Kingsgate Consolidated Limited · ASX:KCN
Kingsgate Consolidated — H1 FY2004 Earnings Presentation
47 slides from Kingsgate Consolidated's earnings presentation, Feb 23, 2004
Slide 1: Half Year Analyst Presentation cover letter to ASX
ABN 42 000 837 472 23 February 2004 The Manager Announcements Company Announcements Office Australian Stock Exchange Limited Via ASX Online 47 pages (inclusive of cover page) Dear Sir/Madam Half Year Analyst Presentation ended 31 December 2003 Please find attached a copy of a presentation being made
Slide 2: Half Yearly Results - Dec 2003
Half Yearly Results - Dec 2003 23 February 2004
Slide 3: Kingsgate – Who We Are
Dec. 2003 Kingsgate – Who We Are Half Yearly Results 23 Feb. 2004 UNIQUE • One of World’s Lowest Costs • Operating mine in Thailand FIRST MOVER GREAT COMPANY IN THE MAKING
Slide 4: Achievements in Calendar 2003
Dec. 2003 Half Yearly Results Achievements in Calendar 2003 23 Feb. 2004 Major Plant Expansion completed + 50% Throughput US$7.95 million Debt Repayment Refinancing US$ 32 M Capital Raising A$ 42 M First “Prospect A” Reserve 400,000 oz Gold & 4.3 Moz Silver Exploration Accelerated
Slide 5: Kingsgate – What We Have Done
Dec. 2003 Half Yearly Results Kingsgate – What We Have Done 23 Feb. 2004 Gold Poured kozs Gold Production Head Grade 48 7 42 6 5.6 36 5.2 4.6 Milled Grade ( g/t ) 5 4.4 4.2 30 3.8 4 24 3.5 3.5 3 2.8 18 2 12 6 1 0 0 Dec 01 Mar 02 Jun 02 Sep 02 Dec 02 Mar 03 Jun 03 Sep 03 Dec-03 Dec 01 Mar 02 Jun 02 S
Slide 6: Original Mill Construction (2001)
Dec. 2003 Half Yearly Results Original Mill Construction (2001) 23 Feb. 2004
Slide 7: Completed Expansion
Dec. 2003 Half Yearly Results Completed Expansion 23 Feb. 2004
Slide 8: Results
Dec. 2003 Half Yearly Results Results Financial Half 23 Feb. 2004 Year Year 2002/03 2H03 • Gold Produced (oz) 154,484 62,461 • Cash Cost (US$/oz) 94 120 • Profit (A$M) 47 17 • EBITDA (A$M) 63 21 • Earnings per Share (A$) 0.65 0.21 • Dividends (A$/share) 0.25 0.10 • Net Cash (A$M) 10 48 • Exploration
Slide 9: Financial Performance
Dec. 2003 Half Yearly Results Financial Performance 23 Feb. 2004 • PAT of A$16.7 million • EPS 20.8 cents, DPS 10 cents (48%) • Revenue US$385/oz (2002: US$320/oz) • Strong operating cash flow • Net cash at December 2003 of A$48.4 million • Capital management initiatives
Slide 10: Financial Performance
Dec. 2003 Half Yearly Results Financial Performance 23 Feb. 2004 A$Million 2003 HY 2002 HY Revenue 35.8 46.8 Cash Costs (12.8) (14.2) D&A (5.2) (6.5) Site EBIT 17.8 26.1 Net Interest 0.2 (0.8) Admin/Other (1.3) (1.2) Profit Before Tax 16.7 24.1 Tax - - Profit After Tax 16.7 24.1
Slide 11: Net Profit Source of Change
Dec. 2003 Half Yearly Results Net Profit Source of Change 23 Feb. 2004 A$M 30 27 24 21 18 15 12 9 6 3 0 T es de ry IP ic e st s in te AT PA n n ra ov e W P r o dm ra P u s To G c C tA ge nt vio Re In a n r re e cn Cu Pr E x
Slide 12: Cash Cost Performance
Dec. 2003 Half Yearly Results 23 Feb. 2004 Cash Cost Performance US$/oz 500 400 Current Gold Price 300 200 Chatree 2002 HY 100 Chatree 2003 HY 0% 20% 40% 60% 80% 100%
Slide 13: Group Cash Flow
Dec. 2003 Group Cash Flow Half Yearly Results 23 Feb. 2004 A$Million 2003 HY 2002 HY Receipts from Customers 38.5 48.7 Payments to suppliers (18.2) (16.3) Net interest 0.2 (0.8) Operating Cash Flow 20.5 31.6 Exploration (5.5) (1.7) PP&E and Development (10.1) (5.7) Investing Cash Flow (15.6) (7.4) S
Slide 14: Group Cash Flow & Net Cash
Dec. 2003 Half Yearly Results Group Cash Flow & Net Cash 23 Feb. 2004 A$M A$M 80 80 60 60 40 40 20 20 0 0 -20 -20 -40 -40 Jun 02 HY Dec 02 HY Jun 03 HY Dec 03 HY Operating CF Investing CF Dividends Shares Issued Net Oper'l CF Net Cash
Slide 15: Statement of Financial Position
Dec. 2003 Half Yearly Results Statement of Financial Position 23 Feb. 2004 Dec. Payables/ Mine Assets Other Net Cash Equity Provisions 2003 $60m $15m $48m $117m $6m Payables/ June Mine Assets Other Net Cash Provisions Equity 2003 $53m $15m $10m $5m $73m Chatree Debtors Strong Creditors Increase Gold
Slide 16: Hedging
Dec. 2003 Half Yearly Results Hedging 23 Feb. 2004 Hedging is ‘remnant’ of Project Financing Commitments at 33% of Reserves Additional Reserves to reduce impact Actively Reviewing opportunities to reduce
Slide 17: Gold Hedging Positions
Dec. 2003 Half Yearly Results Gold Hedging Positions 23 Feb. 2004 '000 ozs Bought Put & Sold Call Options Price/oz 100 750 80 600 60 450 40 300 20 150 0 0 (20) (150) (40) (300) (60) (450) (80) (600) (100) (750) 2003/04 2004/05 2005/06 2006/07 2007/08 US$ Puts A$ Puts US$ Calls A$ Calls US$ Put Price
Slide 18: Capital Management
Dec. 2003 Half Yearly Results Capital Management 23 Feb. 2004 • Share placement of $42 million • Dividend Reinvestment Plan introduced • Dividend Policy of 25 - 50% of EPS • Financing Facility of US$32 million • Project facility repaid • 4 banks: CBA, HSBC, MBL, RAL
Slide 19: Slide 19
Slide 20: Drilling Pre-March 2003
Dec. 2003 Half Yearly Results Drilling 23 Feb. 2004 Pre-March 2003
Slide 21: Drilling
Dec. 2003 Half Yearly Results Drilling 23 Feb. 2004
Slide 22: Kingsgate – What We’re Doing
Dec. 2003 Kingsgate – What We’re Doing Half Yearly Results 23 Feb. 2004 1. Seeking New Business Opportunities 2. Operating Excellence 3. Vigorous Exploration GROWTH & PROFITABILITY
Slide 23: 1. Seeking Business Opportunities
Dec. 2003 Half Yearly Results 1. Seeking Business Opportunities 23 Feb. 2004 Chatree Quality difficult to duplicate Springboard for Asian opportunities Single Operation Diversification Financial Capacity
Slide 24: 2. Operational Excellence
Dec. 2003 Half Yearly Results 2. Operational 23 Feb. 2004 Excellence • Environment • Social • Economic
Slide 25: 3. Exploration
Dec. 2003 Half Yearly Results 3. 23 Feb. 2004 Exploration
Slide 26: 1 Million oz Reserves
Dec. 2003 Half Yearly Results 1 Million oz 23 Feb. 2004 Reserves A ‘Resource’ 0.4 Moz ‘Reserve’ ( June ’03) C D 0.6 Moz ( June ’03) H
Slide 27: Kingsgate’s Ore Reserves
Dec. 2003 Half Yearly Results 23 Feb. 2004 Kingsgate’s Ore Reserves 1,500 1,000 Reserves (Oz x 1000) 500 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 -500 Prospects C,H & D Prospect A Cumulative Production Recovery
Slide 28: Exploration
Dec. 2003 Half Yearly Results Exploration 23 Feb. 2004 Strategy Components Short Term: Immediate Contribution Medium Term: Replace Reserves Long Term: Company Growth
Slide 29: Short Term
BMO Nesbitt Burns 2004 Global Resources Short Term Conference March 2004 6 m @ 11.3 g/t 14 m @ 8.5 g/t 9 m @ 8.0 g/t 29 m @ 4.5 g/t H 9 m @ 3.1 g/t • + 70,000 oz • Open to SW
Slide 30: Medium Term
Dec. 2003 Half Yearly Results Medium 23 Feb. 2004 Term A ‘Resource’ • Major ‘Reserve’ Structures K C D H B
Slide 31: Prospects A & K
Dec. 2003 Half Yearly Results Prospects A & K 23 Feb. 2004 Prospect A Prospect K
Slide 32: Exploration Results
BMO 19 m @ 6.3 g/t Nesbitt Burns 2004 Global Exploration Resources Conference Results 5 m @ 4.1 g/t March 2004 5 m @ 2.7 g/t 17 m @ 7.2 g/t 5 m‘Resource’ @ 8.5 g/t 38 m @ 2.4 g/t ‘Reserve’ 6 m @ 3.2 g/t 51 m @ 2.1 g/t 11 m @ 2.2 g/t 4 m @ 5.7 g/t 6 m @ 6.5 g/t 17 m @ 1.1 g/t
Slide 33: Drilling Pre-March 2003
Dec. 2003 Half Yearly Results Drilling 23 Feb. 2004 Pre-March 2003
Slide 34: Drilling
Dec. 2003 Half Yearly Results Drilling 23 Feb. 2004
Slide 35: Resistivity Targeting Tool
BMO Nesbitt Burns Resistivity 2004 Global Resources Conference Targeting March 2004 Tool
Slide 36: Resistivity Targeting Tool
BMO Nesbitt Burns Resistivity 2004 Global Resources Conference Targeting March 2004 Tool A East Prospect K H Extension
Slide 37: Long Term: FIRST MOVER
Dec. 2003 Half Yearly Results Long Term: FIRST MOVER 23 Feb. 2004 Khorat Basin Loei-Petchabun Volcanic Belt
Slide 38: Long Term
Dec 2003. Half Yearly Results Long Term 23 Feb. 2004 • Prospective Region • 1,500 sq km • New Budget
Slide 39: Long Term
Dec. 2003 Half Yearly Results Long Term 23 Feb. 2004 • 1,500 sq km • New Budget • Prospective Region • Infrastructure • Long Life potential
Slide 40: Regional Mapping
Dec. 2003 Half Yearly Results Regional 23 Feb. 2004 Mapping
Slide 41: Regional Prospects
Dec. 2003 Half Yearly Results Regional 23 Feb. 2004 Prospects
Slide 42: Prospects
A Protpecteasns WRB i oe iK Groepe
Slide 43: Early 2003 Messages
Dec. 2003 Half Yearly Results Early 2003 Messages 23 Feb. 2004 Kingsgate Consolidated Ltd 1. EVOLUTION 2. GROWTH 3. PROFITABILITY
Slide 44: Performance During 2003
Dec. 2003 Half Yearly Results Performance During 2003 23 Feb2004 • Mill Throughput + 20 % • Reserves + 33 % • Land Controlled + 118 % • Exploration SPL’s + 2,500 % • Total Cash + 95 % • Outstanding Debt - 66 %
Slide 45: Kingsgate – Where We’re Going
Dec. 2003 Kingsgate – Where We’re Going Half Yearly Results 23 Feb. 2004 GROWTH Vigorous Exploration • Short Medium and Long Term Increased Production Acquire New Business PROFITABILITY Strong Dividends Strong Safety & Sustainability Performance To Enhance Shareholder Value
Slide 46: Kingsgate – Who We Are
Dec. 2003 Kingsgate – Who We Are Half Yearly Results 23 Feb. 2004 • UNIQUE • One of World’s Lowest Costs • Operating mine in Thailand • FIRST MOVER • GREAT COMPANY IN THE MAKING
Slide 47: Dec. 2003 Half Yearly Results
Dec. 2003 Half Yearly Results 23 Feb. 2004
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