade (g/t) 4.1 7.0 Mill recovery (%) 93.2% 94.1% Ounces produced (oz) 42 66 Ounces sold (oz) 45 65 Cash costs/ounces sold ($/oz)1 Cash costs/tonne milled ($/t)1 678 82 385 85 Capital expenditure ($’000s) (100%)1 10,725 2,795
down from 66 Koz in 2009 due to mine equipment availability and grade
grade
compared to prior year period, both from underground as well as from the low grade stockpiles processed
put in place
increase reserves and extend mine life
1 Figures to 30 September 20102
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Tulawaka Underground Extension Programme
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Golden Ridge Feasibility Project
South North
Grade Thickness gm x metre
US$ 750 Pit RC Infill 2010
– geological model completed – resource modeling underway
1.2km of 4km strike
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North Mara – Gokona-Nyabigena Underground Project
600m 800m 1000m 1200m 600m 800m 1000m 1200m 12400E 12600E 12800E 13000E 13200E
200m
Pit Stage 2 Pit Stage 3
17m @ 12.11g/t
West East
20 to 40 40 to 60 60 to 80 80 to 100 > 100 < 20Grams X metres
13m @ 6.95g/t 14m @ 33.7g/t 23m @ 8.6g/t 13m @ 7.79g/t
Gokona East Zone Gokona West Zone Gokona Deeps Extension Target
600m 800m 1000m 1200m 600m 800m 1000m 1200m 12400E 12600E 12800E 13000E 13200E 600m 800m 1000m 1200m 600m 800m 1000m 1200m 12400E 12600E 12800E 13000E 13200E
200m 200m
Pit Stage 2 Pit Stage 3
17m @ 12.11g/t
West East
20 to 40 40 to 60 60 to 80 80 to 100 > 100 < 20Grams X metres
13m @ 6.95g/t 14m @ 33.7g/t 23m @ 8.6g/t 13m @ 7.79g/t
Gokona East Zone Gokona West Zone Gokona Deeps Extension Target
Gokona-Nyabigena underground project
completion during H1 2011
announced during Q4 2010
extend mine life
extensions to both Gokona West and Gokona Deeps lodes
planned final Stage 3 open pit
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Bulyanhulu Upper East Zone Update
Upper r East Zone
and action plan formulated
existing decline underway
and work commenced with completion targeted during the first half of 2011
feasibility study completion and work starting shortly after Existi ting g 1.8km decline cline
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Nyanzaga Project Update
2010
Kilimani resource areas commenced
Tusker prospect, closer to surface and also potential for higher grades at depth
scheduled for later in 2011 with feasibility study commencing by year end 2011
targeting geophysical and geochemical anomalies for further stand-alone and satellite deposits
Tusker
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VTEM Target
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Conclusion
to see the positive effects of operating initiatives taken, and focus at Tulawaka on extending mine life
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Strong position to continue growing the business